HomeRoots Pitch Deck | Investor Insights | April 2024
Market analysis on sports apparels and accessories
1. Market Analysis of Sports Apparels and accessories manufacturers
VIT BUSINESS SCHOOL
2. Contents
VIT Business School: ..................................................................................................................... 3
Introduction to Adidas: ................................................................................................................... 4
Products ....................................................................................................................................... 5
Brand Image ................................................................................................................................ 7
Corporate information ................................................................................................................. 7
Current executive board ........................................................................................................... 7
Financial information .............................................................................................................. 8
Market Turnover Analysis .............................................................................................................. 8
Capital Labour Ratio ....................................................................................................................... 9
Conclusion: ................................................................................................................................... 12
3. VIT Business School:
VIT University was established in 1984 by well-known educationalist and former parliamentarian, Dr. G. Viswanathan, Founder and Chancellor. Dr. V. Raju, Former Professor of State University of New York, USA, currently the Vice Chancellor, Dr. Anand A. Samuel, Pro- Vice Chancellor. Chennai Campus is in Vandalur-Kelambakkam Road.VIT University has more than 17 Bachelor’s and 32 Masters’ programmes, 29000 (including 1000 foreign students from 44 countries) and 4000 faculty members Accreditation: The National Assessment and Accreditation Council (NAAC) of the University Grants Commission (UGC) has accredited the university with a 'A'. The Institution of Engineering and Technology (IET), and the Energy Institute, UK have audited the teaching-learning processes at VIT and accredited the programmes in 2004, with the highest validity of five years Programmes at VIT are accredited by the Institution of Engineers, India (IEI). The Accreditation Board for Engineering and Technology (ABET) of the USA accredited the Civil, Mech, CSE, biomedical, ECE, EEE programmes. VIT Business School, under the aegis VIT University has created a niche for itself as an institution promoting excellence in management education and research with Dr. M J Xavier as its Executive Director.
4. Introduction to Adidas:
Adidas AG is a German multinational corporation that designs and manufactures sports shoes, clothing and accessories based in Herzogenaurach, Bavaria, Germany. It is the holding company for the Adidas Group, which consists of the Reebok sportswear company, TaylorMade- Adidas golf company (including Ashworth), Rockport, and 9.1% of FC Bayern Munich. Besides sports footwear, Adidas also produces other products such as bags, shirts, watches, eyewear, and other sports- and clothing-related goods. Adidas is the largest sportswear manufacturer in Europe and the second biggest in the world, after Nike.
Adidas was founded in 1949 by Adolf Dassler, following the split of Gebrüder Dassler Schuhfabrik between him and his older brother Rudolf. Rudolf had earlier established Puma, which was the early rival of Adidas. Adidas and Puma are both currently based in Herzogenaurach, Germany. The company's clothing and shoe designs typically feature three parallel bars, and the same motif is incorporated into Adidas's current official logo. The name ADIDAS was coined from "Adi" (a nickname for Adolf) and "Das" (from "Dassler").
The acquisition of Reebok also allowed Adidas to compete with Nike worldwide as the number two athletic shoemaker in the world.
Adidas has many business locations around the world such as Portland OR, Hong Kong, Toronto, Taiwan, England, Japan, Australia, and Spain. Mainly sold in the U.S., Adidas makes lots of assets from these countries and is expanding to more overseas countries.
In 2005, Adidas introduced the Adidas 1, the first ever production shoe to use a microprocessor. Dubbed by the company "The World's First Intelligent Shoe", it features a microprocessor capable of performing 5 million calculations per second that automatically adjusts the shoe's level of cushioning to suit its environment. The shoe requires a small, user- replaceable battery that lasts for approximately 100 hours of running. On 25 November 2005, Adidas released a new version of the Adidas 1 with an increased range of cushioning, allowing the shoe to become softer or firmer, and a new motor with 153 percent more torque.
On 11 April 2006, Adidas announced an 11-year deal to become the official NBA clothing provider. They will make NBA, NBDL, and WNBA jerseys and products as well as team-coloured versions of the "Superstar" basketball shoe. This deal (worth over $400 million) takes the place of the previous 10-year Reebok deal that was put in place in 2001.
