The text explores the state of the athletic sportswear industry in China, specifically focusing on German company Adidas. China, renowned for its large population, was rapidly emerging as a strong economic force and experiencing notable growth in its sports industry. Adidas initially entered the Chinese market in the early 1990s through agents and by 1993, China had become their main manufacturing center. Rather than establishing their own retail stores in China, Adidas opted to sell their products through franchisees.
The sportswear industry in China was highly competitive, with Nike and Li-Ning posing strong competition to Adidas. The upcoming Olympic Games in Beijing in 2007 presented opportunities for growth, leading to major playe
...rs in the industry, both international and domestic, preparing to capitalize on these prospects. This case study examines the Chinese sportswear industry using Michael Porter's five force model and analyzes Adidas' competitive strategies. It also details the demographic profile and segmentation of Chinese consumers as described in the case.
Adidas' decision to acquire Reebok will increase its market share, but it will still be lower than Nike's market share. The challenges that Adidas will face include achieving synergies from the acquisition and competing directly with the market leader while staying ahead of the local favorite.
The objective is to use Michael Porter's five force model to analyze the sportswear industry in China.
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