Under Armour Inc. Harvard Case Solution & Analysis

Under Armour Inc. Case Solution

Introduction

Under Armour was founded in 1996, and is headquartered in Baltimore, Maryland. The former University football player, Kevin Plank, formed the company. He is an alumnus of University of Maryland. The company designs, develops, markets, and distributes; apparel, footwear, and accessories for every individual whether male or female. The company has been operating efficiently and has an increasing profitability throughout its operations. In the second quarter of year 2013, the company achieved 23% increase in revenues and 163 percent increase in net profit, which are $455 million and $18 million respectively. The vision and mission statement of the company is as follows:

“Our investments illustrate our commitment to realizing our long-term vision of one day having our Women's business larger than Men's, Footwear larger than Apparel, and our International business larger than our U.S. business."

Objectives and Strategy

The company focuses on innovation and product quality. Its strategy is to provide high quality and better products through the use of latest technologies. It has competent research departments, which try to come up with the modern design and convenient structure for apparel, footwear, and other accessories. The company’s sole objective is to focus on the athletic and sports industry. This limits its operational and business strategies to sports and athletic consumers. Therefore, limits its product diversification.

The company wants to focus on the direct selling channels, using online stores, outlets, and specialty stores. The latest objective revision has made the company to focus more on the women products, which is also shown by the mission statement. The primary objective of the company is to become a leader in athletic and sports products and increase its market share. It has started focusing more on the women athletic apparels, footwear, and many other products due to the growing participation of women in sports.

Mission Statement

Under Armour Mission statement can be revised as:

“Through the use of our innovative design, product dynamics, market research and technology make the product that serves the true purpose of an athlete and make value addition to their passion, efforts and success”Under Armour Inc Case Solution

External Opportunities and Threats

 Opportunities
1There is growth potential in the company to grow globally
2the company can diversify its products beyond apparels
3there is opportunity to offer products targeted to casual wear customers
4the company has less debt in its structure thus it can make capital expenditures to maintain competitiveness
5Acquisitions will make the company to expands and increase its business
6Through the use of patents, company can make its products unique
7Women segment is underutilized, with increase of women interest in sports, this division can bear top results
8Marketing strategy can be enhanced through sponsoring various sporting events
9Accessories shows more growth, more innovative designs can help utilize this high growth
10More proportion of population has become health conscious and involves in sports activities.
 Threats
1there were many big players that can affect the company's business such as Nike and Adidas
2There is substitute products in the market, which hinders the company's sales
3Per capita income has been decreasing as inflation is rising
4Under Armour products are tagged at high prices compare to other competitors
5Without patents, competitors can easily copy the products and this leads to lower sales
6Many other small players in the industry have captured more market share.
7Footwear industry has slow growth rate, and sports footwear has only 13% market share
8Improved efficiency of public transportation
9Competitors use low cost manufacturing, as they setup its manufacturing industry in china where labor is cheap
10the company is of small size as compared to its competitors which makes it difficult to compete well

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