Strategic management assignment - NIKE company
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- 1. 1 Introduction Company History NIKE, Inc., incorporated on September 8, 1969, is engaged in the design, development, marketing and selling of athletic footwear, apparel, equipment, accessories and services. The Company's operating segments include North America, Western Europe, Central & Eastern Europe, Greater China, Japan and Emerging Markets. The Company's portfolio brands include the NIKE Brand, Jordan Brand, Hurley and Converse. The Company sells its products to retail accounts, through its retail stores and Internet Websites, and through a mix of independent distributors and licensees across the world. The Company's products are manufactured by independent contractors. As of May 31, 2016, the Company focused its NIKE brand product offerings in nine categories: Running, NIKE Basketball, the Jordan Brand, Football (Soccer), Men's Training, Women's Training, Action Sports, Sportswear (its sports-inspired lifestyle products) and Golf. Men's Training includes its baseball and American football product offerings. The Company also markets products designed for kids, as well as for other athletic and recreational uses, such as cricket, lacrosse, tennis, volleyball, wrestling, walking and outdoor activities. The Company's athletic footwear products are designed primarily for specific athletic use. Its products are also worn for casual or leisure purposes. The Company also sells sports apparel. The Company also markets apparel with licensed college and professional team and league logos. The Company sells a range of performance equipment and accessories under the NIKE Brand name, including bags, socks, sport balls, eyewear, timepieces, digital devices, bats, gloves, protective equipment, golf clubs and other equipment designed for sports activities. The Company also sells a range of plastic products to other manufacturers through its subsidiary, NIKE IHM, Inc. NIKE IHM, Inc. manufactures Air-Sole cushioning components at the Company-owned facilities located near Beaverton, Oregon and in St. Charles, Missouri. The Company's Jordan Brand designs, distributes and licenses athletic and casual footwear, apparel and accessories focused on basketball using the Jumpman trademark. The Company's Hurley brand designs and distributes a range of action sports and youth lifestyle apparel and accessories under the Hurley trademark. The Company's brand, Converse, designs, distributes and licenses casual sneakers, apparel and accessories under the Converse, Chuck Taylor, All Star, One Star, Star Chevron and Jack Purcell trademarks. Converse Direct to Consumer operations include e-commerce business.
- 2. 2 The Company competes with adidas, ASICS, Li Ning, lululemon athletica, Puma, V.F. Corporation and Under Armour. Reuters (2019) Headquarters Nike's world headquarters are surrounded by the city of Beaverton but are within unincorporated Washington County. The city attempted to forcibly annex Nike's headquarters, which led to a lawsuit by Nike, and lobbying by the company that ultimately ended in Oregon Senate Bill 887 of 2005. Under that bill's terms, Beaverton is specifically barred from forcibly annexing the land that Nike and Columbia Sportswear occupy in Washington County for 35 years, while Electro Scientific Industries and Tektronix receive the same protection for 30 years. Nike is planning to build a 3.2 million square foot expansion to its World Headquarters in Beaverton. The design will target LEED Platinum certification and will be highlighted by natural daylight, and a gray water treatment center. Siemers, Erik (2016). . Board of directors Board of directors of Nike ,by (Kapasondo 2019)
- 3. 3 Contents Form Of Business Nike, Inc. is an American multinational corporation that is engaged in the design, development, manufacturing, and worldwide marketing and sales of footwear, apparel, equipment, accessories, and services. Nike’s Corporate Vision Statement Nike Inc.’s corporate vision is “to remain the most authentic, connected, and distinctive brand.” The business continues to apply this vision statement, which was emphasized in the corporation’s global growth strategy for 2015. The company focuses on developing its brand. The following are the notable components of Nike’s corporate vision statement: Authentic Connected Distinctive Nike’s vision statement uses the word “remain,” which indicates that the company already considers its brand as the most authentic, connected, and distinctive in the global market for sporting goods and related products. The “authentic” component of the corporate vision statement shows that the company aims to make its products deliver high performance to consumers. On the other hand, the “connected” component is about ensuring consumers’ personal connection with the brand. Nike’s marketing mix or 4P supports the creation and maintenance of such connection with customers. The company also maintains distinctiveness by delivering the best possible products to the market. This corporate vision regards Nike Inc. as a leader in the industry, while pushing the business to further separate itself from competitors. A notable point about the company is it also develops connections with consumers through its vision for corporate social responsibility: “to help NIKE, Inc. and our consumers thrive in a sustainable economy where people, profit and planet are in balance.” This vision serves as basis for Nike Inc.’s corporate social responsibility strategy and stakeholder management approaches.
- 4. 4 Nike’s Corporate MissionStatement Nike Inc.’s corporate mission is “to bring inspiration and innovation to every athlete in the world.” The company further states that everybody is an athlete, based on Nike founder Bill Bowerman’s statement, “If you have a body, you are an athlete.” This mission statement represents the company’s strategic goal of reaching out to the global leisure and sports footwear, apparel and equipment market. The following main components are in Nike’s corporate mission statement: Inspiration Innovation Every athlete in the world As a leading manufacturer of sports shoes, apparel and equipment, Nike Inc. inspires people to adopt a “winner mindset”, which is covered in the “inspiration” component of the mission statement. The company’s slogan “Just Do It” represents this inspirational goal. Also, Nike’s corporate mission statement emphasizes innovation. This component is applied through the company’s strategy of continuous improvement of products through new technologies, as included in Nike Inc.’s generic competitive strategy and intensive growth strategies. The “every athlete in the world” component indicates that the company’s corporate mission pushes the business to target every consumer in the world. As noted, the company considers every person an athlete. Thus, based on this corporate mission, Nike’s products are designed to attract and satisfy a wide variety of market segments globally. Nathaniel(2018)
- 5. 5 Situational Analysis SWOT analysis Nike’s Strengths (Internal Strategic Factors) Nike’s strengths are the primary drivers of the company’s growth and global leadership in the sports shoes, apparel and equipment market. This component of the SWOT Analysis deals with the internal strategic factors that support business development and competitiveness. The following strengths are the most notable in the case of Nike Inc.: Strong brand image Rapid innovation processes Extensive global production and distribution network Nike’s strong brand image evolves based on product quality. The company’s effective marketing campaigns also contribute to this strength. Also, rapid innovation processes are a core factor in Nike’s ability to create cutting edge designs for its athletic footwear, equipment and apparel. The company’s extensive global production and distribution network is a strength that enables the business to support global market dominance. This part of the SWOT Analysis shows that Nike Inc. has capabilities to retain its global market leadership. Nike’s Weaknesses (Internal Strategic Factors) Weaknesses could disrupt Nike’s growth trajectory in the sports shoes, apparel and equipment market. This component of the SWOT Analysis addresses the internal strategic factors that prevent or reduce business performance. In the case of Nike Inc., the following weaknesses are the most significant: Labor controversies Limitations in the product mix Limited presence in developing markets Labor controversies continue to plague Nike’s business, especially in considering production facilities in developing countries. This weakness negatively impacts the company’s brand image. Also, even though Nike Inc. has expanded its product mix through the years, the resulting product lines are still limited in capturing a larger share of the sports shoes,
- 6. 6 equipment and apparel market. Moreover, the company suffers from limited presence in developing markets, partly because of issues with pricing, imitation and patent protection. This weakness limits Nike’s global growth. Based on this part of the SWOT Analysis, Nike Inc. must improve its policies and strategies in the areas of labor and employment, product mix development, and penetration in developing markets. Opportunities for Nike Inc. (External Strategic Factors) Nike Inc. has opportunities to enhance its performance in the athletic footwear market. The external strategic factors that facilitate business growth are covered in this component of the SWOT Analysis. The following are the major opportunities in the case of Nike Inc.: Improve labor/employment practices Improve the product mix Increase market presence in developing countries Nike has the opportunity to improve its labor practices to address controversies in this area of the business. Proactive strategies for this concern can lead to an improved brand image. Another opportunity is for Nike to improve its product mix to attract more customers, especially non-athletes. The company also has the opportunity to improve its presence in developing markets to benefit from these markets’ high growth potential. This part of the SWOT Analysis indicates that Nike Inc. must reform some of its policies and strategies to ensure its continued leadership in the global athletic footwear, apparel and equipment market. Threats Facing Nike Inc. (External Strategic Factors) Even though Nike is one of the major players in the sports shoes, equipment and apparel market, some threats could limit or reduce the company’s performance. This component of the SWOT Analysis deals with the external strategic factors that negatively impact business performance. The following threats are most notable in Nike’s case: Tough competition Rapid technological innovation Imitation Nike faces tough competition, considering other major players like Adidas. Also, rapid technological innovation could further increase competitive pressure if Nike does not innovate as rapidly. In addition, imitation remains a threat, especially in developing countries with poor legal protection for patents. This part of the SWOT Analysis shows that, for Nike
- 7. 7 to maintain its leadership in the global sports shoes market, product innovation and legal protection must be included in its major strategies. Marketing Mix of Nike Nike is one of the pioneers in marketing and the marketing mix of Nike is one of the strongest. Depending mainly on pull strategy, it has established its hold in face of major competitors like adidas and reebok. Read on for its product marketing mix. Product in the Marketing mix of Nike Nike offers a wide range of shoe, apparel and equipment products, all of which are currently its top-selling product categories. Nike started selling sports apparel, athletic bags and accessory items in 1979. Their brand Cole Haan carries a line of dress and casual footwear and accessories for men, women and children. They also market head gear under the brand name Sports Specialties, through NikeTeam manufactures and distributes ice skates, skate blades, in-roller skates, protective gear, hockey sticks and hockey jerseys and accessories. Price in the Marketing mix of Nike Nike’s pricing is designed to be competitive to the other fashion Shoe retailer. The pricing is based on the basis of premium segment as target customers. Nike as a brand commands high premiums. Nike’s pricing strategy makes use of vertical integration in pricing wherein they own participants at differing channel levels or take part in more than one channel level operations. This can control costs and influence product pricing. Place in the Marketing mix of Nike Nike shoes are carried by multi-brand stores and the exclusive Nike stores across the globe. Nike sells its product to about 20,000 retail accounts in the U.S. and in almost 200 countries around the world. In the international markets, Nike sells its products through independent distributors, licensees and subsidiaries. The company has production facilities in Asia and customer service and other operational units worldwide
- 8. 8 Promotions in the Marketing mix of Nike Promotion is largely dependent on finding accessible store locations. It also avails of targeted advertising in the newspaper and creating strategic alliances. Nike has a number of famous athletes that serve as brand ambassadors such as the Brazilian Soccer Team (especially Ronaldo, Renaldo, and Roberto Carlos), Lebron James and Jermane O’Neal for basketball, Lance Armstrong for cycling, and Tiger Woods for Golf. Nike also sponsors events such as Hoop It Up and The Golden West Invitational. Nike’s brand image, the Nike name and the trademark swoosh; make it one of the most recognizable brands in the world. Nike’s brand power is one reason for its high revenues. Nike’s quality products, loyal customer base and its great marketing techniques all contribute to make the shoe empire a huge success. Hitesh (2018)
- 9. 9 Findings The statistic depicts the revenue of Nike, Adidas and Puma from their respective footwear segment from 2010 to 2017. In 2017, Adidas' revenue from the footwear segment was 10.36 billion U.S. dollars. Nike is the market leader in the global sports footwear industry, with sales amounting to revenue of over 19.8 billion U.S. dollars in 2016. This figure is larger than the combined footwear revenues of its two closest rivals, Adidas and Puma, who made global sales of 10.68 billion U.S. dollars and 1.71 billion U.S. dollars respectively. Of Nike’s footwear revenue in 2016, four billion dollars was generated in Western Europe and a further 2.54 billion U.S. dollars came from emerging markets in countries such as Brazil and Mexico. However, North America remained the biggest regional market for Nike as footwear sales here reached 9.3 billion U.S. dollars in 2016. In comparison, sales of Nike apparel in the U.S. generated revenue of just under 4.8 billion U.S. dollars and sales of equipment reached 719 million U.S. dollars.
