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STUDYOFORDERDELIVERYSYSTEMFOR

INSTITUTIONALSALES,SERVICEEFFICIENCYAND

CUSTOMERPERCEPTIONOFADIDASBRANDVIS--VIS

COMPETIOTION

A PROJECT CONDUCTED FOR

ADIDAS

SUBMITTED IN PARTIAL FULFILMENT OF POST GRADUATE DIPLOMA IN MANAGEMENT (PGDM)2009-2011

Rajesh Gupta

PGDM 2009-2011

ROLL NO. 09DM95

April-June 2010

FACULTYMENTOR INDUSTRYMENTOR

Prof. Gagan Katiyar Mr. Nitin Kakkar


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Summer Project Certificate

This is to certify that Mr. RAJESH GUPTAbearing Roll No. 09DM95a student of PGDM has worked on

summer project titled STUDY OF ORDER DELIVERY SYSTEM FOR INSTITUTIONAL SALES,

SERVICE EFFICIENCY AND CUSTOMER PERCEPTION OF ADIDAS BRAND VIS-A-VIS

COMPETITION, after trimester-III in partial fulfilment of the requirement for the programme. This is his

original work to the best of my knowledge.

Prof. Gagan Katiyar

Date: BIMTECH, Greater Noida.


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This is to certify that Mr. RAJESH GUPTA a student of Birla Institute Of Management, PGDM, Roll

Number- 09DM95 has worked on summer project titled STUDY OF ORDER DELIVERY SYSTEM

FOR INSTITUTIONAL SALES, SERVICE EFFICIENCY AND CUSTOMER PERCEPTION OF

ADIDAS BRAND VIS-A-VIS COMPETITION under our guidance and supervision. This Summer

Project Report has the requisite standard and to the best of our knowledge no part of it has been reproduced

from any other summer project, monograph, report or book.

NITIN KAKKAR

INSTITUTIONAL SALES MANAGER

ADIDAS

GURGAON

DATE:


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ACKNOWLEDGEMENT

I express my sincere thanks to ADIDAS INDIA MARKETING PVT. LIMITEDfor giving me an

opportunity to work with them through this project. I take this opportunity to express my profound sense of

gratitude to Mr. Nitin Kakkar (Institutional Sales Manager) whose sincere co-operation and guidance

enabled the project to assume its systematic shape.

I feel immense pleasure in expressing my sincere thanks and deep sense of gratitude to Prof. Gagan katiyar

(Faculty guide, Birla Institute of Management Technology), for his time and valuable efforts. He

constantly encouraged me right from the selection of the project to final preparation of my project.

I also express my thanks to Mr. Nitin Dayal, Mr. Probal Sur and Mr. Vaibhav Jain for extending their

support.

RAJESH GUPTA

PGDM 2009-11

Roll no. 2009/095


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TABLE OF CONTENTS:-

Executive Summary 6

Topic of the Project 7

Literature Review 8

Company Profile 11

How adidas operates 15

Order Delivery Process 18

Study of Service Efficiency 21

Study of Customer Perception 26

Annexure 31

Bibliography 33


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EXECUTIVE SUMMARY

adidas is primarily into the business of shoemaking that too particularly for the sports. Be it any sport

whether Tennis or Football or Cricket adidas has its range of shoes designed specially to support that sport.

It also make apparels like T-shirts, track suits and accessories like wrist band, socks, bag pack, water bottles

and many other all designed keeping in mind the sports.

adidas was founded by Adi Dassler and he followed three guiding principles in his development work,

driven by his passion for sports and shoemaking: To produce the best shoe to serve the needs of the sport, to

protect the athlete from injury, and to make the product durable.

The objective of the report is to study the order delivery process of adidas and service efficiency in B2B

segment. It was carried out in three parts.

Initially the order delivery system was studied by asking the employees involved in the process and then it

was implemented to understand it better.

Secondly, the service efficiency in terms of delivery was studied by tracking the order completion status.

Order was tracked with the help of IOS( Institutional Order Status) which was developed by the sourcing

department. IOS of four months was studied and analysed.

Thirdly, a questionnaire was formed to study the customers perception of adidas brand and its competitors

and based upon the responses analyses were carried out.

On the basis of the analysis, it is found that adidas is second best or leads the studied parameters whether it

is quality or style or brand visibility.

It was also found out that Reebok has very high brand presence i.e. availability, visibility and association

with sporting events in India. So it is recommended that adidas needs to focus on its marketing and

promotional strategies to increase brand visibility.


