Report: Adidas' Global Business Environment Analysis (SWOT & PEST)

This report provides a comprehensive analysis of Adidas' global business environment. It begins with an introduction to the concept of the global business environment and its impact on firms. The main body of the report focuses on a detailed SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis of Adidas, examining its internal capabilities and external challenges. Following the SWOT analysis, a PEST (Political, Economic, Social, and Technological) analysis is conducted to evaluate the external factors influencing Adidas' operations, including government regulations, economic trends, consumer preferences, and technological advancements. The report concludes by summarizing the key findings, emphasizing the importance of understanding the global business environment for achieving sustainable growth and competitive advantage. References to relevant academic sources are included to support the analysis.

Global Business
Environment

Table of Contents
INTRODUCTION...............................................................................................................3
MAIN BODY ......................................................................................................................3
SWOT .......................................................................................................................3
PEST.........................................................................................................................4
CONCLUSION ..................................................................................................................5
REFERENCES..................................................................................................................6

INTRODUCTION
The concept of global business environment is defined as a combination of
various environment of different sovereign countries, uncontrollable local and
international interactions that impact over firm decision making procedure in regard of
allocating the resources and utilising the same in a optimal manner. Along with this,
adopting the function of global business environment enable establishment to expand
their market share, productivity and also make more competitive within current
marketplace (Aguilera and Crespi, 2016). Moreover,, it assist firms to render enormous
employment opportunities that lead them to improve the economic status and also to
enhance the living standard of community or society in an improved manner. Hence, in
relation to this project, Adidas company has been considered as it is recognised as a
well established and branded sports firm in Apparel and accessories industry. It is
founded in the year of 1924 and deliver the product like shoe, clothing and accessories
across the globe. Moreover, this study contains SWOT, PEST analysis of company in
order to evaluate its internal and external business environment for accomplishing the
desired gaol.
MAIN BODY
SWOT
Every organisation has its own internal capabilities which empower them to
maintain its brand value among competitors in a better way (Dilek and Keskingöz,
2016). However, SWOT analysis is viewed as important tool for company as it help
them to examine its potentiality or ability in order to grab all available opportunity and
also can take corrective course of action against unpredictable threat in an innovative
style. Hence, the SWOT analysis of Adidas are as follows:
Strength
 The key strength of Adidas is that it contain diversified products and offer wide
range of footwear and accessories under the brand name of Adidas (premium
segments) and Reebok (mid range).
Weakness

 Due to the implication of premium pricing strategy, Adidas is able to target
limited customer only who lives in developing countries (Gooris and Peeters,
2016).
Opportunity
 As the customer lifestyle and market competition is rising, Adidas has wide
opportunity to expand its market division in other countries that lead them to gain
competitive advantage among other competitors (Tsvetkov, 2014).
Threat
 As Adidas is regarded as global brand but still it undergoes thorough intense
level of competition that impact over its profit margin and reputation within
competing industry (Tsitsipati and Athanasios, 2014). Adidas main competitors is
Nike who acquires first position in existing marketplace.
Henceforth, the above explained SWOT analysis help Adidas to identify its
strength or weakness in order to make use of available opportunities for coping up with
all emerging threat or challenges in an effective way. Therefore, Adidas takes an
initiative to examine current or upcoming marketplace trend that empower them to place
their brand in an aggressive or competitive position in prescribed time duration.
PEST
PESTLE analysis plays a significant role as it help organisation to evaluate its
external environment and also to implement best strategic decision for obtaining profit
maximisation in competitive market. Thus, the PEST analysis of Adidas are as follows:
Political: This factor comprises government regulation, rules, policies and etc.
which impact organisation productivity ratio (Cadle, Paul and Turner, 2014). However,
Adidas undergoes with a severe pressure from its political government regarding
adhering or following certain regulation related to supply chain like International trade
agreements, Product safety laws and so on. Hence, Adidas make an initiative to follow
all regulation or policies of government which help them to place their brand in a
aggressive and competitive position without any hindrances .
Economic: In this, it involves economic growth, exchange rate, inflation,
deflation and many more that impact firm's profit margin ratio (Nurcahyani, 2017). In
context of Adidas, it face severe recession recently which wholly hampers its functional

unit across the globe. However, for tackling with the same, Adidas reduce its cost of
production and deliver each product in low cost that lead them to enlarge its market
share or size in an improved way (Rachel and et.al., 2014).
Social: This factor encompasses customer taste and preference, demographic
competences, population income and so on which influence establishment decision
making procedure (Sundar and et.al., 2017). In relation to Adidas, they come across
with a huge demand of customer regarding health products that challenged company to
attain sustainable growth. Hence, Adidas take corrective course of action to meet out
the requirements of its targeted population in a creative and satisfactory manner.
Technological: In this involves automation, advancement, innovation of
technologies that effect firm to accomplish its goal in a better way ( Morris and
Metternicht, 2016). In regard of Adidas, there was a huge demand among population
regarding innovative technologies which effect negatively over company in maximising
its profit margin. Thus, to overcome the same, Adidas adopt advanced technologies like
Fitbit which help them to satisfy health conscious people in a innovative and productive
style without nay hindrances (Kimura and et.al., 2016).
CONCLUSION
It has summarised from the above report that Global Business Environment plays
a crucial role in organisation as it help them to make use of all available opportunity in
order to gain competitive advantage among competitors. Therefore, with the adoption of
SWOT and PEST framework, it help company to examine its potentiality and strength
for attaining sustainable growth. On the other hand, if company does not follow these
approach in proper way, it impact negatively over establishment in regard of placing the
brand in a better position as per varying market trends. Thus, determining of market
condition and firm's capability enable company to take correction course of action in
order to face macro and micro factor in an impressive or attractive manner.

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Online
Adidas SWOT analysis – SWOT analysis of Adidas, 2019 .[Online].Available Through;
<https://www.marketing91.com/adidas-swot-analysis/>

PESTLE Analysis of Adidas, 2017 .[Online].Available Through;
<https://pestleanalysis.com/pestle-analysis-adidas/>