Retailing, Franchising, and Consumerism Business Intelligence in China

Adidas' Sales In China Down 15% In Q1 2010

The world's leading sports supplies provider Adidas has published its performance for the first quarter in 2010, stating that its sales in Greater China were EUR198 million, a year-on-year decrease of 15%; and the decrease reached 20% if currency factors are taken into consideration.

For the reporting quarter, the Greater China area is reportedly the worst among Adidas' worldwide markets. The company realized sales of EUR945 million in the Western European market, a year-on-year increase of 5%; it's sales in the North American market were EUR585 million, a year-on-year increase of 10%; its sales in Latin America and the Japan-oriented Asian market also showed increase of 24% and 1%, respectively; but its sales in Greater China and the European emerging markets decreased by 20% and 1%, respectively.

Ma Gang, a Chinese sports market analyst, told local media that Adidas was over-optimistic about the post-Olympics Chinese sports products market and its re-construction of sales channel system has not been completed, leading to its bad performance in China in 2009. Ma said over last year, Adidas closed at least 200 stores in China and most of these other stores have not recovered operations yet.

Ma revealed that facing the severe competition in the Chinese sports supplies market, the only way to increase revenue is to open new stores. However, comparing with Chinese brands like Anta and Peak, which expanded new stores rapidly in 2009, Adidas' effort was far from enough.

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