...Under Armour Case Study Source: Hogan, 2013 Table of contents Detailed Timeline 3 Business and Corporate Level Planning 4 Brief Summary of the Company Situation in their Competitive Environment, Issues they Face and Clear Problem Statement to Analyze 6 Key Leadership 8 Types of innovation and Evidence of Entrepreneurship 10 Global Presence and Effects 11 Ethics - Examples of Social Consciousness/Corporate Social Responsibility 12 Responsible Wealth Creation 14 Engagement and Plan Alignment & Corporate Culture 15 Wild Card 16 Internal Analysis 17 External Analysis 20 SWOT Analysis 24 Recommendation 27 Bibliography 33 Appendix 37 Team Member Roles 46 Detailed Timeline It all started in 1995 when Kevin Plank, the special teams captain on the University of Maryland football team, noticed that the cotton T-shirts he and his teammates wore underneath their pads were always soaked and filled with sweat (Under Armour, 2012). “There has to be something better,” he believed (Under Armour, 2012). That statement soon launched the performance apparel industry (Under Armour, 2012). That statement also became Under Armour’s generic strategy, which was to develop a better product than there was in the market. While Plank was perfecting his t-shirt after he graduated, he needed funds to launch his apparel line, so he maxed out his credit cards to the tune of $40,000 and set up a company in his grandmother’s basement in Washington, DC (Under Armour, 2012). In...
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...Table of Contents Written Report Executive Summary…….............................................................................. 2 Company Profile………………………………………………………..…..3 Industry Analysis…………………………………………………………...4 SWOT Analysis………………………………………………………….....8 Valuation…………………………………………………………………..12 Conclusion……………………………………………………………..…..13 Historical Ratio Analysis Valuation ratios………………………………………………………........17 Dividends………………………………………………………………….17 Growth rates……………………………………………………………….18 Financial strength………………………………………………………….18 Profitability ratios………………………………………………………….19 Management effectiveness…………………………………………….......19 Efficiency………………………………………………………………….19 Valuation Tables Pro Forma Income Statement……………………………………………..21 Pro Forma Balance Sheet…………………………………………………23 Free Cash Flow……………………………………………….…………...25 Free cash flow valuation summary……………………………..……...….26 WACC calculation………………………………………………………...27 Sensitivity analysis………………………………………………………...27 Graphs/ Plots Net income (loss) by year……………………………………………….…28 Free cash flow by year……………………………………………………..28 Written Report Executive Summary Executive Summary Introduction of the Firm Under Armour (UA) was incorporated on July 1, 1996; producing and distributing performance apparel and footwear for athletes of all ages. The brand engineered a fabric that enhances performance and comfort through its “moisture wicking” fabrications that helps athlete’s performance no matter the weather...
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...Under Armour Strategic Plan Part BUS/475 Under Armour Strategic Plan Part Two Under Armour has learned how to be successful with a resilient strategic plan in place. The strategic direction that a company decides to endeavor could be the cause of a company to become successful or fail. Strategic plan of a company needs to be explained to all personnel involved to be a successful venture by the company. The purpose of this synopsis is to analyze the forces and trends that Under Armour has to relate to and that is relevant to its competitive situation. The internal and external forces will include the economic as well as legal and regulatory forces and trends. Externally this will cover the economic, innovation, and social aspects. The internal forces will include technologies, goals, and strategy points. SWOTT Analysis With today’s recession the business markets in the world face many obstacles to keep business profitable. With a Strategic plan incorporated and followed in the company will allow the company to set goals and achieve the goals. Under Armour developed strategic plans that include a SWOTT analysis. This establishes by what method the business will survive in the market during the recession. A SWOTT analysis is a situational analysis of an organization’s internal strengths and weaknesses, opportunities, threats and trends that are faced by the company (Pearce, 2009). This analysis will be examined to provide a strategy for the company’s survival. With...
