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Speaker 1: Bloomberg Audio Studios, podcasts, radio news.

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Speaker 2: We do want to turn too well another earning support

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Speaker 2: and this is actually for a private company, but a

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Speaker 2: private company that we all know and love. New Balance

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Speaker 2: the company saying that twenty twenty three was a milestone year,

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Speaker 2: the company known for sneakers and athletic apparel, reporting double

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Speaker 2: digit record growth in every global market, reaching six point

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Speaker 2: five billion dollars in annual sales. That's a twenty three

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Speaker 2: percent increase year over year from twenty twenty two. Joining

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Speaker 2: us now for an exclusive conversation, Joe Preston. He's a

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Speaker 2: president and CEO of New Balance Athletics. Six point five

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Speaker 2: billion and nine percent growth astonishing, Joe, whatch got you there? Well?

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Speaker 3: Thanks, I remain Hi, Gena Martin. Pleasure to be here. Yeah,

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Speaker 3: it's our third consecutive year at double digit growth all

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Speaker 3: around the globe. Every every region has posted those results

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Speaker 3: and we're seeing across categories footwear and apparel. We surpassed

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Speaker 3: a billion dollars in apparel last year for the first time.

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Speaker 3: It's across men's, women's, and kids and as there's really

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Speaker 3: three reasons for it's it's innovation, it's brand activation, and

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Speaker 3: its operational excellence.

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Speaker 2: Talk a little bit about the brand activation and more importantly,

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Speaker 2: brand visibility. I think for a certain cohort of people,

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Speaker 2: New Balance has always been at a presence in their closets,

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Speaker 2: in their lives. But the partnerships that you and your

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Speaker 2: rest of your team have gone out to get with

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Speaker 2: people like Kawhi Leonard and basketball, Cocoa, golf and tennis

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Speaker 2: and I'm no, I'm forgetting quite a few others here.

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Speaker 2: How much of an impact have those partnerships had.

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Speaker 3: I think they've had a tremendous impact. You know, we

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Speaker 3: also have Sidney McLoughlin. We also have Tyrese Maxi. We

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Speaker 3: have over three hundred and fifty athletes and entertainment ambassadors,

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Speaker 3: and our brand teams have done. It's just a great

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Speaker 3: job of connecting sport and culture and that's bringing energy

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Speaker 3: to the brand. It's bringing new consumers to the brand.

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Speaker 3: In fact, sixty three percent of a New Balance dot

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Speaker 3: com customers last year with new customers, and we know

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Speaker 3: they're younger just from all the data that we're collecting.

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Speaker 1: You mentioned innovation as one of those key to your success.

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Speaker 1: Talk to us about that innovation. What are your new innovations,

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Speaker 1: What are you doing to really attract that customer well.

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Speaker 3: Person of all, there's performance innovations that we're bringing into

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Speaker 3: our performance running line as well as well as into

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Speaker 3: our cleated product that's worn across a number of sports.

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Speaker 3: And it's also coming from our lifestyle businesses where our

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Speaker 3: product teams are reimagining some of our heritage styles. And

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Speaker 3: that intersection of taking our heritage, authentic product and reimagining

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Speaker 3: it along with our brand activations, is what's bringing us energy.

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Speaker 1: And where are you seeing the greatest growth globally as

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Speaker 1: a large global company. Are you seeing more emerging market interest,

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Speaker 1: developed market interest, US non US?

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Speaker 3: You know, quite frankly, it has been so consistent from

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Speaker 3: every single reachi. But this past year in twenty twenty three,

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Speaker 3: Europe grew over thirty five percent, so they led the

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Speaker 3: way this year, but the US has been up over

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Speaker 3: twenty percent for three consecutive years. Since the dark days

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Speaker 3: of twenty twenty, we've almost doubled our business and every

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Speaker 3: region's contributing.

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Speaker 2: I'm curious about the competition out there, particularly when it

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Speaker 2: comes to footwear itself. It seemed for a lot of

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Speaker 2: years there was kind of really only three or four

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Speaker 2: major players in here. Obviously Naki and Adidas the biggest,

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Speaker 2: but now you've got upstarts like Hoka, You've got on

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Speaker 2: Cloud and a few other companies that have seemed to

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Speaker 2: just kind of come up out of nowhere and capture

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Speaker 2: the imagination of a lot of folks. How do you

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Speaker 2: stack up in terms of keeping yourself not just visible,

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Speaker 2: but more importantly convincing people for whatever reason that a

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Speaker 2: new balance might be better than saying on Cloud or whatever.

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Speaker 3: Well, new balance is unique. New balance has authenticity. We

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Speaker 3: first once introduced a one hundred dollars running shoe, and

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Speaker 3: then we also that heritage is allowing us to introduce

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Speaker 3: some of our older styles, our iconic styles, as I

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Speaker 3: always mentioned, reimagining them to a new set of consumers.

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Speaker 3: So we are considered new to a younger generation. And

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Speaker 3: then when they get in and they try to unpack

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Speaker 3: as to who we are, they can go back to

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Speaker 3: our history and that authenticity is very powerful.

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Speaker 2: Well, what about how are you doing right now in

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Speaker 2: terms of your own costs when it comes to making

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Speaker 2: these shoes and getting them out there to the retail set.

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Speaker 3: Well, I mean, obviously during COVID costs we're significantly rising,

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Speaker 3: particularly on the distribution front. We also make shoes in

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Speaker 3: the US, and that cost is higher than our competitors,

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Speaker 3: but we committed to it. We've been here for more

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Speaker 3: than forty years in the communities that we serve. We've

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Speaker 3: just opened up a new factory. Excuse me, we just

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Speaker 3: broke around on a new factory in London area and

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Speaker 3: New Hampshire, and we're very excited about continuing to build

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Speaker 3: our capabilities and producing footwear here in the US.

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Speaker 1: Speaking of your employees in the US, how are you

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Speaker 1: finding labor supply right now? We hear lots of different

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Speaker 1: stories depending upon the interest in the industry about scarce

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Speaker 1: supply of labor. Are you experiencing the same? What are

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Speaker 1: the labor dynamics and the footwear business?

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Speaker 3: Well, I think every company has been challenged over the

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Speaker 3: past few years. I don't think it's as difficult as

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Speaker 3: it was a couple of years ago. But also as

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Speaker 3: the brand is growing, more and more people are seeking

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Speaker 3: us out as a place of employment. So you know,

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Speaker 3: we've also got a very loyal and stable employment base.

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Speaker 3: Our associates come here and they stay here, so I

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Speaker 3: wouldn't say it's a big problem for US right now.

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Speaker 1: And how are you seeing the global trade market right now?

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Speaker 1: There's obviously, you know, we're certainly in better condition than

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Speaker 1: we were with the supply constraints of the COVID experience,

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Speaker 1: but there still does appear to be some general friction

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Speaker 1: and supply chains. What are you seeing on the supply

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Speaker 1: chains and global trade?

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Speaker 3: I think from a production standpoint, there's no issue. The

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Speaker 3: issue is ships that are coming out going through the

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Speaker 3: canal and that's causing delays coming into Europe, some delays

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Speaker 3: coming into the US. But from a production standpoint, there's

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Speaker 3: no major issues in the industry.

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Speaker 2: Great, all right, Joe, Great to catch up with you here.

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Speaker 2: An impressive a year four New Balance. In twenty twenty three, Preston,

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Speaker 2: President and CEO of New Balance Athletics, there