New Balance

New Balance Athletic Shoe, Inc.

Type	Privately held company
Industry	Footwear
Founded	1906 as New Balance Arch Support Company
Headquarters	Boston, Massachusetts
Key people	William J. Riley, founder James Davis, Chairman Robert T. DeMartini, CEO & President John Withee, Exec. Vice President and CFO
Products	Athletic shoes, shoes, apparel
Revenue	US$1.55 billion (2006)[1]
Employees	4,180 worldwide (October 2008)[1]
Website	newbalance.com

New Balance Athletic Shoe, Inc. (NBAS), best known as simply New Balance, is a footwear manufacturer based in Boston, Massachusetts, United States of America. It was founded in 1906 as the New Balance Arch Support Company. Eschewing expensive advertising campaigns, it has, nevertheless, grown to be one of the largest makers of sports footwear in the world.

New Balance is notable in that it has continued to maintain a manufacturing presence in the United States as well as in the United Kingdom for the European market—in contrast to its competitors in the same market space, such as Nike and Adidas, who design products in the US and Europe but outsource the majority of their footwear and apparel to manufacturers in China, Vietnam, and other developing nations. The result of this corporate decision is that the shoes tend to be more expensive than those of New Balance's competitors. To offset this pricing discrepancy, New Balance differentiates their products with technical innovations, such as a blend of gel inserts, heel counters, and a greater selection of sizes, particularly for very narrow and/or very wide widths.

History

In 1906, William J. Riley, a 33-year old English immigrant, founded the New Balance Arch Support Company, which manufactured arch supports and other accessories designed to improve shoe fit, in Boston, Massachusetts. His first product, a flexible arch support, was designed with three points of support in the shape of a triangle. These points created greater balance and comfort in the shoe. It's 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 to demonstrate. He would explain to customers that the chicken's three clawed foot resulted in perfect balance. In 1927, Riley hired Arthur Hall to be a salesman, and, in 1934, Hall became a business partner and soon found his niche by marketing his products to people whose jobs required them to spend much time standing.^[2] In 1956, Hall sold the business to his daughter Eleanor and her husband Paul Kidd.

Eleanor and Paul continued to sell mainly arch supports until 1960, when they designed and manufactured the "Trackster," the world's first running shoe made with a ripple sole. It was also the first running shoe to come in varying widths. The "Trackster" was given a big boost through the YMCA programs where it became the unofficial shoe of the program. College track teams such as MIT, Tufts University and Boston University adopted the New Balance Trackster for their cross-country teams soon to be followed by other colleges and private high schools around the country.^[2]

Marketing was mostly by word-of-mouth or local sports fairs, and sales languished, until 1972, when current Chairman Jim Davis bought the company on the day of the Boston Marathon. At the time, the company consisted of just six people making 30 pairs of shoes daily and selling products mostly through mail-order with a few U.S. retailers. Jim committed himself to uphold the company's traditional commitment to individual preferences, customer service and quality products. His future wife Anne, who joined the company in 1978, focused on building a distinct culture for New Balance employees and customers. Their timing was perfect, as the Boston area soon became a veritable hotbed of the running boom that struck the U.S. in the 1970s. Their product line expanded and sales skyrocketed. The homegrown company prospered, and the Davises looked to expand New Balance into a global company. The company is now run by California native Rob DeMartini. DeMartini's background includes Procter & Gamble and Gillette Shave Company. Today, 30% of the New Balance shoes sold in the European market are manufactured at the New Balance facility in England.

Shoes

A New Balance running shoe

A pair of New Balance '574' casual trainers

New Balance headquarters

New Balance is one of few shoe manufacturers to offer the majority of its shoes in a wide range of widths, typically men's range from B to 6E with 3 other widths in between (D, 2E, 4E) and one narrower offering (2A). Women's range from 4A to 4E with four widths to choose from in between (2A, B, D, 2E).

