Index Company HistorySupply and Demand ConditionsPrice Elasticity of DemandProduction CostOverall MarketRecommendationUnder Armour, Inc is an American company that has developed, manufactured and distributed casual, athletic apparel and footwear for women, children and men and Under Armor products will be sold worldwide. The information gathered and outlined in this executive summary will show that despite the company's small revenue in recent years, Under Armor will continue to be an enterprising company and will be the first choice for customers in the field of training apparel. It will also provide an in-depth analysis into Under Armour's microeconomics by examining numerous benchmarks to evaluate its position in the high-end athletic sports apparel market. The analysis will focus not only on supply and demand conditions, but also on price elasticity, the overall market and production costs. I will provide my recommendations with the information I have gathered through my research and analysis. Say no to plagiarism. Get a tailor-made essay on "Why Violent Video Games Shouldn't Be Banned"? Get an original essay Company History Under Armor became a company in 1996, by Kevin Plank, a 24-year-old former special teams captain of the Maryland Football team. He founded the company because he was tired of always changing out of sweat-soaked shirts while working out. Like any athlete, they will agree that having to take off your sweat-soaked shirt while trying to train and perform at your peak is very aggravating. He changed that and restructured the game by creating his own product. Its products helped athletes stay cool and dry in all types of conditions and gave the athlete more time to train and less time to wick away sweat. Kevin created this amazing product in his grandmother's basement in the District of Columbia. His first sale brought him $17,000 in late 1996 and would help him build on the success of his product and found his company Under Armour. Supply and Demand Conditions The coronavirus (COVID-19) pandemic has adversely affected the U.S. and global economies, disrupted supply chains and financial markets, and introduced substantial travel and transportation regulations, along with shutdowns mandatory and “shelter in place” orders. In the midst of this global pandemic, Under Armor is committed to protecting the health and safety of our teammates and consumers, while working with our customers and suppliers to reduce potential disruptions and helping our community address challenges posed by this pandemic 'During the first quarter, our January and February results aligned well with our plan. Since mid-March, with the dramatic acceleration of the pandemic in North America and EMEA and the subsequent closure of retail stores, we have seen a significant decline in revenue across all markets. Frisk continued: "As a result, like so many companies, we have had to make very difficult decisions, including temporarily laying off colleagues in our U.S. retail stores and distribution centers along with other actions to ensure we protect Armor's financial stability." Sales have surged this year at the same time as women's apparel sales have surged, Under Armor, like many other companies and industries, has felt the wrath of the coronavirus pandemic. The company said on March 31 that first-quarter revenue fell 23% to $930 million, with 15 percentage points related to impactsof the COVID-19 pandemic in the quarter. Revenue fell 41% to $708 million in the second quarter, the company announced July 31. Under Armor announced on September 8 that it will lay off 600 employees from its global staff as part of cost-cutting measures due to the pandemic. Price Elasticity of DemandPrice elasticity is elastic with respect to supply and demand for Under Armor and all major sporting goods manufacturers. for example I can evaluate the Under Armor and Nike stores in New York. each brand has great stores and clothing, shoes and accessories with prices ranging from $50 to $200. this is where the comparisons end and where Under Armor hurts itself. Although the Under Armor store is large, it is not always properly signposted, they don't have much variety in colors, and they are very repetitive for both men's and women's clothing and footwear. Nike, however, had a properly signposted store with clothing and footwear in every style, color and fabric imaginable. Additionally, athletes have tried facilities where you can try out running shoes on a treadmill or basketball shoes on a basketball court. I would say the price elasticity is much lower for Nike than it is for Under Armour. If Under Armor really wants to regain its momentum and compete with a giant like Nike, it wants to be as revolutionary with its store design, apparel and shoe colors as it could be when designing fashion technology, as well as trying to be very less. repetitive. In this case, customer responsiveness to Under Armor product price changes will, at least in North America, be more on the negative side than on the positive side. If Under Armor's prices continue to be like Nike's or increase and customer income stays the same or decreases, people will get along with Nike as they market themselves better in their stores as well as being the longest lasting and most brand dependent. If Under Armor prices go down or Nike pushes up and customer income stays the same or goes up, I would say Under Armour's domestic sales will go up quite a bit, to honestly take a pound of flesh off Nike's which they may need to keep prices lower for several years and may need to market themselves better with greater variety to take away reliable Nike customers from the sporting goods giant. For any sporting goods company, you want to stay updated on the amount of demand you receive for your product and adjust your supply and prices because of this. Production Cost Production cost is particularly essential in any business. while they are based on statistics generally if the production cost is lower the higher the profit will be. Under Armour's cost of goods has remained constant in recent years. The cost of goods includes some things which include transportation costs and production costs. Under Armour's cost of goods sold for the fiscal years ending December 2017 through 2019 averaged $2.601 billion. Looking back at the last five years, Under Armour's cost of goods sold peaked in December 2018 at $2.832 billion. Under Armour's cost of goods sold reduced in the first two quarters of 2020. Under Armor reported losses of (-1.638 million), 2019 (2.797 billion) and 2018 (2.832 billion), 2017 (2.733 billion). Their numbers have declined this year due to the coronavirus pandemic. They feel like they are doing wonderful things with their company as far as making the most of the products they sell. Below is a chart of the company's growth over the past three years. Overall market The market.