Puma slows Chinese imports as imposed US tariffs take effect

Puma is sourcing more and more from suppliers in countries like Indonesia and Vietnam for the US market as the trade war between China and the United States intensifies, according to Arne Freundt, CEO.

The CEO of the German sportswear brand revealed in an interview with Bloomberg that it is sourcing approximately 10 percent of the footwear imports for the US market for China, a significant decrease from its previous 30 percent, as tensions between the two countries mount. Since Donald Trump was elected US president, Puma has introduced several changes amid growing US and China trade tensions, including new tariffs and export restrictions.

With trade uncertainty affecting consumer behavior, agility is key for success, added the Puma CEO noted that he met with staff this week to assess US consumer sentiment, analyze competitors, and ensure sourcing teams receive firsthand market insights.

Puma’s diversified sourcing strategy, which includes sourcing from other countries like Vietnam and Indonesia, is an advantage, said Freundt, noting that competitors may struggle to adapt as quickly and potentially may have to increase prices. However, Pumas has hit a few stumbling blocks in the past few months.

After reporting strong Q3 results and reaffirming its 2024 forecast post-election, demand for key products like Palermo sneakers and Suede XL skater shoes slowed in November, particularly in China and Latin America, where warehouse constraints added pressure. Although product demand was strong in October, the overall decrease in consumer demand was felt.

In January, Puma surprised investors with weaker-than-expected Q4 results, missing estimates and delaying a key profitability target by two years, which caused shares to drop more than they had in over two decades.

Freundt was appointed CEO in November 2022 after serving as chief commercial officer. The 45-year-old has been with Puma since 2011, overseeing strategy, retail, e-commerce, and the EMEA division. Since taking up the reins at Puma, Freundt says he has aimed for a “realistic” financial outlook but now plans a more cautious approach amid industry volatility. For me, the message is loud and clear: we need to be more cautious about communicating our expectations,” he said to Bloomberg.