- 10. 10 Although it is still behind Nike in the global market, Adidas’ footwear segment is growing steadily, with 360 million pairs of shoes produced in 2016, the highest figure to-date. The largest regional market for Adidas in 2014 was the emerging European markets, which accounted for 33 percent of net sales. This market included areas such as Russia and the Commonwealth of Independent States. A considerable portion of sales were also made in North America, where the company generated 19 percent of its revenue. Owing to the market dominance of Nike and Adidas, Puma’s footwear sales have remained relatively constant since 2006. The footwear segment nevertheless remains the company’s biggest earner as sales in its apparel segment stood at around 1.3 billion euros in 2016 and sales of its accessories generated close to 667 million euros in revenue. Statista (2019) Conclusion As a conclusion Nike company has contribute in producing quality sport products. My recommendation is Nike can involve into digital sports. In my opinion the new accelerometer based Nike and technology is the birth of a whole new generation of Nike products and an amazing innovation to motivate people to include sports into their everyday life.
- 11. 11 References: Reuters (2019) Nike Inc (NKE) profile [Online] Available from: https://www.reuters.com/finance/stocks/company-profile/NKE [Accessed on 14 February 2019] Siemers, Erik (January 20, 2016). "A first look at Nike's $380M-plus HQ expansion (Renderings)". American City Business Journals. [Online] Available from: https://en.wikipedia.org/wiki/Nike,_Inc.#cite_ref-:0_84-1[Accessed on 14 February 2019] Nathaniel (2018)Nike Inc.’s Mission Statement & Vision Statement (An Analysis)[Online] available from: http://panmore.com/nike-inc-vision-statement- mission-statement Daniel (2017) Nike Inc. SWOT Analysis & Recommendations [Online]Available from: http://panmore.com/nike-inc-swot-analysis-recommendations [Accessed on 14 February 2019] Hitesh (2018)[Marketing Mix of Nike [Online]Available from: https://www.marketing91.com/marketing-mix-nike/ Statista(2019) Revenuefromfootwearsegmentof Nike,Adidasand Puma from2010 to 2017 (in billion U.S.dollars) [Online]Available from:https://www.statista.com/statistics/278834/revenue-nike-adidas-puma-footwear- segment/ Organizational chart Nike Hurley International Organizational structure - nike [Online] available from: https://www.kisspng.com/png-organizational-chart-nike- hurley-international-org-2340121/
Assignment of Economics for Managers Lecturer: Gregory Trotman Subject: CO5125-Economics for managers Submission Date: 28 January 2014 By: Group members Rajveer Kaur (12779931) Harpreet Kaur (12793172) Sonam Rani (12875498) NIKE COMPANY Background information of Nike Company Nike is the world famous company. It is an American multinational corporation which is occupied in the design, development, manufacturing and worldwide marketing and selling of the footwear, equipment and many more other services. The Nike Company was founded on 25 January 1964. The first founder Bill Bower man and the second founder Phil Knight. The Nike name comes from the Greek word goddess of victory. The mission of the Nike Company is to bring inspiration and innovation to every athlete in the world. There are two sides to Nike: the public face and hidden misery. It is the number one shoe maker in the world. This Company creates designs for all age groups, for instance, for men, women and for Children. Description of the Business The following given is the description of the business as well as the competitive environment in which terms the business operates: (a) Type of the business The Nike Company is a manufacturing as well as retailer type company. There are 800 worldwide factories for Nike brand and products. It is true that most of the Nike brand apparel is manufactured out of the United States. It’s all happen due to independent contract manufactures those are situated in different 34 countries. Nike is the one of the largest seller of athlete footwear and athlete apparel in the modern world. (b) Business products Nike sells sports footwear such as running, basketball, and children’s shoes and women shoes.... ... middle of paper ... ...gnore to these factors. References List Sexton, R.L. (2013), Exploring Economics, 6th edition, Keat, P.G., and Young, P.K., (2009), Managerial Economics: http://www.theaustralian.com.au/business http://www.afr.com www.nike.com www.collegetermpapers.com www.investopedia.com http://suite 101.com/a/marketing audit-of nikes-strategies-994402
In this essay, the author
- Explains that nike is an american multinational corporation which is occupied in the design, development, manufacturing, and worldwide marketing and selling of the footwear, equipment and many other services.
- Describes the business and the competitive environment in which it operates.
- Explains that nike is a manufacturing as well as retailer type company with 800 worldwide factories for nike brand and products.
- Explains that nike sells sports-inspired lifestyle apparel, such as bags, sports balls, protective equipment, gloves, bats, eyewear, and many more.
- Explains that nike's main target is to market the shoes for males and females. the competitive market of nike has increased.
- Explains that the most of the customers of nike are located on the net. the main objective of marketing is remaining net tv and magazines.
- Explains that nike has several competitors, including reebok, adidas, and puma. nike and adidas are famous in footwear and accessories.
- Explains that the competitor of nike is located in european, because adidas is mainly focus on european market.
- Explains that an entrepreneur makes his business by putting the resources such as land, labour and capital as well as adding all his ideas his brand name to achieve success as a true businessman.
- Explains that the input as land or building will not change whether the supply or demand of the product is increasing or decreasing. nike company has their plant in asia (indonesia).
- Explains that nike have chief executive officers who maintain all the operational activities in the firm and the salary to pay them will not change as according to the demand of the product they are fixed.
- Explains that the equipment used to make the shoes, sports products, will remain the same in all the quantities so they will not vary according to the output.
- Opines that if more quantity is supplied, more money will be needed to produce more products.
- Explains that rubber is a very important factor of the shoe's production. if the quantity demanded for the products is increasing, we need more rubber to make the sole.
- Opines that the equipment or machines we are using in the production process always needs cares in terms of the fuel or oil.
- Explains that work force is the main factor in the manufacturing process. to produce apparel, equipment, and shoes that are demand of the modern era a firm (nike) has workers.
- Explains that the global economy has positive and negative consequences on nike.
- Explains that nike exports its product to other countries and imports nike products from different countries.
- Opines that nike is the world's number one company. it is rooted in the competition and dominates its competitors. inflation, unemployment, and interest rates are part of every business.
- Explains that nike is a highly competitive and mature market where the top four manufactures hold over 70% of the market share.
- Explains fixed cost, which is fixed and does not change according to the level of production. salaries, rent, and insurance are examples of fixed costs. variable cost is the cost that varies with inputs.
- Explains that the long run is defined as the time period necessary to allow all the inputs to be varied. nike has different factors of the products such as land, rubber, oil, labour, designs and expert’s equipment and the sales man.
- Explains that nike has salesman in retail stores of six continents of the world and if the quantity of demand company’s product is increasing, it has to hire more sales man to provide quality services to their customers.
- Explains that political stability includes political inclination of political parties, influence of party and personal interest on politicians, and so on.
- Explains that high unemployment rate would decrease the costumer's expenditures, and that recession would be the great threat for nike.
- Concludes that a 10% depreciation of us dollar has made imported indian shoes cheaper for u.s consumers, while appreciation of rupees has developed the competitiveness of indian nike company's exports.
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Financing the Enterprise: Nike
Nike is a major power structure in the global economy, a financial land marketing powerhouse. On every level, they practice diversity, they are socially responsible, and Nike gives back to those who are less fortunate. Nike seems to keep improving on every level of business there innovative and never seem to stop looking for new ideas to keep the consumer excited waiting to see what next. Financially Nike has come from nothing five hundred dollars and an idea. This is what America is made of entrepreneurial-minded individual, which believes in an idea and make it come true with just a few dollars.
Commodity Chain Analysis of Nike Shoes
Since its creation, Nike has proven itself as a popular brand and it has created niches by selling products such as footwear, apparels and various types of sports equipment. This paper will attempt to trace the product development of Nike shoes from its origins in conception and design to the manufacturing and production process located in contract factories in developing countries to advertising and marketing of Nike as a cultural commodity and finally, the retailing of the footwear around the world.