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...UNDER ARMOUR Ecomonic Analysis Wisniewski, Angela Table Of Contents 1. Executive Summary 3 2. Company History and Analysis 3 a. Strengths 4 b. Weaknesses 4 c. Opportunities 5 d. Threats 5 3. Microeconomic Analysis 5 4. Macroeconomic Analysis 7 5. Market Structure- Monopolistic Competition 8 e. Consumer Demand 9 6. Market Competition 9 7. Managerial Recommendations 11 8. Conclusion 13 9. Works Cited 14 Executive Summary Under Armour is in the Textile- Apparel Clothing industry, in the consumer goods sector. The market has been driven by economic recovery, new product offerings and a rising degree of consumer confidence. This is a diverse industry, with specialized companies and competitors. Under Armour is a developer and distributor of athletic apparel, footwear and accessories for all ages and sexes. In November of 2005 Under Armour went public with an IPO and has since grown into a multi-billion dollar company gaining brand recognition through contracts with the Notre Dame Program and partnering with large nationwide retailers. The company primarily markets to consumers in North America. Internationally the company sells products to countries in Europe and a third party licensee sells products in Japan. Under Armour still faces heavy competition and competitors include large apparel, footwear and sporting goods companies with...
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...increase market share. The Under Armour brand has been built on differentiation, authenticity, and originality. An advanced second skin microfiber under garment to control perspiration and body temperature, for athletes as well as those who lead active lifestyles, is the cornerstone of Under Armour’s business. Since founder Kevin Plank first launched the original Under Armour compression t-shirt in 1996, the company has experienced rapid growth, with distribution to over 500 retail stores, outfitting agreements with athletic teams, and international expansion. Over the past decade, Under Armour has expanded its marketing efforts and has not limited itself to only athletic wear by increasing its product offerings to include footwear, accessories, children’s wear, and women’s active wear. Problem Statement Under Armour has excelled in its product and marketing strategy to date, however the company must seek to improve the future prospects for growth, including, but not limited to, product manufacturing, operations and distribution, and market expansion. Analysis With the growing popularity of collegiate and competitive sports and physically active lifestyles Under Armour has experienced continuous growth and success, despite the many competitors saturating the sports apparel market in recent decades. Such notable success and exponential growth is due largely to Under Armour’s product innovation and differentiation. This analysis will evaluate Under Armour’s current strategy...
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...University UnderArmour vs Competitors Comparison Nike has a very clear cut business strategy and specific goals it wants to accomplish. Innovation is at the heart of Nike’s business growth strategy. Nike uses this innovation in order to become a more sustainable company, which is the second key aspect of its business strategy. We live in a world where natural and human resources are constrained and Nike realizes that this could greatly affect its business. The cost of competition for resources will increase as these resources become increasingly scarce. Coupled with emerging trends, such as customization, a push to be closer to multiple markets, and shifting labor markets, Nike sees a new opportunity to create business growth for the future. A big aspect of Under Amour’s growth strategy is expanding abroad, which also ties into how they plan to manage competition. Under Armour has established a solid position in the United States and Europe is a big opportunity to continue expanding. By expanding in Europe, Under Armour hopes to try and gain some market share from Nike, who is their largest competitor. Under Armour may need to adjust its messaging for Europeans, who are less impacted by its traditional football and baseball based marketing. Nike has a slight advantage because it is coming at Europe from a running and basketball perspective, which are much more international sports. Both Nike and Under Armour are very focused on innovation. With the industry that they are in they...
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...Table of Contents Brief History………………………………………………………………………P.3-4 Current Status……………………………………………………………………..P.5 SWOT Analysis……………………………………………………………………P.6-7 Direct Competitors…………………………………………………………………P.7 Genral Trends………………………………………………………………………P.8 External Influences………………………………………………………………….P.8-9 Global Issues………………………………………………………………………..P.9 Problems…………………………………………………………………………….P.10 Income Statements………………………………………………………………….P.11 Ration Analysis……………………………………………………………………..P.12-16 Work Cited…………………………………………………………………………P.17 Conclusion………………………………………………………………………….P.18 Worked Cited………………………………………………………………………P.19 Brief History One of the biggest name in American sports clothing and accessories is Under Armour. This company focuses on providing hi-tech sportswear for professional athletes, but they also have a large range of sportswear and casual apparel for others. Kevin Plank founder and CEO of Under Armour, he first carne up with the ideas for Under Armour in 1995. Plank was the special teams' captain on the University of Maryland football team. He noticed after every game him and his teammate cotton T-shirt were heavily soaked in sweat. He told himself "there has to be something better". He also noticed that his synthetic fabric short in wore in practice stay dry. After graduation from Maryland, Plank set out to corne with a product that sports have never seen before. On a trip to New York City famous garment district for fabric...
