Jd sports - Business Case Study

JD SPORTS 1
JD SPORTS
Student’s Name:
Lecture’s Name:
Institution:
Course:
Date:
Word Count:

JD SPORTS 2
Background & History of the Company
JD Sports is a retailer and distributor of sports and casual wear and is the leading
brand in UK in this market space. JD Sports was founded in 1981 by John Wardle & David
Makin (JD) from a single shop in Bury, Great Manchester, England which has now grown into
many branches throughout England and Europe. As the company continued to row, the founders
opened a new branch in 1983 at Arndale Centre, Manchester. The growth of the company
continued and by 1989, the company opened its first store in Oxford Street, London. Through
continuous growth since it was founded, the company was finally listed on the London Stock
Exchange in 1996 (JD Sports Fashion, PLC; Annual Report).
By December 2001, JD had acquired 200 more stores throughout England. The
company did this by first acquiring stores from Blacks Leisure Group called First Sport. JD then
acquired 70 more stores in October 2005 from Allsports administrators. In May 2005, John and
David who were the founders of JD Sports and the company’s largest shareholders sold their
shares for £44.6 Million to the Pentland Group. After the purchase, the founders resigned from
JD’s board of directors. The company continued to grow and in December 2007, it purchased
Bank Store a fashion clothing retail outlet for £19M. Bank Store sold fashion brands such as Alu,
Firetrap, Adidas Originals and Henleys (JD Sports Fashion, PLC; Annual Report).
JD Sports currently supplies and sponsors a large number of athletes, football teams
and sports associations; these include: Blackpool, Bournemouth, Luton Town, Dundee United
and Oldham Athletic. The sponsorship deals with these clubs allow them to us the Carbini brand.
JD Sports then expanded to France and acquired 75 small stores in May 2009 all which were
under the Chausport brand. JD also increased its acquisition by buying Champion Sports in

JD SPORTS 3
January 2011 for £19.6M. JD also bought a conflicted Blacks Leisure Group in January 2012 for
an amounted that totaled to £20M. The company also acquired Streetwear which is also a
clothing brand in February 2012 for an undisclosed amount. JD also bought Cloggs, in February
2013 which was an established brand in shoe retailing. Finally, JD sports acquired Go Outdoors
in 2016 for £112M. JD Sports faces significant competition in its environment from
organizations such as Auto Trader Group Plc, Inchcape Plc, Sports Direct International Plc, BCA
Marketplace Plc, Card Factory Plc and WH Smith Plc (JD Sports Fashion, PLC; Annual Report).
Objectives of the company
Throughout the years, JD Sports has established itself as the top retailer of own
brand and branded sports fashion apparel, casualwear and footwear in both the United Kingdom
and Ireland. The objectives of the company is to sustain their strong market position in coming
years even as the competition grows stronger. This will be done by the continued investment in
retail stores, nurturing of good relationships with global brand suppliers and acquisition of
different brands and retail stores throughout Europe and overseas which have the potential to be
developed and exploited for the benefit of the group’s brand which is known to offer and
appealing products in stores with vibrant atmospheres (JD Sports Fashion, PLC; Annual Report).
JD Sports fundamental business strength is their consumers who are either Outdoor
or Sport Fashion oriented. To retain their leading position, JD Sports main objective is therefore
to provide a wide variety of brands to select from. This is achieved by the introduction of own
brands to act as complementary brands to the existing global brands and also working
consistently to be the partner of choice with various international brands. The Group seeks to
record profits in all the businesses they acquired as their medium term goals. For their ultimate

JD SPORTS 4
objectives, JD Sports seeks to sustain a long-term growth in their earnings to ensure a growth I in
Total Shareholder Returns (TSR) through dividends and the overall performance of the share
price. The Group seeks to achieve this objective whilst maintaining their financial ability to
invest towards the growth of the business (JD Sports Fashion, PLC; Annual Report).
Directors’ interests and remuneration
On June 26, 2014, JD Sports shareholders held their AGM and approved the Director’s
remuneration policy. This policy acknowledges that JD Sports operates at a very competitive
retail space and therefore the acquisition of a high caliber Executive Director is critical to the
company’s success. Therefore, it was necessary for the Group to come up with a remuneration
policy that is appropriate to attract, motivate and retain an individual of such caliber.
Remuneration should be consistent to the performance of the group over its medium and long
term existence, to ensure both the shareholders and the business experience growth in their
earnings (JD Sports Fashion, PLC; Annual Report).
Due to these factors, JD Sports has created a Remuneration Committee. This committee is
made up of three independent Non-Executive Directors and its duties include determining the
company’s remuneration policy and determining the remuneration packages for both the senior
management and the Executive Directors. The committee also determines the terms and
conditions for service contracts signed by Executive directors among other duties such as
managing the terms of performance-oriented schemes run by the business and their
remunerations (JD Sports Fashion, PLC; Annual Report).