New Balance

Last updated

New Balance Athletics, Inc.
Formerly
  • New Balance Arch Support Company
  • New Balance Athletic Shoe Company
Company type Private
Industry Footwear
Founded1906 (1906)
FounderWilliam J. Riley
Headquarters100 Guest Street, Boston, Massachusetts, U.S.
Key people
Products
RevenueIncrease2.svgUS$6.5 billion (2023) [2]
Number of employees
≈ 8,000 (2024) [3]
Subsidiaries
Website newbalance.com

New Balance Athletics, Inc. (NB), best known as simply New Balance, is one of the world's major sports footwear and apparel manufacturers. Based in Boston, Massachusetts, the multinational corporation was founded in 1906 as the New Balance Arch Support Company.

Contents

New Balance maintains a manufacturing presence in the United States, as well as in the United Kingdom for the European market, where it produces some of its popular models. New Balance claims to differentiate its products with technical features, such as blended gel inserts, heel counters and a greater selection of sizes, particularly for very narrow or very wide widths. The company is privately held and totaled $6.5 billion in revenue in 2023. [2]

History

20th century

New Balance headquarters in Boston New Balance headquarters.jpg
New Balance headquarters in Boston

In 1906, William J. Riley, an English immigrant, founded the New Balance Arch Support Company in the Boston area, manufacturing arch supports and other accessories designed to improve shoe fit. [4] His first product, a flexible arch support, was designed with three support points to provide greater balance and comfort in the shoe. It is believed that Riley came up with the name "New Balance" by observing chickens in his yard and demonstrated the way his arch supports worked by keeping a chicken foot on his office desk. He explained to customers that the chicken's three-pronged foot resulted in perfect balance. In 1927, Riley hired Arthur Hall to be a salesman. In 1934, Hall became a business partner. [5] The company later did business under the name New Balance Athletic Shoe Company. As New Balance slowly established itself as a niche business in the 1930s, baseball players and track and field athletes sought the company out for its specialty footwear. [6]

In 1956, Hall sold the business to his daughter Eleanor and her husband Paul Kidd. [7] Eleanor and Paul Kidd continued to sell mainly arch supports until 1960, when they designed and manufactured the "Trackster", the first running shoe to come in varying widths. The Trackster gained popularity through YMCA programs in which it became the unofficial shoe. [5] College track teams such as Massachusetts Institute of Technology (MIT), Tufts University and Boston University adopted the Trackster for their cross-country teams, soon to be followed by other colleges and private high schools around the country. [8] Marketing was mostly word-of-mouth or through local sports fairs.

Sales languished until 1972, when 28-year-old Jim Davis bought the company, feeling that "leisure-time products would be a high-growth market." [6] At the time, the company consisted of six people making 30 pairs of shoes daily and selling products primarily through mail-order with a few U.S. retailers. [9] The Boston area became a center for the running boom of the 1970s, and the product line expanded and sales grew rapidly. [4] The company opened a UK factory in Workington in 1982, which relocated to Flimby in 1991. [10]

21st century

New Balance storefront in Connecticut New Balance (14566840827).jpg
New Balance storefront in Connecticut

In 2001, New Balance purchased canvas sneaker company PF Flyers and re-launched the brand in 2003. In February 2004, the company purchased Warren, Michigan-based Warrior Lacrosse, now Warrior Sports. [11] [12] In 2011 New Balance placed its Aravon, Cobb Hill, and Dunham brands under its Drydock Footwear affiliate. In 2015, New Balance's parent, together with Berkshire Partners, bought the Rockport shoe company from the Adidas Group and combined it with Drydock Footwear under the name The Rockport Group, now with the Aravon, Cobb Hill, Dunham, and Rockport brands. [13] [14] [15] In 2018, The Rockport Group went into bankruptcy and was sold. [16] [17]

In February 2015, New Balance announced its entry into the global soccer (association football) market. The company had started its soccer business through its subsidiary Warrior Sports in 2012, punctuated by a $40-million-a-year sponsorship deal with Liverpool F.C., but made the move to rebrand based on the global reach of the parent brand. [18] Later on, the UK High Court rejected the legal filling of New Balance against the Liverpool's UK£70 million+ kit deal with Nike, which come into force in January 2020 and staggered the Manchester United deal with Adidas for £75 million annually. [19] [20]