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...Under Armour (Case 1) The following is an environment analysis of the ‘clothing’ business sector of the Performance Apparel Industry, with an analysis on Under Armour, a growing company headquartered in Baltimore, Maryland. The Future of Under Armour is unforeseen but we know that Under Armour wants to be number one in the industry above all competitors. Nike and Adidas will always strive to be the leaders but is our products truly better than theirs? The first section of this report will consist of an overview of the trends in technology, demographics, economics, political/legal and finally social/cultural. Political/Legal There is not too much content that Under Armour must worry about in this section. They just need to stay in the realms of regular business and legally obtain the correct patients so that no other competitors steal valued material. This actually makes their products perform better than other competitors. Politically Under Armour needs to promote good and safe work habits. They do not want a negative view like Nike obtained after they were seen utilizing sweatshops to make a deeper profit in the Industry. Even if a few customers find out they are using bad practices, then it shatters the whole reputation and brand image. Socio-cultural and Global Under Armour and other competitors can and have been using a global image to win the customers over. It is very important that Under Armour utilizes the global image of their quality product, for instance, showing...
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...6/20/2012 Under Armour: Case 1 The following is an environmental analysis of the “performance apparel” business sector of the athletic apparel industry, with an analysis on Under Armour, the 3rd largest athletic apparel company. The company is clearly rapidly growing, touching markets that have been dominated before, but continues to pride themselves on the performance of their products. The first section of this analysis will cover the trends in technology, economics, demographics, socialites and culture, as well as politics and legalities. It also includes coverage over Porter’s 5 forces and analysis’ of the industry and competitors. It will be concluded with strategies of success of the company as well as alternative strategies. Demographics In the terms of the overall athletic market, Under Armour claims 31% of the market share, Nike 36%, and Adidas and other athletic companies claiming the remainder. In their specific products, Under Armour claims 75% of performance apparel market share, with Nike and Adidas struggling to catch up. The company targets consumers of all ages and all demographics. Their consumers include men, women, and children; athletes, coaches, fans, active people, athletic staff, and anyone who lives an active life style. Their consumers can attain their products through their website, 15,000 retail stores across the country, regional retail chains like Academy and Dick’s sporting goods, and as of 2007, 17 retail outlet stores. Approximately 94% of Under Armour’...
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...Under Armour’s Strategy Case Analysis 1. How strong are the competitive forces confronting Under Armour, Nike, and The Adidas Group? Provide a five-forces analysis to support your answer. The competitive forces confronting Under Armour, Nike, and the Adidas Group are very strong. There are many other companies who offer similar sportswear and gear lie these three groups. A consumer has a wide variety of merchandise available to choose from, and the price to pick one brand over another costs the customer very little. All the competitors have allowed the market to be saturated with similar merchandise without much differentiation in products. The companies have an equal economic capability and economy of scale as Under Armour, Nike, and Adidas Group which allows them to remain equally competitive. The competitive pressure coming from new entrants into the sportswear apparel industry is relatively high. Active lifestyles are promoted heavily and customer demand for athletic products are high which means newcomers can expect to earn exponential profits. If a company has the resources to enter the market, then they could become a formidable competitor. The competitive pressure coming from firms offering substitute products is very high. Substitutes are often attractive to consumers because they are readily available for a nice price. Consumers often become used to buying substitutes because they suffer very low cost when switching products. Competitive pressure...
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...Under Armour STEEP Analysis Socio Cultural: Due to, the global rising trend of quality awareness, and global health conscious of athletes and customers, they are more willing to pay for the quality product, regardless of its price with more expectation in enhancing their athletic performances and lifestyle .This is perfectly matched with the company as delivering superior unique, innovative quality products Then, company has to try to tailor the products to meet the needs. Technological: With the new technology software SAP enable the company to reach effectiveness in managing inventory and shipment to distributors. But still not enough in prospect for sufficient communication between rising number of distributors, therefore, company should introduce ICT and restructure the IT system to utilize forceful customer analysis for more operational efficiency. Economic: The growth in the sport performance apparel industry, together with rising in physical active consumers seems to be promising future for Under Armour. Nowadays, the economic recession in U.S., rising labor costs and material prices affect both local economy and international economy where the company operate in like China. Weakens of Euro and an Asian recession affect in the dropping in sales. Environmental: The innovative commodities of the company still less in environmental concern,due to raw material petroleum- based is involved in production process. Thus, company should pursue on environmental friendly materials...
