Financial Position (FP) •
Ratin gs
Adidas AG’s has Return on Equity of 11.2% on 2015, compared to the Sports Goods ndustry Return on Equity of 11.5%.
!.0
4 Adidas AG’s Net IIncome ncome from continuing operations is € 720 million which results to an increase of 12.1! from the prior "ear’s € #42 million Net Income from continuing operations.
5.0
Adidas AG’s "or#in$ capita capita turno&er in 2015 is '.() "hich is an increase of * pts. from !.( of 201!.
*.0
Adidas $%& ratio ratio at the end of 201 is € 27.10' compared compared to the (ports Goods Industr" $%& "ear)end ratio of € 24.0.
+.0
Adidas AG’s Return Return on n&estment for 2015 is 5.!0%) "hich increased y .2* point percenta$e compared to 201!’s 5.1'% R-.
!.0
•
•
•
•
22.0
Industry Position (IP) Adidas AG’s prot forecast for 201+ /ompany’s $ro"th for the net 5 years Suppy chain and resource dispatch of Adidas AG focus more on the &eocity and ease of access. /ompany’s nancia anayses sho" it’s staiity that may create opportunities. oint forces of Adidas, Adidas, Reoo#, Reoo#, and ayor3ade ayor3ade continue to impro&e impro&e and create more ad&anta$es "ith re$ards to niche mar#ets. •
•
•
•
•
5.0 5.0 *.0 !.0 +.0 23.0
Stability Position (SP) echnoo$ica echnoo$ica de&eopment de&eopment is fast4paced and aects the needs of consumers. Adidas sports foot"ear operates in an oi$opoistic mar#et mar#et so there th ere is hi$h arriers to entry) threat of ne" entrants is minima. 6roduct prices and shippin$ cost of the ma7or competitor, 8i#e, is moderatey hi$her. Sportin$ $oods industry is at ris# of incompiance iti$ation iti$ation due to increasin$ community concern to"ards en&ironmenta sustainaiity. sustainaiity. 9Adidas mana$e en&ironmenta issues as an inte$ra part of their daiy operations: ;ess4de&eoped countries are eperiencin$ in
•
•
•
•
41.0 4*.0 4*.0 41.0
4!.0 -12.0
Comptiti! Position (CP) •
Sae of athetic foot"ear in =S constitutes at east !0% of the mar#et share. Adidas promotes its products throu$h endorsements in e&ery sport y $oa sports stars and teams. 3aintain mar#et dominance in /hina o&er its tou$hest competitor, 8i#e. n&est strate$icay in mar#etin$ in $ro"in$ uran cities across the $oe. -pen up to consumers, athetes, and partners to co4create the future $oa products for $oa cities.
•
•
4+.0 45.0
•
41.0
•
4*.0 4*.0 -1".0
# Spac $atri% &or #didas #'
Conclusion ($ A*erage is> 412.0 ? 5 @ 42.! +$ A*erage is> 41.0 ? 5 @ 4*.+
I$ A*erage is> 2*.0 ? 5 @ !.+ ,$ A*erage is> 22.0 ? 5 @ !.!
-irectional ector +oordinates > /)a/is> 4*.+ B !.+ @ 1 ")a/is> 42.! B !.! @ 2
r&or* #didas sould pursu aggrssi! stratgis.
SP#C+ $atri% &or #didas
t can e inferred, ased on the matri, that Adidas shoud pursue actions that "i utiiCe its interna stren$ths to ta#e ad&anta$e of eterna opportunities, o&ercome their "ea#nesses, and a&oid threats. t is aready e&ident that Adidas is ta#in$ inte$ration strate$ies y acquirin$ smaer competitors, such as ayor3ade and Reeo#. Adidas, ho"e&er, does not pursue much of ac#"ard inte$ration since they found outsourcin$ as an eecti&e action. As for for"ard inte$ration, Adidas does not aso eercise such strate$y currenty. Durthermore, Adidas needs to act to"ards mar#et penetration especiay in the =S "here its mar#et share is reati&ey smaer as compared to 8i#e, and etend their mar#et eyond the current ones. ;asty, it can e aso ceary seen that Adidas is aready continuousy de&eopin$ ases and e/planations for the ratings are pro*ided in pages )
1
and di&ersifyin$ their products y ta#in$ ad&anta$e and copin$ up "ith the chan$es and ad&ancement in technoo$y.
