Under Armour: Risks

Under Armour has a nice, big supply chain. It has operations in over 10 countries. According to the
company’s Supply Chain List (July 2018), its Tier I suppliers are in the following countries:

1. Argentina (1)
2. Bangladesh (2)
3. Brazil (8)
4. Cambodia (6)
5. China (35)
6. Colombia (1)
7. Dominican Republic (1)
8. Egypt (3)
9. El Salvador (5)
10. Georgia (1)
11. Haiti (3)
12. Honduras (2)
13. Israel (1)
14. Indonesia (14)
15. Jordan
16. Madagascar
17. Malaysia
18. Mexico
19. Nicaragua
20. Pakistan
21. Peru
22. Singapore
23. Taiwan
24. Thailand
25. Turkey
26. USA

And so on…

One risk that we see here is a fragmented supply chain. However, we must keep in mind that this is how
such companies focus in today’s globalized world. For comparison, Adidas has 1,200 suppliers spread
over 69 countries.

Restructuring Plans

1. Stronger: go-to-market strategy, which looks at

a. all relevant internal players from product design to sourcing to marketing and retail
b. all aspects of these interactions
 2. Faster:
a. market discipline
b. inventory turnover
c. matching demand to supply
3. Smarter: match everything to plans

Annual Report

Revenue breakup
Apparel - 66%
Footwear – 21%
Accessories – 9%
Licensing and connected fitness – 4%

Plan

2 deliverables:
1. Online Presence
a. E-marketplace
b. Fitness and training
i. App
ii. Wearable tech
2. Point by point rebuttal of all of Under Armour’s strategies for the future

For number 1, the things we need to ask

1. How much revenue does it make from its online presence, and all of the categories within it
a. 1.8%
2. How much does it spend
a.
3. What are its plans
4. Apparently it was hacked, what other incidents have happened to it
5. UA’s standing in comparison to Nike’s
6. Future potential

For number 2, the things we need to ask

1. What is the strategy it proposes?
2. Identify any and every element that can go wrong