Business Environment Analysis: Under Armour's Macro Factors Report

This report provides a comprehensive analysis of Under Armour's business environment, focusing on the impact of macro factors. It utilizes PESTLE, SWOT, and VRIO frameworks to assess the external and internal factors influencing the company's operations, strengths, and weaknesses. The report examines the political, economic, social, and technological (PESTLE) influences, as well as the application of SWOT/TOWS analysis to determine how these factors affect decision-making. Furthermore, it evaluates the interplay between internal strengths and weaknesses and external macro factors. The report also delves into how organizations navigate transformation and overcome resistance to change in a dynamic market environment. Finally, it assesses the impacts of VRIO analysis on decision-making and business objectives, offering a detailed understanding of Under Armour's strategic positioning and its ability to adapt to a changing business landscape.

Assignment front sheet
Learner name Learner Student I.D. Assessor Name
Navroop Sandhu 1017470 Ms. Sabrina Tsang
Date issued Submission Deadline Submission Date
18thOctober 2021
13thDecember 2021 12th December 2021
Resubmission Deadline (If appropriate) Resubmission Date (If appropriate)
Internal Verifier Name Internal Verification Deadline
Qualification Unit number and title
Level 5 Higher National Diploma in Business Unit 1:Business and the Business Environment
Assignment
title
Assignment 2: Business Environment Analysis
Criteria
reference
To achieve the criteria the evidence must show that the student is able to: Evidence
LO3 Use contemporary examples to demonstrate both the positive and negative influence/impact the macro
environment has on business operations
P4 Identify the positive and negative impacts the macro environment has upon business
operations, supported by specific examples. 13-21
M3 Apply appropriately the PESTLE model to support a detailed analysis of the macro
environment within an organisation. 13-21
LO4 Determine the internal strengths and weaknesses of specific businesses and explaintheir
interrelationship with external macro factors
P5 Conduct internal and external analysis of specific organisations in order to identify
strengths and weaknesses. 81-89
P6 Explain how strengths and weaknesses interrelate with external macro factors. 90-94
M4 Apply appropriately SWOT/TOWS analysis and justify how they influence decision-
making. 89-90
D2 Critically evaluate the impacts that both macro and micro factors have upon business
objectives and decision-making.
22-24 and 95-
97
**Any resubmission evidence must be submitted within 15 working days of learners receiving
assessment feedback

Contents Tabl
e
Exclusive summary.........................................................................................................................12
1) The positive and negative impact the macro environment has upon business operations.........13
2) The impact that macro factors (PESTEL) have upon business objective......................................22
3) The impact that macro factors (PESTEL) have upon Decision-making.........................................23
4) How Under Armour need to monitor external influences...........................................................24
5) how Under Armour need to forecast external influence.............................................................27
6) How the macro environment influences/impacts upon business activities.................................30
7) How organizations go through the transformation process and overcome resistance to change in
response to the changing market environment..............................................................................70
8) VIRO analysis..............................................................................................................................81
9) PESTEL ANALYSIS........................................................................................................................87
10) SWOT analysis..........................................................................................................................89
11) how strength and weakness interrelate with external macro factors (the competitive
environment).................................................................................................................................90
12) how strength and weakness interrelate with external macro factors (government intervention)
.......................................................................................................................................................92
13) Evaluate the impacts that VRIO analysis have upon decision-making.......................................94
14) evaluate the impact that VRIO analysis have upon business objective.....................................95
Conclusion......................................................................................................................................97
References page.............................................................................................................................98
Exclusive summary
In this task, perception of Under Armor organization will be made. PESTLE, SWOT and
VRIO examination will be utilized to notice it full scale climate, the strength and
shortcoming of the organization. these data assist with advancing specialist on how Under
Armor organization respond to adjust with the quick evolving climate. Moreover, various
variables that effect Under Armor business movement will likewise be incorporated,