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TOPIC OF THE PROJECT

Project Title:

A study of adidas delivery system for Institutional Sales, Service efficiency and customer perception of

adidas brand vis-a-vis competition.

Objective:

First- The whole process of sales i.e. from taking an order to delivering the order to client will

be analysed.

Second- The study of service efficiency of adidas in terms of delivery vis-a-vis competition.

Third- Studying customer perception of adidas brand vis-a-vis competitors.


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LITERATURE REVIEW

SALES PROMOTION STRATEGY

Sales are the lifeblood of a business-Without sales there would be no business in the first place; therefore it

is very important that if a business wants to succeed, it should have a sales promotion strategy in mind. The

primary objective of a sales promotion is to improve a companys sales by predicting and modifyingthe

target customers purchasing behaviour and patterns. Sales promotion is very important as it not only helps

to boost sales but it also helps a business to draw in new customers while at the same time retaining older

ones. There are a variety of sales promotional strategies that a business can use to increase their sales.

However, it is important that we first understand what a sales promotion strategy actually is and why it is

important.

Sales promotion strategy is an activity that is designed to help boost the sales of a product or service. This

can be done through an advertising campaign, public relation activities, a free sampling campaign, a free gift

campaign, through demonstrations and exhibitions, through sponsoring events, through temporary price

cuts, personal sales letters, and emails.

When developing a sales promotion strategy for your business, it is important that the following points are

kept in mind.

Consumer attitude and buying patterns

The brand strategy The competitive strategy The advertising strategy And other external factors that can influence-the products availability and pricing.

Sales Promotion Strategies

There are three types of sales promotion strategies:

Push strategy Pull strategy A combination of the two

A push sales strategy involves pushing vendors and agents to sell the companysproducts to the consumer

by offering various kinds of promotions and personal selling efforts. The basic objective of this strategy is to

persuade vendors and agents to carry the companysbrand, give it shelf space, promote it be advertising, and

ultimately push it forward to the consumer. Typical push sales promotion strategies include; buy-back

guarantees, free trials, contests, and discounts.

A pull sales promotion strategy focuses more on the consumer instead of the vendor or agent. This strategy

involves getting the consumer to pull or purchase the product directly from the company itself. This

strategy targets its marketing efforts directly on the consumers with the hope that it will stimulate interest


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and demand for the product. Typical pull sales promotion strategies include; samples, coupons, cash refunds

or rebates, loyalty programs and rewards, and games.

A combination sales promotion strategy is just that; it is a combination of both push and pull strategy. It

focuses both on the vendor as well as the consumers, targeting both the parties directly. It offers consumer

incentives side by side with discounts.

Methods of Sales Promotion

Some of the most common methods used in sales promotion strategies include:

Coupons Price discounting Gift with purchase offers Sampling Refund and premium offers Group promotions Frequent user/loyalty offers

STOCK MANAGEMENT

Stock needs to be available for sale when your customer is ready to buy. But since it sucks up cash to have it

waiting to be sold, it is good stock management and forecasting which is needed to keep stock for the

shortest possible time.

Know the stock

The trick to shortening stock days is to carefully manage when the stock is coming in, as well as when it is

going out.

There is a need to know:

What is selling What isnt selling Which items are slow moving Which items are obsolete What the trends/seasons are Whats the margins on items are What it is costing to store stock.

Watch top performers

Finally, keep an eye on industry benchmarks. Good benchmarks should include stock days for the low,

average and top performing products. The stock days of top performing products are fewer than those of the

others.


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In a nutshell, shortening the length of time stock sits in the store room will free up working capital to spend

on other things like advertising, salaries and expansion.

Setting Targets

The essence of control is the comparison of performance against plan or target. The monitoring of progress

and the comparisons with target reveal variations from the original plan(control activity) which can either be

used to guide activities back towards the original plan or for the monitoring of actual results and if

unforeseen conditions have arisen, can be used to revise the original plan.

Control activity is of great strategic importance and is part of general plan reviews which are vital in

uncertain conditions. Planning and control are distinct activities, but they go hand in hand. To maximize the

benefits from planning (budgeting), the manager should use the plan as a benchmark for

controlling(assessing the effectiveness and efficiency of implementation). Conversely, it is difficult to

control activities without a benchmark plan.


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COMPANY PROFILE

adidas Group, the parent company of adidas, Reebok and TaylorMade Golf, is the worlds second largest

maker of athletic footwear, apparel and equipment by sales. The company makes most of its money by

selling at wholesale rates to large retailers like Dicks Sporting Goods(DKS), Foot Locker(FL), and Sports

Authority. But at the same time we cannot underestimate the potential of corporate sales. Nearly one-fourthof the companys revenue in India comes from Institutional Sales.

