Adidas is ending its practice of sourcing products from China for the US market, CEO Bjørn Gulden announced during a recent earnings call. The company has made significant changes to its supply chain, aiming for a more localized approach.
Adidas has 82 factories in China, accounting for 23% of its Tier 1 suppliers. However, the company is diversifying its supply chain to avoid potential tariffs and geopolitical risks. This move follows similar actions by other companies, such as Helen of Troy and Mattel, which are also shifting production away from China.
Gulden stated that Adidas is “in good shape” for potential new US tariffs and is focused on creating a more agile and speedy supply chain. The company aims to produce goods in their respective regions, such as China goods in China and India products in India.
The decision to shift away from China comes as the US government considers imposing additional tariffs on Chinese-made goods. Adidas is proactively adapting its supply chain to mitigate potential risks.
Gulden emphasised that Adidas has made significant progress in reconfiguring its supply chain. The company is prioritising flexibility and resilience in its supply chain management, recognizing that a more localized approach can bring numerous benefits.
As Adidas continues to navigate global trade and supply chain complexities, its decision to shift away from China underscores its commitment to strategic risk management and maintaining a competitive edge.
Source: SupplyChain Dive