additionally, how the full-scale climate will influence Under Armor organization's
independent direction and business objective will be talked about.
1) The positive and negative impact the macro
environment has upon business operations
Political factor of Under Armour
Under Armour one of the roles is to analyse the macro environment, PESTEL can affect their
macro environment and not only that it can have impact on textile-apparel clothing.
● Political strength plays a big role in business which has a growth in it. Under Armour
political factor helps them to track the potential market.
● For manufacturing companies like Under Armour. For some countries the labour law
is highly authoritarian which can affect their business and pose a problem of political
factor
The political Factor positive and negative impact on Under Armour
Political variables remember change for the public authority exercises and changes in the
lawful arrangements and guidelines. Political elements influence promoting choices of the
organization. For instance, government give appropriation or low pace of tax assessment
from retailer business then it sways emphatically on the advertising choices of the
association. Political powers incorporate chance of political race and the potential results
whether climate will serene or there will be chances of political change.
The major political variable that is influencing the development of the games great
organizations is changing exchange approaches and political turmoil. The heightening
exchange battle among China and the United State additionally have contrarily affected the
development of the Sporting merchandise industry as increasing in the levy rates for
example 15% obligation on the billions of dollars of Sports Equipment like baseballs,
football, lacrosse sticks, and so on have contrarily affected the exchange of different
sporting gear and clothing from US(Bray, 2019). Alongside this, prohibitive exchange

strategies during the COVID-19 likewise adversely affected the general exchange of different
labour and products. Notwithstanding, because of the adverse consequences of COVID-19,
the US government rejected different Chinese items, for example, material and clothing from
higher levy rates to work with the exchange of products. Additionally, the Chinese
government has declined levy rates on the import of some material products and cotton fiber
to guarantee decreased import cost of the merchandise(shutterstock, 2021)
There are numerous outer ecological variables that can influence Under Armor business. It is
normal for supervisors to evaluate every one of these elements intently. The point is
consistently to take better choices for the association's advancement. Some normal variables
are political, monetary, social and innovative (known as PEST investigation). Organizations
likewise study natural, legitimate, moral and demographical factors.
The political variables influencing business are regularly given a great deal of significance. A
few parts of government strategy can influence business. All organizations should keep the
law. Supervisors should observe what impending enactments can mean for their exercises.
The world of politics can affect business associations in numerous ways. It could add a
danger variable and lead to a significant misfortune. they ought to comprehend that the
political variables have the ability to change results. It can likewise influence government
approaches at nearby to administrative level. Organizations ought to be prepared to manage
the neighbourhood and worldwide results of governmental issues.
There are 3 fundamental impacts of these political elements on business associations. They
are:
Effect on economy
Changes in guideline
Political soundness
the first is sway on economy, The political circumstance of a nation influences its financial
setting. The monetary climate influences the business execution.
For instance, there are significant contrasts in Democratic and Republican arrangements in
the US. This impacts factors like duties and government spending, which at last influence the
economy. A more prominent degree of government burning through regularly animates the
economy.

the second is change in guideline, Governments could adjust their principles and guidelines.
This could thusly affect a business.
After the bookkeeping embarrassments of the mid-21st century, the US SEC turned out to be
more mindful on corporate consistence. The public authority presented the Sarbanes Oxley
consistence guidelines of 2002. This was a response to the social climate. The social climate
encouraged a change to unveil organizations more at risk. (PESTLEANALYSIS
CONTRIBUTOR, 2018)
Political analysis helps to identify the political interference in the business industry. This may
include government policy, political stability in the national and overseas market, foreign
trade policy etc.
Economic factor of Under Armour
The Macro environment factors such as inflation rate, savings rate, interest rate, foreign
exchange rate and economic cycle determine the aggregate demand and aggregate investment
in an economy. While micro environment factors such as competition norms impact the
competitive advantage of the firm. Under Armour, Inc. can use country’s economic factor
such as growth rate, inflation & industry’s economic indicators such as Textile Apparel
Clothing industry growth rate, consumer spending etc to forecast the growth trajectory of not
only sector name sector but also that of the organization
● Under Armour is motivated by strong economic policies as the better apparel industry
have hold of growth chance.
● However, the purchasing power of consumers and high labour cost in some countries may
cause a price increase in product.
The economic factor positive and negative impacts on Under Armour
As we realize that the development of the games merchandise market relies upon the
monetary conditions, GDP, work economic situations, and so forth The GDP pace of the US
is 6.6 % in the second quarter of 2021, somewhat higher than 6.5 % in the main quarter of
2021. The ascent in the GDP rate is the consequence of the recuperation from the effects of
COVID-19 which is additionally expected to impact the development of the games products

