Sports Inc. Problem Statement

8/10/2019 Sports Inc. Problem Statement

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www.pwc.com/dconstruct

Sports Inc.

Request for Proposal

10 September 2014


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All Rights Reserved by Sports Inc. and PwC-Diamond

Table of Contents

Background...............................................................................................................................................................3

Engagement Objectives .............................................................................................................. 4

Submission Requirements .......................................................................................................... 5


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Background

ContextSport Inc.(hereby referred to as the Company) is an American corporation that is engagedin the manufacturing and selling of footwear, apparel, sports equipment and accessories. Thecompany is headquartered near Miami, Florida and is one of the America's largest suppliersof athletic shoes and apparelwith revenue in excess of US$19 billion in its fiscal year 2014(ending May 31, 2014). As of 2014, it employed more than 20,000 people. In 2013 the brandalone was valued at $20.7 billion, making it the one of the most valuable brand among sports

businesses.

Currently, the company is structured into two broad divisions: Sports Inc Marketing &Sports Inc Manufacturing. Sports Inc Marketing owns the Marketing and R&D functions

while Sports Inc Manufacturing owns the Manufacturing and Distribution functions. TheCompany has 300 company owned stores (not a franchise model) spread across US andmainly sells its product through these stores. The company is considering investing intransportation infrastructure and IT infrastructure to cut costs.

A broad overview of the Companysdepartments is represented below.

Situation

The market for the range of sports goods that Company sells is fairly competitive andfragmented with stable revenue and growth trends. However, the Company has been facingdeclining profitability over the past 2 years in-spite of stable revenues. There has been arecent change in company management. The new management is very concerned about thedeclining profitability trends especially in the Manufacturing and retailing division given thatthe largest investors expect the firm to meet stringent net profitability target of 12% by FY 17.The company is in the process of planning its store rationalization and growth strategy tomeet those targets.

The company would like PwC-Diamond (hereinafter referred to as "the firm") to determine

possible reasons for decline in profitability and recommend an appropriate storerationalization and growth strategy.


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Engagement Objectives

Identify the drivers that explain the profitability decline the company has seen inrecent years

Define the framework for store rationalization and execution roadmap forimplementation of the same

Determine the appropriate levers and roadmap for future growth strategy both in U.S.and emerging markets like South East Asia


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Submission Requirements

The response submitted by the firm, on 17th September 2014, should detail out the followingmandatory information required by the company for evaluation of the proposal:

Project Understanding: A brief description of the objectives of the current projectengagement as understood by the firm. (1 slide)

Approach and Methodology: This section will detail out how the firm intends toperform the analysis and the underlying framework for the same. For example, identify thecritical drivers and corresponding data analysis to ascertain their impact on firmsprofitability. (3 to 5 slides)

Data Requirements: This section should contain the detailed data requirement for asuccessful execution of the project as envisioned by the firm. In general, the firm may use anythird party data from a reliable source as long as it is publicly available. (1 slide)

List of Deliverables: This section will detail out the list of deliverables (along withsamples as applicable) that the firm will provide to the company (1 to 2 slides)

Project Timelines:This section should detail out the timelines for the project, along withany time commitment required from the company. Senior management from the company

will be available for a conversation to shortlisted proposals to answer any further queries (1

slide)

Resource Requirement & Cost:This section should detail out the engagement team forthe project with description of work assigned to each team member and their experience inthe subject (1 slide)

The submission is to be in a power point format with not more than 12 slides + relevantappendix

Documents

Sports Inc. Problem Statement