Background

adidas was founded by Adolf Dassler in 1948. It remained a family firm till 1989, when it was transformed

into a corporation. The adidas Group is the worlds second largest sporting goods company. adidas product

range includes shoes, apparel and accessories for basketball, golf, soccer, cricket, fitness and training. The

company has over 14000 employees, 110 subsidiaries and sources from 840 factories across the world. 60 %

of the companys suppliers are based in Asia. In 1997, adidas acquired the Solomon Group and the name got

changed to adidas-Solomon AG. The name further changed to adidas AG in 2006 following the acquisitionof Reebok. adidas started in India in 1996 as a joint venture with Magnum Trading, with adidas holding 80%

stake. In India, it sources from 16 factories which employ 3800 people. It also sells accessories such as

footballs, wrist bands, cricket bats and water bottles in addition to footwear and apparels. adidas has 30-35

% share of the premium footwear market in the country. The market is estimated to be growing at 15-20%

annually. The six metros account for nearly 40% of adidas sales, but the smaller towns are also playing an

important role and showing very healthy growth.

Development of the logos

Right from the start, Adi Dassler wanted to mark his products clearly. In thedays of the Gebrder Dassler Schuhfabrik (Dassler brothers shoe factory) he

experimentalised with a capital D and the written name DASSLER. Later on,

many shoes bore the logo on the left, which shows a bird carrying a shoe in its

beak. It appears on a background reminiscent of a coat of arms drawing with the

written name DASSLER shaped like a crown on top.

After the Dassler brothers had gone their separate ways and had both founded

their own factories, Adi Dassler started using the written name adidas as a logo.He used a logo pictured here on the left, elongating each d in the name adidas to

make them look like the lateral posts of a high-jump facility and placed a highjump

shoe with the 3-Stripes in-between.

Besides the logos, the 3-Stripes mark is without doubt the quintessential adidas

symbol. Adi Dassler first used them on footwear as an identification mark in

1949. Adi Dassler created a symbol that could be immediately recognised when

his footwear was used in athletic competition and associated with adidas. He

emphasised the association with the slogan The Brand with the 3-Stripes. The

3-Stripes now enjoy worldwide recognition as an adidas symbol.


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Towards the end of the 1960s, Adi Dassler sought a new, additional

identification mark for the adidas brand. Inspired by the 3-Stripes, the Trefoil is a

geometric execution with a triple intersection, symbolising the diversity of the

adidas brand. This symbol was first used on adidas products in 1972, and later

became the companys corporate symbol. Today it plays the important role of

representing the adidas Sport Heritage division.

In 1997, adidas decided to introduce an integrated corporate design, choosing as

the core element a new and yet familiar old logo: the 3 bars. It was designed in

1990 by the then Creative Director Peter Moore, and was initially used on the

Equipment range of performance products. It is inspired by the 3-Stripes as they

appear on footwear. The shape formed by the bars also represents a mountain,

indicating the challenge to be faced and the goals to be achieved.

In August 1998, following the merger of adidas and Salomon, adidas-Salomon AG introduced a new

corporate logo. The logo unites the values of the brands of the new group, incorporating the typical

colours of the two previous groups: blue for adidas, red for Salomon. The logo shows three shapes

coming together to form a larger shape, namely a diamond. The space between the shapes forms

another shape, that of a person with arms raised in victory and celebration. This logo, which was alsodesigned by Peter Moore, appears on all corporate documents of adidas-Salomon AG, but not on

products. All the brands belonging to the adidas-Salomon Group, i.e. adidas, Salomon, TaylorMade,

Mavic, Bonfire, ArcTeryx, Clich and Maxfli retain their full logo identity on products, in marketing

and in communication.

In July 2002, adidas-Salomon AG presented a revolutionary new business

strategy for the adidas brand, aimed at expanding its customer base and driving

top-line growth. The new structure is a fundamental shift from the traditional

Footwear and Apparel structure, introducing a new three-divisional approach

with the Sport Performance, Sport Heritage and Sport Style divisions. The

former 3-bar logo in conjunction with the brand name adidas is used for the

Sport Performance division and the Trefoil logo in conjunction with the brand

name adidas for the Sport Heritage division. The adidas Sport Style logo was

newly created in 2001. The inspiration for the symbol was the fast-moving and

ever-changing world we live in today. This was also the inspiration for the

whole concept behind the Sport Style division. The world is represented with the

globe whose speed is captured by the oval shape. adidas is indicated by the three

stripes across the face of the globe, keeping pace with the speed and change of

our world.