During 2016, New Balance opposed the Trans Pacific Partnership [21] [22] and condemned the Obama administration's support for it, arguing that it would hurt its domestic shoe manufacturing (while Nike, which does not manufacture in the US, supported the TPP). [23] [24] Matt Lebretton, the company's Vice President of public affairs said in April 2016 "I would say that when Hillary Clinton, Bernie Sanders and Donald Trump all agree on something, then it has to be given a closer look; and they all agree that TPP is not the right policy." [25] After Donald Trump won the 2016 U.S. presidential election, Lebretton told a reporter, "The Obama administration turned a deaf ear to us [about trade] and frankly, with President-elect Trump, we feel things are going to move in the right direction." Some news outlets reported that an ad hoc boycott campaign was created out of an interpretation of Lebretton's remarks as supportive of Trump. [26] [27] [28] [29] Owner and Chairman Davis donated almost $400,000 to the Trump Victory Committee in September 2016. [30]

In December 2018, Chief Commercial Officer Joe Preston succeeded Rob DeMartini as New Balance's president. [1] In March 2020, the company announced that it would be converting some of its manufacturing facilities in New England to produce face masks in response to the COVID-19 pandemic. [31] Later on in 2018, Sydney Mclaughlin-Levrone signed a partnership with New Balance.


In April 2021, Teddy Santis, founder of lifestyle brand Aimé Leon Dore, was named creative director of New Balance's premium sneaker line. [32]

Products and operations

New Balance Trail More running shoes New Balance - Trail More running shoes.jpg
New Balance Trail More running shoes

New Balance manufactures a range of shoes and apparel. It maintains a manufacturing presence in the United States, as well as in the United Kingdom for the European market, where it produces some of its most popular models such as the 990 series—in contrast to its competitors, which often manufacture exclusively outside the United States and Europe. [33] [34] As a result, New Balance shoes tend to be more expensive than those of many other manufacturers. To offset this pricing difference, New Balance claims to differentiate its products with technical features, such as blended gel inserts, heel counters and a greater selection of sizes, particularly for very narrow or very wide widths. [35] Between 1992 and 2019, the company made approximately $69 billion in profit. [35] In 2017, New Balance's facility in Flimby, England was producing 28,000 pairs of shoes a week, 5 percent of the New Balance shoes sold in the European market. [36] [37]

Sponsorships and collaborations

New Balance sponsors a variety of sports teams, leagues and individuals. Sponsorships include the New York Road Runners, which organizes the New York City Marathon; [38] the National Basketball Association (NBA); [39] major league baseball teams the New York Mets and the Boston Red Sox; [40] [41] and Team Ireland at the Rio 2016 Olympics. [42] It has sponsored football national and club teams worldwide, US and European athletics teams, and individual athletes in basketball, baseball, cricket, cycling, tennis, rugby, lacrosse, motorsports, and skateboarding.

The company has launched products in collaboration with apparel company Aimé Leon Dore, [43] NBA star Kawhi Leonard, [44] and British fashion designer Paul Smith. [45]

New Balance Foundation

The New Balance Foundation was established in 1981. The foundation donates to national and Boston-based charitable organizations, and groups that support children and families with a focus on health, nutrition, education and physical activity. [46]

Sustainability

New Balance committed to the Science Based Targets initiative, the United Nations' emissions reduction plan that seeks to keep global warming under 1.5 degrees Celsius. The brand also aims to reach 100% renewable electricity for its operations by 2025. [47] In February 2024, New Balance introduced its resale program 'Reconsidered'. [48] According to this plan, pre-worn shoes are sold on New Balance's online store in a new section of the website. [47] [49]

Toning footwear

In 2011, a class action lawsuit was filed against New Balance alleging that the company's toning footwear touts unproven benefits. In support of its claim of false advertising, it cited a University of Wisconsin–La Crosse research study on toning shoes that was funded and published by the American Council on Exercise. [50]

Researchers studying rival toning shoes made by Skechers and Reebok reported that there were no "statistically significant increases in either exercise response or muscle activation" as a result of wearing the toning shoes. There was no statistically significant difference between participants wearing special "toning shoes" and controls wearing normal sneakers. The researchers concluded that there is "simply no evidence to support the claims that these shoes will help wearers exercise more intensely, burn more calories or improve muscle strength and tone." However, it was noted that "These shoes may be encouraging a fair number of people who probably wouldn't put on a normal pair of walking shoes and go out and walk." [51] In August 2012, New Balance agreed to pay $2.3 million to settle false advertising claims. [50]

