Business and Management

Birkenstock Orthopädie GmbH & Co. KG is a shoe manufacturer that located in Germany. The company sells Birkenstock, a German brand of sandals and other shoes notable for their contoured cork and rubber Footbeds, which conform somewhat to the shape of their wearers’ feet. Representative products include the two-strap sandal, the Arizona, and the Boston clog. In the 18th century, the founder of Birkenstock is a Mr. Johann Birkenstock. The generation of Birkenstock family members has been designing and crafting footwear since 1774, when Johann Birkenstock worked as a shoemaker in a small German village.
In 1986, Konrad Birkenstock, master shoemaker has two shoe specialty stores in Frankfurt and is starting to make footbed insoles. Konrad Birkenstock explains about his ideas for a custom shoe and get a licenseand contracts for the production of his flatbed shoes. He starts travelling extensively throughout Germany and Austria. There are few brands that design by Birkenstock’s family members and produce by the Birkenstock company which are

In 2004, Birkenstock receives the Drapers Award as ”Best Shoe of the Year” in England because the Birkenstock products’ timeless design making them suitable
for every age group, any occasion and all types of people.

While 2006, The Birkenstock brand was awarded the Cleo Fashion Award 2006 in the category “Best Walking Shoe” in Singapore.

In 2007 this year the Birkenstock brand once again won a prize in the “Best Walking Shoe” category at the Cleo Fashion Award in Singapore.The three owners of Birkenstock Orthopadie GmbH  Stephan, Alex and Christian Birkenstock take over their longstanding distribution partner, Birkenstock Distribution USA, to trade as Birkenstock USA, LP.

A new and larger footbed manufacturing facility in Gorlitz commenced operation in the spring of 2009.

Economic Component
Economic component is one of the external environmental factors that encompasses some factors such as interest rate, inflation, changes in disposable income, stock market fluctuations, and business cycle stages.
Economic factor has a major impact on how the company operates their business and make decisions. Example, the exchange rate affects the cost of exporting the goods and the cost of supply and the price of imported the goods for manufacturing the shoes.

In the 1890s, Konrad Birkenstock has an idea about the shoes and he knows this will success, but unfortunately the next decade brought the introduction of cheaper factory-made shoes and a subsequent decline in the demand for custom-made footwear. In 1987, black Monday is the financial crisis that affects the Birkenstock seriously. The stock market crashed around the world, shedding a huge value in a very short time.
Besides that, Birkenstock companies and their shops were located in 83 countries, therefore the exchange rate are currently affecting the company, but since this company is a big and successful company so this factor will not affect too much to this company but if the exchange rate is going up in the economy,this will become a higher expense to the company, it might be a loss for this company.

Demographic Component
Demographic component is the population based on factors such as age, race, gender, education level, geographic location, income and family composition. This component currently affects the Birkenstock company because nowadays the footwear of the Birkenstock company has already become a trend for the peoples especially teenagers. The range age of the customers is between 16 to 35.So, we can see that this brand is popular with younger demographic.
Besides that, the factors of location also affected this company. Normally the shops of Birkenstock company are located in big cities such as Kuala Lumpur, Malaysia. Kuala Lumpur is the main state and also is a state that is very crowded. In this location, got more rich peoples, more peoples can afford the brand of the shoes.
Furthermore, young parents also follow the trend to allow their kids or children wearing the footwear of this brand. We can say that the factor of location is currently affecting this company. The changes of the location will affect the income of the company. If the shops of this company located at the place that are less population or a state that technology not very advanced. The income of the company will drop because the citizens don’t have a higher income to follow the trend and afford the brand of these shoes.Children wearing the footwear of this brand.
Technological Component
Birkenstock only uses natural and sustainable materials such as cork, latex and jute for the Birkenstock footbed. It was one of the first manufacturers in the world . Exclusively water soluble and solvent-free adhesives are used to produce the shoes. In the recent years, innovative techniques, permanent operational enhancements and continuous process optimization enabled Birkenstock to reduce their energy consumption by more than 90%. Any EVA punching scraps left after producing soles are shredded and used for playgrounds, sports grounds or for noise barriers on the motorway. Every components of the Birkenstock styles from the buckle to the sole, can be individually replaced or repaired. The family company then uses remaining leather to create accessories such as key fobs. Birkenstock is able to ensure that all of the valid environmental guidelines are met by keeping their site in Germany, which are some of the strictest in the world.
Furthermore, Birkenstock is selling their stocks by using Information Technology. Birkenstock creates a website to enable customers to know all of the information of Birkenstock. Birkenstock also provides the catalog system to let their customers online shopping when they feel free. Birkenstock uses the help of media to advertise their products to gain popularity.
In conclusion, the external environmental that affect Birkenstock are economy component, technological component and demographic component. Birkenstock is the best-known brands in the world, but the external environment factors still affected Birkenstock seriously. Examples, the financial crisis affect the stock market of the Birkenstock seriously. Examples, the financial crisis affect the stock market of the Birkenstock seriously. So, in my opinion, Birkenstock need to find the way to overcome the economy problem.
Besides that, Birkenstock has gained reputation as one of the manufacturer in the world that uses the natural and sustainable materials to manufacture the shoes. Many of the customers prefer to buy the footwear of this company because it very comfortable and it has various types of design for each brand therefore customers have many options when buying. One of the reasons why Birkenstock has earned the popularity because they have the longest history of making the comfortable footwear.

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