Download The market for Lawn-Tennis Rackets - th

 CIBCO / MA Market Brief The market for Lawn-Tennis Rackets Evelyn Geddert and Michael Knödler Executive Summary •
Decrease of imports to Germany Tennis is a popular and reputable sport in Germany. Although, according to the International Trade Center the imports of Germany from all its trading partners worldwide decreased in quantity from 2005 until 2007, there can be an increase recorded in 2008. In contrast to these figures, the European Commission indicates a decrease of imported tennis rackets from 2006 until 2008. Nevertheless, experts predict a stagnant demand trend for the following years due to different substitutes of tennis such as golf. •
China is main exporter of tennis rackets to Germany, no production of tennis rackets within Germany. China is the main exporter to Germany which reflects the fact that most of the lawn‐tennis racket production is in China. China is by far the main origin of imports of lawn‐tennis rackets to Germany and produces under very low labor costs. Due to this fact, China was the origin of more than 80 percent of Germany’s imports of lawn‐tennis rackets from 2004 until 2008. Furthermore, according to research there is no tennis racket production in Germany at all. •
Tennis racket sales to stagnate in the medium‐term, the global sports industry will suffer cost pressure and competition in the future. Provided by the European Commission, Germany recorded an apparent consumption of 65 tons in the year 2008. Although, according to different experts the consumption will stagnate in the medium term, the global sports industry suffers more and more under cost pressure and aggressive competition. Competitors try to purchase tennis rackets from the cheapest producers in order to get a higher margin at the end. Additionally, Germany records a high level of concentration in retail sellers due to different categories of retailers such as specialized stores, online sellers and sometimes supermarkets which also sell tennis rackets. © 2007 CIBCO copies of the full report can be ordered from: [email protected] •
Producers can avoid the downward price spiral and stagnant sales by differentiation strategies and offering high quality products. But for many end consumers competition is not necessarily based on price when buying a tennis racket. In most cases brand recognition is the most important factor because consumers try to identify themselves with certain brands presented by professional tennis players. Therefore, a differentiation strategy is a means of avoiding the continual downward price spiral and stagnant sales levels of tennis rackets by offering high quality. This requires high financial resources and capabilities as well as the availability of distribution channels and good relationships to suppliers. Due to the fact that there are already many well‐
established competitors such as Wilson, Head, Babolat, Dunlop, and Yonex with high brand recognition, it is an enormous challenge to enter the German market in order to sell tennis rackets. © 2007 CIBCO copies of the full report can be ordered from: [email protected]