Strategic Analysis Of Adidas
Executive summary
Evolving strategy in any industry especially if an organization is expected to survive is a must. Using the appropriate tools, and procedures will help companies determine the best strategy to consider. The strategies employed should be determined by changes both in the indigenous and global market, and the need to competitive globally. These strategies differ from industries to industries and its specialization. The sports industry is highly competitive and ever dynamic due to the varying needs of athletes.
Companies in sporting goods industry need to ensure that their competitive strategy fits the sports product industry. Adidas is one of the top brands in the sports and footwear market but has experienced its own share
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G, et al 1999, businessdictionary.org).
It helps the organization understand its capabilities, customers and business environment. It a crucial step in establishing a long-term relationship with the customers. Several methods are employed such as the 5Cs Analysis, SWOT analysis and Porters five forces analysis (Wikipedia1).
2.1 SWOT analysis of Adidas
a. Strengths
1. The company has a long heritage and high brand value since 1924.
2. The company sponsors major sporting events including Olympics and major sportsmen and teams.
3. The company has worldwide presence and is internationally recognized.
4. The company has a well-diversified product portfolio ranging from sport shoes and equipment, to clothing and accessories.
5. Has a workforce of over 55,000 employees.
6. Strong and innovative marketing over years have created a strong brand retention in the minds of customers. With branding endorsement from celebrities, sponsorship of major sport organizations such as FIFA, UEFA, Olympics, and the NBA.
7. Effective distribution network via a variety of
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These forces are namely; bargaining power of suppliers, Threat of New entrants, Threat of Substitute products or services, bargaining power of buyers and Industry Rivalry (Grundy 2006).
a. Bargaining power of suppliers
Due to the surplus availability of suppliers in the sporting goods industry, the bargaining power of suppliers is a weak one. As such Adidas can exert full control over its suppliers and get good value for their supplies thereby influencing the cost of production (brightkite.org). Also due to its sear size of operation subsequent on large quantity of supplies as such, Adidas will be able to negotiate for better deals. This would in turn, reduce the cost of production and make them more competitive than brands with smaller operation size.
b. Threat of New
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