Nike started its empire as a company to distribute Japanese running shoes, Tiger, in the United States with the name Blue Ribbon Sports in 1964. Nike founders, Bill Bowerman and Phil Knight, had a great coach-student relationship when both were still at University of Oregon; Bowerman was Knight’s coach seeking a better running shoes and Knight loves athletics so much that he could not live without it. This relationship led Blue Ribbon Sports. After the success of Tiger shoes, Blue Ribbon Sports was renamed into Nike in 1971. Nike is actually the name of the winged Greek goddess of victory and the SWOOSH logo represents her wing. Carolyn Davidson, who was Knight’s student at Portland State University, designed and trademarked the logo in 1971. They introduced the slogan “Just Do It” slogan in 1988 and immediately boost Nike into a sports supplier powerhouse. It surges the market share from 18% to 43% in 1988. The slogan basically informs the consumers to push beyond limits and strive to achieve new goals.
Rhetorical Analysis Of Nike
Nike is a worldwide known business that many people around the globe are attracted to purchase. They make a variety of products ranging from shoes and clothes to sports gear, sports products, and many different accessories. Nike is designed for everyone ranging from infants to elderly. Because of their range of age for products, this makes them a huge competitor. Being able to appeal to all ages and styles of people.
Nike was first known as Blue Ribbon Sports, founded by University of Oregon track athlete Philip Knight and his coach Bill Bowerman in 1962. It officially became Nike, Inc. in 1978 while taking its name after the Greek goddess of victory. Mark Parker is the current CEO and Phil Knight still continues to hold a position at the top of the organization, as the company Chairman.
Knight In The 1970's Blue Ribbon Sports
In 1972 Knight created Nike and paid a college student $35 to design a logo for his new company. In the early days of Nike they earned the reputation of having a party atmosphere at corporate events where screaming, fighting, and consuming alcohol and drugs were common and even encouraged. Nike became increasingly popular and was at the top of the sneaker game in 1990 when many forms of controversy and some questions of Knights character arose. Nike was able to get through the controversy and remain at the top of athletic footwear and Phil Knight was named the “most powerful” person in sports in 1993. The controversy continued to attract itself to Nike and as the founder and CEO many scrutinized the way Knight handled himself and the company in those situations. Phil Knight is one of the most successful self made billionaires in history but many dispute whether or not he is one of the best business leaders of a
Many global companies like Nike, Inc. are seen as role models both in the market place as well as in society in large. That is why they are expected to act responsibly in their dealings with humanity and the natural world. Nike benefits from the global sourcing opportunities, therefore areas such as production and logistics have been outsourced to partner companies in low-wage countries like China, Vietnam, Indonesia and Thailand. As a result the company is limited nowadays to its core competencies of Design and Marketing.
Strategic Analysis Of Nike
Nike Inc. was founded in 1962 by Bill Bowerman and Phil Knight as a partnership under the name, Blue Ribbon Sports. Our modest goal then was to distribute low-cost, high-quality Japanese athletic shoes to American consumers in an attempt to break Germany's domination of the domestic industry. Today in 2000, Nike Inc. not only manufactures and distributes athletic shoes at every marketable price point to a global market, but over 40% of our sales come from athletic apparel, sports equipment, and subsidiary ventures. Nike maintains traditional and non-traditional distribution channels in more than 100 countries targeting its primary market regions: United States, Europe, Asia Pacific, and the Americas (not including the United States). We utilize over 20,000 retailers, Nike factory stores, Nike stores, NikeTowns, Cole Haan stores, and internet-based Web sites to sell our sports and leisure products. We dominate sales in the athletic footwear industry with a 33% global market share. Nike Inc. has been able to attain this premier position through "quality production, innovative products, and aggressive marketing." As a result, for the fiscal year end 1999, Nike's 20,700 employees generated almost $8.8 billion in revenue.
Nike Business Strategy Essay
Nike Inc. is a very successful publicly traded sportswear and equipment company based in the United States. Nike is a multi-national and Fortune 500 company. It has reached achievements in their innovation in products that Nike has become one of the most recognized companies today and companies dream to have what Nike has created. The main headquarters for the company is in the Portland area near Beaverton, Oregon. Nike leads the world in supplying athletic apparel and shoes. Nike shows how devoted they are in the satisfaction of their customer’s needs that it shines upon their mission statement and encompasses their vision. Nike ensures to go far and
Nike Child Labor Case Study
The Nike Inc. company “Just do It” logo encourages many to be motivated to push themselves to work hard and to believe in themselves. The Nike Inc. shoe industry has marketed their sneakers through popular icons such as sport players. However, the same should be encouraged in employees who manufacture these products overseas in China, Indonesia and Korea. Nike has a responsibility to ensure that Management in the manufacturing company is held to a higher practice to avoid unsafe working conditions, unfair pay and child labor.
Nike: The History And History Of Nike
Nike was created around the late 50’s early 60’s(Page 3 Frisch, Aaron. The Story of Nike). The creator got the idea to make them because of a school project. It was about a business that they would run as they came out of highschool. His name was Phil Knight. It originated in Hillsboro Oregon. And this was the start of something great.
Case Study Of Nike Sports Shoes
This project concentrates on the Nike Sports shoe; Nike is one of most significant shoe manufacturing company worldwide. Sportswear manufactured by Nike is known for quality and is most liked brand of athletes. (Daniel, 2011)
Nike Inc and Sweatshops
In addition, Nike is a worldwide known company and it is among the top empires just as Adidas and Puma. It has more than 900 factories which are located in an estimated 50 countries, they also have more than 660 000 workers which most of them are women. However, although they have a lot of factories around the world, their main manufacture factories are located in China, Indonesia, and Vietnam which are basically countries with the most minimum salaries rate given to the workers. Nike chooses these locations for their production of their merchandise because of the cheap ...
Nike Inc. was founded in 1962 by Bill Bowerman and Phil Knight as a partnership under the name, Blue Ribbon Sports. Our modest goal then was to distribute low-cost, high-quality Japanese athletic shoes to American consumers in an attempt to break Germany's domination of the domestic industry. In 2000 Nike Inc. not only manufactured and distributed athletic shoes at every marketable price point to a global market, but over 40% of our sales came from athletic apparel, sports equipment, and subsidiary ventures. Nike maintains traditional and non-traditional distribution channels in more than 100 countries targeting its primary market regions: United States, Europe, Asia Pacific, and the Americas (not including the United States).
Summary Of Nike
Nike was incorporated on September 8, 1969. Company focuses on seven key categories of its products: running, basketball, and football, men’s training, women’s training, Nike’s sportswear and action sports. It also designs products for kids as well as other athletic and recreational uses, such as cricket, golf, other activities, baseball, tennis, volleyball, soccer and wrestling. The Nike Company also deals in athletic apparel and accessories in addition of athletic bags and accessory items.
More about Nike Assignment
Unit 1 Business Environment Assignment - Nike
The two companies chosen are Nike and Oxfam.
Type of firm
Nike is multinational company of Unites States. Its headquarters is in Oregon. It manufactures designs apparels, shoes, and other sports equipment and accessories. It is one of the most valued sports brand across the globe. It sells its products in many nations and operates on a national level. It is a profit making business and is a listed firm in USA. Thus it is in the manufacturing business and it provides one of best sports apparels, shoes and equipment. It tries to manufacture the best sports apparel which can help the people and athletes in improving their performance.
Nike is a public listed firm on NASDAQ and thus have many shareholders. Institutions form the major shareholders and own the firm. Their stake is approximately 83.76%. Top five institutions having stake are Vanguard Group, FMR LLC, State Street Corp, Capital Research and Bank of New York Mellon Group (About Nike, 2014)
Oxfam is a non-profit organization working across the globe. It is a confederation of seventeen firm across the globe and it has centres in 94 nations.
Its main is to help people poverty and other injustice being faced by them. It aims that people exercise their rights. They work on different campaigns; like public education, assisting people in calamities and disasters. Their main aim is that people should not live in poverty and there should be more equitable world. There are four main areas in which Oxfam works which are helping in crisis, gender equality, economic justice and essential services. This firm is not owned by any institution and many international organizations have their stake in this firm. Each country has its own Oxfam centre and they operate out of it. They work on the funds received by them (About us, Oxfam, 2014).
Stakeholders or firms affected by the decisions of the firm or are related to the firm are known as the stakeholders. These individuals or firm either decision making for the firm or are affected by the decisions taken by the firm. They work closely or are associated with the firm in any manner. For any important decision made it affects their working or the way they conduct their activities. For Nike stakeholders are the investors, management of the firm, employees of the firm, customers of the firm, debtors on the firm, suppliers of the firm. Lastly the potential investors of the firm also form important stakeholders (About Nike, 2014)
For Oxfam the main stakeholders are the organizations which form the organizations, People who are getting help from the firm, people who contribute to the firm and also the people or firm against which the firm is going to take action.
Thus for both the firms the stakeholders is totally different. Since their operating model is completely different, the way stakeholders react and are formed is also different.
For Nike there is a management which has been appointed by shareholders and Board of directors. Nike is public listed firm and hence the major shareholders say is taken into account. Thus after shareholders the management has the main say in the working of the firm. CEO of the firm is at the top and the rest of the management and its employees are below. Board of directors monitors the activities of the management and raises issues if there is any decision which does not seem right to them. Institutions form the major shareholders of the firm and thus they also have their say in choosing of the management. Oxfam is an international organization and is formed through many organizations. There is no central power of Oxfam which controls all their activities. In each country they have their centres and each centres works on the issues relevant for the nation. Funds raised for a cause in one nation can be given to another nations. Thus the centres work in tandem to get the work done however there is no central power which has the say or has the major investment in Oxfam, It is the collective decision of the individuals.