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Entered India as part of Global Strategy

adidas decided to enter India as part of the companys global strategy to take direct control of the markets in

Asia. The domestic demand was not high when the company started its operations. In the first 9 years, India

was the smallest sub-division in Asia, in terms of revenue. The company believed that India had the

potential to become a huge market, considering Indias large youth population and the changingdemographics. The merger with Reebok has strengthened adidas in India. In most countries, adidas is

significantly bigger than Reebok but in India, Reebok has larger share of the market.

Mission of the Company

The adidas Group strives to be the global leader in the sporting goods industry with sports brands built on a

passion for sports and a sporting lifestyle.

Consumer Focussed: continuously improve the quality, look, feel and image of its products andorganizational structures to match and exceed consumer expectations and to provide them with the

highest value.

Innovation and Design leaders: who seek to help athletes of all skill levels and achieve peakperformance with every product they bring to market.

Global Organisation: that is socially and environmentally responsible, creative and financiallyrewarding for employees and shareholders.

Committed: to continuously strength their brand and products to improve competitive position. Dedicated: to consistently deliver outstanding financial results.

Target Markets

The target market of adidas is the urban youth with the brand proposition competition to lifestyle. The

principle consumption centres namely the metros are also a potential target market.

Products and Applications

PRODUCTS APPLICATIONS

Shoes, spikes, socks Running

Studded boots, warm up suites Football

Shoes, jerseys, shorts, team kits Basketball

Hats, gloves, bags, golf sticks, golf balls Golf-TaylorMade

Shoes, gloves, team kits CricketShoes, accessories, apparels Tennis

Footwear, Apparels and accessories Casual

Competitive Scope

adidas is in the sportswear, apparel and sports accessories business. The main competitors of adidas in India

are NIKE, PUMA and Reebok (though they have acquired the last named brand, both brands are competing

for market share in India).


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NIKE

Nike is currently the world leader in the Sports good industry. The company concentrates on style and

technology with a high price range of the products.

PUMA

A German based company best known for its football shoes and athletic shoes. The competition from Puma

has become stronger after the 2008 Olympics in which the Jamaican sprinter Usain Bolt broke the world

records and won 6 gold medals. Bolt was wearing Puma shoes.

Future Plans

adidas has plans to make India the hub for its South Asian operations. Most companies which start

operations in a new country, initially set up their sourcing office and start selling when the local demand

reaches a threshold. adidas strategy has just been the reverse. Now, after establishing itself in India as a sales

and marketing organisation, it is planning to set up a global procurement base for International markets.After China, which is the current growth driver in Asia, adidas expects India to be the next powerhouse,

which will drive regional growth over the next 3 to 8 years. India is a significant market for adidas and it

plans to have 200 to 300 more franchisee showrooms by 2011. In institutional sales also, it is eying an

increase of 20% in sales by 2011.It is exploring the option of transferring technology and know-how to

manufacture high-end footwear in India.


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How adidas operates

adidas has approx 600 stores in India. For the manufacturing of apparels it relies on 13 factories in India and

Imports whereas for shoes it has tie up with Lakhani India and shoes worth more than Rs 3000 are imported.

The lead time for apparels is 3 months and for shoes is 6 months.

adidas is a fashion industry and it operates in two segments i.e. Spring Summer and Fall Winter

In spring summer adidas offers a completely different range from what it offers in Fall Winter period. The

summer spring collection is manufactured in post June period and Fall Winter in post December period -This method is followed because of the lead time.

Now onwards my concern will be with the Institutional sales limited to Corporates. Some of the corporate

clients of adidas are LG, Samsung, Intel, HP, Sony, etc. Corporate sales are like free sales i.e. the products

corporate buy are to be distributed free to their customers or distributors so they demand quality and brand at

cheaper rates.

The key areas taken care of are:

Clients: Which kind of client will buy adidas products?

What kind of promotions they indulge themselves in and when?

adidas

Retail

Exclusive

outletsDistributors Retailers Factory outlets Mixed outlets

Institution

Corporate

Frontend Backend

Personal

kitting ServiceCSD Schools

SpringSummer

Jan

Feb

Mar

Apr

May

Jun

Fall WinterJuly

Aug

Sept

Oct

Nov

Dec


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For example:- A tyre industry like Goodyear, which sells its products to customers who have buying power

because only the car owner will buy products from them and since the person has got car, it means he is

earning well enough to afford i. Now that person may be involved in business or Job but in both cases he

needs a laptop. So, Goodyear can offer adidas bag to its customers and this promotion can also help to draw

in new customers.

