Apparel Industry: The Apparel Industry

The athletic apparel industry has shown a large increase in popularity. Global sales of sport clothing have increased from 146.1 billion US dollars in 2007 to 162 billion US dollars in 2012(Global Participative Sport as Consumption). Particularly in the United States, sales of sport apparel have increased by 7% from 2013 to 2014 (Wingus). There has been a large trend in healthy living, as “activewear accounted for $33.7 billion in sales and made up 16 percent of the apparel market” (Wingus). The industry is booming, as sportswear, specifically yoga pants, has transformed into people’s daily apparel. (Refer to Appendix Table 1) Huffington post noted, “people are wearing trendy workout clothes all day, every

Analyzing the industry using Porter’s Five Forces, it can be seen that the Outdoor Apparel industry is very competitive. The threat of entry is very high, with several large conglomerates making acquisitions in the industry and established apparel companies such as Polo Ralph Lauren making expansions into sports apparel. With several brands such as North Face in the high end of the industry, as well as Columbia and several private labels dominating the middle and lower ends, a large number of substitutes are available. Buyers have large bargaining power, as end consumers could easily switch to another brand, while at the same time wholesalers are

In the athletic apparel industry, as in any industry, it is key to stay in touch with the current trends in order to keep your products relevant. With Lululemon focused on such a niche activity it will be important that they explore other markets within the sports apparel industry in the future so as to stay relevant. We can see the company’s first steps in doing just this when they recently introduced their men’s apparel line. A summary of the athletic apparel industry’s external environment are listed in Exhibit 1.

Technological factors – New technologies may create new products and new processes (Company Regulations.com; 2011). Technology will reduce cost, improve quality and lead to innovation. Developments such as Wi-Fi hotspot in the mini buses, MP3 players, online devices

Competitors in the industry can wreak havoc on the bottom line for a company. With rivals, a price competition usually ensues, which benefits the customers but hurts the competing businesses that share a common strategy. In reviewing rival sellers, many competitors exist within the sports apparel and footwear industry, but most of them are unable to compete with the industry giants, Nike and Adidas. They are well seated in the industry and their sales reveal this ultimate strength, however, Under Armour is putting pressure on these mammoths. In 2015, global sales of sports clothing and footwear equated to $250 billion, of which Nike grabbed $30.6 billion, Adidas held in its grasp $18.8 billion and Under Armour had a much smaller piece of the pie, at $3.9 billion globally. In reviewing these numbers, it looks like Under Armour is really subpar to the industry giants, but this is not exactly the case. Under Armour in the past couple of

Companies like Under Armour, Nike and Adidas/Reebok have high threats of substitute´s products. These companies share the sport apparel industry and are vulnerable to competitive pressure from the actions of buyers whenever they view that their products can be substituted for others. The availability of substitutes invites the costumer to compare performance, features, and ease of use as well as price. Under Armour’s major competitors are Nike and Adidas/Reebok because they have a similar or competing product offerings. The top sport apparel brands offer similar products and that is why each one of them needs to keep a high standard and produce good quality products in order for customers to keep buying their product.

a. Under Armour’s approach towards innovation is very unique, they think and plan out their projects thoroughly in order to create a one of a kind product that could be appealing to their consumers. The company has been extremely progressive throughout the years in order to stay ahead of the other competitive companies in their targeted industry. By constantly updating and coming up with different product lines, such as compression shirts and cleats, Under Armour is able to compete with other top athletic wear company’s in their market. If

Under Armour’s business strategy towards market segmentation is broken down into three different basis; Age, Gender, Uses. The first major market segmentation is by age, different age groups demand different products and Under Armour has produced certain merchandise to appeal to each generation. The second is Gender, both male and female respectively make up roughly 50% of the market equally.To appeal to females UA produces apparel in brighter colo, as a fashion forward athletic wear. While for males they they cater toward masculine vibe of tight fitting and resistant to wear and tear. Lastly, UA segments by the range of uses for their products.

Other major companies in direct competition (filling the same need, with the same products) include brands which have a focus on athletic apparel such as Athletica (a subsidiary of GAP with a focus on sports apparel), Under Armour (a supplier of sportswear and casual apparel), Nike (a retailing giant focused on footwear, apparel, equipment, accessories

The sportswear industry is growing and becoming more competitive so the will be new producers and entries in the market with new ‘’aces up their sleeves’’. More competition in the market

Under Armour is in the Textile- Apparel Clothing industry, in the consumer goods sector. The market has been driven by economic recovery, new product offerings and a

Sport Apparel is a large industries with many firms such as Nike, Adidas, Reebok, Under Armour, the Gap, Athleta, Nordstrom, Lucy and Bebe store. Large industries allow multiple firms and producers to prosper without having to steal market share from each other. Large industry size is a positive for Lululemon Athletica. … This qualitative factor will lead to an increase in costs.

As shown in Figure 2 of the Appendix, a Porter Five Force Analysis makes it clear that the overall rivalry within the athletic apparel industry is medium to high. Because Nike and Adidas already have a substantial amount of capital resources and other assets, Under Armour struggles against them to gain market share. 8Also, private labels of retailers and newer sports apparel companies could potentially pose a threat to Under Armour, but mostly due to the fact that Under Armour does not hold any fabric or process patents. This makes it extremely easy for any competitor to duplicate a product or process with no consequence. However, the threat of new entrants is not too troublesome within the industry because of the great capital cost required for branding, advertising, and meeting product demand. Furthermore, the sports apparel industry is in the maturity phase of the industry life cycle. This means that each company included in the oligopoly must

Companies in this industry also attempt to differentiate themselves by technical advancements in the apparel. Companies compete to find the technology that consumers believe will help their overall performance in sports and activities; whether it’s a sweat wicking shirt or lighter shoe, consumers seek the product they believe will give them the greatest advantage. Overall, the rivalry amongst competitors is a strong force that ultimately lowers the profitability of the industry.

Technological - how the rapid pace of change in production processes and product innovation affect a business.