Gravity Step

Executive Summary

  • Increased Production​
  • Price Reduction Strategy​
  • Quality Sacrifice
Projections
Year EPS ROE Image Rating Credit Rating
21 6.5 15 85 A
22 8.5 20 90 A+

Strategic Vision

  • To become a global leader through constant innovation and model selection availability while maintaining an affordable price for our loyal athletes. ​

  • To have high-quality shoes at an affordable price while providing models that appeals to customers. ​

  • To assist our customers with their aspiring goals 

Performance Targets

Market Strategy

Internet Market

Wholesale Market

Private-Label Market

Company’s Production Strategy

Gravity Step Financial Statistics
Year 11-20
Year 11 12 13 14 15 16 17 18 19 20
Interest Coverage Ratio (oper. profit ÷ interest exp.) 12.96 17.54 27.86 38.80 79.10 75.00 36.39 32.77 13.95 7.49
Debt to Assets Ratio (total liabilities ÷ total assets) 0.30 0.23 0.16 0.13 0.11 0.16 0.18 0.36 0.33 0.27
Default Risk Ratio (cash flow from ops ÷ principal paymts) 5.81 6.90 8.65 9.95 20.02 11.86 3.48 6.15 3.17 1.88
Current Ratio (current assets ÷ current liabilities) 3.29 3.80 4.49 5.58 4.09 2.34 4.61 2.49 2.42 2.38
Operating Profit Margin (operating profit ÷ net sales revenues) 0.21 0.23 0.23 0.20 0.22 0.21 0.21 0.17 0.20 0.09
Net Profit Margin (net profit ÷ net sales revenues) 0.14 0.15 0.15 0.14 0.15 0.15 0.15 0.11 0.13 0.05
Dividend Payout (dividends per share ÷ earnings per share) 0.28 0.12 0.00 0.17 0.14 0.12 0.14 0.13 0.11 0.18

Strongest Competitors

Company Suggestions

  • Increase price​

  • Increase quality​

  • Differentation between all Markets ​

  • Pay back debt to increase credit rating​

  • Abandoned celebrity endorsements unless they become less expensive​

  • Find a blue ocean (Niche Differentiation)​

Lessons Learned

​

  • Finding a balance in when to update strategy​

  • Reducing costs, but maintaining quality and efficiency is a fine line ​

  • Importance of finding a blue ocean in designated regions ​

  • Importance of strategic forecasting and looking at changing external conditions ​

  • Comprehension of rival competition and making defensive and offensive counter measures