market. Further, the income from the Sports Equipment portion in the US added up to the US
$ 14,744 of every 2021. The income of the games merchandise market is most noteworthy
from China which is US$28,890m in 2021.(statista, 2021)The accessibility of modest work is
one of the vital elements for the quicker development of athletic gear on the lookout. Further,
the joblessness rate in China is simply 5 % when contrasted with the joblessness pace of 6.7
% in the US which prompts higher creation of athletic gear and clothing products(statista,
2021)
Alongside this, the flare-up of COVID-19 likewise adversely affected the worth of the dollar
and the worth of the dollar has fallen by 10 to 12% starting around 2018(Roach, 2021)The
fall in the worth of the Dollar is prompting the cost seriousness of the sent-out merchandise
and less expensive products help to work with an increment in the interest for different
Sporting merchandise. Be that as it may, the fall in the worth of the Dollar likewise
diminishes the buying force of different Organizations in the global market as it prompts an
expansion in the cost of the imported merchandise
Economic factors are broad in range it is the mixture of national and international
environment. Business organisations are working under complex economic environment
which affects both the decisions related with organisation’s production and consumer
decision making process.
Financing costs,
Interest rates may show up in a scope of better places, forced by a scope of various
individuals. Clearly the norm for financing costs is of extraordinary premium to banking
establishments, however it may likewise influence organizations whose systems depend on
taking out huge advances.
Trade rates,
Exchange rates are a muddled theme, yet they unmistakably need to apply to the individuals
who manage commodity or import. Changing trade rates may influence how much an
organization needs to pay to its global provider to fulfil them, which can influence net
revenues, just as take a great deal of assets to keep steady over.(bush, 2016)
Economic factors affect the profitability of the company. Economic factor includes economic
growth, interest rates, exchange rates, inflation, and disposal income of consumers and so on.

Social factor of Under Armour
It refers to the socio-cultural factors that shape and mold the customer preference and needs.
Demographics, population growth, career attitude, societal norms play a critical role in
planning the demand and distribution model in any industry.
The social factor positive and negative impacts on Under Armour
Society’s culture and way of doing things impact the culture of an organization in an
environment. Shared beliefs and attitudes of the population play a great role in how marketers
at Under Armour, Inc. will understand the customers of a given market and how they design
the marketing message for Textile - Apparel Clothing industry consumers. Social factors that
leadership of Under Armour, Inc.
We all know that individuals in the current times are becoming more health-conscious and
thus, are participating in various sports and Recreation activities to keep themselves healthy.
It is one of the good opportunities for the Sporting goods companies to expand their market
share by launching various other Sporting goods and equipment. This further opens new
opportunities for the Sporting goods companies to enter the new market by launching various
new products and services such as healthy drinks, sports technology, wearable equipment,
etc. in the market. Not just this, the desire of the customers to buy branded products also open
various opportunities for Global companies such as under Armour to expand their market
share through innovative products and services.
Social elements incorporate target clients of the Under Armor, changing in their taste and
inclinations, clients’ perspectives and qualities and so forth This element change the business
association interest and supply. Assuming that business produces merchandise according to
client taste and inclinations than it influences association decidedly. Under Armor faces these
full-scale ecological elements. Large and significant changes in the full-scale climate factors
are normally outside the control of business so it is fundamental that administration of the
organization ought to have the option to investigate the impact of these elements so they
could use sound judgment.it can impact the sales of products and revenues earned.

