According to CEO Arne Freundt, Puma is increasingly relying on suppliers from countries such as Indonesia and Vietnam during sourcing for the US market because the trade war between China and the United States is tightening.
In an interview with Bloomberg, the CEO of the German sporting goods provider said that Puma received about 10 percent of shoe imports for the US market from China. This is a significant decline compared to the earlier 30 percent, as the tensions between the two countries increase. Since Donald Trump was re-elected US President, Puma has made various changes due to the increasing tensions between the USA and China with new tariffs and export restrictions.
In view of the uncertainty in the trade, which affects consumer behavior, agility is the key to success, emphasized the Puma CEO and explained that he met with his employees last week: inside, to get the mood of the US consumers : To assess the inside, to analyze competitors and to ensure that the procurement teams receive first -hand market information.
Puma’s diversified sourcing strategy, which also includes procurement from other countries such as Vietnam and Indonesia, is an advantage, says Freundt. Competitors could not adapt so quickly and may have to increase prices. However, Pumas has come across some stumbling blocks in recent months.
After the good results for the third quarter and the confirmation of the forecast for 2024 After the elections, the demand for important products such as the Sneaker Palermo and Suede XL skating shoes went back in November, especially in China and Latin America, where storage bottlenecks caused additional pressure. Although product demand was strong in October, the general decline in consumer demand was felt.
In January, Puma surprised investors with unexpectedly weak results for the fourth quarter, missed the forecasts and postponed an important profitability goal by two years. As a result, the share price fell as strong as it has not been in over two decades.
Freundt was appointed CEO in November 2022 after working as a Chief Commercial Officer. The 45-year-old has been with Puma since 2011 and headed the areas of strategy, retail, e-commerce and the EMEA division. Since taking office at Puma, he has sought “realistic” financial forecasts, but now he is planning a more careful approach in view of the volatility in the industry, said Freundt.
“For me, the message is clear and clear: we have to be more careful when it comes to communicating our expectations,” he told Bloomberg.
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