Flevy Management Insights Case Study
Global Expansion Strategy for Athletic Wear SMB in North America


Fortune 500 companies typically bring on global consulting firms, like McKinsey, BCG, Bain, Deloitte, and Accenture, or boutique consulting firms specializing in Platform Strategy to thoroughly analyze their unique business challenges and competitive situations. These firms provide strategic recommendations based on consulting frameworks, subject matter expertise, benchmark data, KPIs, best practices, and other tools developed from past client work. We followed this management consulting approach for this case study.

TLDR An emerging athletic wear SMB experienced a 20% sales growth decline due to market saturation and operational inefficiencies. A robust Platform Strategy for international expansion was implemented, leveraging Lean Management and a Digital Maturity Model to enhance ops and digital presence. However, the long-term effects on sales growth and market share are uncertain, necessitating continuous evaluation and innovation.

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Consider this scenario: An emerging athletic wear SMB based in North America is at a critical juncture requiring a robust Platform Strategy to tackle its growth plateau.

The company has experienced a 20% decline in year-over-year sales growth, compounded by a saturated domestic market and increasing production costs. Externally, the brand faces fierce competition from established players who are diversifying their product lines and adopting aggressive digital marketing strategies. Internally, the lack of a cohesive digital presence and an outdated supply chain model are significant barriers to scalability and market competitiveness. The primary strategic objective of the organization is to penetrate new international markets, thereby diversifying its revenue streams and establishing itself as a global brand in the athletic wear industry.



The athletic wear market is rapidly evolving, driven by changing consumer lifestyles and an increased focus on health and wellness. As this SMB navigates these waters, it's imperative to dissect underlying issues that are stymieing growth. Primarily, the organization's reliance on traditional retail channels in an increasingly digital world stands out as a critical misstep. Additionally, a failure to culturally and operationally adapt to global market demands has left the company lagging behind its more agile competitors.

Market Analysis

The global athletic wear market is characterized by high growth potential, driven by a surge in health consciousness and athletic lifestyle adoption among consumers. However, the landscape is highly competitive with a mix of established brands and emerging players.

We begin our analysis by examining the competitive forces that shape the industry:

  • Internal Rivalry: High, with numerous brands competing on innovation, brand loyalty, and price points.
  • Supplier Power: Moderate, due to the availability of alternative suppliers worldwide, though premium materials can be controlled by a few.
  • Buyer Power: High, with consumers having access to a wide array of choices and price comparisons online.
  • Threat of New Entrants: Moderate, given the significant investment in brand building and supply chain required to compete effectively.
  • Threat of Substitutes: Low, as the unique value proposition of athletic wear (combining fashion with functionality) is difficult to replicate by non-specialized apparel.

Emergent trends in the industry include the rise of sustainable and ethically produced athletic wear, the integration of technology for personalized fitness tracking, and a shift towards direct-to-consumer sales channels. These trends indicate significant changes in industry dynamics:

  • Increased consumer demand for sustainability and ethical production practices, presenting both a challenge in adapting supply chains and an opportunity to differentiate in the market.
  • Technological integration into apparel offers a new frontier for innovation but requires substantial investment in R&D and partnerships.
  • The growth of online and direct-to-consumer sales channels reduces reliance on traditional retailers but necessitates a robust digital strategy and infrastructure.

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Internal Assessment

The organization possesses a passionate commitment to quality and innovation but is hampered by outdated operational processes and a lack of global market insight.

SWOT Analysis

The company's strengths include a strong brand identity in the domestic market and a loyal customer base. Opportunities lie in expanding into new international markets and leveraging digital platforms for sales and marketing. Weaknesses are evident in the company's supply chain inefficiencies and digital presence. Threats include the intensification of competition and the volatility of international trade regulations.

VRIO Analysis

The brand's identity and customer loyalty are valuable and rare but not fully exploited due to operational inefficiencies. Improving supply chain management and digital marketing capabilities could transform these attributes into sustainable competitive advantages.

Capability Analysis

Success in the global athletic wear market hinges on agility in supply chain management, digital marketing excellence, and product innovation. Currently, the organization's capabilities in these areas are underdeveloped, necessitating targeted investments and strategic partnerships to bridge the gap.

Strategic Initiatives

Derived from the insights gained, the following strategic initiatives over the next 3-5 years are proposed:

  • Supply Chain Optimization: Redesign the supply chain for efficiency and flexibility, enabling the company to respond quickly to market demands and reduce costs. This initiative aims to enhance profitability and support international market expansion. Resource requirements include supply chain management expertise and technology investment.
  • Digital Transformation: Develop a comprehensive digital strategy encompassing e-commerce, digital marketing, and customer engagement. This initiative seeks to strengthen the brand's online presence, drive direct-to-consumer sales, and foster international brand recognition. It will require investment in digital platforms, marketing talent, and analytics target=_blank>data analytics capabilities.
  • Market Expansion through Partnerships: Enter new international markets by forming strategic partnerships with local distributors and influencers. This approach aims to mitigate risks associated with direct entry and leverage local market insights. Necessary resources include market research, partnership management, and legal counsel for contract negotiation.

Platform Strategy Implementation KPIs

KPIS are crucial throughout the implementation process. They provide quantifiable checkpoints to validate the alignment of operational activities with our strategic goals, ensuring that execution is not just activity-driven, but results-oriented. Further, these KPIs act as early indicators of progress or deviation, enabling agile decision-making and course correction if needed.


