New Balance Case Study

Introduction New Balance has experienced a rapid increase in growth within the last few years in the market for running shoes and has become one of the most innovative and customer oriented shoe companies in the world. Sales increased by almost 361% from 1974 to 1976 and has been accompanied by moving the production facility to Boston in order to keep up with the rising demand and to increase production. New Balance’s innovations provide excellent heel and forefoot cushioning and availability in all widths, making New Balance one of the top contenders in the shoe market. This rapid growth and recognition gives the company a number of choices concerning its future direction, New Balance can either aggressively expand overseas and contest the shoe market internationally or stay in the United States and continue to maintain the lead in a high-quality niche market. Establishing a plant in Texas is highly recommended due to the relatively low amount of risk and allowing New Balance to expand without having to sacrifice production and quality. Texas is also the middle ground between these options, Ireland and Lawrence, has lesser total costs, and will help reduce delivery time to an expanding market on the West Coast of the United States.
Forecasting Growth New Balance is currently in an exponentially expanding market, as illustrated in the Exhibit 4 Trendsmooth model, and environment. Recreational sports such as football and basketball are becoming increasingly popular. As sports become a bigger part of our lives, individual fitness will become a greater priority. Most fitness minded consumers are not professional runners but they will research to find the most effective and comfortable shoes by looking into runner magazines, such as Runner’s World. As New Balance continues to be featured in running publications and magazines and individual fitness continues to become a daily part of American livelihood, maintained growth and increase in market share becomes a