adidass Corporate Running process- Frontend & Backend

Frontend is responsible for building relations with clients and get the orders i.e. frontend people represent

Adidas and negotiate with clients to get the sales. They should know the type of client who will buy Adidas

products and in which month they run what kind of promotions. Promotion can be customer centric or

Dealer centric. In Customer centric type they offer gifts or scratch cards with assured prizes with their

products whereas in Dealer centric they offer extra incentive or free products to dealers in order to push the

sales(for ex. Offering Adidas shoes worth Rs 4000 to Dealer on buying two ACs). Moreover, companies

generally go for customer centric approach in the peak sales period or they can follow both strategies

simultaneously. Now, the frontend people should have thorough knowledge of these activities of clients.

Backend people take care of the profitability, products, delivery, etc aspects of sales. In other words they

execute the sales.

Corporate clients dont buy the expensive merchandise as they have to give them as a gift to customers or

dealers. So, the backend people should know the type of product corporates need. After deciding upon the

product, volume which needs to be manufactured is forecasted keeping in view the upcoming events and

past trends. Also, frontend should maintain 25% profit on total sales. The more the volume the less will be

the landed cost, so the price is settled keeping in view the volume. Backend people give the slots to the

frontend i.e. the minimum price needs to be charged for 25% profit for the fixed volume. Now, the delivery

of goods is crucial for maintaining the future relations with the clients. Due to lead time the products are

manufactured based on the projections, so the backend manufactures the product which it thinks the

corporate will demand in specific volume based on forecasts and then convey everything i.e. product

available, volume available, price and the time they require to make the product(with personalization) ready

to deliver to the frontend. Thus frontend is supported with data from backend.


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Now, to track down the orders there is IOS (Institutional Order Status) which is maintained and updated

daily so that the orders which are pending and which are delivered can be tracked. This contains all details

about the deal i.e. sourcing month (month in which the deal initiated), client name, quantity ordered, landed

cost, MRP, MDP (Marketing Delivery Plan the date of delivery which was agreed b/w client and agent),

SDP (sourcing Delivery Plan), Date of Delivery (the date on which consignment was actually delivered to

client), volume Delivered (the volume delivered to client). Thus IOS gives the thorough details of the deal.This also helps adidas to keep track of the inventory so that they do not go out of stock or delay the delivery

due to shortage of stock. IOS is followed by frontend and maintained by backend.


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Order Delivery Process

Before explaining the order delivery process, let me first explain that in Institutional Sales adidas has one

authorised vendor named Eight Grams Of Brain Marketing Pvt. Ltd. It started four years ago as an official

vendor of adidas. For adidas, it looks after only corporate part of Institutional sales. EGOB also deals with

other brands like Raymond, Peter England and unbranded stuff but none of them are adidas rival brands.

EGOB has almost all big companies as their clients.

Now, whenever the adidas agents or employees get a lead or query, there are three primary things which

they try to know from the client which are

Budget Time Requirement

Budget- This is the amount client is willing to spend to purchase the merchandise for its promotional or any

other motive. Knowing the budget is very important because then the agent can tell them which products a

client can go for since adidas has products ranging from Rs599 to Rs2999.

Requirement- This is the quantity required by the client. This is important for the agent to know because if

the quantity is less than 500 they will try to give it from the stock because minimum quantity required for

production is 500.

Query

Show Sample

Negotiations

Quote

Purchase Order

Order to adidas

Delivery to Customer


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Time- This is the period within which the client requires the delivery. It is also a very crucial factor in

corporate sales because the company requires minimum 7-10 days to execute the order from the purchase

order date if the quantity is less than 500. Otherwise the order will be executed from production which

requires minimum 40-45 days for apparels and 20-25 days for bags from the PO date and the mentioned

time is without customization.

After knowing these three basic things, the agent tries to figure out which product they can give the client or

if the client already knows the product he requires. Then the agent figures out the possibility of whether he

can execute the order by meeting the above mentioned parameters.

Now, if the product is selected keeping in view those three parameters, the agent asks if any customization is

required by the client. If no customization is needed he can move to the next step i.e. showing the sample to

the customer.

If customization is needed then the customer has two options i.e. whether to go for

PrintingOr

EmbroideryPrinting is cheaper than Embroidery and takes less time. Embroidery is not recommended if the order is

going to be executed from stock because it is very difficult to do embroidery on the finished product.

Printing can be done in 4-5 days.

In case of customization, the agent asks the customer three things:

Size of Logo Placement Colour

After knowing the specifications a swatch (sample) is prepared and is send to the client for its approval. If

the client approves the sample then the deal is carried forward to next step; otherwise a new sample is

prepared with modifications.

