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Our Retail segment’s strategic vision is to become one of the top retailers in the world by delivering healthy, sustainable growth with improved return on investment. Retail plays an important role for the growth of our Group and our brands.

The reasons are manifold:...

The reasons are manifold:

• As a place to showcase the breadth of our brands (i.e. concept stores)


• To create distribution in markets which do not have traditional wholesale structures


• The share of selling space via wholesale is in decline due to industry consolidation


• Everything we learn in own retail benefits the rest of the organisation


• Need for a clearance channel (i.e. factory outlets).

Over the past five years, the adidas Group has evolved into a significant retailer, operating 2,270 stores for the adidas and Reebok brands worldwide.
Going forward, we have simplified the shape of our store chain, by clustering it into three different formats, namely brand centres, core stores and factory outlets.

• Brand centres, i.e. large stores carrying the full range of each of our adidas sub-brands under one roof, are the bold and powerful statements about their strength, breadth and depth. This format will be kept to a limited number and only in exclusive locations.


• Core stores are the commercial engine for sales and profit across the Group’s retail organisation, upholding and accentuating each brand’s reputation. There will be adidas brand core stores, Originals core stores and Reebok core stores and, depending on their size, they will be categorised and clustered into A, B or C.


• Our factory outlets will facilitate the controlled sale of excess stock returned from our wholesale key and field accounts, franchise partners, e-commerce as well as own-retail stores. Through improved management of regional inventory and limited planned production, we want to improve and balance our product offering and therefore further increase our profitability.
  

In light of the increase in importance of retail to the Group’s performance, a new central leadership team was established in 2009.
 
This team is mandated to develop a global strategic framework and guidelines, represent retail store and market needs on a global level, and to act as a catalyst to drive commercial performance for the adidas and Reebok retail operations around the globe. To become a world-class retailer, four strategic pillars have been defined: 

• Focus on the consumer


• Achieve operational excellence


• Exploit portfolio of brands


• Leverage our global presence and scale.

By focusing on these four strategic pillars, we are confident to become one of the top retailers in the world. In line with our strategic business plan Route 2015, we will further invest in our own-retail activities and will open over 500 stores by 2015 across the existing store formats. The majority of these store openings are planned in the emerging markets, particularly Russia. Another area of focus will be the further roll-out of Originals core stores to increase the number of distribution points for our apparel collection, and the implementation of the new vertical business model for the adidas NEO label see Global Brands Strategy. To execute on these pillars, Retail has set its strategic priorities around improving its delivery on the “Five P’s”: People, Product, Premises, Processes and Profit.

The consumer and our employees are the primary reference points in order to be successful. ...

The consumer and our employees are the primary reference points in order to be successful. Retail constantly strives to interpret and adapt to consumer demand, targeting a mix of new and loyal consumers, whether it be sports-active, sports-inspired or casual consumers. To make sure that consumer needs are being met, Retail will set up organisational teams and recruit store staff that are highly engaged and commercially- and consumer-minded. We want to build a retail back office and field workforce that thinks and “trades” like a vertical retailer and whose highest priority is to serve the consumer. To achieve this, in 2010, Retail introduced a new human resources people strategy called SHINE.
The aim is to leverage existing best practices and create a single global standard for the field organisation, to ensure a high availability of broad and deep vertical retail and commercial skills to develop our staff globally.

The key element of our product strategy in Retail is to ensure that relevant products are presented through the Group’s various retail formats to match the intended consumer profile. ...

The key element of our product strategy in Retail is to ensure that relevant products are presented through the Group’s various retail formats to match the intended consumer profile. This requires a product offering that is price-competitive, simple to understand, easy to find and, most importantly, available at the right time and the right place. To achieve this goal, we will leverage the product assortments, concepts and point-of-sale materials to match real-time consumer trends. Furthermore, the analysis of daily trading information will provide the capability to display our products in the correct proportionality and thus increase our full-price sell-through, especially on best sellers to “make the big bigger”.

The start of a pleasant shopping experience is the store. It is the meeting point between the consumer and the brands. ...

The start of a pleasant shopping experience is the store. It is the meeting point between the consumer and the brands. Therefore, it is of highest importance that our retail environments are inspirational, athletic, fun and interactive, while at the same time being laid out clearly and logically to make it easy to shop. In order to drive our sales per square metre, Retail has set a clear priority on optimising its real estate management process.
Dedicated real estate teams have been set up who make sure that:

• Store location and store size fit to the local market


• Store is designed to drive high sales per square metre 


• Market share growth and increased market presence is in line with our integrated distribution roadmap, where Retail will focus on the top 100 cities globally.

Streamlining and harmonising retail store operations and supply chain processes to gain the necessary speed to respond to consumer requests remains a top priority for Retail in 2011. ...

Streamlining and harmonising retail store operations and supply chain processes to gain the necessary speed to respond to consumer requests remains a top priority for Retail in 2011. From a store perspective, a key initiative is to identify and promulgate best-in-class operations policies and procedures and ensure consistent adoption to the new retail standards. Globally consistent manuals will provide clear and commercial guidelines for store development, visual merchandising and in-store communication procedures to establish flawless execution and operational excellence.
We will also continue to work on adapting the supply chain, system landscape and buying and demand planning processes. This is essential as we strive to increase our in-season flexibility, be more responsive to changing trends and to achieve economies of scale for the Group’s retail activities. Shifting our retail focus strictly onto the consumer also means changing our mindset from a sell-in (push model) oriented to a more sell-through (pull model) oriented perspective.

To increase the commerciality and profitability of the Group’s existing retail assets is the primary focus of all retail teams, whether they are working in logistics, store operations, marketing or any other Retail function. ...

To increase the commerciality and profitability of the Group’s existing retail assets is the primary focus of all retail teams, whether they are working in logistics, store operations, marketing or any other Retail function. Therefore we will close down stores not reaching their potential, as well as closely review and monitor each new store opening or remodelling to ensure that the targeted profitability and return on investment is accomplished. As part of Route 2015, a key area of focus is to increase four-wall profitability in existing brand centres and brand core stores. To support this strategy, in 2010, Retail introduced a new set of operational KPIs benchmarked to best-in-class retailers.