Under Armour currently manufacturers most of their products by third parties overseas. “In 2006, our products were primarily manufactured in Asia, Central and South America and Mexico” (Under Armour, 2016). However, their distribution center remains in Maryland. Only a select number of products though are filtered through their distribution center. When Under Armour enters the golf equipment business there are numerous factors to consider in obtaining the raw materials, manufacturing, and distribution. Most major golf equipment companies manufacture their clubs in China but assemble their clubs in USA. Due to lower labor costs, materials, and EPA regulations makes more sense to outsource overseas.
After throughout research, …show more content…
Expansion of their distribution facility to include an assembly plant will take over a year. In addition, the creation of the shaft and head of the club it will take up to 10 weeks to reach the United States. When the shaft and head reach the assembling facility, it will take a day or so for assembly and packaging for distribution. By having the assembly plant next to their distribution facility, it does save time.
By Under Armour manufacturing product in Japan there presents a handful of potential challenges that could come with this decision. For instance, if their hired third party manufacturer is behind in production or shipment they cannot sell their product for online orders or retail stores. Also, regulation and tariffs that could come with new political changes in both Japan or the United States. Finally, any blockage in raw materials or resources would be a huge obstacle for Under Amour’s production of golf clubs.
Lean management puts the customer first. The customer must find value from the collection of the raw material to the sale. “Lean manufacturing is a competitive philosophy adopted by many companies to produce cost effective products and services” ((Allada & Srinivasaraghavan, …show more content…
Japan is also using state of the art technology in manufacturing products similar to golf clubs. Technology is becoming more prevalent in the sport of golf than ever before.
There has been so much emphasis on American made products and keeping American jobs. By using the lean management strategy, we must realize that our consumers are going to find value in this and Under Armour must limit as much manufacturing as possible overseas. Our strategy will be to produce the most technologically advanced golf club but do everything possible to have the club primarily made in the United States.
Labor, Equipment, Materials:
Under Armour will be using an overseas third-party for early manufacturing of their product. Asia has been producing golf clubs for many of the top golf equipment organizations in the United States. “Japan has been in the club-manufacturing business for decades, but as investment casting of clubheads became more prominent, and the desire for more affordable labor became paramount, Taiwan took the lead in clubhead manufacturing” (Stachura, 2010). Labor costs will be cheaper outsourcing the manufacturing component overseas. However, Under Armour wants to limit as much labor as possible overseas because the golfing community is starting to notice and value American-made