Under Armour

Background

Kevin Plank a University of Maryland football had a need for performance

apparel that was engineered to keep him cool, dry, and was light weight. Seeing

no other products on the market that met this quarter he decided to make his own

performance apparel and the company we now know as Under Armour was born.

In 1995 Kevin Plank was able to take newly available moisture-wicking, polyester-

blend fabrics to create tighter fitting shirts and undergarments that would make

it cooler and more comfortable to engage in strenuous activities. With this new

product and the help of Kip Fulks, and Scott Fulks Kevin formed KP Sports and

began selling his products to athletes and sports teams. In 1998 the company was

able to secure a small business loan and began to grow its product offerings to

include high-tech undergarments tailored for athletes in different sports including

hot and cold weather sports. In 2000 major retailers started selling KP Sport’s

apparel and sales began to grow rapidly with revenues reaching $5.3 million. For

the next 11 years the company continued to grow, increasing both product offerings

and revenues. In 2005 KP Sports changed its name to Under Armour and became a

public company with an initial public offering of 9.5 million shares.

The five-forces analysis for Under Armour consists of five forces that range from

low to high in competitive intensity. The five forces are rated in order from most

competitive, to least competitive. The most competitive force Under Armour

faces is rivalry within the industry. Under Armour faces intense competition from

companies such as Nike and Adidas as well as newer players. Nike and Adidas have

considerably larger resources at their disposal and are making a play within the

performance apparel market to gain market share in the industry. These larger

companies could leverage their strong brand recognition and...