FI,#,CI# PSII, #didas #'/s Rturn on +uity 4.0
Adidas AG’s R-E is ess than the a&era$e R-E of sports industry thus indicatin$ Adidas is eo" the a&era$e industry e&e ut this is the net hi$hest R-E for &e years 9201042015: foo"in$ the 201* hi$hest R-E. #didas #'/s ,t Incom &rom continuing oprations 5.0
Adidas AG’s net income from continuin$ operations is '20 miion "hich resuts to an increase of 12.15% from the prior year’s +!2 miion net income from continuin$ operations. hou$h the 8 increased y 12.15%, the 2015 8 does not sti competey re$ained the ar$e decrease of 8 from 2012 and 201* 9thou$h it increased in 201!: and o"est 8 $enerated durin$ 201042015 operations. Fut this aso sho"s the continuin$ reco&ery of Adidas AG. #didas #'/s oring Capital urno!r 3.0
Adidas AG’s "or#in$ capita turno&er in 2015 is '.( "hich is an increase of three 9*: points from !.( of 201!.hou$h Adidas AG achie&ed the hi$hest "or#in$ capita turno&er, "hich measures ho" "e a company is utiiCin$ its "or#in$ capita to support a $i&en e&e of saes, durin$ the &e4year operation, oo#in$ o&er cause other nancia eements, the increase of three points in "or#in$ capita ratio is caused y the noticeae increase of tota current iaiities. hus, the increase is not merey due to mana$ements eciency is usin$ its tota current asset ut aso accompanied y the e&ident increase in tota current iaiities. #didas P+ ratio 4.0 Adidas 6HE ratio at the end of 2015 is 2'.10, compared to the sports $oods industry 6HE year4end ratio of 2!.50. Adidas AG’s 6HE 2015 year4end ratio is hi$her than the industry’s 6HE 2015 year4end ratio and in 2015 Adidas AG has the hi$hest 6HE year4end ratio so far. his indicates that Adidas AG has een &ery attracti&e in the equity mar#et. his enets the Adidas AG to easiy accumuate capita from in&estors throu$h its equity. #didas #'/s Rturn in In!stmnt 5.0 Adidas AG’s Return on n&estment for 2015 is 5.!0 percent "hich increased y .2* point percenta$e compared to 201!’s 5.1' percent R-. he increase of R-
2
indicates that its in&estment in usiness assets hi$her than 201!’s ut, such increase does not compensate the fact that 2015 R- is one of the smaest R- durin$ the &e4year operations of Adidas AG foo"in$ the 201!’s R- ein$ the smaest. Note3 he 5*e)"ear operations 62010)201 is 5nancial result of the 2010 (trateg" 6with a span of 5*e "ears of Adidas AG.
I,67SR8 PSII, #didas #'/s pro9t &orcast &or 2014 5.0
Adidas said it no" epected currency4neutra saes and operatin$ prot to oth $ro" y at east 10 percent in 201+ after predictin$ in 8o&emer that they shoud rise at a hi$h sin$e4di$it rate 4 the same forecast it had $i&en for 2015. Company/s gro:t &or t n%t ; yars 5.0
German sport4shoe ma#er Adidas AG epects the fastest saes $ro"th in &e years to e tempered y shrin#in$ protaiity as it pays more to purchase $oods in Asia. Supply cain and rsourc dispatc o& #didas #' &ocus mor on t !locity and as o& accss. 3.0 hey focus on faster product creation and production y continuousy impro&in$ the infrastructure, processes and systems. Additionay they aso emphasiCe on si$nicanty reduced compeity on a $roup e&e y streaminin$ the $oa product ran$e, consoidatin$ the "arehouse ase as "e as harmoniCin$ ao&e mar#et4ser&ice. he amition to dei&er the est randed shoppin$ eperiences at a consumer touch points. nno&ati&e speed modes in suppy chain to respond quic#y to consumer needs. Company/s 9nancial analyss so: it/s stability tat may crat opportunitis. 4.0 Fased on the anayses in the nancia dimension, company’s potentia for $ro"th and de&eopment can e achie&ed in many "ays at any time. he company’s proe in terms of currency does not hinder the company to ta#e actions in pursuin$ its $oas.
*
ad!antags :it rgards to nic marts. 6.0
Each company has speciaty se$ments that enae the $roup to achie&e hi$h performance in each mar#et se$ment. his heps the $roup to compete "ith others despite of the dierences in rand names. ayor3ade is intended to compete "ith 8i#e Gof. And Reoo# if more focused on ItnessJ that the "hoe "ord is mosty concerned of.
S#=II8 PSII, cnological d!lopmnt is &ast-pacd and a>cts t nds o& consumrs. - 1.0 Ad&ances in technoo$y present Adidas "ith ne" opportunities due to their products ein$ more readiy a&aiae to customers. 6urchasin$ Adidas’ products is no" much easier for customers and this is somethin$ Adidas "i ha&e to capitaiCe on. Adidas shoc#ed their "ay into the technoo$ica side y ma#in$ the "ord’s rst smart shoe, addin$ a microchip inside the shoe connectin$ to smartphones and "ireess mp* payers. he pac#a$in$ the company uses is suitae for transportation o&er on$ distances, humid conditions and etreme temperature chan$es, they use recyced paper and other en&ironmentay4friendy pac#a$in$ materias. #didas sports &oot:ar oprats in an oligopolistic mart so tr is ig barrirs to ntry? trat o& n: ntrants is minimal . -3.0
Adidas and 8i#e are currenty the mar#et eaders and other companies such as 6uma are aso hi$hy competiti&e. Aout +0 percent of mar#et is hed y Adidas and 8i#e.
!
