Description: Those comfortable Birkenstock sandals have been a favourite of many consumers for years, often symbolizing a counter-culture outfit. The arch-supporting footwear has been made in Germany since 1774, but this past week Birkenstock stock was publicly traded on the New York Stock Exchange for the first time. The initial public offering (IPO) brought in close to $500 million in exchange for 10.8 million shares. With manufacturing centred in Germany using predominantly European materials, it will be interesting to see if Birkenstock can maintain its traditions, given the new pressure of having to meet earnings expectations of a publicly-traded stock.
Date: October 12, 2023
Source: abcnews.com
Link: https://abcnews.go.com/GMA/Style/birkenstock-public-new-york-stock-exchange/story?id=103916524
Discussion points:
1) Have you ever worn Birkenstock sandals? What do you think of them?
2) Do you think now that Birkenstock is publicly traded that it may face pressures to move production from Germany in order to reduce its costs?
3) Page 11-7 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses Initial Public Offerings (IPOs). What was the largest IPO in history and how much did it bring in?
Andrew Leslie, Jessie Kpai, Samuel Johnson, Presley Warren-Daigle
1) Some members of our group have worn Birkenstocks. They were uncomfortable at first, but became very comfortable after being broken-in.
2) Birkenstocks may face some pressure to keep up with their shareholders’ demands to increase profits, however many investors respect the brand for its long heritage and tradition. Moving production centres elsewhere, or changing suppliers is not a small feat, and cost-saving measures may sacrifice the quality that the brand has built itself upon.
3) The largest IPO in history was when oil producer Saudi Aramco went public in 2019, raising 25.6 billion USD.
Emily Lake, Sage Jull, Maalik Boukouiss, Kenna Van der Pluijm
1. Most of our group wear/wore some form of Birkenstock sandals. They are very comfortable shoes because they mold to the shape of your feet. They are also a very supportive shoe, and they last for a very long time. They have become increasingly popular over the last couple of years for our generation.
2. We do not think that they will completely move productions to Germany, but they may open additional production places. People know and love Birkenstock shoes as they are and as they have been here for over 200 years, we don’t see how they would benefit from moving and changing that process, especially since that’s where they get the majority of their supplies. It would end up costing more for them in the long run, which is exactly what they don’t want considering their sales are being sold on the lower end.
3. The Largest initial public offering in the world is the Saudi Arabian Oil Company which is called Saudi Aramco. The company brought in 25.6 billion US dollars.
Zanna Hathaway, Dylan Kurtz, In Hye Yang, Andrianna Scott
1) 2 of our group members have never owned Birkenstock sandal’s but the 2 that have love them.
2) We think they will face pressure to move however we think they should stay true to their roots. Also if they move it could risk effecting the quality of shoes which would cause people to not buy them.
3)The largest Initial Public Offerings was Saudi Arabian Oil Company. They brought in 25.67 billion US dollars in December 2019.
Jagger Russell, Gerrit Sierink, Lauren Reid, Rachid Nait-Aiss
1. Lauren in our group has Birkenstocks, Lauren thinks they are quality shoes, they were a little more popular a few years ago.
2. Yes because Birkenstocks share price is too high, to make it more interesting to stock brokers the price should be lower.
3. Saudi Aramco, it brought in 25.6 billion USD
Laura LeBlanc
1) Yes, they are comfortable
2) Yes, they may get more pressures from stockholders that it wouldn’t have received before
3) The largest IPO in history was Saudi Arabian Oil Company (Saudi Aramco), which brought in US $25.6 Billion
Laura LeBlanc
Olivia McCray
cortrell simmonds
cortrell simmonds
cortrell simmonds
1) Yes, they are comfortable
2) Yes, they may get more pressures from stockholders that it wouldn’t have received before
3) The largest IPO in history was Saudi Arabian Oil Company (Saudi Aramco), which brought in US $25.6 Billion
Cortrell Simmonds
laura leblanc
olivia mccray
Andrew Carrier, Janan Anvar, Cecilia Indira Anderson
1) Yes, I have worn Birkenstock sandals before. My thoughts are that the shoes are very durable and well made. Being made of all high-quality materials like natural cork, natural latex, jute and suede is the reason for this. I also think that they are convenient and comfortable.
