Topics: Ethics, Retailed, Personal Selling

Summary: Former executives at Under Armour Inc., the sportswear company whose accounting is under federal investigation, said they scrambled to meet aggressive sales targets, borrowing business from future quarters to mask slowing demand in 2016 for its athletic apparel. The Baltimore company frequently leaned on retailers to take products early and redirected goods intended for its factory stores to off-price chains to book sales in the final days of a quarter, according to former executives in sales, logistics, merchandising and finance.

Classroom Application: It’s important for you to understand this story about Under Armour and how its salespeople were under pressure to generate sales orders just before the close of each quarter. This pressure and the sales tactics that are used are fairly common, and impact both manufacturers and retailers. Many of you will pursue careers either in retailing or sales, so you need to understand why companies use these tactics, and they need to have a legal and ethical framework you can apply to their own decisions and behaviors.

Questions:

1. In your own words, explain what ‘pulling forward’ means in the context of Under Armour

2. What tactics did Under Armour’s sales force use to try to get sales booked before the end of each quarter? (Describe at least two)

3. Why did Under Armour face pressure to show consistent sales growth?

4. What roles did retailers play in the tactics you described in the previous question?

5. According to the article, were any of Under Armour’s tactics unethical or illegal?

6. If you were a salesperson for Under Armour and your sales manager pressured you to book sales just before the end of the quarter, how would you handle the situation?

The article is Under Armour Pushed to Hit Aggressive Targets

Just answer the question and write the essay question.