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References

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  2. 1 2 Ciment, Shoshy (February 22, 2024). "New Balance Posts $6.5B in Annual Sales in 2023". Footwear News . Retrieved August 4, 2024.
  3. ↑ "New Balance | Company Overview & News". Forbes . Retrieved August 4, 2024.
  4. 1 2 Campbell, Casey (April 13, 2017). "A Brief History Of New Balance Shoes". Culture Trip. Retrieved April 30, 2020.
  5. 1 2 New Balance Athletic Shoe Inc. (2006). Enduring Performance: The New Balance Story. New Balance Athletic Shoe, Inc. OCLC   71122256.
  6. 1 2 Grant, Tina (February 25, 2005). International Directory of Company Histories. Vol. 68. Detroit, Michigan: St. James Press. ISBN   978-1-55862-543-3. OL   8607128M – via Funding Universe.
  7. ↑ "The History of New Balance Athletics". What's Good?. Archived from the original on January 4, 2018.
  8. ↑ Larson, Peter (2012). Tread Lightly: Form, Footwear, and the Quest for Injury-Free Running. Constable & Robinson. ISBN   978-1-62087-355-7. OCLC   823385051.
  9. ↑ "Jim Davis & family". Forbes. Retrieved May 1, 2020.
  10. ↑ "New Balance marks 100 years in business". Times and Star. Newsquest. December 29, 2005. Retrieved March 13, 2023.
  11. ↑ "New Balance shoes relaunches classic PF Flyers brand". Deseret News. March 18, 2003. Retrieved May 1, 2020.
  12. ↑ "New Balance, Seeking Growth, Purchases Warrior Lacrosse". Wall Street Journal. February 2, 2004. Retrieved May 1, 2020.
  13. ↑ Eric Convey. "Rockport is a Massachusetts shoe company again". BizJournals.com. Boston Business Journal.
  14. ↑ "Can Cobb Hill, Aravon, And Dunham Products Still Be Purchased?". support.newbalance.com.
  15. ↑ "Berkshire Partners and New Balance to Acquire The Rockport Company". Business Wire. January 23, 2015. Retrieved March 25, 2022.
  16. ↑ Nanos, Janelle (May 14, 2018). "Shoemaker Rockport files for bankruptcy protection". The Boston Globe . Retrieved May 14, 2018.
  17. ↑ "2 LI shoe stores close in parent's bankruptcy".
  18. ↑ Stock, Kyle (February 4, 2015). "New Balance Goes on Offense, Slides Into Soccer". Bloomberg Business. Retrieved February 4, 2015.
  19. ↑ "New Balance to take Liverpool to court in kit deal row". September 24, 2019. Retrieved April 23, 2021.
  20. ↑ "Liverpool seal £70m+ kit deal with Nike". January 7, 2020. Retrieved April 23, 2021.
  21. ↑ Harlow, Doug (April 13, 2016). "New Balance ends silence, criticizes Asian trade deal and rebukes military for order delay". Portland Press Herald . Retrieved January 11, 2023.
  22. ↑ Chesto, Jon (April 11, 2016). "New Balance accuses Pentagon of reneging on sneaker deal". The Boston Globe . Retrieved January 11, 2023. New Balance is reviving its fight against the trade deal, which would, in part, gradually phase out tariffs on shoes made in Vietnam. A loss of those tariffs, the company says, would make imports cheaper and jeopardize its factory jobs in New England.
  23. ↑ Johnson, Dave (April 15, 2016). "Did Administration Offer New Balance A Big Contract For TPP Silence?". Common Dreams . Retrieved January 11, 2023.
  24. ↑ Surowiecki, James (January 2, 2017). "The Trump-Era Corporate Boycott". The New Yorker . Retrieved January 12, 2023.
  25. ↑ Harlow, Doug (April 12, 2016). "New Balance blasts Obama administration over trade pact, broken promise". CentralMaine.com. Retrieved January 11, 2023. New Balance is 'coming out against TPP after remaining neutral and quiet for about a year on the issue,' LeBretton said in a telephone interview. 'This administration has failed to provide a pathway that allows us to be confident that our government will take the steps to ensure our continued domestic operations and the growth in those operations. I would say that when Hillary Clinton, Bernie Sanders and Donald Trump all agree on something, then it has to be given a closer look; and they all agree that TPP is not the right policy,' he said.