On 3 November 2011, Adidas announced that it would acquire outdoor action sport performance brand Five Ten through a share purchase agreement. The total purchase price was $25 million USD in cash at closing.
By the end of 2012, Adidas is reporting the highest revenues ever and Chief Executive Herbert Hainer expresses optimism for the year ahead.
5. Products
ADIDAS famous products are,
Apparel
Running
Association Football
Tennis
Golf
o Company timeline
o Product
Cricket
Basketball
Lacrosse
Jiu Jitsu
Rugby
Gymnastics
Skateboarding
o Team
Professional
Amateur
Baseball
Field hockey
Accessories
o Sandals
Adilette
Santiossage
Adissage
Other sandal brands
Apparel
The first ever piece of apparel created by Adidas was the Franz Beckenbauer tracksuit. One of the main focuses of Adidas is football kit and associated equipment. Adidas remain a major company in the supply of team kits for international association football teams and clubs, including Bayern Munich, Real Madrid, Chelsea, Manchester United (starting in 2015-16) and A.C. Milan.
Adidas makes referee kits that are used in international competition and by many countries and leagues in the world. The company has been an innovator in the area of footwear for the sport, with notable examples including the 1979 release of the Copa Mundial moulded boot used for matches on firm dry pitches. It holds the accolade of the best selling boot of all
6. time. The soft-ground equivalent was named World Cup and it too remains on the market, timeless and iconic.
FIFA, the world governing body of football, commissioned specially designed footballs for use in its own World Cup tournaments to favour more attacking play. The balls supplied for the 2006 World Cup, the Teamgeist, were particular noteworthy for their ability to travel further than previous types when struck, leading to longer range goals.
Adidas also introduced another new ball for the 2010 World Cup. The lighter and more aerodynamic ball led to many shots and passes being over hit. The Adidas Brazuca was the match ball of the 2014 World Cup. In November 2009 World Number 4 Andy Murray was confirmed as Adidas's highest paid star with a 5-year contract reported to be worth $24.5m.
Players sponsored by Adidas can take advantage of the Adidas Player Improvement Program, where the company provides coaches, fitness trainers and sports psychologists to players in order to further their careers. The program includes legendary coaches such as Darren Cahill and Sven Groeneveld.
Adilette
Adilette was the first ever pair of sandals made by Adidas, originally developed in 1963. Adidas claims that a group of athletes approached Adi Dassler requesting a shoe be made for the locker room.
To this day, the resulting sandals are a best-seller. Since the original Adilette sandals were created nearly fifty years ago, more varieties have been created in different colours (black, red, green, grey, orange, brown, yellow, pink, golden, silver). Most recently, Adidas has introduced a colour scheme that goes along with its Predator and adizero line; the scheme is dubbed warning (orange) and purple. Usually, seven stripes appear on the strap of the classic models. The most common adilette livery is in navy blue or black, mixed with white colours. Also the Woodilette and Trefoil models follow the same design but without stripes on the strap.
The model provides a contoured orthopedic rubber sole with synthetic upper, and was designed as an après-sport slide, but the adilette were quickly used everywhere out of sport's world. Opting for a wide, over the foot strap rather than the design of flip flops, the adilette sandals provide a fresh style and a different level of comfort for the wearer. The strap is also glued to the sides of the sandal, which directs tension to less stressful areas of the sandal, which gives the sandals more durability.
Santiossage
The Santiossage is a uni-sex slide-style sandal. The sandal has the trademarked three stripes on a velcro strap toward the front of the shoe. Santiossage comes in black, navy, or red. On the side of the shoe, toward the heel on either side, the manufacturer's name appears, as well as on a round emblem in the actual heel of the foot-bed. Notably, there are tiny clear massage nubs throughout the foot-bed for the purpose of massaging after-sport footaches, although the
7. sandals are worn casually among non-athletes. Seen through these clear nubs are Adidas' three stripes.