After the sample has been approved, there are negotiations on the discount offered by the agent to the

customer or negotiations can also be on the payment terms i.e. whether the payment will be 100 percent

advance or 50 percent advance. Also, if there is multi point delivery then it is charged.

After the negotiation phase, a Quote is prepared by the agent which includes the price offered to customer,

delivery schedule, taxes and the payment terms. In this the customization charges are mentioned separately.

After the Quote, a Purchase Order is prepared by the client in favour of the Eight Grams of Brain if they are

dealing through them or in favour of adidas if the client has approached directly to adidas.

Now, the question arises Why will the corporate buy through Eight grams of Brain instead of

approaching adidas directly?


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This is because, it is not necessary that all corporates need quantities in hundreds or thousands. Sometimes

they may require the quantity as low as 50. In that case adidas cant provide that. Here EGOB comes into the

picture as they stock hot selling products and can execute the order from their stock.

In the order delivery process, after receiving the PO if the order is needed to be executed from the

production- Then it is booked by the adidas employee using its adirace software with the sourcingdepartment which is responsible for the production and quality check. Otherwise it is executed from the

stock by the vendor.

Material/fabrics adidas sell are:

100% Cotton CVC (Chief Value Cotton)- This is 60% Cotton + 40% Polyester 100% Polyester- The three types of polyester used by adidas are

Pique (best quality) Interlock Ilet

CLIMACOOL- This is the adidas technology which is made for athletes and can be wore in summers

despite being polyester because it absorbs sweat and spreads it across the whole T-shirt thus making the

evaporation process faster.

Designs used by adidas are:

With stripes Without stripes Separate- These are the ones with graphics

Combos adidas sell are:

100% Cotton with Stripes 100% Cotton without Stripes 100% CVC with Stripes 100% CVC without Stripes Polyester with Stripes Polyester without Stripes


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Study of service efficiency of adidas in terms of delivery vis-a-vis competition

Scope

Looking beyond price and quality as a differentiator, adidas need to focus on their value chain to examine

what factors they can rely upon as differentiator. Companies can use their excellence in operations and

product leadership as differentiators. However, both of these criteria are related to one gating factor and that

is service. For some sales executives, service is the only viable differentiator they can rely upon to market to

customers, current and potential. To use service as a differentiator, adidas must provide excellent service to

all of its key clients, agents, vendors and members of its distribution channels.

Institutional sales in adidas is responsible for 25% of the total revenue and every year it is increasing by

approx 20% i.e. in year 2009-10 they achieved the target of Rs85 crore out of which Rs25 crore was

corporate sales and for this year 2010-11 they have the target of Rs30 crore in corporate sector. Institutional

sales since their inception have been doing well with a good conversion rate.

The study aims to find out the service efficiency of adidas and whether it can be further used to enhance the

sales and can the service of adidas cope up with the increase in the business.

Service efficiency

In adidas, after the order is being taken it is referred to the sourcing department for its execution which is

then responsible for the production, quality and timely delivery of the order. Sourcing department which sits

at the main office of adidas in Gurgaon is in direct touch with the 13 manufacturing plants like in Noida,

Ludhiana, etc. The sales executives after taking the order, give full specifications i.e. size ratio,

customization details, period of delivery, etc to sourcing people who then communicates with the outsourced

plants, ask them for the sample before producing a whole lot and then the sample undergoes SGS and MCS

testing which are nothing but related to fabric, technical specifications and quality standards. After the

sample is being approved by the sourcing, production proceeds and then the order is delivered.

To keep a track of the orders an IOS (Institutional Order Status) format was developed by the Sourcing

department which will help both the frontend i.e. sales executives to know the status of their order so that

they can keep the client updated if there is any postponement or preponement in delivering the order and

backend i.e. sourcing which can know their status whether they are on time or not.

Institutional Order Status is maintained and updated every Monday so that the orders which are pending and

which are delivered can be tracked. This contains all details about the deal i.e.

Sourcing month (month in which the deal initiated), Client name, Vendor name, OC (Order confirmation date) Quantity ordered, Landed cost, MRP, MDP (Marketing Delivery Plan the date of delivery which was agreed b/w client and agent),


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MDP-agreed (Marketing Delivery Plan the date of delivery which was agreed b/w sourcing andagent),

SDP-if delayed (sourcing Delivery Plan- here the status is written by sourcing people i.e. if there isany delay or not),

SDP-internal (this is the date agreed b/w agent and ware house to deliver), Date of Delivery (the date on which consignment was actually delivered to client), Volume Delivered (the volume delivered to client)

Thus IOS gives the thorough details of the deal. This also helps adidas to keep track of the products which

are hot selling and thus helps the next year to make forecast for the inventory so that they do not go out of

stock or delay the delivery due to shortage of stock. IOS is followed by frontend and maintained by backend.

