Adidas: After The Spread Of The Epidemic, The Supply Chain Of The Company Is Faced With The Risk Of Interruption.

The impact of the new crown pneumonia epidemic on the physical shops continues, and to what extent will the epidemic affect performance, even Adidas, a sports giant, is also hard to pin down.

In March 12th, reporters learned from Adidas that in the first three weeks of 2020, Adidas's performance in the Greater China region was strong. However, the sudden new crown epidemic has a substantial negative impact on business. The company has closed a certain number of brand self owned stores and franchised stores, while other business outlets still have a significant decrease in the volume of traffic.

The impact is that since the Spring Festival of January 25th to the end of February in January 25th, the income of Adidas in Greater China has decreased by about 80% over the same period last year. Since then, the company's operation in the Greater China region has been improved. The closed stores and warehouses have been resumed and their traffic has increased.

Adidas said that since the outbreak of the outbreak, Adidas has worked closely with all partners to ensure that the market is in good condition. To this end, the company canceled all shipments in February, and there may be a large number of returns in the future. The company plans to digest these stocks through its own channels within the year. The company expects that in the first quarter of 2020, revenues in the Greater China region will decrease by 800 million euros to 1 billion euros. On this basis, it is estimated that in the first quarter, the operating profit of Greater China will be reduced by 400 million euros to 500 million euros. In addition, with the spread of the epidemic, the volume of passenger traffic in the Japanese and Korean markets has declined, and the company's business has also begun to be adversely affected. Although the supply chain of the company is also facing the risk of interruption, most factories in China have resumed operation, and global procurement activities have not yet been affected.

In March 11th, Adidas released its 2019 annual performance, excluding exchange rate factors. The company's annual revenue increased by 6% in 2019, and its operating profit margin increased to 11.3%. In addition, Adidas has achieved double-digit growth in sales in the two strategic growth areas of Greater China and the electricity supplier.

Adidas CEO Rothd (Kasper Rorsted), referring to the company's performance outlook in 2020, said: "as the epidemic continues to change, we can not accurately assess its impact on the overall performance of the 2020 year. Whatever the impact on our business, ensuring the health and safety of employees and their families is always the top priority of our work. "