New Balance Athletic Shoe Company: Situational Analysis Essay

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Situation analysis New Balance Athletic Shoe Company has been ranked the third in the US Athletic shoe industry. During the financial year 2007, it recorded revenues of $1,630 million, an increase of 5.2% over 2006 (www.businessweek.com). Since the athletic shoe market is highly competitive, New Balance is trying to figure out how to compete in this highly competitive market against such industry giant like Nike, Adidas/Reebok. Below is a SWOT analysis of New Balance. SWOT analysis Strengths | Weaknesses | * Brand name, quality product, and global recognition. * Strong distribution system * Brand loyal customer * Offer special product * Good reputation and relationship with distributors and retailers | * Too …show more content…
Identification of alternatives
Some alternatives available for New Balance include: 1) Focusing on running footwear category. 2) Focusing on walking footwear category. 3) Focusing on basketball footwear category 4) Focusing on training footwear category. 5) Developing a second tier shoe.
Criteria
Each of the above alternatives will help New Balance to solve its real problem. However, some alternatives are more viable than others depending on the criteria used to evaluate them. Below is a list of the criteria that was used to evaluate the alternatives:
List of criteria 1. Sales 2. Growth 3. Market share 4. Consumer trend 5. Risk
These criteria were chosen as they reflect the end goal from the New Balance’s perspective and were also aligned with the company’s guideline and strategies. Some criteria are weighted more heavily than others. For instance, since sales and growth are the end goal for New Balance, they will be weighted the heaviest, while consumer trend and risk are weight the least.
Analysis
Each alternative has been evaluated against the criteria listed above and is given a score. The alternatives with highest rating will be the recommended alternatives for New Balance. Below is a rating alternatives summarizing the analysis: ( The weights assigned to each criterion are based on the level of importance on the final decision, and the rating of each
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