Athletic Footwear Company – Key Facts (BSG Overview)
5 Performance Metrics (KPIs) • Earnings per Share (EPS)
• Return on Equity (ROE)
• Stock Price
• Credit Rating
• Image Rating (based on S/Q rating, market share, CSR)
4 Geographic Regions • North America
• Europe–Africa
• Asia–Pacific
• Latin America
Production & Distribution • Production Facilities: North America, Asia–Pacific
• Distribution Centers: Memphis, Milan, Bangkok, Rio de Janeiro
Retail Market Facts • Retail outlets: 60,000 total
• North America & Europe–Africa: 20,000 each
• Latin America & Asia–Pacific: 10,000 each
• Retail pricing: Wholesale price + 40–100%
Products & Sales Channels • Products: Branded Footwear, Private Label Footwear
• Sales Channels: Wholesale, Online, Private Label contracts
Materials • Two types: Standard and Superior
• Typical mix: 60% Standard, 40% Superior
• 250 suppliers, delivery < 48 hours
Key Drivers of S/Q Rating • Spending on features and styling
• Percentage of superior materials
• TQM / Six Sigma spending (current and cumulative)
• Worker training investments
• Production improvement option C
Production Cost Drivers • Fringe benefits
• Incentive compensation
• Best practice training
• Equipment type (new or refurbished)
• Production improvement options
13 Competitive Factors
Affecting Sales
• Both channels: S/Q rating, models, advertising, celebrity appeal,
brand reputation
• Wholesale: price, retail outlets, delivery time, retailer support,
rebates
• Online: retail price, search engine advertising, free shipping
Worker Productivity Factors (9) • Base pay changes, incentive pay, compensation vs competitors
• Training spending, number of models
• Supervisor salary, worker/supervisor ratio
• Equipment type, production improvement option D
Reject Rate Factors (6) • Incentive pay
• TQM / Six Sigma spending
• Best practice training
• Number of models
• Equipment type
• Production improvement option A
Credit Rating Determinants • Interest Coverage Ratio = Operating Profit / Interest Expense
• Debt to Assets Ratio = Total Liabilities / Total Assets
• Default Risk Ratio = Cash Flow from Operations / Loan Principal
Payments
• Risk: <2.0 High | 2–4 Medium | >4 Low