Reebok 2010 Annual Report Download - page 87

Group Management Report – Our Group Global Sales Strategy Wholesale Strategy 83
Wholesale strategic pillars
01
Activate our
brands at the
point of sale in all
relevant channels
Ensure
commercial
success
Industry
benchmark in
servicing retailers
with world-class
efficiency
Build strong
relationships with
leading and most
dynamic retailers
To be the
globally leading sales organisation
in the sporting goods industry
Wholesale Strategy
The main strategic objective of the
Wholesale channel is to deliver profitable
market share growth by becoming the
leading sales organisation in the sporting
goods industry in terms of effectiveness
and efficiency see 01. To realise this,
Wholesale takes the go-to-market
strategies handed over by Global Brands
and commercialises them within a
defined framework across various third-
party retail channels.
Our most important third-party retail
channels are sporting goods chains,
department stores, independent sporting
goods retailer buying groups, lifestyle
retail chains and e-tailers. In this respect,
Wholesale strives to establish strong
partnerships with the most dynamic
retailers in their respective channel of
distribution by offering best-in-class
and tailored services. The principles to
achieve this include:
– Differentiating and segmenting product
offering to match channel strengths.
– Harmonising and standardising selling
models and processes to achieve
efficiency and cost leverage and reduce
working capital requirements.
Customer and range segmentation
to exploit market potential
Rolling out standardised product
range packages around the globe is an
important part of the Group’s Wholesale
strategy. The initiative, which was first
designed and implemented in Europe,
involves a customer segmentation
strategy that facilitates the systematic
allocation of differentiated product
packages to groups of comparable
customers. With 40,000 different
partners around the world that operate
more than 100,000 points of sale, this
segmentation is broadly based on a
distinction between sports and lifestyle
retailers that either have an up-market
“brand-driven” positioning or a value-
oriented “commercial” positioning. By
best suiting their specific needs, this
provides a platform to better exploit
market potential, while at the same time
supporting the reduction of complexity
and costs. In addition, our Wholesale
segment continues to partner with
retailers on increasing the level and
quality of sell-through information
the Group receives on a regular basis.
This creates a mutually beneficial
understanding of their needs which
helps us to become a more valuable and
reliable business partner to our retailers.
At the same time, this helps us to drive
incremental business opportunities.
Retail Space Management
to drive efficiency
Retail Space Management (RSM)
comprises all business models helping
our Global Sales function to expand
controlled space in retail. Under the
premise that the selling process is
not finished until the consumer has
bought the product (“It is not sold until
the consumer has it”), Wholesale is
cooperating with retailers along the
entire supply chain to bring best-in-class
service all the way through to the point of
sale. By helping to increase profitability
per square metre for the Group’s retail
partners as well as improving product
availability, we can achieve higher
customer satisfaction, thus driving share
of retail shelf space.
The two predominant models to drive
the success of RSM for the adidas Group
are Franchising and Never-out-of-stock.
– Franchising: Mono-branded store
franchising is one of the Group’s prime
growth opportunities, as it offers superior
brand presentation. Franchise stores
are financed and operated by franchise
partners. The adidas Group normally
contributes to the costs for brand-
specific fixtures and fittings each store
has to be equipped with. Further, we
support our franchise partners with
a comprehensive franchise concept,
including range propositions, IT systems,
training concepts, and guidelines for
store building and store operations. This
ensures that the quality of the brand
presentation and the service offered to
the consumer are at all times high and
comparable to our own-retail stores.