Under Armour has notched 17 consecutive quarters of 20 percent or greater growth — an astonishing (and enviable) achievement.UA’ s rapid growth continues. It hit $5 billion in sales in 2017, and expects to grow another 30% in 2018, on its way to being a $10 billion company by 2020.
The key to success often lies in introducing innovative products and efficient supply chain management. Few companies operating today have so clearly perceived the importance of a supply chain centric strategy as the foundation for achieving outstanding growth and profitability. And it is certainly working——
UA’ s growth heavily relies on its of product assortment. It includes variety by both, channel and geography. This assortment is principally germane as UA seeks advanced proliferation into the international operations by further expanding its supply chain maneuvers in North American retail (XRT) stores as well as the online disposition.
Supply chain enhancements
UA’ s core focus lies in shrinking its supply chain by cutting down the lead times for various operational activities like procuring raw materials, and augmenting manufacturing process. Also, the crucial element is to set dates for goods and ensure that it reaches within the predefined time. UA is also discovering ways to ship products directly to the customers from its source.
Engaging SAP for effective SCM
UA has a long collaboration with SAP for providing or ERP solutions. This alliance is aimed towards optimizing inventory, process enhancements, and amending effective cost management. Expecting inventory strategy to work out.
Implications of Inventory Management
If we are to consider UA’ s inventory turnover ratio, it is indeed one of the lowest among their competitors. The ITR was locked to 3.0x during 2015. If we are to compare Nike on this grounds, then its ITR is 4.0x, while LuLu keeps it at 4.5x.
Two elements – Swiftness to market and rich assortments drives the demand for footwear and apparel companies. The inventory management initiatives of UA apparently reflects company’s strategic alignment towards utilizing inventory management as a cost-cutting tool which in turn can yield high inventory turnover with an active SCM. In longer run, UA is expected to outperform global giants regarding share growth.
A faster, stronger, better supply chain in a company that knows how to win.
Here’s your chance to know more about UA’s effective SCM. Colin Browne, Chief Supply Chain Officer, UA will share his experience about Retail Supply Chain of UA during 2018 Consumer-driven Supply Chain Summit held in Shanghai on 18-19th April. Want to meet Colin Browne and more than 200 other retail supply chain executives and practitioners? Register now while you still can!