The cultural implications, the gender and connected demographics, the social lifestyles, the
domestic structures; all of these are studied by companies to understand the market and the
consumer better.
Several social factors drive business for Under Armour. With the change in the lifestyle of
people, demands for products changes. Now people are more brand conscious. They want
quality products that give them high satisfaction at reasonable prices.
Social and cultural factors include values, beliefs and attitudes of the customers. Thesefactors
affect company directly because changes in customers taste and preferences changes the
production policies and demand supply of the company.
Technological Factor of Under Armour
Technological advancement is the key to success for businesses nowadays. Innovation,
automation, technical awareness is some of the factors that influence the production and
distribution of goods. It also has an impact on customer communication. Technological
advancement empowers the company to improve its business strategies.
The technological factor positive and negative impacts on Under Armour
The new mechanical turns of events and forward leaps made by contenders, as referenced
previously. In the event that experiences another innovation that is acquiring ubiquity in the
business being referred to, it is critical to screen the degree of prevalence and how rapidly it
is developing and upsetting its rivals' incomes. This would mean the degree of desperation
needed to sufficiently react to the advancement, either by matching the innovation or tracking
down an imaginative other option.(Murphy, 2018)
Innovative headway has acquired significance in each circle of life and new advances are
likewise supporting up the development of the athletic gear industry. Sensor innovation is
perhaps the best technology that is utilized in outdoor supplies in the current occasions.
Likewise, wearable gear, tennis sensor devices, and so forth have acquired enormous ubiquity
on the lookout(sports, 2021)
Alongside this, Sporting products organizations are additionally putting resources into 3D
printing innovation to fabricate inventive athletic shoes. Alongside this, Under Armor is
likewise putting resources into different cutting-edge innovations, for example, 3D printing to
additional upgrade execution. Under Armor likewise has as of late concoct the 3D printing

execution coach for example UA Architect which assists competitors with participating in
extraordinary exercises through 360-degree execution preparing(walker, 2020)
These factors include new technologies, skills and knowledge required for production of
goods or services. These technology and materials needed for the production are also impact
the business decisions of the Under Armour, it impact the environment of the business. If a
business is able to update its technologies time to time, then it will survive in the competitive
market efficiently but if it is not able to follow the trend then it will have to the loss in the
market.
Technological factors affect marketing and management in different ways which includes
new technology for producing goods and providing services, new ways of distribution
channels and so on.
Environmental Factor of Under Armour
Environmental factors have become increasingly important in the last few years owing to
different issues such as scarcity of raw materials, climate change, and pollution, and other
things. Businesses must focus on sustainability to ensure growth and a long-lasting impact.
Environmental factors positive and negativeimpact on Under Armour
The clients in current occasions are turning out to be greater manageability cognizant.
Consequently, clients not just interest superior grade and imaginative sporting gear yet
additionally harmless to the ecosystem Sporting hardware. The rising issue of Climate
Change likewise has required the associations to dispatch climate amicable and feasible
Sporting hardware. Different Sporting hardware and clothing organizations like Adidas,
Nike, Asics, and so forth are executing different natural supportability practices to resolve
ecological issues(Sportanddev, 2021).Under Armor is likewise an individual from the
Sustainable attire alliance that assists the organization with driving the clothing footwear and
material industry by guaranteeing no damage to the climate. Nonetheless, activists from the
rainforest activity network likewise blamed Under Armor for annihilating timberlands,
adding to denials of basic freedoms just as environment contamination(Matthews, 2017)
Under Armour produce amazingly a lot of waste might be legally necessary to deal with their
ecological propensities. This might incorporate contamination fines and amounts, which
might put a monetary strain on, while depending, in any rate, on sustainable power might be

costly, it frequently gets support from the public authority as well as from its client base, who
might address an exceptional cost for the items that might create.
Environmental factors have come to the forefront only relatively recently. They have become
important due to the increasing scarcity of raw materials, pollution targets and carbon
footprint targets set by governments. These factors include ecological and environmental
aspects such as weather, climate, environmental offsets and climate change which may
especially affect industries such as tourism, farming, agriculture and insurance. Furthermore,
growing awareness of the potential impacts of climate change is affecting how companies
operate and the products they offer. This has led to many companies getting more and more
involved in practices such as corporate social responsibility (CSR) and sustainability.
Legal Factor of Under Armour
Similar to the political factors, legal factors also comprise the rules and regulations. These
include consumer rights, health and safety, and equal opportunities, and others. Legal factors
are essentials, especially for global trade.
Legal factor positive and negativeimpacts on Under Armour
Different laws and guidelines, for example, the combustible textures act, an overall
declaration of similarity, American Society for testing and materials norms, CPSIA
principles, and so forth manage the assembling, import, and offer of different Sporting
clothing and hardware in the business(Mo, 2021)In any case, the workplaces of Under Armor
are situated in London, Jakarta, Hong Kong, New York City, Panama City, Mexico City,
Guangzhou, Houston, Toronto, and so on which requires the organization to conform to
different guidelines and guidelines of these nations. Alongside this, Under Armor is asserted
for ill-advised bookkeeping and break of the government protections laws which required the
organization to pay $ 9 million for settling the administrative charges(MIRABELLA, 2021)
In number of nations, the legitimate structure and foundations are not strong enough to secure
the protected innovation privileges of an association. A firm ought to painstakingly assess
prior to entering such business sectors as it can prompt burglary of association's mystery
ingredient accordingly the by and large upper hand. A portion of the lawful elements that
Under Armor, Inc. administration ought to consider while entering another market are Anti-
trust law in Textile - Apparel Clothing industry and by and large in the country,

