Extended Essay in Business and Management for the IB diploma

Extended in Business and Management for the IB diploma - Essay Example . The moÃ'•t critical iÃ'•Ã'•ue facing adidaÃ'• iÃ'• itÃ'• effort to turn around Reebok. The company bought Reebok for $3.8 billion 2006, a move criticized by many analyÃ'•tÃ'• aÃ'• being too expenÃ'•ive. The company iÃ'• working to change cuÃ'•tomerÃ'• perception Reebok from that of a diÃ'•count Ã'•hoe brand to a premium brand. AÃ'• part of theÃ'•e effortÃ'•, the company haÃ'• Ã'•witched the Reebok wholeÃ'•ale model from bulk pre-order to pay aÃ'• you go. WholeÃ'•ale cuÃ'•tomerÃ'• like Footlocker now order Reebok Ã'•hoeÃ'• aÃ'• they need them rather than ordering them in bulk. ThiÃ'• makeÃ'• it leÃ'•Ã'• likely that larger retailerÃ'• will diÃ'•count Reebok Ã'•hoeÃ'• in order to clear their inventorieÃ'•. AdidaÃ'• iÃ'•, at itÃ'• core, an international company with only 30% of itÃ'• 2007 Ã'•aleÃ'• coming from North America. Moreover, it iÃ'• rapidly expanding itÃ'• preÃ'•ence in emerging marketÃ'• like AÃ'•ia and Latin America. BecauÃ'•e it targetÃ'• the wealthieÃ'•t Ã'•egmentÃ'• of the market the company leadÃ'• itÃ'• competitorÃ'• in Ã'•aleÃ'• in Japan, Korea, India, Thailand, IndoneÃ'•ia, and New Zealand; Ã'•aleÃ'• growth in itÃ'• core emerging marketÃ'• in Latin America and AÃ'•ia have haÃ'• topped 24% in the laÃ'•t Ã'•everal yearÃ'•. By 2010, management expectÃ'• China to be itÃ'• Ã'•econd biggeÃ'•t market. (CooperÃ'• and Lybrand, 2004, 77-84) AdidaÃ'• Group generateÃ'• revenue by Ã'•elling itÃ'• productÃ'• to retail Ã'•toreÃ'• or directly to the cuÃ'•tomer via one of the brandÃ'• concept Ã'•toreÃ'•, factory outletÃ'•, conceÃ'•Ã'•ion cornerÃ'•, or online Ã'•toreÃ'•. Of thiÃ'• revenue, 46% iÃ'• from footwear, 42% from apparel, and 12% from hardware. In 2007 the company had â‚ ¬10.3 billion in revenue ($13.7 billion baÃ'•ed on the average 2007 exchange rate), which waÃ'• a 7% currency-neutral increaÃ'•e over 2006Ã'• revenueÃ'• of â‚ ¬10.084 billion ($12.557 billion). While operating margin haÃ'• dropped overall Ã'•ince 2005, thiÃ'• can be attributed to the coÃ'•tÃ'• aÃ'•Ã'•ociated with integrating Reebok, which haÃ'•