Below are the analyses of IOS:

JANUARY STATUS

Order Jan Delivery

Order

Qty %

On time 27 42%

00-05 Days Delay 0 0%


11-15 Days Delay 16 25%


21-25 Days Delay 0%

26-30 Days Delay 0%

Above 30 Days Delay 10 16%

TBC(To be confirmed) 0%

Total 64 100%

FEBRUARY STATUS

Order Feb Delivery

Order

Qty %

On time 39 55%

00-05 Days Delay 1 1%06-10 Days Delay 2 3%



21-25 Days Delay 16 23%




Total 71 100%

MARCH STATUS


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Order March Delivery

Order

Qty %

On time 50 58%

00-05 Days Delay 11 13%

06-10 Days Delay 18 21%11-15 Days Delay 4 5%






Total 86 100%

APRIL STATUS

Order April Delivery

Order

Qty %

On time 76 83%






26-30 Days Delay 0 0%Above 30 Days Delay 6 7%


Total 92 100%

Findings

On analyzing it was found that the on time delivery has increased from 42% in January to 83% in April. The

increase in on time delivery efficiency was observed with each progressive month i.e. in Jan it was 42% then


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in Feb it increased to 55%, then to 58% in Mar and finally to 83% in Apr.

From the above graph, it can be easily interpreted that there is no pattern in delay and with each passing

month they are improving the on time delivery.

Reasons for the Delay

Sometimes sales executives get the orders which are difficult to execute like if there is an order for200 T-shirts with client logo at chest that too embroidery, then it is difficult to execute such order

because the quantity is too small to be processed through production and it can be served from stock

onlyand doing embroidery on finished product is very difficult.

Sometimes time given to sourcing is too little as it is expected to complete the order of 500 quantityand 3000 quantity in same time.

Sourcing is already operating at half time period i.e. lead time taken by sourcing to supply in retail is90 days whereas for corporates it is 40-45 days.

A lot of time is wasted in testing i.e. quality check and technical specifications because a samplefrom the plant goes to the testing centre, and if rejected, will directly lead to at least a 10 days delay.

Common warehouse for retail and Institutional sales.Recommendations

For bigger orders, sales and sourcing people should go together so that the technicalities can be dealtand answered then and there only. It means the sourcing person will tell exactly how much time he

needs to execute and whether the requirements can be met or not in terms of customization and also

the costing.

Sales executives should be given training in the field of sourcing so that they do not commit for theorder which cannot be executed.

Separation of stock between retail and Institutional sales to avoid mix-up i.e. they should beallocated stock according to their demand through adirace( software used in adidas to keep the track

of the inventory and intra communication).

0%

10%

20%

30%

40%

50%60%

70%

80%

90%

January February March April

On time Delivery

00-05 days Delay

06-10 Days Delay

11-15 Days Delay

16-20 Days Delay

21-25 days Delay

26-30 Days Delay

Above 30 Days Delay


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Competition

adidas and Reebok both hold 76% market share in B2B business. So, Reebok is the only potential

competitor of adidas.

Since data regarding service efficiency in terms of delivery cannot be obtained from internet and one has to

solely depend on primary data for this purpose and which no company will provide to anyone unless and

until one is a part of company.

Reebok do approx. 35 crore corporate sale per annum and their delivery time varies from 10 days to 60 days

depending upon the quantity of the order. Generally, they manage to serve the clients with 70-80%

efficiency on time whereas in adidas, sale is approx 20 crore per annum and time given to sourcing to

process the order is 40-45 days and their service efficiency is increasing with each passing month.


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Study of customer perception of adidas brand vis-a-vis competitors

Sample Size-31

Composition of the sample:

65%

35%

Gender

Male Female

55%32%

13%

0%

Age Group20-25 25-30 30-35 35-40


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Findings:

It is found that approx. 60% consumers perceiveNikes brand value as very high whereas adidas and Puma

comes under high category with 65% and 50% response respectively. Reeboks brand perception is average

as compared to its competitors.

It is found that nearly 60% consumers believe that Nikes products are over-priced and nearly 70% believe

adidasprice as little high whereas majority believe Reeboks price as value for money.