Discrimination law, Copyright, licenses/Intellectual property law and Consumer assurance
and web-based business.
Since the Under Armor Company is an enlisted neighbourhood and worldwide business
without really any record of untrustworthy practices, the lawful variables are not
extraordinary towards the activity of the business and have insignificant effects. The
adherence has worked with a smooth movement of the Under Armor Company all around the
globe. For example, the organization has extended from the US to landmasses like Europe
and Asia.(IvyPanda, 2019)
Lawful and Regulatory Factors There is consistently hazard with any enormous business that
endeavours out into unfamiliar assembling. Gaining from Nike's missteps; Under Armor has
been exceptionally mindful as to keep away from sweat shop and youngster work. Starting at
2006 Under Armor has producing in Asia, Central and South America, and Mexico. With the
expansion of the assembling office in Maryland last year, not exclusively is Under Armor
ready to satisfy a higher worldwide need for its item, yet it will likewise bring back apparel
that gladly bears the "Made in America" tag. Becoming International has permitted Under
Armor to enlist the administrations of unaffiliated producers. This in a manner has been a
shrewd move for Under Armor. Not just have they consented to non-exposures arrangements
with these unfamiliar producers, however they have likewise distinguished work force who
spot actually look at social compliances, quality frameworks, and monetary strength before
being chosen as a maker. This has been an instrumental power in the general development of
the organization. Working on both a worldwide and homegrown battleground Under Armor
has delivered a Code of Ethics and Code of Conduct for all makers to follow. This has
supported them in following all laws, and has helped in recognizing and relieving potential
debates that can emerge from dangerous and exploitative work rehearses.(bartleby, 2021)
Albeit these elements might have some cross-over with the political variables, they
incorporate more explicit laws like separation laws, antitrust laws, business laws, shopper
assurance laws, copyright and patent laws, and wellbeing and security laws. Unmistakably
organizations need to realize what is and what isn't lawful to exchange effectively and
morally. On the off chance that an association exchanges all around the world this turns out
to be particularly interesting since every nation has its own arrangement of rules and
guidelines. Moreover, you need to know about any expected changes in enactment and the

effect it might have on your business later on. Prescribed is to have a lawful consultant or
lawyer to assist you with these sorts of things.
2) The impact that macro factors (PESTEL) have upon
business objective
Full scale factors concern the bigger outside climate and are outside the ability to control of
the association. They sway the business goals by building up great connection and between
subordinate relations and help to make fitting procedures and strategies to adapt to contenders
Research Aims and Objectives
The association and the business climate share a shut circle cooperation. Business climate
influences the association thus summoning a reaction from the association subsequently
finishing the cycle. It infers that the comprehension of the hierarchical reaction is important
to understand the impact of the business climate on the association.
The point of the current exploration is to break down the effect of the large-scale business
climate on the little assembling organizations. Additionally, the review will assess the
reaction conduct of the associations in the unique large scale business climate. The essential
targets of this examination are as per the following:
To recognize the full-scale ecological powers dynamic in the partaking associations.
To survey the effect of the dynamic full scale ecological powers on the partaking
associations.
To look at the reaction conduct of these associations against the full-scale ecological powers.
Following focuses will be noted:
Sharpness of the association – regardless of whether proactive or responsive?
Impression of the business climate – steady or tempestuous?
The data sources.
Bearing of the hierarchical reaction – inward or outer?
The primary objective connections with sifting through the miniature business powers that
are effectively influencing the little assembling organizations. It will recognize the essential
business powers dynamic in the area. The subsequent target relates with passing judgment on