Adissage
Adissage is also a uni-sex slide-style sandal. Available in black, navy, light blue, black with pink, and other assorted colors, the sandal has the trademarked three stripes on a velcro strap toward the front of the shoe. On the side of the shoe, toward the heel on either side, the manufacturer's name appears, as well as on a round emblem in the actual heel of the footbed. Like the Santiossage, there are tiny black massage nubs throughout the foot-bed for the purpose of massaging foot aches after sport, although popular as a casual sandal amongst non-athletes as well.
Brand Image
Adidas, like other sports brands, is believed to engender high consumer brand loyalty. Brand loyalty towards Adidas, Nike, Inc., Puma AG and several other sportswear brands was examined in a recent study. The study found consumers did not exhibit unduly high loyalty towards such brands.
"Adidas is all in" is the current global marketing strategy for Adidas. The slogan aims to tie all brands and labels together, presenting a unified image to consumers interested in sports, fashion, street, music and pop culture.
"Impossible is Nothing" was the previous mainstream marketing slogan for Adidas.
Corporate information
Current executive board
CEO: Herbert Hainer
Chief Financial Officer: Robin J. Stalker
Global Brands: Eric Liedtke
Global Operations: Glenn S. Bennett
Global Sales: Roland Auschel
8. Company Analysis:
Financial information
Financial data in millions of euros
Year
2008
2009
2010
2011
2012
Sales
10,084
10,299
10,799
10,381
11,990
EBITDA
1,078
1,165
1,280
780
1,159
Net income
483
551
642
245
567
Net debt
2,231
1,766
2,189
917
221
Market Turnover Analysis:
Market Capital is the product of outstanding shares of the company and the current share price, it is an important element in gauging the size of a company. The following pie chart is a distribution of the market share for the top 5 sports apparels in India. It provides an insight to the market capitalization of each company in terms of Crores.
Turnover (in $Billions)
27.04 44%
19.24 31%
8.2 13%
2.706 4%
1.58 3%
1.27 2%
1.5 3%
NIKE
ADIDAS
REEBOK
PUMA
FILA
ASICS
9. Capital Labour Ratio
Capital to Labour ratio measures the ratio of capital employed to labour employed.
Now let me show you the comparison of the capital-labour ratio of the top apparel manufacturing companies as on Q2 2014.
Capital Labour Ratio
WEKA Forecast
Weka is a collection of machine learning algorithms for data mining tasks; Weka is used here to forecast the share price of Adidas using data of the last traded price. The forecast uses data of previous month. Horizontal axis indicates the last traded share price. The bold red line indicates the last trade price until available data, and the jotted lines indicate the predicted price.
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20000
40000
60000
NIKE
ADIDAS
REEBOK
PUMA
FILA
ASICS
CONVERSE
Capital Labour Ratio
10. SPSS Chart
SPSS Software package was used for statistical analysis of data using dependent and independent variables to forecast the share price of Adidas. Different variables such as last traded price, Opening price, High price were used to forecast the share price. Data for analysis was taken for a period of months prior to analysis. The blue line indicates the actual opening price of the share whereas the red line indicates the forecasted price.
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10
20
30
40
50
60
70
80
Chart Title
ltp
estimated
11.
12. Employee Turnover:
The following bar chart is a graphical representation of number of employees and the turnover of each company. Blue bar represents number of Employees in terms of thousands and the Red bar represents sales turnover of the respective company.
Conclusion:
I have chosen ADIDAS as my dream company in the sector of Sports Apparels and Accessories because of ADIDAS’s grand success in today’s market and the way in which their products tend to be unique which in turn pans out to be its success point in selling. This makes ADIDAS a perfect company for a person interested in this sector to pursue his/her career.
0
100
200
300
400
500
NIKE
ADIDAS
REEBOK
PUMA
FILA
ASICS
CONVERSE
TURNOVER(in $ Billions)
13. Bibliography
www.moneycontrol.com
www.wikipedia.com
www.adidasindia.com
www.equitymaster.com
For Further details Contact:
Dr P James Daniel Paul, Professor, VIT- BS, Chennai, jamesdanielpaul.p@vit.ac.in Tel: +91 44 3993 1040 HP: +91 98402 94590
Mr. Surendra prasanna.R , Student VIT-BS, Chennai
prasanna.payne@gmail.com Ph: +91 8870735732