Nike being a large firm require large capital from the public and hence public listing is important for the firm to raise capital for the firm and have other sources of capital. For a firm being public listed helps to get capital and thus expand their business. Using this structure the firm can invest the capital in capex and increase their operations. Thus such structure helps the firm achieve their objectives and having wide operations. For Oxfam, there is a lot of responsibility and trust associated with the firm and hence there should not be a single individual driving the decision of the firm as it can be misused. Its headquarters for Britain are located in Cowley. Since not there is collective decision of the firm involved with Oxfam one can be make sensible decisions which are informed and which are beneficial to the society and devoid of any selfish intentions. Thus for both the firm the structures are important and gives them the balance to be successful.
Nike has been in this since long and has been one of the most successful brands in sport across the globe. Since it is demand driven industry its revenues are largely dependent on the economy of the countries where is operates. Since sports apparel and footwear do not form essential goods people spend on them when they higher disposable income and this happens when the economy of country is doing well. Thus the factors like GDP of the nation, unemployment levels, inflation are the three main economic factors which can affect the growth of the company. Increasing GDP and lower unemployment levels are good for the firm as people will spend more however reverses is true for the firm. During the period of early 2000 when the economy of UK was doing well, Nike saw good increase in the revenues of the firm from nation. However in the recent years when the economy is not doing well the sales have been muted for the firm (Noakes, 2012). Oxfam performance does not depend on the macro economic factors, it depends on the donations received by the firm. Since it is a non-profit organization there are no revenues to compare, however one compare the donations received by the firm and the number of campaigns undertaken by the firm in the respective nation.
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For Nike political stability of the nations where it operates is important as stable governments tend to provide better business environment . Countries with better economies tend to spend of sports apparel. If the economy is poor like Africa then the firm products may not sell as people may be spending on essential goods rather than sports. Technology plays an important role as they need to come out with new products which can improve the performance and experience of the athletes. Legal factors also play an important as the firm need to avoid legal issues if it wants to start businesses in new nations and setup factories. If the nation does not allow much investment in the nation then the firm may not be able to do that(Piskorski & Johnson, 2012). For Oxfam political factors are very important as sometimes it may be fighting against the policies of government and hence it needs political stability of the government to exist in the nation. Firm works for economically backward society and hence economy of the nation plays important role. If the economy is less developed there would be more work for the firm. Social factors play an important role as the way wealth is distribute and people treated in a society will determine their rights and role of the firm. Technology can be used by the firm to come out with new solutions and connect with people. Lastly legal factors are important as the firm will use legal options to fight and also need legal support to survive in the nation (Fitzpatrick, 2014).
For Nike one of the major stakeholders is customers. Customers need good quality of products from Nike. Nike has strong competitors like Puma, Adidas. Hence the firm needs to come out with good products. If other firms manufacture better products then the firm will face decreasing sales. Thus the customer feedback is significant for firm decision. Another stakeholder important are the investors. Investors need good return on equity and hence they seek answers from the management on the performance of the firm. Thus their say has important role in the management decisions and also their selection (Maguire, Potts & Fletcher, 2012) For Oxfam the shareholders who matter are the people for whom they serve. Their fight is against the poverty and their main stakeholders are the people. Thus on their conditions their action will be decided. Else their shareholders are the press and the media who will report their activities and thus the firm will know whether their action have any positive effect on the society. Lastly the people who have opened their centres in each of the country and the representatives of the international organization also play an important role in the decision making of the firm and they are the most important stakeholders for the firm (Carr, A. U. S. T. I. N., 2013).
For Nike one of the major conditions was the 2008 crisis when the sales of the firm declined and thus the firm was faced with decreasing sales. Firm however focused on its core area, tried to come up with new and better products and when the economy revived they again saw increase in sales. Nike is one of the most trusted global brands and hence the firm needs to constantly work on improving the performance of the goods (Lund-Thomsen & Coe, 2013). For Oxfam there have been a lot of controversies regarding their activities. One of the major controversy was regarding Starbucks. Starbucks has blocked three Ethiopian coffee beans thereby denying them the revenues. Starbucks used their position to undue influence the national coffee associated to block the beans. However there were lot of controversies regarding this issue and the motives of Oxfam were questioned. Also there were cases when Oxfam was accused of asking of commercial favour from the bananas of Dole. They were accused that they backed the rival producer and thus were fighting against them (About us, Oxfam, 2014).
Nike has expanded its reach to various countries. Its main source for new revenue growth has been emerging markets. With the government becoming more stable and the government making their norms areeasier for free trade it has become easier for the firms to do business Due to the easing legal factors and businesses polices Nike has been able to perform well over the years and expanded its market across the globe. Thus due to strong political influence and freeing of markets by the emerging economies Nike has been able to increase its growth in the revenue (Rangan, Chase & Karim, 2012). Oxfam has gained a considerable popularity and has strong presence in many countries. It is trying to deal with social factors and with increasing awareness among people due to technology it has been able to spread its agenda to the people. With the increased usage of the social media there has been constant increase in the communication with the people and hence it becomes easy for the organization to get information and also communicate to the people about the crisis. In the latest development the firm is fighting against the Taliban actions of the peace which are threatening the rights of woman. Also Oxfam has taken up many issues and they have used strong legal actions against them. If laws are not strong in the nation then it can be become difficult for the firm to conduct the business (Ellis, 2011).
The chosen business strategy is Nike. Investors form important stakeholder for the firm. Due to demand from investors to have high return firm has invested a lot into new technology and coming up with new products. Also the firm had to venture out and invest in new markets like the emerging economies. Customers who are also important stakeholders are also demanding new and better products. So the firm has to invest in new technology and come out with products that are better than their competitors and also give a better experience to the customers. Thus Nike has come out with good products like better running shoes, better apparels for the sportspersons which help them perform better in their lives (Peretti & Micheletti, 2011)
People have become more conscious about their health and focusing on their health. As a result people are playing more sports and thus there are chances of increase in the sales of the firm. Also Nike has advertised itself better. Thus there is more visibility of the brand and people are trying to buy the best apparels and other equipment. Thus there is high probability of increased sales. In addition to this with emerging markets waking up to these brands and these firms penetrating more in the market they can get increased sales for the firm.
In above section different aspects for Nike and Oxfam have been analysed. Stakeholders play an important role in the decisions of the firm. Also social and legal factors play an important role in the firm performance. Nike has performed well over the period and has tried to accustom itself to these factors. Oxfam too has grown over the period used various technologies and different mediums to expand its reach.
About Nike, 2014. Retrieved on 17 th November 2014 from https://secure-nikeplus.nike.com/plus/ About us, Oxfam, 2014 Retrieved on 17 th November 2014 http://www.oxfam.org/en/our-purpose-and-beliefs Ellis, P. D. (2011). Social ties and international entrepreneurship: Opportunities and constraints affecting firm internationalization. Journal of International Business Studies, 42(1), 99-127. Maguire, B., Potts, J., & Fletcher, S. (2012). The role of stakeholders in the marine planning process—Stakeholder analysis within the Solent, United Kingdom. Marine Policy, 36(1), 246-257. Somasundaram, J., Howard, P., & Reed, R. (2013). Customer retention: a case study of stakeholder analysis in higher education. Green, D. (2012). From poverty to power: How active citizens and effective states can change the world. Oxfam. Fitzpatrick, C. (2014). UK: Oxfam reveals link between flooding and deprivation. Carr, A. U. S. T. I. N. (2013). Nike: The No. 1 Most Innovative Company of 2013.Fast Company. Peretti, J., & Micheletti, M. (2011). The Nike sweatshop email: Political consumerism, internet, and culture jamming. Politics, Products, and Markets. Exploring Political Consumerism Past and Present. New Brunswick, 127-142.
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NIKE Assignment 3
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Marketing Plan Of NIKE Introduction: This report intends to formulate the marketing plan of Nike, Inc. Nike was founded
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TABLE OF CONTENT CHAPTER-1 Introduction: 1.1Objective of the study 1.2Need of study 1.3Scope of the study 1.4Limitation
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Tugas Perilaku Konsumen STRATEGI PEMASARAN DALAM PRAKTEK NIKE Disusun oleh: ABDUL NURFIKRI AULIYA ARIFAH DORI ANDELO GU
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Nike, Inc was founded in 1964 in the state of Oregon, US. Nike is the largest seller of athletic footwear and apparel in
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1.0 Executive Summary The company we choose in this assignment is NIKE. The segmenting and targeting is important factor
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02-02-2011 Nike Introduction The marketing environment has been rapidly changing in the last twenty years. Having a st
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Table of Contents 1. Introduction ......................................................................................
