Adidas case study
Adidas
Adidas group INTRODUCTION: It is a multinational corporation which was founded in the year 1949. It is headquartered in Herzogenaurach, Germany. It is occupied in designing as well as manufacturing different kinds of shoes, accessories and clothing. It is the largest manufacturer of sportswear in Europe. It has been ranked the second-largest Manufacturing Corporation in the whole world after its competitor, Nike. It also consists of holding other companies as well including Reebok, the sportswear organisation, Taylor Made, the golf organisation, occupying 8.33% of the football club in Germany, Bayern Munich along with Runtastic, a technological fitness company in Austria. It had a whopping turnover of about €21.915 billion in the year 2018. The logo of Adidas consists of three stripes which are utilized in the shoe and clothing designs.
COMPETITORS NIKE Nike is an American Multinational Corporation, which is committed to designing as well as manufacturing for the development in all across the world. It is engaged in manufacturing, marketing and sales of different kinds of products such as footwear, accessories, apparel equipment along with services. The company is situated in Beaverton, Oregon. It is the largest supplier of athletic footwear, apparel, and manufacturer of sports equipment in the whole world. The company’s turnover is for about $29. 6 billion in the year 2017. Nike is most prominent competitor of Adidas and has been ranked first all across the world.
REEBOK It is American apparel as well as a footwear company. It is also a subsidiary of German sporting goods giant Adidas ever since the year 2005. The company is headquartered in Boston, Massachusetts. It produces as well as distributes running, fitness and Cross-Fit sportswear which includes footwear along with clothing. Reebok is the official partner in footwear as well as apparel sponsor under the American martial arts promotion named as Ultimate Fighting Championship (UFC), Spartan Race and CrossFit. The Union flag is structured as the Reebok’s “Classic” range of apparel. The annual turnover of the brand Reebok is 1.69 billion euros in the year 2018.
SWOT STRENGTHS
Legacy as well as heritage. A diverse range of portfolio. Holds a strong position in the financial system. Distribution of networks. Endorsements by celebrities. Collaboration as well as memberships.
WEAKNESS
Higher price range. Third-party manufacturers. A limited line of products
OPPPORTUNITIES
Transforming lifestyle. Development in the market. Extension in the line of products. Rising demand for premium commodities. Backward integration.
THREATS
Rising Competition. The dominance of the suppliers. Rules and regulations of Government.
PESTLE ANALYSIS Political Factors: The brand Adidas adidas business case study is engaged in supplying, shipping as well as distributing their products and services all across the world. They need to follow the supply chain of international government and follow the procedures and policies of political systems. The brand also utilises the forces of the political system as the method of armed interference of counterfeit goods and services. Adidas need to follow each and every country’s individual taxation system. They have maintained specific rules and regulations in order to distribute their products all across the overseas. The multinational company offers to outsource the establishment of their goods and services to the third-world countries. In this way, they actually reduces and maintains their manufacturing costs.
Economic Factors There are for about fifty large organisations who are always there to contribute for about seventy per cent of the industry’s revenue. Adidas is one of those industries who engage their maximum revenue from such sources. The luxurious products of several categories are always competing against one and another. The brands associated with sports goods and services are also competing against the other industries such as gaming as well as the music industry. The global economy is rapidly fluctuating simultaneously. Manufacturers are shifting their accommodation for this reason. The company needs a lot of research work to do in order to distribute and sell their products appropriately. There is a scope of enormous growth and set of opportunities in the upcoming future. Adidas always manufactures its products in China because the labour cost can be higher but the creation cost is comparatively lower. They should revise their pricing system and should apply new price tags for every product. They may face severe challenges and threats while importing and exporting their goods and services.
Social Factors: The brand Adidas is always applying innovative ideas to their products and transforming according to their customer’s reviews and preferences. The products are available for every age, groups, gender and match up with the lifestyle. Their primary objective is comfort and health-conscious products for the buyers, along with love towards sports activities. They are always up for the latest trends and tastes of the buyers and to engage the customers’ every time. They also offer different kinds of vouchers and volunteer programs for consumers.
Technological Factors: The company always applies various tests in several conditions in order to cater the athletes. They are always up for modifying and optimising their performance for all the coaches as well as professionals in this sports industry. They provide numerous solutions regarding any problem of the athletes. They utilise natural elements regarding replacements. They provide immense support for the online sales department through their official website as well as on social media.
Legal Factors: The company has its ownership for its intellectual properties as well as IP systems. The company also owns design patents by defending their legal rights from those who intend to copy and infringement. They have their trademark for protecting further proceedings. They are occupied with several sponsorships and endorsements with famous celebrities. They always follow the national as well as local laws of any country.
Environmental Factors: The company reduces the environmental impact and effects on societies. They follow their duties towards monitoring the dangerous substances as well as reducing them to a minimum percentage. They distribute natural materials in their goods and services. They have their personal ethics and business practices by ensuring supplies and following the regulations of every country.
CONCLUSION Adidas is a renowned company, which cannot be diminished in the upcoming years. It will score high and will rise in profits. They may face controversies, but they will continue to increase their production in the future. They always witness substantial growth. They will continue to grab the attention of the consumers according to their preferences.