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...Every since the creation of the well known body wear Under Armour in 1996, Kevin Plank's formal University of Maryland football player. The band has under gone rapid expansion and popularity throughout the world today being that it all started in a basement. It has taken over the performance workout apparel market in the United States and worldwide, over the years it has began to outsell another well known sporting apparel such as Nike and Addidas. Under Armour Inc. has even expanded its market way beyond performance apparel line and brings products such as footwear and casual wear also workout wear. The company has prided itself on maintaining a competitive advantage by always having top-notch products and adopting new ideas to outcompete...
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...Date: June 18, 2012 Re: Analysis of Under Armour’s Business Locally and Globally After a thorough analysis of your company, I recommend that you continue the footwear line in the United States and expanding internationally with the performance apparel. I feel that this modification will help the company take advantage in different markets overseas while still expanding in the United States. In this memo, I will first outline what I consider to be your company’s implemented business model plan, and after the SWOT analysis of the company, I will make recommendations for the revisions of Under Amour’s. Business model for Under Armour Mission of Under Armour. Under Armour business model revolves around the design, production, marketing, and distribution of high-tech athletic performance apparel to men, women and youth. The company’s main focus is the production of apparel for football, even though it has made vast advances in other sports such as, baseball and lacrosse. I believe the company should continue focusing on updating the production of apparel for the sports already dominated in while targeting other sports such as, Olympic sports, soccer, and basketball. Under Armour’s business model is one of a kind in that the company builds its sales efforts in constituting a base, wherein products are pushed out to sports professionals with the purpose that the style is seeped into majority of consumers. Business model for operations. Under Armour’s business model main focus is the...
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...Chapter Internal Factor Analysis Strengths and Weaknesses (SWOT) D.1 Under Armour Corporate Structure Analysis Internal Environment Under Armour Corporate Culture Analysis Below is some of the corporate culture that Under Armour Implemented to the company * Founder’s Beliefs Kevin Plank as a founder of the under armor, since the beginning of his leadership, has always emphasized to each of its employees to always believe that the UA will evolve into big company. * Leadership Culture UA as the one biggest Company in sportswear certainly has a view to the future. To reach its goal in the future, UA needs a good leader. To support this Culture, UA create a Training program. * Team Oriented Culture Under Armour accentuate teamwork and collaboration than individual effort to create new product, teamwork and collaboration also give many input to create a great poduct. This also minimize risk in develop new product. * Hard Work Kevin Plank as a founder of UA, has a good work to increase the UA performance since the beginning. This causes the hard work of the Kevin Plank to reach their goals to make UA become biggest company in the sportswear. This culture also transferred to the employees, each employees of UA must have a passion to work hard to reach the company goals. * Innovation Culture UA ralize that company will growth with an innovation to compete with another company such as adidas and nike. With an innovation as a core strategy throughout the...
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...MQM 385 Summer 2008 Under Armour Strategic Analysis Team 2: Paul Huston. Ryan Marchand. Eric Webster. Rachel Eberle. Irén Ganèva. Lamar Wooley. Margaret Kobel. Table of Contents Executive Summary ___________________________________________________________2 External Analysis _____________________________________________________________3 Value Chain…………..…………………………………………………………………….3 Key Success Factors ……………………………………………………………………...7 Porter’s 5 Forces ……………...……………………………………………...…………..9 External Analysis Conclusion …………………………………………………………...12 Opportunities in the environment …………………………………………….....12 Threats from the environment …………………………………………………...14 Internal Analysis_____________________________________________________________16 Financials & Cash Flow Analysis ………………………………………………………16 Cash Position ……………………………………………………………………16 Financial Indicators ……………………………………………………………..16 Cash Flow ……………………………………………………………………….16 Internal Analysis Conclusions …………………………………………………….…….17 Strengths ………………………………………………………………………...17 Weaknesses ……………………………………………………………………..17 Competitive Strategies ________________________________________________________19 Current Corporate Strategy ….………………………………………………………..19 Integration position ……………………………………………………………...20 Diversification position …………………………………………………………21 Current Business Strategy ….…………………………………………………………23 Product positioning ………………………………………...………...…………23 Current Functional Strategy …….…...
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