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NIKE SUPPLY CHAIN MANAGEMENT SUPPLY CHAIN MANAGEMENT OF 1 NIKE SUPPLY CHAIN MANAGEMENT CONTENTS Page No. 1. Intro
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NIKE, Inc. Introduction: Nike, Inc. is a major publicly traded sportswear and equipment supplier based in the United Sta
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Marketing Plan Of NIKE Introduction: This report intends to formulate the marketing plan of Nike, Inc. Nike was founded by Bill Bowerman and Phil Knight in January 25, 1964; before 54 years. The headquarters of Nike are located in Beaverton, Oregon (Washington Country, Oregon U.S).The origin of Nike is from America, and it is a multinational corporation that is mainly engaged in the manufacturing, design, development, marketing and selling of footwear, accessories, services, equipments and apparel across the world. In the current time, Nike is delivering their products all around the world, it has nearly 1015 operating facilities in UAE and Nike generates positive cash flow by means of these stores, due to huge demand of Nike’s products and services. TASK 1: Be able to compile marketing audits 1.1 1. Production Concept: In the production concept, consumers would favor those goods that are highly accessible and reasonable in price. This is one of traditional concept in marketing management, which is used to guide producers. This concept implies that producers usually tend to enhance their productivity and selling efficiency. 2. Product Concept: Under this concept, consumers would favor those goods that provides them superior quality, better performance and unique specifications. However, under this product concept marketing strategies mainly put emphasis on improving product features and quality. 3. Selling Concept: Selling concept implies that consumers would not purchase products of specific firm, until and unless they are not carrying out extensive selling and marketing efforts. Therefore, management throws emphasis on formation of sales transaction instead of creating long- 1 Marketing Plan Of NIKE lasting relations with their consumers. Companies usually undertake aggressive programs for selling their products. 4. Marketing Concept: Under marketing concept, the accomplishment of firm’s objectives is dependent upon analyzing the needs and requirements of potential target market and providing them preferred satisfaction as compare to their competitors. Here, management mainly focuses on “customer First” strategy. 5. Societal Marketing Concept: By employing societal marketing concept, companies tend to understand the values and current trends of society. Under this idea, “marketing strategies needs to provide value to consumers in such a manner that can sustain or enhance both the customers and society’s welfare. Nike: Out of these five marketing concepts, Nike put constant focus on product concept. This is the strategy that has kept Nike ahead in the line of competition, and is continually evolving due to their strategies and offerings. 1.2 Nike’s capabilities: In the current time, the capabilities of Nike lie down in the area of Research and Development, and human resource. This company has extensively invested billions in staffing itself with professionals, for instance, industrial architectures, bio-mechanics and other expert physiologist. However, by this pool of specialist Nike is conducting more R&D in order to modernize their offerings and providing all time unique products. Thus, for future planning, HR and R&D would be helpful in enhancing Nike’s capacity. 1.3 SWOT Analysis: Strength’s Nike is global brand and leading shoe producer. It has joint ventures with Apple’s IPod in continuous innovation. It has well-built distribution channels for promoting its products. Nike holds strong position over its negligible long term borrowings. Nike has ground-breaking shoe designs that encourage customers to Weakness’s The sales of Nike are heavily dependent upon footwear segment. Nike has breached in history and they offer minimum wages to its employees. The internal organizational conditions of Nike are poor. Due to poor internal environment it has bad reputation. 2 Marketing Plan Of NIKE design and propose their own shoe’s online. Nike serves diverse products all around the globe. Nike has effective marketing campaigns and supports various products. Nike serves various segments, such as, baseball, golf and footwear and many more. Opportunities’ Nike can extend its line of products, for instance, sports wear shoes, sunglasses along with jewelry and so on. Nike brand can also be extended to international level. Nike can avail the opportunity to support various marketing events worldwide, such as, (the Olympics and FIFA). Nike’s products are sold at higher price as compare to its competitors, such as, Adidas. Threat’s Due to economic downturn and rapid changes in currencies can lead Nike to suffer from huge competition, because competitors are turning towards more aggressive policies and generating higher quality products. Sensitivity to price. sustaining status of eco-friendly, (SWOT analysis of the company) PEST Analysis: Political factors: Within the organization there are certain rights of workers that can influence the Nike’s internal mechanism. Nike has positive policies of government that supports organization in attaining growth perspectives, particularly in US. However, the surrounded lawful issues have influence over its operations, but Nike handles these situations by gaining help from foreign entities and government, and Nike holds constructive relations with them. Economic factors: Nike acquires funding from various other corporations. Nike can also be the medium in generating new job opportunities. Owing to economic recession customers can get influenced and it can also decline customer’s confidence for Nike’s products. However, currency risk, interest rate risk and exchange rate risk for Nike’s product can be raised. Social factors: Customers are showing more loyalty towards the Nike and becoming brand conscious, which is that can a kind of benefit for Nike. In addition, the increase in market share of women consumers can also raise opportunity for the Nike. Technological factors: 3 Marketing Plan Of NIKE New technological factors can affects Nike as it is involved in its products. By means of technology Nike can creates extremely innovative goods, such as, shoe construction/ designing. It can also make mobile applications and various facilities and web browsers by which consumers can engage with online shopping with the help of new digital technologies and trends, (Hanrahan, 2002). 1.4 Porter’s Five Forces’ (Nike) 1. Competition with Nike Inc. is a Strong Force Competition in the market decides how Nike sustains its market share of the sports shoes market. These are following external elements that create stronger force of spirited rivalry in Nike’s situation: Lower market growth rate is considered as stronger force Higher aggressiveness of enterprises is also stronger force Moderate number of enterprises is a moderate force The lower market development rate is partially because of enterprises higher market penetration along with higher market saturation. This situation forms a stronger force, because Nike and some other business’s fight for those markets that grows gradually. In contrast, enterprises are heavily aggressive in fighting for getting huge market capital. In addition, there are just reasonable numbers of enterprises that has significant influence on Nike. On the basis of this component of porter’s Five Forces, the external elements can give rise to stronger competition, which is required by Nike Inc. for throwing emphasis on market growth and product development for ensuring competitive edge and for increasing share in the global athletic shoes market, apparel, accessories and equipment markets. 2. Bargaining Power of Nike’s Consumers/Purchasers forms moderate Force Nike’s consumers directly have impact on firm’s performance. This component of porter’s Five Forces indicates how customers decide for firm’s competitiveness and the industrial internal and external environment. However, in Nike’s situation, here are some external elements that contribute towards moderate bargaining power of consumers. Lower switching costs Moderate availability of substitute products Relatively small size of individual consumers 3. Bargaining Power of Nike’s Suppliers is considered as weaker force Higher entire supply of Nike’s products Larger population of vendors and suppliers 4 Marketing Plan Of NIKE Moderate amount and size of individual suppliers is considered as moderate force. 4. Threat of Substitute products is also moderate Force for Nike Moderate accessibility of substitute products is a moderate force. Moderate presentation per price of substituted products is also moderate force. A lower switching cost for products is considered as stronger force. 5. Threat of New Entrants Higher cost of brand growth is considered as weaker force Higher economies of scale is a weaker force Moderate cost for conducting trade is considered as a moderate force. TASK 2: Understand the main barriers to marketing planning 2.1 Assess the main barriers to marketing planning An effective marketing strategies and proper planning is necessary and fundamental element for any company. Nonetheless, occasionally, there could be certain obstacles in the line of marketing planning. For instance, in case of Nike here are some barriers or challenges the management of Nike is facing. Lack of motivational aspects towards change: When stakeholders are not motivated and they do not sense the necessity to deal with the threats or they will not hunt for opportunities, it will be major barrier to formulate a great marketing plan. Overconfident in solving problems: Overconfidence will create a defective or unsuitable answer for the potential problems. Lack of co-operation among management: HRM and financial divisions are not agreeing on sharing resources and goals, noticeably the marketing plans would be suffered. Poor internal Environment: This is the biggest barrier that is ongoing from last decade in the Nike Inc. 2.2 How Nike may overcome barriers to Marketing planning Ten rules were proposed by Professor Mc Donald that can be effectively used to deal with barriers in the line of marketing planning. Here are these rules that Nike can apply. 1. 2. 3. 4. 5. Align marketing strategies with their day-to-day operations. Formulate strategies before formulation of tactics. Follow shared values in relation to marketing perspectives. Create structure based on marketing strategies. Comprehend all the information on SWOT analysis. 5 Marketing Plan Of NIKE 6. Provide training to the workers for enhancing their knowledge and skills. 7. Scan the macro and micro environment thoroughly. 8. Systematize the overall marketing procedure. 9. Formulate goals and objectives in sequence. 10. Adopt culture and style based on changing requirement. TASK 3: Be able to formulate a marketing plan for a product or service 3.1 Marketing plan for Nike’s products Nike is considered as world’s famous and leading producer of athletic footwear and apparels. However, it accounts for more than approximately 47% of agile shoes market exceeding sales of U.S$ 3.7 Billion (Partlow, 2003). Nike is supplying superior quality goods in more than 100 nations, although its main target segment counts on U.S, Europeans, Asia Pacific, and America. Besides, this Nike has obtained this renowned status by means of their ground-breaking and striking design along with quality production and intelligent marketing strategies for promoting and selling their goods. In this entire Assignment I have formulated the marketing plan for Nike’s products, which includes marketing mix 4Pcs, communication and distribution tools that Nike Company carries out while undertaking selling and promoting its products. 3.2 why marketing planning is essential in the strategic planning process for an organization 1. Describe the importance of marketing planning 1. Marketing plan assist companies in developing goods that can meet the preferences and needs of target consumers. However, good marketing plan gives an idea to the consumers in differentiating your products than the competitors. They can comprehend what is point of parity and difference in your product, and why they should decide to buy your products. 2. A well formulated marketing plan assist companies in reaching their target market, enhance their consumer base and eventually raise their bottom line purpose. It is frequently needed when company looks for funding, and it assists them in setting SMART goals and objective. 3. However, formulation of marketing planning needs in-depth research, sufficient time and devotion, although this process is very useful because it really contributes much more towards reaching success. 