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Case Study - Efe Matrix for Fila

Autor:   •  April 11, 2011  •  Case Study  •  2,095 Words (9 Pages)  •  1,456 Views

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Brand awareness is one of the biggest assets that athletic shoe companies as Nike, Adidas, Reebok, Fila can have. Brand awareness always brings a considerable advantage in getting consumer's attention and making a good place in that shoe market. If a well established brand name effectively mentions the messages of quality and dependability. Thus consumers will automatically go to that brand relying on the image that has been created when they don't have time to shop around.

Athletic shoe manufacturers must balance the costs of labor, raw materials, purchasing quantities, competitor strategies, shipping, import tariffs, and technological advancements. In an effort to keeps costs down, the industry has been looking to overseas sourcing. The training shoe manufacturing has shifted their financial investment from South Korea and Taiwan, now considered to be higher-cost production locations, to lower-cost ones such as Indonesia, Thailand and China. The trend has been for trainer companies to continue to use the same Korean and Taiwanese manufacturers, who have set up and manage production plants in the new geographic locations. They are also able to profit from beneficial trade and tariff agreements, wherever they exist.

Favorable legislation regarding foreign manufacturing has led to a big increase in foreign sourcing. In order to diversify supply and production lines, manufacturers have spread out their operations over many areas to avoid over concentration in one region. With this strategy, if one country or region experiences problems that interrupt production, the affected company is not completely out of options and can still accomplish production.

Distribution channels dictate who a company's customer will be and how they will get the product. The footwear companies must choose their channels carefully because they want to make the product available, yet remain true to their image and goals. Retailers account for the largest percentage of sales, so manufacturers must be especially careful with their relationships with them. If a disagreement arises between manufacturer and retailer, the manufacturer could face potentially extensive problems getting the product to market. A recent example of this occurred between Foot Locker and manufacturer Nike. In an attempt to carry more of the lower cost shoes that consumers are demanding, Foot Locker cut back on their high-end purchases from Nike significantly. Nike, in turn, had to look for other outlets for their signature lines.

The ability of companies in the industry to shorten their design, development, production, and distribution cycles is vital to success. In the past, retail stores could carry a product months in advance of a projected need, but now consumers want to buy closer to when they actually experience the need for the good. With the shortened cycles, manufacturers can place more of an emphasis on styling and keep


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