## Personnel Risks 

To a significant extent, the success of the PUMA Group is due to the dedicated commitment and performance of its employees. To ensure lasting success, the company has developed external and internal training measures, employee participation programs, and 

## Sourcing Risks 

Most suppliers’ production facilities are in the industrializing countries of Asia. Business activities with these countries create diverse risks for the PUMA Group. For example, risks may arise through exchange rate fluctuations or changes in customs levies and duties, trade restrictions, natural disasters and political 

## Financial Risks 

Financial risks may arise for PUMA primarily through currency effects. The majority of PUMA products are sourced in Asia in US$. Parts of the necessary US$ currency, however, can only be 

## Product 

PUMA products must satisfy the functional, aesthetic and high-quality expectations of buyers. Extensive laboratory tests and collaboration with PUMA athletes on product design and development ensure that the products satisfy the highest quality requirements. To this end, the external manufacturers work 

## Retail Operations 

The international expansion of the company’s retail operations ensures consistent presentation of the product lines and allows the company to capture a higher gross profit margin. However, the extension of the value chain involves investment risks. An increase in retail shops, for example, may be associated with long-term rental commitments and investments which could 

## Organizational Challenges 

The virtual organizational structure built up over the years drives global orientation and ongoing decentralization. However, it is associated with increased coordination requirements for coping with technical, logistical and personnel challenges. An added factor is the growing complexity within the organization structure 

## Summary 

PUMA’s risk management enables it to fulfill the legal requirements concerning control and transparency in company operations. Management believes that in the overall assessment 

attractive remuneration systems with to the goal of building up, developing, and motivating top talent to remain with the company on a long-term basis. 

instability. Risks can also arise as a result of an over-dependency on individual suppliers. For the avoidance and containment of such sourcing risks, PUMA has developed very good relationships with a number of manufacturers in different countries and sourcing regions. 

raised through sales in the US$ region. PUMA approaches this risk in accordance with an internal guideline through the use of primary and derivative financial instruments (hedging). 

according to technical, material, and design specifications. As a risk prevention measure, PUMA has established a global sourcing organization responsible for all requirements of product manufacturing. 

increase the share of fixed costs. In periods of declining sales, these fixed costs would burden profitability. PUMA approaches these risks through careful selection of retail locations, recruitment of staff with extensive experience in the retail business, daily sales reporting, and extensive controlling. 

caused by the growth of the Group. Through strategic planning, continuous optimization of business processes and investments in information technology, PUMA can continue to grow organizationally while tapping into new potential for efficiency and international communications. 

of the risk situation the risks are limited and confinable and do not represent a hazard to the going concern of the PUMA Group. 

Foreword | Mission | Management Report | Share | Marketing | Consolidated Financial Statements - IFRS - | Report of Supervisory Board | Board of Management 