2. Explain the role of marketing planning in the strategic planning process 6 Marketing Plan Of NIKE In today’s competitive environment among organizations marketing plan plays vital in strategic planning mechanism. Nonetheless, a number of marketing status correspond to the corporate level, many are represented at functional level in an industry units of any particular organization. Marketing is implicated within strategic arrangement at every level of organization. The activities of Strategic marketing can be categorized into three essential components. First, marketers assist everyone within the business to get familiar among markets and their consumers. Therefore, they are accountable for assisting organizations in executing marketing values by means of strategic planning mechanism. Second thing is that, marketers can provide help in gathering and analyzing data that is needed for examining the current scenario, identifying current trends existing in the marketing surroundings, and assessing the impending influence on such trends. However, this gathered information along with examination offers input for business, production, and marketing strategic planning’s. Thirdly, marketers are usually engaged in the growth of business, production, and plans for strategic marketing. However, the impact of marketing activities varies from one organization to other. For such forms that are driven by marketing beliefs, marketing essentially plays vital part in making strategic decisions. 3.3 Examine techniques for new product development Ansoff Matrix of Nike New Products Existing market Existing Products Marketing Penetration New Market Market Development Diversification Product development Explanations: 1. In Market penetration Nike enhance its sales to the current existing market, and penetrates highly in-depth into the existing marketplace. However, Nike raises their sales by means of advertising campaigns and relationship marketing. 2. Under category of product development Nike develop new products but for the existing market, through getting better understanding of consumers. 3. In market development, existing products of Nike are sold in new markets, such as, areas of interests and sporting idols. However, this practice is carried out in countries like, China, Russia, India and Brazil. 4. In diversification, Nike sells their new products in the new markets that eventually lead to actual strategic growth. The techniques that company need to consider while developing new products. 7 Marketing Plan Of NIKE First, they need to define what their product is all about and how it will meet the desired needs of consumers. They should examine the needs and preferences of their potential market. Company should clearly convey what they are proposing, what is point of differentiation and how their product will fit into the existing market. After analyzing and answering these questions, company should formulate well-informed marketing plan for their new offerings accordingly. 3.4 Justify recommendations for pricing policy, distribution and communication mix for Nike. Nike Inc follows leading marketing strategy in the market of athletic shoes and accessories. In general it relies on its marketing mix in order to maximize its revenue and growth. However, marketing mix is the grouping of company’s strategies and other tactics that enterprise uses for executing their plan, in accordance with various products, promotion, price and place. Nike’s Product Mix: 1. Athletic shoes 2. Apparel 3. Accessories and equipments Recommendation: Nike is one of the well-known brands that have created trust by offering superior quality products. According to me Nike should extend its line of products in a bid to serve diverse market across the world. Place or Distribution in Nike’s marketing mix: Nike sells its products across the world by means of various retailers and it has large number of outlets around the world. 1. 2. 3. 4. 5. Various retailers Niketown retailing outlets Official online stores of Nike Flagship stores Nikeid Recommendation: This component of marketing mix is the reason due to which Nike is generating huge profit. I would suggest Nike to start some other outlets to those places where there is unavailability of Nike’s products. Nike’s promotional mix: In order to sustain the brand image, Nike relies on most effective channels for promoting its products. 8 Marketing Plan Of NIKE 1. 2. 3. 4. 5. Personal selling Advertising Direct marketing Public relations Sales promotion Recommendation: I would like to recommend Nike to use social media, in order to increase promotion of its products. Pricing Strategy: Nike Inc put emphasis on value-based strategy for pricing its products. This strategy enables Nike to enhance growth in its sales and generate more profit. The current Pricing strategy followed by Nike is like; it might constantly use it. Nike's existing consumer base currently specifies what they will be ready to pay the cost/price of the good to make sure the quality and service they are getting from Nike. Recommendation: However, Nike is just using value-based pricing model, although it can also use some other pricing strategies in a bid to attract more customers. 3.5 How factors affecting the effective implementation of marketing planning have been taken into account For maximizing revenue and minimizing risks within firms, the only consistent way is to adapt an appropriate marketing planning with the specific requirements, in the meantime by applying accessible marketing techniques and information for enhancing the flexibility. The factors that could have impact over the progress of marketing plan are listed down below: Management support (internal factor) Financial budget (source of funding, external or internal factor) Legality in terms of production and supplying goods (legal requirement) Carrying out necessary research (internal and external factor, as well as technological factor) All these factors that are stated above would cause affect on the effective execution of marketing planning. However, it may consider as important to taken into account because these factors may impair the marketing plan if there is lacking and can destroy the overall marketing plan. TASK 4: Understand ethical issues in marketing 4.1 9 Marketing Plan Of NIKE Ethics conducting practices of right behavior that forms the decision making process by people or business units. Promoting ethics in the marketing activities has consciously deals with the principles of justice, equality, moral principles, values and wrongs within the workplace.. The major use of marketing ethics is to prevent someone from doing any deceive or taking advantage by means of unethical practices. In general, unethical marketing activities will directly have impact on a good marketing procedures and it can have adverse affect on marketing planning. Therefore, majority of firms has taught to be responsive towards consumer’s needs and views in a bid to sustain this long-term interest and relations in their business. Furthermore, social responsibilities are subjected towards marketing activities for protecting customer’s rights, avoiding inequitable trading and encouraging trade in extensive range. 4.2 Analyze examples of how organizations respond to ethical issues (Nike) Adler and Bird (1987) and Stead (1990) stated certain strategies for enhancing ethical practices and for avoiding unethical practices within firms. However, they recommended that, firstly, leading managerial needs to promote ethical awareness to the subordinates by means of providing motivation, support and showing care upon ethical activities. Secondly, they suggested that leading managerial positions needs to put emphasis on institutionalization of moral values, norms and fair procedures that are included into every level of organization. In Nike case, the management is not engaged in motivating their employees and valuing their norms. Therefore, they have bad reputation in the market owing to this reason. Based on world report, Nike is practicing to overcome these issues and working towards responding ethical issues. 4.3 Analyze examples of consumer ethics and the effect it has on marketing planning Mintel (1994) clarifies "ethical consumer" as a customers who usually considers environmental problems, animal problems and also ethical problems that counts harsh regimes and defender while shopping. However, in a bid to continue with a great marketing planning, the firm needs to consider customers rights. However, being morally wrong in selling and buying products, it may create bad intention and attitude. For instance, if consumer is buying product that is not lawful, obviously the firm will not consider consumers right during selling products. It will influence the overall market itself and eventually unethical practices would be spread all around. 10 Marketing Plan Of NIKE References: Ahmed, R., Brohi, H., Bhutto, A., Prithiani, J., Khubchandani, R., Kumar, S. and Abbas, Z. (2016). Strategic Marketing Plan of Nike. [Online] Research Gate. Available at: https://www.researchgate.net/publication/299889166_Strategic_Marketing_Plan_of_Nike [Accessed 2 Aug. 2016]. Anon, (2016). [Online] Available at: https://mymission.lamission.edu/userdata/schonfd/docs/Assignments/Nike%20Segmentatio n%20and%20Targeting.pdf [Accessed 2 Aug. 2016]. Barnes, P. (2011). Nike Marketing Analysis. [Online] Slideshare.net. Available at: http://www.slideshare.net/philipjamesbarnes/nike-marketing-analysis-8675338 [Accessed 2 Aug. 2016]. Google.com.bn. (2016). Nike Ansoff matrix - Carian Google. [Online] Available at: https://www.google.com.bn/search?q=nike+ansoff+matrix&espv=2&biw=1366&bih=584&t bm=isch&tbo=u&source=univ&sa=X&ved=0ahUKEwjXxuSw0JjOAhWTNpQKHWmADgUQsAQ IGQ#imgrc=jkhTWkjf_EhohM%3A [Accessed 2 Aug. 2016]. Marketing91.com. (2016). Marketing Mix of Nike. [Online] Available at: http://www.marketing91.com/marketing-mix-nike/ [Accessed 2 Aug. 2016]. Consumer behavior in relation to premium products. (2015, march 23). Retrieved from http://www.ukessays.com/essays/marketing/consumer-behaviour-in-relation-to-premiumproductsmarketing-essay.php. Nike News. (2010, May 04). Retrieved from NIKE, INC. INTRODUCES 2015 GLOBAL GROWTH STRATEGY: http://news.nike.com/news/nike-inc-introduces-2015-globalgrowth-strategy Sporting Goods Industry - Statistics & Facts. (2014). Retrieved from http://www.statista.com/topics/961/sporting-goods/. Nike.inc. (2014). Retrieved from http://www.nikeresponsibility.com/report/content/chapter/labor. Sporting Goods Industry - Statistics & Facts. (2014). Retrieved from http://www.statista.com/topics/961/sporting-goods/ Rourke, Elizabeth; Troester, Maura; Salamie, David. (2006). International Directory of Company Histories. Retrieved from http://www.encyclopedia.com/topic/NIKE_Inc.aspx. Nike Inc. (2016, 02 29). Retrieved from https://www.google.com/finance?q=NYSE%3ANKE&fstype=ii&ei=6w68VomINMOnu gTC5YW4Cg Nike Inc. (2016, 03 15). Retrieved from Wikipedia: https://en.wikipedia.org/wiki/Nike,_Inc. 4P of Nike. (n.d.). Retrieved from scribed: http://www.scribd.com/doc/76309961/4-P-s-ofNike#scribd 11 Marketing Plan Of NIKE About Nike. (n.d.). Retrieved from Nike Official: http://about.nike.com/pages/executives Aid, B. (2005). Nike: Evolution of marketing strategy. http://www.icmrindia.org/casestudies/catalogue/Marketing1/MKTA018.htm. Anna. (2013). Consumer Behavior. Retrieved from https://consumerbehaviourmcgill.wordpress.com/2013/01/19/nike-more-than-a-logo/ BlogSpot. (n.d.). Retrieved March 2016, from Marketing: http://matthopkinspsumarketing.blogspot.com/ Deng, T. (2009). “Just Done It”--- Nike’s New Advertising Plan, Facing Global Economic Crisis. International Journal of Business and Management. Hanrahan, w. (2002). Business environmental audit critically access the strategic direction of the Nike brand. Marketing strategy of Nike. (n.d.). Retrieved from http://sales-managementslides.com/marketingstrategy-of-nike/ Nike marketing communications-mix. (n.d.). Retrieved march 2016, from panmore: http://panmore.com/nike-marketing-communications-mix 12
Report "NIKE Assignment 3"
Nike: Company Analysis
Nike company analysis: introduction.
This paper is a critical analysis of Nike, an American based fashion and apparel company. Key sections of this document provide an evaluation of the company’s external environment, its market share, internal operational dynamics and critical factors that influence its performance. The last section of the report outlines key recommendations the company’s managers should adopt to remain relevant in its key market segments. However, before delving into these details, it is important to first review Nike’s share perfromance. Figure 1 below shows that the company has had a positive share performance in 2018.
According to figure 1 above, Nike’s share price steadily increased throughout 2018. The highest price reported within the year was $85.55, while the lowest was $62.49. In addition, throughout the year, the firm’s stock outperformed other companies within the same category, such as Amazon and Netflix (Google Markets 2019). Experts have characterised Nike’s shares as “a growth stock,” because in 2018, investors received a 20% return on their money (Google Markets 2019).
