Supply Chain Woes Slow Down Adidas Growth

Supply chain issues are continuing to slow down Adidas growth as the company fell 5 percent in the most recent quarter.

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Supply chain issues are continuing to slow down Adidas growth as the company fell 5 percent in the most recent quarter.

Nike has been regaining momentum in the sportswear industry, leaving Adidas struggling to compete. According to Yahoo News, Adidas currency-neutral sales growth would slow to between 4 and 8 percent this year, with supply chain issues accounting for a 1-2 percent fall as it struggles to meet strong demand.

Meanwhile, its competitors are only forecasting growth for this year. 

"The volume grew quicker than anticipated and we didn't respond quickly enough to that demand signal," chief executive Kasper Rorsted said during a news conference. 

However, the company does expect sales growth of just 3 percent in the first half of the year, Yahoo News reports. Adidas will speed up in the second half as it ramps up supplies by relocating factory capacity and prioritizing the U.S. market. Shares rose in North America by 9 percent.

The company has previously relied too much on the Europe market for short-term fashion trends. In order to recover, Adidas is investing heavily in marketing, such as sponsorship deals with soccer teams. 


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