2) Now that Birkenstock is publicly traded, they may face pressure from shareholders to move production in order to reduce its costs. That being said, we still believe that they should stay true to their long heritage in Germany. Since 95% of their products are also assembled there, it could affect the quality of the sandals if they were to move production from Germany.
3) The largest IPO in history was a Saudi Arabian oil company which is called Saudi Aramco. The capital raised was 25.6$ billion.
Aidan Hazen and Josh Gonsalves
1. Two of our group members have worn Birkenstock sandals before they both really like the comfort and look of the sandals. They also like how they mold to your feet once broken in. Both group members would recommend them to anyone looking for new sandals.
2. Now that Birkenstock is a publicly traded company, I do believe they will receive pressure to move production outside of Germany as producing in countries such as China and Vietnam are drastically cheaper, it could save the company millions of dollars as well as potentially increase production in order to meet new expectations.
3. The largest initial public offering (IPO) was from a Saudi Arabian Oil Company Saudi Aramco in December 2019. This IPO made $25.6 billion US dollars.
Spencer Desveaux, Broderick Richardson, Daniel Spears, Abdul Haruna
1. Have you ever worn Birkenstock sandals? What do you think of them?
Yes everyone in our group has at some point in their lives worn Birkenstock Sandals. They are very convenient in the summer!
2. Do you think now that Birkenstock is publicly traded that it may face pressures to move production from Germany in order to reduce its costs?
Yes, now that Birkenstock has shareholders involved with their company there is more pressure from holders to cut expenses and raise profits in order to increase their share value.
3. Page 11-7 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses Initial Public Offerings (IPOs). What was the largest IPO in history and how much did it bring in?
We found in the textbook that the largest IPO was from a Saudi Arabian Oil Company Saudi Aramco in December 2019. This IPO made 25.6 Billion US dollars.
Haley Harrison
1. I own Birkenstocks and find them a very comfortable shoe. The more you wear them the more they break in and mold to your foot. I have had mine for over 4 years now.
2. now that the company has moved to a publicly traded company i think they will feel the pressure to move production outside Germany to overall reduce its costs. However even though costs may be reduced it could devalue the company if the production is changed even slightly. Birkenstocks are considered a high value brand that many say is worth the high prices for high quality production. If the quality decreases at all the sales will decrease and the loyal customers may no longer be loyal.
3. The largest IPO was from a Saudi Arabian company called Saudi Aramco that brought in $25.6 billion dollars US.
Haley Harrison
Isabelle Rafter, Mary Goudy, Keeve Chantack, Riyan Mittal
1. Most group members have worn or owned a pair of Birkenstocks. The consensus is at first they are uncomfortable (especially if the shoes belong to someone else and you’re just borrowing them) but once the shoes are broken in, they are super comfortable
2. Birkenstocks will likely not face extreme pressure to move from Germany. This is a well-established brand with a long prestigious heritage, moving from Germany to cut costs will likely jeopardize the quality of its product. Which is not something they want to do
3. Saudi Aramco’s IPO is the largest ever recorded, raising $25.6 billion USD in December 2019
John christodoulou, Andrew Little, Shristhi Suresh Kedia, and Lauren Kate Hatheway
1.) We all have worn Birkenstocks. At first they are uncomfortable until you worn them down then they are comfortable. They have has a line of plastic Birkenstocks which are comfortable from start till finish. They are also great for water activities, being that they are water proof.
2.) There is pressure from the stockholders, which hasn’t been giving before.
3.) Saudi Aramco, the capital raised was USD $25.6 Billion. Which is the largest IPO in history.
Remi McLaughlin, Rykert Balfe, Tristen Devine, Hayden Rowe
1.) Some members of our group have worn a pair of Birkenstocks. For the ones who have worn them they are a very comfortable and reliable shoe. Once their broken in they really mold to your feet, which makes them very comfortable.
2.) Yes, we do think that it will face pressure from the stockholder to reduce their cost. Also, almost all of their assembly was in Germany and almost all of their product was from Europe by relocating this might change the quality of the product and it may increase cost to find new suppliers.
3.) The largest IPO in the world was the Saudi Aramco oil company, the company brought in $25.67 billions US dollars in December of 2019. This was the largest IPO in history.