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Adidas aims at enhancing sales to outshine Nike by 2015

11
Nov '10
Adidas – the German sporting goods company intends to increase its sales to e17 billion ($24 billion) by 2015 as it attempts to outshine the market leader Nike. The company's objective is to break the overall market growth record and to go beyond its most important competitor in terms of growth.

Recently, Adidas has given an account of its strong third-quarter results, which have been raised by the growth in sales in Eastern Europe and US. The company anticipated its 2010 sales to increase by eight percent at stable currency rates from e10.4 billion ($14.6 billion) in 2009. Nike had registered sales of $19 billion till May 2010 and it is intending to touch $27 billion by 2015. If both the companies reach their target by 2015, then also Nike would be ahead of Adidas.

North America, Greater China, Latin America, Britain, India, Japan and Russia/CIS are expected to be the major growth markets of Adidas. The United States, Russia and China are likely to contribute 50 percent of the company's sales growth. Adidas is aiming a compound yearly earnings growth rate of 15 percent, faster than the sales growth, as well as an operating margin of 11 percent by 2015.

Adidas and Reebok brands together are likely to account for over 90 percent of the intended 45-50 percent increase in sales. The sales at Adidas sport performance brand targeting athletes, soccer and basketball players is expected to grow from e6.2 billion to e8.5 billion. The other Adidas brands which focus mostly on style and fashion are likely to experience a growth in sales from e2 billion to e3.7 billion. Reebok sales are likely to rise from e1.9 billion to e3 billion.

Adidas had acquired Reebok in 2006 and is likely to continue to play its role in strengthening the sector. It may explore several other business prospects in future if the other brands agree with its planned brand priorities. However, the company is not keen on buying any other outside brand, right now.

Fibre2fashion News Desk-India


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