New Balance does not give names to the shoes it sells, instead referring to them by a 2, 3, or 4 digit model number. This is done to "place an emphasis on the New Balance philosophy, not any one particular shoe".[2] When a shoe is redesigned, the model number is increased by one. The numbering system originated from the price. The Tracker 320 was $32, the 990 was $99, etc. However, now the model number reflects the category of the shoe such as stability, neutral, lightweight, and motion control. The numbering system allows customers to identify which shoes are in the categories that best fit their needs.

Made in USA (and UK) stance

New Balance is one of several shoe companies that makes some of their products in the United States. Green America states in the New Balance Responsible Shopper company information page that around one quarter of NB's shoes are made in the United States.^[3] New Balance owns five factories in the United States: two in Massachusetts (Boston and Lawrence), and three in Maine (Norridgewock, Skowhegan, and Norway).^[4][5]

In 1994, New Balance manufactured 70% of its shoes in the United States.^[6]

The New Balance production facility in the United Kingdom has been, since 1982, at Flimby, Cumbria in North West England, where 28,000 pairs of shoes are produced each week.

Toning footwear

A class action lawsuit against New Balance filed in 2011 alleges that the company's toning footwear touts unproven benefits. In support of its claim of false advertising, it cites a University of Wisconsin – La Crosse research study on Toning Shoes that has been funded and published by the American Council on Exercise.^[7]

Researchers 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." ^[8]

Sponsorships

A member key for the New Balance Hubway system in Boston.

New Balance is the apparel partner for the Melbourne Football Club in the Australian Football League. It also has one endorsement deal in the NBA with Matt Bonner of the San Antonio Spurs. New Balance also sponsors the Boston Cannonns major league lacrosse team (MLL). New Balance is also the primary sponsor of Boston's bike share system, the New Balance Hubway.

2011 Presidential campaign

In August 2011, it was discovered that New Balance chairman James Davis had donated $500,000 to Restore Our Future, a political action committee supporting the campaign of Republican presidential candidate Mitt Romney, which caused a backlash from their customers.^[9] Company president/CEO Robert DeMartini responded with a letter on the company's Facebook page, stating that Davis had made a private donation to the Romney campaign, that it was not made by New Balance, and that Romney's signed pledge to challenge same sex marriage was not reflective of Davis, DeMartini, or New Balance's corporate stance on GLBT rights.

References

1. ^ ^{a b} "Fact Sheet: New Balance Athletic Shoe, Inc." (PDF). New Balance. http://www.newbalance.com/corporate/pressroom/corporate_docs/NB_Factsheet.pdf. Retrieved 2006-09-23. 
2. ^ ^{a b} Enduring Performance: The New Balance Story
3. ^ Responsible Shopper Profile: New Balance
4. ^ New Balance - Domestic Manufacturing
5. ^ Hemmerdinger, J. (22 May 2011). "The Bottom Line: Running hard". Portland Press Herald. http://www.pressherald.com/business/running-hard_2011-05-22.html. Retrieved 22 May 2011. 
6. ^ Shoe and Tell: The Quest for American-Made Sneakers
7. ^ [manatt.com/uploadedFiles/News_and_Events/Newsletters/AdvertisingLaw%40manatt/Pashamova%20v.%20New%20Balance.pdf "Pashamova v. New Balance"]. manatt.com/uploadedFiles/News_and_Events/Newsletters/AdvertisingLaw%40manatt/Pashamova%20v.%20New%20Balance.pdf. Retrieved 6 February 2011. 
8. ^ Parcari, Ph.D., John; Mark Anders, John Greany, Ph.D., Stephanie Tepper, M.S., Brian Edmonson, B.S., and Carl Foster, Ph.D.. Will Toning Shoes Really Give You A Better Body?. http://www.acefitness.org/getfit/studies/toningshoes072010.pdf. Retrieved 2/5/11. 
9. ^ [1]

External links

• Official website
• Sneakerset.com sneakerpedia
• FTC 'Complying with the Made In the USA Standard' site
• Info on New Balance UK manufacturing