End of Kanye West Partnership Hurting Adidas
Following the end of their partnership towards the end of last year, Adidas have admitted that the end of the deal is "hurting" their business, with sales in North America hit hardest.
They have said that the loss of the business led sales being cut by $400m (£350m) in the first quarter of this year - with revenue falling overall by 1%.
A positive for Adidas to take was that sales overall were up by 9% when the impact of the Yeezy business was excluded.
They are noticing and benefiting from the current trend in the market for "terrace" style trainers - seeing significant and increased demand for the Samba, Gazelle & Campus styles.
They already have plans afoot to increase production in the coming months.
The BBC reported:
The decision has cost the firm millions in sales and has it facing its first annual loss in more than three decades.
Shoes from the collaboration remain wildly popular in the resale market.
Chief executive Bjoern Gulden said the company was still working out how the sales would happen.
"What we are trying to do now over time is to sell some of this merchandise... burning the goods would not be a solution," he said at the company's annual shareholder meeting.
Adidas has about 1.2bn euros (£1bn; $1.3bn) worth of Yeezy shoes sitting in storage.
Mr Gulden said the firm had decided to sell some of the merchandise, instead of donating it, because it did not want to see the products reach the market indirectly.
Mr Gulden - who joined Adidas at the start of this year from rival Puma - warned that 2023 would be "a bumpy year with disappointing numbers".
He also said that Adidas was aiming to make sure that 50% of the products it sells in China are designed specifically for the Chinese market.
China is the world's second largest sportswear market, but Adidas has been falling behind its rivals there.
In the first three months of the year, its sales in China were down 9.4% from a year earlier."
Images via BBC News & Private Sport Shop
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