0%

10%

20%

30%

40%

50%

60%

70%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Brand Perception

Nike

adidas

Puma

Reebok

0%

10%

20%

30%

40%

50%

60%

70%

80%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Price Perception

Nike

adidas

Puma

Reebok


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It is found that Puma has low visibility in sporting events held in India whereas Nikes association is averagewhich is also less than what is required for the visibility. Reebok has high association with Indian sports as

compared to all its competitors whereas adidas has followed middle road as its association is less than

Reebok but greater than other brands.

It is found that in terms of functionality i.e. heat regulation, breathability, durability, easy care, dimensional

stability and pleasant touch Nike surpass all its competitors and adidas is placed second by majority. Reebok

on the other hand is perceived as average in terms of functionality. In case of Puma there is mixed response

as nearly 40% consider it as average whereas 35% consider high in functionality.

0%

10%

20%

30%

40%

50%

60%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Brand association with sporting

events

Nike

adidas

Puma

Reebok

0%

10%

20%

30%

40%

50%

60%

70%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Functionality

Nike

adidas

Puma

Reebok


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It is found that Reebok has very high brand presence in comparison to its competitors with 40% vote andother 50% consider it highly accessible. Adidas has comparatively less availability and visibility as

compared to Reebok but greater than Nike and Puma. Puma is considered as below average in terms of

visibility.

It is found that all four brands are offering more or less same variety and style with Nike leading the group

and then adidas is considered as most stylish brand with lot of variety to offer.

0%

10%

20%

30%

40%

50%

60%

70%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Availability and Visibility

Nike

adidas

Puma

Reebok

0%

10%

20%

30%

40%

50%

60%

70%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Style and Variety

Nike

adidas

Puma

Reebok


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It is found that the quality of the fabrics of Nike is perceived as very high whereas Reeboks as average.Adidas fabrics quality is voted as second best with more than 60% perceiving it as high.

Conclusion

There is no doubt that Nike is perceived as a premium brand in terms of quality and brand value in

comparison to adidas but it does not have the brand presence i.e. availability and visibility in India as

compared to adidas or Reebok. Price of Nike is also perceived as very high as compared to adidas.

If we observe the above analysis carefully it is found that adidas is second best or leads the studied

parameters whether it is quality or style or brand visibility.

As long as Nike and Puma both does not have the brand visibility and association with sporting events in

India which adidas and Reebok has, they do not pose any threat to the latters market share in B2B segment

in India.

The healthy competition lies between adidas and Reebok. Though adidas has high quality, functional

attributes, variety, brand value and style but when it comes to price and brand visibility Reebok has an edge.

Recommendations

In India, Reebok has very high brand presence i.e. availability, visibility and association with sporting

events. So, adidas needs to focus on its marketing and promotional strategies to increase brand visibility.

Since India is a price sensitive market, one cannot survive in it by offering its products at high premium no

matter how high its brand value is. So, adidas should try to reduce its prices without compromising on

quality because reducing the quality will dilute its brand image.

0%

10%

20%

30%

40%

50%

60%

70%

%age

believe very

high

%age

believe high

%age

believe

average

%age

believe low

%age

believe least

Brand fabrics

Nike

adidas

Puma

Reebok


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ANNEXURE

Questionnaire to study consumer perception of adidas brand vis--vis competition

1. What is your perception about the Quality of the following brands? Tick appropriate cellsLeast Low Average High Very high

Nike adidas Puma Reebok

2. What is your perception about the Price of the following brands? Tick appropriate cellsLeast Low Average High Very high


3. What do you perceive about the Brand Association of the following, in terms of their associationwith sporting events like IPL, International sporting events like soccer, tennis etc and brand visibility

in terms of advertisements and promotion from Indian perspective? Tick appropriate cells

Least Low Average High Very high


4. Are you involved in activities like jogging, yoga, aerobics etc and actively take part in sports liketennis, cricket etc? Do the following brands have sportswear that supports these strenuous activitiesto take care of excessive sweating, keeping your body cool, keeping your skin dry etc? Rate the

following on Functional attribute. Tick appropriate cells

Least Low Average High Very high



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BIBILIOGRAPHY

Books:

Malhotra, Naresh k. And Dash, Satyabhushan, P 2009. Marketing Research.Pearson Publications,New Delhi, 5

th

Edition.

Schiffmean, Leon G. and Kanuk, Leslie Lazar, P 2009. Consumer Behavior.Pearson Publications,New Delhi, 9thEdition.

Websites:

www.adidas.com www.google.com www.wikipedia.com
http://www.adidas/http://www.google.com/http://www.wikipedia.com/http://www.wikipedia.com/http://www.google.com/http://www.adidas/

rajesh gupta fmcg

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