The firm’s impressive stock performance could be attributed to its ability to insulate its bottom-line performance from competitive pressures. At the, same time, Nike’s share variances should be contextualised within the larger context of its overall stock performance in the past two decades because, in 17 years, it has registered a high dividend payout ratio compared to its competitors (Google Markets 2019).
For example, the positive performance in 2018 aligns with the $0.02 per share increase in its quarterly dividend payment. The trend dates back to 2014 (Google Markets 2019). Therefore, the positive stock performance of 2018 is part of a continuous growth trend, which started 17 years ago. Indeed, figure 2 below shows that the 2018 share performance was part of a larger growth trend that started in 2014.
Nike Company Analysis: Market
Nike has a significant market share in the global apparel industry. Figure 3 below shows that North America is the company’s main market. Europe, Middle East, and Africa are the second largest markets, while China and the Asia Pacific regions provide the least revenue for the company.
Although figure 3 above shows the importance of the North American market to Nike’s success, other key market segments have the potential to increase its revenues. For example, figure 4 below shows that Japan is the leading growth market for the fashion brand because it accounts for up to 25% of Nike’s annual growth (Statista 2019). China is also another emerging market because it accounts for about 14% of its revenue (Statista 2019). Western Europe, Central Europe, Eastern Europe, North America and other countries are also important to the company’s growth strategy because they account for 7%, 6%, 5% and 3% of the firm’s revenue for growth markets.
Nike Essay: Macroeconomic Analysis
Variations in inflation rates have influenced customers’ purchasing power in the apparel industry. This index has a significant impact on sales because high rates mean that fewer customers buy fashion products, while low inflation rates mean that more customers buy new goods. There has been a general rise in interest rates in most global markets. For example, in figure 5 below, Giles (2018) from the Financial Times reports that the inflation rate in the UK has steadily increased between October 2015 and April 2018.
The increase in inflation rates means low liquidity within the market, as more people will be hesitant to spend money. This development could affect the bottom-line performance of fashion companies because their products have elastic demand. Overall, the increase in interest rates means that there could be an increase in the consumer price index, which could negatively affect profitability (Camarda 2018).
There has been a decrease in unemployment rates across major global economies (Camarda 2018). For example, since the 2007/2008 global financial crisis, the unemployment rate in the US has significantly declined from 10% in 2009 to 4% in 2019 (Camarda 2018). There has been a similar reduction in the UK unemployment rate because, in 2011, this figure was 8.3% and in 2018, it was 3.9% (Camarda 2018). Figure 6 below shows the general decline in unemployment rate within the UK from 2014 to 2018.
The low unemployment rate has a significant bearing on the cost of production in the apparel industry because it could increase overheads, as there will be fewer people willing to work for lower wages.
Currency fluctuation has a significant impact on the fashion and apparel industry because of its global nature. This macroeconomic force could influence the industry’s performance by increasing the cost of production. For example, Camarda (2018) says that recent plummeting exchange rates in Switzerland have affected the cost of raw materials. These exchange rates have a significant impact on the fashion and apparel industry because companies often earn revenue and incur operational costs in varied currencies. The impact of such fluctuations is prevalent in the apparel industry because of its global nature.
Evidence of the impact of currency fluctuations on the fashion and apparel industry was seen in 2015 when Switzerland delinked its Swiss Franc from the European Union and local apparel companies immediately incurred a 15% rise in operating costs (Camarda 2018).
The uncertainty regarding the exit of the UK from the European Union has had an impact on the fashion and apparel industry by making it difficult to plan in an uncertain economic environment. The uncertainty has a significant impact on labour relations, tax computations and even profit repatriation. The negative effect of “Brexit” on the fashion industry can be observed through the unwillingness of fashion designers to vote for the exit of Britain from the European Union (Cook 2017). For example, a recent report pointed out that “Brexit” would limit access to top-tier talent for British fashion designers (Cook 2017).
Nike Essay: Internal Analysis
Nike company analysis: change of leadership.
Nike has recently reported changes in its leadership structure. These variations are set to improve the company’s competitive position and brand image because they will promote inclusivity, respect and empowerment of employees (Nike Inc. 2018). Changes in leadership have also promoted diversity and inclusion in the organisation (Nike Inc. 2018). Overall, these developments create an environment where employees feel appreciated in promoting the company’s success.
Nike Company Analysis: New Products
Nike’s product strategy is consistent with the goal of athlete advancement. For example, the company’s products have demonstrated innovation in cushioning platforms (Nike Inc. 2018). Nike React is one new product that is borne from its innovative strategy. Nike Air is another product that demonstrates the company’s capability to develop functional and popular product designs. Generally, the company’s product strategy is predicated on progress and athlete advancement (Nike Inc. 2018).
Nike Essay: Change in Structure of the Business
Nike is considering making changes to its business structure by integrating its brick-and-mortar business with digital platforms (Nike Inc. 2018). This strategic shift in its operational plan is aimed at improving sales because the firm has realised that the traditional model of retail did not accommodate dialogue. The business change is largely highlighted in the corporation’s new business product – House of Innovation (Nike Inc. 2018).
Nike Essay: Objectives, Mission, and Vision
Vision Statement: “ To remain the most authentic, connected and distinctive brand ” (Smithson 2018, p. 2).
Mission Statement: “To bring inspiration and innovation to every athlete in the world” (Smithson 2018, p. 2).
- To protect and improve the company’s position as the top brand in athletics
- To grow the fitness market by establishing a strong momentum
- To direct and manage Nike’s global business in emerging markets
- To support increased margins through the proper execution of business strategies
Nike Company Analysis: Business Legal Structure
Nike is a publicly listed company. This means that the company’s ownership structure is modelled within a shareholding framework. Within this setup, the corporation’s shares are freely traded in the stock exchange market. As a publicly traded company, Nike has limited liability. In other words, the company can sue or be sued in the same manner as an individual does.
Nike Company Analysis: Organizational Structure
Nike’s organisational structure reflects differences in regional markets. Therefore, it is designed to address variations in regional market performance. According to the geographic distribution of the company’s structure, this framework has three key divisions, which include global corporate leadership, semi-autonomous geographic divisions, global segments for contrast and brand licensing (Thompson 2018). Under the global corporate leadership department, which is based in Oregon, USA, the company operates 12 key subsidiaries, which include Office of the President, Nike Brand, finance, global human resource management, merchandising department, the legal department, global sports marketing and operations (Thompson 2018).
In the semi-autonomous geographic division, the company operates six key entities, which include North America, Western Europe, Central/Eastern Europe, China, Japan and emerging markets. Lastly, the global division for merchandising has converse and brand licensing departments (Thompson 2018). Nike’s robust organisational structure has supported the company’s success and strengthened its organisational performance. Therefore, it is one of the company’s key strengths.
Nike Company Analysis: Financial Performance
Nikes’ profitability has increased in the past five years from a low of $9 billion in 2011 to a high of $15 billion in 2017 (Pratap 2018). This profitability index is commensurate with a similar pattern in the company’s revenues. Indeed, within the past five years, the company’s revenues have increased from $20 billion in 2011 to $34 billion in 2017 (Pratap 2018). In 2016, the firm owned $2 billion to its creditors (Downie 2016).
This debt was distributed across different financial instruments because $7 million was short-term and $66 million was long-term (Downie 2016). Most of the debt ($1.99 billion) was in form of bonds (Downie 2016). The $2 billion debt mentioned above represents an increase in the company’s liabilities because, in 2015, this figure was only $1.3 billion and in 2014, it was $1.4 billion (Downie 2016). Nonetheless, Nike’s profitability and revenue show that the company is in good financial health. Its income, cash flow and profitability statements, which appear in appendices 1, 2 and 3 represent a broader understanding of the company’s financial performance.
Nike Company Analysis: Conclusion and Recommendations
Critical issues that could affect Nike’s performance include technology and increased competition. Technology is a critical success factor because it is changing how Nike conducts its business. The company’s ability to succeed in the digital marketplace will determine how well it will remain relevant in today’s fast-paced world. Competitive rivalry is also another key success factor that will shape the company’s performance.
Although this force has traditionally affected the firm’s profitability, it remains one of its key threats. Particularly, the competition Nike will experience from some of its traditional rivals, such as Adidas and Puma, will shape the company’s success. In addition, the firm should be cognizant of the fact that it is the leading footwear company in the world and consequently needs to improve its marketing strategy to remain at the top.
As highlighted above, two critical issues that could affect Nike’s business operations are technology and business rivalry. The process of overcoming technological challenges depends on the company’s ability to embrace digital marketing strategies. Nike has shown promise of adopting a digital business strategy because it has integrated its brick-and-mortar business with its digital marketing strategy to create a hybrid business plan that would channel the company’s future sales (Nike Inc. 2018).
Lastly, to overcome competition, Nike needs to consistently innovate and revamp its marketing strategy to remain relevant and communicate to its customers about new products. This strategy has yielded significant levels of success, as seen through the launch of Nike Air and some of its traditional brands, such as Nike Jordan . By investing more resources in its research and development plan, the company should come up with more interesting and innovative products to maintain its market dominance.
Bells, S 2017, What are Nike’s key markets .
Bloomberg 2019, Nike: US . Web.
Camarda, B 2018, Exchange rate shifts can buffet luxury brands . Web.
Cook, G 2017, Brexit poses serious risk to UK fashion industry . Web.
Downie, R 2016, Nike stock: capital structure analysis (NKE). Web.
Giles, C 2018, ‘UK consumer inflation accelerates in August’, Financial Times. Web.
Google Markets 2019, Nike’s share price . Web.
Nasdaq 2019, NKE company financials . Web.
Nike Inc. 2018, The defining innovations and products of 2018. Web.
Pratap, A 2018, Nike financial history . Web.
Smithson, N 2018, Nike Inc.’s mission statement & vision statement (an analysis) .
Statista 2019, Nike’s revenue worldwide from 2017 to 2018, by region (in million U.S. dollars) .
Thompson, A 2018, Nike Inc. organizational structure characteristics (analysis) .