Product prics and sipping cost o& t ma@or comptitor* ,i* is modratly igr. -3.0 Adidas shoes start at under K50 "hie their appare starts under K25. Adidas has fair prices for hi$h quaity sport and fashion cothin$, accessories, and foot"ear. 3enLs snea#ers are most epensi&e and of course, chidrenLs shoes are the o"est price "hen it comes to Adidas foot"ear. -n the other hand, 8i#e Air 6e$asusB 2( runnin$ shoes cost K100.00) 8i#e Mapor aon Eite ;o" N men’s foota ceat shoes cost K1!0.00) 8i#e Ecipse OomenLs Shoe cost K+.00) 8D; team menLs 7erseys cost K100. OomenLs cost K(5 and for oys the cost is K'0) 8i#e Oindrunner men’s 7ac#et cost K5) and, 8i#eB Sportand cost K5(.00. Sporting goods industry is at ris o& incomplianc litigation du to incrasing community concrn to:ards n!ironmntal sustainability. (#didas manag n!ironmntal issus as an intgral part o& tir daily oprations) -1.0
Fuidin$ on se&era en&ironmenta initiati&es o&er the past years, in 2010, they de&eoped a coherent en&ironmenta strate$y for the "hoe Adidas $roup, "hich aims to reduce their reati&e en&ironmenta footprint y 15 percent y 2015. heir approach is to mana$e en&ironmenta issues as an inte$ra part of their daiy operations, positi&ey contriutin$ to the Adidas $roups o&era usiness performance. Adidas has an en&ironmenta strate$y team ed y $roup socia and en&ironmenta aairs 9SEA: and consistin$ of representati&es of a rands and core functions, reports to the Adidas $roup eecuti&e oard. ss-d!lopd countris ar %princing inAation :ic inAuncs t spnding ba!ior o& consumrs.
-4.0
n
C$P+IIB+ PSII, Sal o& atltic &oot:ar in 7S constituts at last 50 o& t mart sar. -6.0 In reaity the rand is d"arfed y 8i#e P "hich o"ns a "hoppin$ !% of the =SA’s foot"ear mar#et, "hie Adidas’s (% share has decined e&ery year since 2011.Jhe statistics sho"s a &ery sma mar#et share of Adidas in the foot"ear mar#et. Fut achie&in$ !0% is not impossie. #didas promots its products troug ndorsmnts in !ry sport
5
by global sports stars and tams. -5.0
Oe $i&e it a 45 ecause of the fact that 8i#e is quic#er in acquirin$ and ha&e more endorsements from popuar athetes, teams, and or$aniCations "hich caused it to ha&e more M appearances than Adidas. $aintain mart dominanc in Cina o!r its tougst comptitor* ,i.
-1.0
/hina, composin$ the ar$est popuation, is an important mar#et for sportin$ $oods in "hich Adidas must ha&e to compete "ith 8i#e for the etent of their mar#et share. In!st stratgically in marting in gro:ing urban citis across t glob.
-3.0
IAdidas epects to $ro" its top4ine re&enue y 15% annuay throu$h 2020. t pans to create this $ro"th throu$h in&estments to increase its speed of ne" products to mar#et, "hich "i ao" the company to adapt more quic#y. t aso intends to in&est strate$icay in mar#etin$ in $ro"in$ uran cities across the $oe, as the company reco$niCes the mo&ement of popuation, particuary youn$er and more athetic se$ments of the popuation, to uran areas.J Adidas is currenty "or#in$ on this and the resut is yet to e seen for e&auation. pn up to consumrs* atlts* and partnrs to co-crat t &utur global products &or global citis. -3.0
Fy its o"n admission, Adidas has een cosed o to consumers, athetes and partners "hen it comes to shapin$ the future of the rand. his is chan$in$ "ith its mar#eters cedin$ some of the contro in the hope of ee&atin$ creati&ity and inno&ation "hen it comes product desi$n and ad&ertisin$. t is aready happenin$ "ithin the Adidas -ri$inas part of the usiness, "hich has pared ac# the numer of ceerities it "or#s "ith ut $i&en those it does such as musician 6harre $reater creati&e contro of the rand. Qainer added> IOe "i open up to consumers, athetes and partners so that they can co4create the future to$ether. Oe "i ta#e this spirit and $i&e many more the opportunity to mo&e coser to us and ecome part of us and our rand.J
References
+
https>HHadidas.#no7i.comHcompare4&sHni#e https>HHadidsaudit."ordpress.comH https://books.google.com.ph/books?isbn=1137411996
http>HHnance.yahoo.comHqTs@UVQ-h'2! http>HH""".$oa.adidas.com http>HH""".adidas4$roup.comHenH http>HHcsimar#et.comHndustryHindustryWDinanciaWStren$thWRatios.phpTind@!01 http>HH""".hi$hsnoiety.comH2015H11H0(Hni#e4adidas4mar#et4sharesH http>HHqC.comH5(0'1Hadidas4is4catchin$4up4to4ni#e4in4chinaH http>HH""".in&estopedia.comHarticesHmar#etsH012+1+Hadidas4&s4ni#e4&s4under4 armour4"hich4201+4n#eua.asp http>HHm.thedrum.comHne"sH2015H0*H2Hho"4adidas4creatin$4ne"4recapture4its4 "innin$4strea#
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