  26. ↑ Germano, Sara (November 11, 2016). "New Balance Faces Social Media Backlash After Welcoming Trump". The Wall Street Journal . ISSN   0099-9660 . Retrieved November 12, 2016.
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  28. ↑ Chuck, Elizabeth (November 11, 2016). "This is why people are lighting their New Balance shoes on fire". NBC News . Retrieved November 12, 2016.
  29. ↑ Woolf, Jake (November 9, 2016). "Our New President Just Got His First Sneaker Endorsement (Update)". GQ . Retrieved November 14, 2016.
  30. ↑ O'Sullivan, Jim (January 13, 2017). "New Balance founder gave nearly $400,000 to Trump". The Boston Globe . Retrieved January 21, 2017.
  31. ↑ Yang, Nicole (March 28, 2020). "New Balance is working to manufacture facial masks during coronavirus pandemic". The Boston Globe . Retrieved May 7, 2020.
  32. ↑ New Balance Names Aimé Leon Dore Founder Teddy Santis as Its Newest Creative Director Robb Report, DEMETRIUS SIMMS, April 7, 2021
  33. ↑ "New Balance 990 Series: Pioneering Perfection". Sneaker Freaker. May 25, 2017. Retrieved April 30, 2020.
  34. ↑ "New Balance: The US company shaking up the sneakernomics". CNBC. June 9, 2015. Retrieved April 30, 2020.
  35. 1 2 "Made in Maine: New Balance supports soles, souls". Press Herald. May 23, 2019. Retrieved April 30, 2020.
  36. ↑ Maria 2022-02-03T16:14:00, Eugenio Di. "Mathias Boenke: New Balance sees European sales of €1 bn doubling" . Sporting Goods Intelligence. Retrieved June 14, 2022.{{cite web}}: CS1 maint: numeric names: authors list (link)
  37. ↑ "A Look Inside New Balance's UK Flimby Factory". High Snobiety. July 7, 2017. Retrieved May 1, 2020.
  38. ↑ "New Balance Signs 10-Year Deal With New York Road Runners". Podium Runner. December 8, 2015. Retrieved April 30, 2020.
  39. ↑ "New Balance and NBA announce multi-year global deal". SportBusiness. May 1, 2020. Retrieved May 1, 2020.
  40. ↑ "Mets sign New Balance, Mr. and Mrs. Met getting new kicks". New York Business Journal. February 27, 2018. Retrieved May 1, 2020.
  41. ↑ "Boston Red Sox announce new deals". Sports Pro Media. April 5, 2011. Retrieved May 1, 2020.
  42. ↑ Mulvaney, Amy (June 8, 2016). "'It's a big slap in the face' – Irish designers react to Team Ireland's New Balance Olympic kit". Irish Independent . Retrieved February 4, 2023.
  43. ↑ Dean, Tres (November 24, 2021). "Aimé Leon Dore and New Balance Are in This for the Long Haul". GQ . Retrieved February 4, 2023.
  44. ↑ Goh, Yang-yi (February 18, 2019). "Kawhi Leonard's First New Balance Shoe Has A Lot Riding On It". GQ . Retrieved May 1, 2020.
  45. ↑ "New Balance Celebrates 30 Years of the 576 With Paul Smith Collaboration". Hypebeast. June 5, 2018. Retrieved May 5, 2020.
  46. ↑ "New Balance Foundation pledges $2M for COVID-19 response". Boston Business Journal . March 24, 2020. Retrieved May 1, 2020.
  47. 1 2 "New Balance debuts brand-owned resale channel". Glossy. Retrieved February 7, 2024.
  48. ↑ "New Balance Launches Sneaker Resale Program in Sustainability Push". Athletech News. Retrieved February 7, 2024.
  49. ↑ "New Balance launches resale program 'Reconsidered'". Fashion Network. Retrieved February 7, 2024.
  50. 1 2 "New Balance Pays Fat Settlement In Toning Shoes Lawsuit To People It Did Not Slim". Huffington Post. August 29, 2012. Retrieved May 1, 2020.
  51. ↑ John Parcari, Ph.D.; Mark Anders; John Greany, Ph.D; Stephanie Tepper, M.S.; Brian Edmonson, B.S.; Carl Foster, Ph.D. "Will Toning Shoes Really Give You A Better Body?" (PDF). Retrieved January 12, 2016.
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