What gets measured gets managed.
     – Peter Drucker

  • Supply Chain Efficiency Metrics: Measures improvements in production lead times and cost reductions, indicating the success of supply chain optimization efforts.
  • Digital Engagement Scores: Tracks increases in online brand interactions and e-commerce conversion rates, reflecting the effectiveness of the digital transformation strategy.
  • International Market Share Growth: Monitors the brand's expansion in new markets, serving as a direct indicator of the success of internationalization efforts.

These KPIs provide actionable insights into the strategic initiatives' performance, enabling timely adjustments to ensure alignment with the overall strategic objectives.

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Platform Strategy Best Practices

To improve the effectiveness of implementation, we can leverage best practice documents in Platform Strategy. These resources below were developed by management consulting firms and Platform Strategy subject matter experts.

Platform Strategy Deliverables

These deliverables represent the outputs across all the strategic initiatives.
  • Global Market Entry Strategy Report (PPT)
  • Digital Transformation Roadmap (PPT)
  • Supply Chain Optimization Framework (Excel)
  • Strategic Partnership Evaluation Template (Excel)

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Supply Chain Optimization

The Supply Chain Optimization initiative saw the application of the Lean Management framework, which focuses on maximizing value for customers while minimizing waste. Lean Management proved invaluable in identifying inefficiencies within the supply chain and streamlining operations. The organization implemented this framework by:

  • Mapping out the entire supply chain to identify value streams and pinpointing areas of waste such as excess inventory, overproduction, and unnecessary transportation.
  • Applying the 5S methodology (Sort, Set in Order, Shine, Standardize, Sustain) to organize and maintain workspace efficiency, thereby improving the flow of goods and information.
  • Implementing Kanban systems to control inventory levels and ensure that production is driven by actual customer demand.

As a result, the organization experienced a significant reduction in lead times and operational costs. The Lean Management framework not only enhanced the supply chain's efficiency but also contributed to a more responsive and flexible operational structure, capable of supporting the company's global expansion ambitions.

Digital Transformation

For the Digital Transformation initiative, the organization utilized the Digital Maturity Model (DMM) to assess and guide its progress towards becoming a digitally mature enterprise. The DMM framework was instrumental in identifying the current state of digital capabilities and setting a clear path for advancement. The process included:

  • Evaluating the organization's existing digital technologies, processes, and culture against the five stages of digital maturity: Initial, Managed, Defined, Quantitatively Managed, and Optimizing.
  • Developing a tailored digital transformation roadmap that prioritized initiatives based on their impact on customer experience and operational efficiency.
  • Establishing cross-functional teams to lead digital initiatives, fostering a culture of continuous improvement and innovation.

By implementing the Digital Maturity Model, the company significantly enhanced its online presence and e-commerce capabilities. This strategic move not only improved customer engagement but also positioned the company as a digital leader in the athletic wear market, driving direct-to-consumer sales and expanding its global brand reach.

Market Expansion through Partnerships

In pursuing the Market Expansion through Partnerships initiative, the organization applied the Strategic Alliance Framework to effectively select and manage its partnerships. This framework was critical in aligning the company's expansion goals with the capabilities and market presence of potential partners. The implementation steps were as follows:

  • Identifying potential partners with complementary strengths, market knowledge, and customer bases.
  • Conducting a thorough due diligence process to assess the strategic fit and potential value of each partnership.
  • Defining clear roles, expectations, and performance metrics for each partnership to ensure alignment and accountability.

The Strategic Alliance Framework enabled the company to establish mutually beneficial partnerships that facilitated its entry into new international markets. These alliances not only mitigated the risks associated with direct market entry but also accelerated the brand's global expansion, leveraging local insights and networks to gain a competitive edge.

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Key Findings and Results

Here is a summary of the key results of this case study:

  • Implemented Lean Management in the supply chain, reducing operational costs and lead times significantly.
  • Enhanced online presence and e-commerce capabilities, driving direct-to-consumer sales and expanding global brand reach.
  • Entered new international markets through strategic partnerships, leveraging local insights and networks.
  • Applied the Digital Maturity Model, positioning the company as a digital leader in the athletic wear market.
  • Identified and streamlined areas of waste in the supply chain, contributing to a more responsive and flexible operational structure.

Evaluating the results, the strategic initiatives undertaken by the organization have yielded significant benefits, particularly in supply chain optimization and digital transformation. The implementation of Lean Management and the Digital Maturity Model have not only improved operational efficiencies but also enhanced the company's digital footprint, crucial for competing in today's market. These successes underscore the importance of agility and digital savviness in the athletic wear industry. However, the results were not uniformly positive. The report does not quantify the impact on sales growth or market share expansion, leaving a gap in understanding the full financial impact of these initiatives. Additionally, while strategic partnerships have facilitated market entry, the long-term sustainability and integration of these alliances into the core business model remain uncertain. Alternative strategies, such as investing more aggressively in proprietary technology for personalized fitness tracking, could have potentially offered a more distinctive competitive edge.

Based on the analysis, the recommended next steps include a deeper evaluation of the financial impacts of the implemented strategies, particularly concerning sales growth and profitability. The company should also consider enhancing its product offerings with proprietary technology to differentiate itself further in the market. Additionally, a more structured approach to measuring the success of strategic partnerships, including their contribution to revenue and brand equity, would provide clearer insights into their long-term value. Finally, continuous investment in digital capabilities and supply chain innovation should remain a priority to sustain competitiveness and support future growth.

Source: Global Expansion Strategy for Athletic Wear SMB in North America, Flevy Management Insights, 2024

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