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SWOT Analysis of Under Armour Apparel Company

SWOT Analysis of Under Armour Apparel Company

Under Armour Company Overview

Company: Under Armour
CEO: Kevin Plank
Year founded: 1996, Washington, D.C., United States
Headquarter: Baltimore, Maryland, United States
Number of Employees (2018): 15,000+
Public or Private: Public
Ticker Symbol: UAA
Market Cap (March 2019): $8.54 B
Annual Revenue (Dec 2018): $5.229B
Profit |Net income (Dec 2018): $ - 43.4 M

Overview

We, the Casestudyhelp.com overview of the company’s performance as discussed here. The company was formed in the year 1996 by Kevin Plank, who is still serving the company as a CEO. It is well known that the company named Under Armour has originated in U.S.A. manufacturing both casual and sports-related apparels as well as footwear and related accessories. It has branches and outlets located in various global countries like North America, Asia Pacific, South America, Europe, the Middle East, Africa and many more.

In a report carried out in 2017, indicates that its revenue contributions from North American countries alone were about 76.5%. The figure for Asia specific was indicated at 8.7 %. The company is still unbeatable in its branded finest quality T-Shirts that comprise athlete’s friendly lighter, dryer and highly comfortable clothing.

The products are designed with high adaptability matching weather conditions of different countries of the world. The company has reached an innovative international transformation that has contributed to the company Under Armor as the largest digital fitness and Health Company globally.

SWOT Analysis Observations by Casestudyhelp.com

The detail of the Under Armour SWOT analysis that will be advised by our Casestudyhelp.com is enumerated below:

Under Armour Strengths

The wide product range – Product portfolio of Under Armour has strengthened the standing of the company phenomenally. The company is not dependent on a single and specific product. Under Armour Company has not focused itself on only footwear but has also included in other areas like apparel, accessories, and many more. The extensive product range has made the company free from the risk of failure. It also established the achievement of a high sale ratio and continual growth. It was reported that its revenue from 2016-2017 for apparel alone was 67%, while that for footwear was reported at 21%.
Distribution Networks – Attracted by its amazing distribution network, and accelerated growth, investors, are amazed and participate in Under Armour’s business. This result may be considered due to Under Armour’s creative policy of operating through multiple distribution networks of its outlets located globally. The company has achieved 65% of its revenue through its wholesale distribution network, and 31% of the revenue was gained through direct sale to its consumer population.
The advantage gained by adopting Digital Apps – Under Armour is applying the digital transformation of its products with the help of apps like MapMyFitness and many other advanced apps. This has increased its profit extensively, allowing it in the diversification of its resources and continue its transforming its industrial potential.
Brand Popularity – Under Armour has been considered as the 5th most valuable business brand in the world, as reported during 2017. Recognition of its brand by its consumers has created a valuable perception in developing in authenticity and trustworthiness.

Weaknesses of Under Armour

Limited Operating Presence – The Company is still a relatively limited operating presence in the international markets. 83% of its revenue is gathered from its North American branches which makes it entirely dependent on the American markets.
High Investment Expenditure – Under Armour has disadvantages due to its trend in taking the risk with its high investment expenditure. During the last two years, it invested about $847, 477,000 and $153, 312,000 respectively. This investment is positive as it generating more revenues.

Under Armour’s Opportunities

Introduction of New Products – Under Armour has innovative quality as their products have been manufactured with advanced technology. This gives it the leverage to continue the trend of offering better products with necessary design modifications.
Collaboration – Under Armour enjoy a strong collaboration with the companies like Kohl’s initiated in 2017 when Kohl’s started selling merchandise. The cooperation proved to be successful as declared by their management. Other collaborations are with Dillard’s and Macy who sell Under Armour products.
International Markets – There is a huge scope of a generation of more sales and customer growth internationally. The company’s sales reported a growth of 57% in the second quarter of 2017. This figure guarantees a good future.

Under Armour Threats

Political Polarization is a great threat to Under Armour as they were involved in a controversy with Trump administration. CEO of Under Armour Kevin Plank initially supported President Trump and withdrew when his actions resulted in public. This controversy has not subsided yet.

Increased Competition – Its major competitors Nike and Adidas have higher brand recognition and better operational experiences overseas.

Conclusion

Casestudyhelp.com can guide in SWOT analysis of the company like ‘Under Armour’ and observe a promising future for the brand. All that is required is some restructuring by cutting expenditure. It’s already booming revenue, and expansive growth makes it an ideal candidate for investments in the American markets.