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Billabong. Presented by Josi Price, Kiri Linseth, Fun Wu, Emma Ma, Summer Lang. Introduction. History Global Market SWOT Analysis Industry & Competitor Analysis Financials Recommendations Conclusion. Stagnant pool of water Billabong founded

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Billabong l.jpg

Presented by

Josi Price, Kiri Linseth, Fun Wu,

Emma Ma, Summer Lang

Introduction l.jpg

  • History

  • Global Market

  • SWOT Analysis

  • Industry & Competitor Analysis

  • Financials

  • Recommendations

  • Conclusion

History l.jpg

Stagnant pool of water

Billabong founded

Burleigh ,the heart of Australian surfing, 1973

Gordon Merchant

Boardshorts, durable and well price

get credits from famous surfers


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  • Stable Australian market

  • Global expansion

    • First –North America

      large comsumptive groups

    • Japan, South Africa and New Zealand

      got licenses

    • New land— Europe

  • More international surfers credits

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  • Professional surfing products

  • skate and snow

  • No.1 status in Australian waters

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  • August 11th, Australia Stock Exchange

  • Billabong International Ltd

    ASX: BBG

  • Strong promotion in finance

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After 2000

  • 2004

  • Sunglasses brand—Von Zipper

  • Element Skateboards brand

  • Honolua Surf Company

  • Kustom Footwear and Palmers Surf

  • 2005

  • Beach culture airport-retail business

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After 2000

  • 2006

  • Nixon watches and accessories

  • Element Footwear range

    the California-based Beachworks retail business

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  • Clothing, accessories, eyewear, wetsuits and hardgoods

  • Youth culture (12-20 year-old)

  • Marketing, distribution, wholesale and retail

  • Special technique

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  • CEO – Derek O'Neill

  • 1,750 employees worldwide

  • Gets licenses and distributions in more than 100 countries

  • About 8,000 stores around the world

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  • Slogan –“only a surfer knows the feeling”

  • Pushing all kinds of surfing

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Expand The Global Market— U.S. & Europe

  • Annexed Xcel Hawaii

  • Bought Nixon

  • Opened the flagship in Time Square

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Expand The Global Market— Asia-Pacific & Africa

  • Set supply chain in China

  • Licensed business in South Africa

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Other Instruments

  • Sponsor athletes and track events

  • Launch a pan-Europe digital sports channel

  • Distribution channels

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SWOT Analysis

  • Strengths

  • Weaknesses

  • Opportunities

  • Threats

Strengths l.jpg

  • Billabong Brand Name

  • Robust Revenue Growth

  • Strong Profitability

Weaknesses l.jpg

  • Low Returns

  • High Dept-Equity Ratio

  • High Dependence to the Billabong Brand

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  • Strategic Acquisitions

  • Positive Outlook for Sporting Goods

  • Growth in the Footwear Industry

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  • Competition in Global Surf, Skate and other Apparel

  • Rising Costs of Raw Materials

  • Slowdown in Consumer Spending

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Current Situation in Surf Industry

North America, Europe, Australia

  • On the mature stage of the product life cycle

  • In US market, sales is close to one billion dollars in 2005 and 2006.

  • Asia, South America and Africa

  • Absence on surf culture

  • Huge potential market

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Competition in Surf Industry

  • Barrier of entry

  • Production (design, quality, distribution channel, price)

  • Activities of the company

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Competitor Analysis(1)


  • Located in the United States

  • One of the biggest surf sport brands

  • Seperated from Billabong USA as a independent license in 1982

  • In 1998, Bob Hurley set up his own brand-Hurley

  • Was sold to Nike in 2002

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Competitor Analysis(1)


  • Different market segment

  • Concentrate on grassroots marketing

  • Unique company culture

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Competitor Analysis(2)


  • Located in Australia

  • Set up distribution center in the mid 1970’s

  • Was brought to Europe in 1984

  • Built a subsidiary brand -Roxy

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Competitor Analysis (2)


  • Based on the needs of consumers

  • A series of newly conception stores- “ boardrider ” and “ outlet ”.

  • Join in surfing activities and extreme sports

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Competitor Analysis (3)

Rip Curl:

  • Located in Australia

  • Founded in 1969

  • In 1974, sponsored the first Australian professional tour with Coca-Cola

  • $150 million of net income and 70% of products export abroad each year

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Competitor Analysis (3)

Rip Curl:

  • Reform products in design and needs.

  • Expand the international market actively and widely.

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Billabong Key Numbers

  • Company Type: Public

  • Fiscal Year End: June

  • 2006 Sales: $750.2 Million USD

  • 1-Year Sales Growth: 15.7%

  • 2006 Net Income: $106.3 Million USD

  • 1-Year Net Income Growth: 11.3%

  • 2006 Employees: 1,750

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Billabong Financials

  • Billabong was originated out of Australia and bases its accounting practices in accordance to Australian Accounting Standards

  • Uses Australian dollars in all of its financial statements and all foreign currencies are translated into Australian

  • Australian currency is the company’s functional and presentational currency

  • Any gains or losses made between foreign currency exchanges are stated in the income statement

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Translating Foreign Currencies

Foreign currencies that are different from Australian dollars are translated to the functional currency.

3 Steps:

  • Assets and liabilities for each balance sheet are translated using the closing rate at the date of the balance sheet.

  • Income and expenses for each income statement are translated at average exchange rates.

  • All resulting exchange differences are recognized as a separate component of equity.

  • The differences in exchanges from transactions are placed in to shareholder’s equity

  • Investment classification l.jpg
    Investment Classification

    • Billabong classifies its investments in to groups depending on the purpose of the investments

    • The 4 groups are:

      • Financial Assets at Fair Value through Profit and Loss

      • Loans and Receivables

      • Held-to-Maturity Investments

      • Available-for-Sale Financial Assets

    Recommendations l.jpg

    • Distribution channel

    • Make the products individuated

    • Make good use of the international human resource

    Recommendations35 l.jpg

    • Pay attention to Asia market (warm-up and create the needs)

    • Launch a series of new brand covered different market segment

    • Pursue other way to increase the brand recognition.

    • Improve Weak Management