Place/Distribution Every company needs to evaluate their own risk/reward threshold when deciding on production. A company can produce everything in house giving them full control of production. This route ensures accuracy, quality, and cuts down on production times. It also increases liability and operation cost because all the workers, property, and facilities are directly controlled. Startup cost also increases because the company must already possess or acquire facilities. This route is used mostly with large conglomerate corporations who have their hands in all levels of production and distribution. Under Armour went the opposite way. Under Armour’s production strategy is one similar to that being implemented by GAP Inc where almost all …show more content…
They process products through third-party distributors located in Canada, New Jersey, Florida, and leases distribution facilities in California and Maryland to channel products through its wholesale and retail networks in North America. Wholesale sales generated through national and regional sporting goods chains, department store chains, institutional athletic departments, and teams and leagues accounted for 68% of revenues in 2013. Under Armour saw a need for diversification of revenue streams and embarked on a mission to change their model. They saw by building a strong retail network to sell directly to its consumers they could do just that. One way they did that was to have factory-house stores in North America, China, Japan, Mexico, Brazil, and other countries where they attach a retail store to their factories. Another approach was direct-to-customer channels include online sales through website in North America and other countries and has recently begun selling directly in certain international markets including