Trading Economics 2019, United Kingdom unemployment rate .
Appendix 1: Balance Sheet
Appendix 2: Income Statement
Appendix 3: Cash Flow Statement
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SUPPLY CHAIN MANAGEMENT: NIKE
Table of Contents
Overview of the company or organization. 3
Analysis of the supply chain and related operating-level processes. 7
Proposals and justifications for change. 8
Critical success factors, risks, and cost drivers. 10
Impacts on the operations management of the organization. 11
Supply chain management is systematic and the key coordination management for the supply of fundamental merchandise and items to the end users or customers. Or on the other hand, we can say that practice of delivering goods or items to the customers or clients and the association's endeavors are clearly reflected, this is called supply chain management. The primary goal of the SCM is to make total assets, assemble focused framework, synchronize the supply of products, measure execution on a worldwide scale, and exploit logistics, and so forth over the globe.
Today most worldwide organizations are hunting down production centers where work and raw material costs are cheap and SCM is extremely valuable for associations to contend in the worldwide market and system economy. Different associations require distinctive exercises in which strategic management is required with the end goal that sourcing from distinct places of raw materials and after that from distinct places these completed products are gone through various series of the distribution network in which Retailers, merchants, and end clients are included.
Nike used to enjoy a solid brand, very much managed logistics process, and a convincing product advertising. Although, with better competitive participants and better administration and authority times, and even with the fashion brands going into their market space, supply chain magnificence has been expanded over the most recent couple of years, and considered it to be an aggressive weapon. In meeting the primary goal of enhancing consumer loyalty, this supply chain change concentrates on the client - meeting client item prerequisites, enhancing client connections, enhancing the asked for dispersion.
Overview of the company or organization
Nike is one of the biggest and most recognizable shoes and apparels organizations on the planet today. Established in 1964 as the Blue Ribbon Sports, the organization's founder Phil Knight, an Oregon track competitor, and his mentor Bill Bowman began offering Japanese running shoes from behind their cars. Following a couple of years of beneficial sales numbers, Blue Ribbon Sports opened its first retail outlet in Santa Monica, California. At the point when the agreement with Onitsuka Tiger (Japanese organization) finished, Knight chose to begin his own particular footwear line. The organization formally moved toward becoming Nike in 1971 and in June of that year, Nike began utilizing the lofty shoe logo which was designed by Carolyn Davidson. (O'REILLY, 2014)
By the year 1980, Nike had secured half of the market shares of sports footwear in the United States and in December of that year, it became public on the New York Stock Exchange stage, with the help of its marketing partners, the Wieden & Kennedy Company. Wieden & Kennedy’s co-founder Dan Widen proposed the trademark or slogan "Just Do It" for the ad of 1998, and the motto was later given the name of one of the top five advertisement mottos of the twentieth century.
By 31 May 2016, the organization concentrated its Nike brand item offerings into nine classes: Running, Action Sports, Men’s Training, Woman Training, Nike Basketball, Sportswear, Jordan Brand, (Soccer) and Golf. Men's training incorporates its baseball and American football item offerings. The organization additionally markets the items intended for kids, and other athletic and recreational uses, for example, cricket, volleyball, wrestling, tennis, lacrosse, strolling and open-air exercises. Athletic footwear items of the Organization are mainly intended for particular athletic use. Its items are additionally worn for causal or recreation purposes. The organization offers sports clothing Organization also market clothing with authorized school and expert group and association logo. (Carr, 2013)
Nike's fundamental business is athletic or sports shoe industry. The organization began as a mobile shoemaker, however now incorporates Olympic style events, baseball, tennis, soccer, lacrosse, b-ball, football, contender sports, golf, cycling, volleyball, wrestling, cheerleading, aquatics, auto hustling, and cricket. Nike has a line of ice skates for some lines of hockey players and skateboarding shoes. On the off chance that a client is searching for some sort of athletic shoes, at that point, Nike is well on the way to satisfy the prerequisite, in light of the fact that the organization needs to give answers for any and each player. (Bengtson, 2016)
From a residential area in Oregon, Nike has turned into the world's biggest athletic shoes and clothing organization. They began with a shoe and T-shirt today, they are a complex and diversified worldwide association:
- Nike offers their items in 170 nations.
- Today Nike has around 30,000 workers around the world
- Nike has lots of brands that used to serve more than 30 primary games and lifestyle of the consumer.
- Nike work with 600+ manufacturing plant as a partner.
- Nike serves a huge number of consumers with a huge number of products.
From the starting point, their plan of action was based on partnerships - competitors, teams, retailers, producers and supply chain suppliers. They used to work with the best on the planet. Also, they do it for a sole reason - to take into account the needs of their worldwide shoppers.
In addition to shoes and spikes, Nike likewise creates diverse lines of apparel. Nike has distinctive sorts of athletic outfits for men, ladies, and youth, from training gears to pullovers to protective gadgets. (Earnest, 2002)
The organization additionally delivered top, protective helmets, bats, gloves, and swim-wear and celebrity apparels. Recently, Nike has started creating wearable innovation, for example, wristbands to screen the heart rate. Nike has additionally joined forces with Apple to make a downloadable application. Nike tries to improve the dress business and endeavor to address the issues of players.
The right advancement isn't simply new and unique. No one improves the situation like Nike. In any case, they realize that they cannot bless themselves as an inventive - the consumers, in the end, choose for themselves. This is the reason Nike use to invest such a great amount of energy with competitors and customers - tuning in, analyzing, reading and after that building item that improves athletic execution and overall buyer experience. (Krentzman, 2007)
There are many powers Nike has possessed the capacity to use to its advantage in the course of the most recent quite a long while. Maybe Nike is playing the most critical power for the organization, which is a worldwide brand mindfulness that the organization has made. The Nike "subsistence" logo is a standout amongst the most perceived individuals on the planet and, albeit straightforward, simple to be recognized. The logo can be found over the world, alongside different kinds of commercials, boards, ads, and so on. And also it can be found in all Nike items too. Nike is really a worldwide organization and marking numerous support bargains for some, competitors have expanded their brand mindfulness. In spite of the fact that these help arrangements can be expensive, they serve to advance brand mindfulness by achieving a portion of the world's biggest games group of onlookers. Some prominent competitors with Nike Endorsement bargains incorporate Cristiano Ronaldo, LeBron James, Tiger Woods, Maria Sharapova and Derek Jeter Michael Jordan has been named the most significant in all games, which achieves $ 60 million from the Nike through Jordan's eminences of its line of b-ball shoes in a year. (Nisen, 2013)
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We have some amazing discount offers running for the students, analysis of the supply chain and related operating-level processes.
Looking at the future needs of the supply chain management meeting, the primary routes are through virtual associations. These will be founded on intelligent capital-brand, innovation, new item improvement, new channel techniques with which operation exercises will be outsourced widely. The result will be the development of supply chain specialists. We as of now observe the rise of such ideas. Nike sells up to athletic shoes worth $9 billion, yearly, with none of the production lines without owning itself, without reducing the cost of inventory to reduce performance and reduce opening. Concentrating on real point-of-sale demand, the procedures behind the retail shelf are being changed to accomplish the identical flow of the item over the supply chain. Request planning methods have been changed from the retail point of view once more, and "retail reality” is incorporated into item design. (Cooper, Lambert, & Pagh, 1997)
Their delivery guide incorporates a playbook of prioritized activities with official sponsorship, including Demand/Supply Match, Improve Sale List Accuracy, Organize Delivery Center Operations, and enhance forms all inclusive. They also have additionally made an administration board that decides methodologies, organizes activities and runs extensive execution in light of standardized procedures and stages.
Rather than utilizing third party or partnered logistics suppliers to operate their supply of products, the organization utilizes suppliers in all houses to keep the communication line between the system supplier and the Nike SAP framework more strong and noticeable. Nike's logistical supply is now being complicated, the exact opposite thing the organization needs is a mediator who can make things considerably more complicated. The manner by which their procedure has been set up, it is the thing that makes Nike the best for the higher management. However, Nike's logistical supply requires the correct administration incentive to succeed in their business endeavors.
Proposals and justifications for change
Additionally Nike's prime logistics operations, the organization emphasized on decreasing carbon emissions inside its logistical procedures. With regards to making decisions about Nike's logistic flow, the force of carbon emission inside their work is an exceptionally powerful factor. Inbound logistics for Nike presently contribute 23 percent of Nike's impact. Considering business driven delivery decisions on optimizing expenses and lessening waste, the organization has possessed the capacity to reduce the carbon emissions from a recent couple of years (inbound). Utilizing better types of transport empowers Nike to reduce emissions by clever transportation. Through Nike Optimization of Shipping Container Use, U.S. Inbound/outbound delivery aggregate has seen funds of more than $ 8.2 million over the most recent couple of years. This includes unnecessary trips and air inbound. Alongside this, it is said that it is protected to state that the Nike organization is always enhancing and taking measures to better serve the interests of the clients and the earth.
Regarding Outbound Logistics of Nike, the organization intends to decrease the volume while expanding the speed. Nike is always focused around building up a smarter solution for its logistics operation and actualizing new thoughts so its principle destinations of not having the capacity to explore in the vacant amount can be accomplished and not have any desire to deliver more than it is necessary. To accomplish this, the organization has begun to coordinate near-shoring. But in the past, Nike has outsourced to a place where work was cheap, now because of the advancement of innovation, the organization has begun utilizing shoring near its advantage. The total flow of Nike guarantees reliable satisfaction of its shopper demand with its assembling base, while also overseeing and enhancing its value chain inside its operations.
Following are the proposals:
- Organizing basic audit.
- Creating a Corporate Responsibility and Compliance Partition.
- Assigning field managers.
- The establishment of a global database.
- Start external expert review.
This monitoring and enforcement instrument will make certainty internally, which is necessary before the listing is issued. Nike should change this remarkable response in a phenomenal marketing opportunity for its supply chain crisis, raising intensity risks identified with the revelation of the factory. As a proof of its new sense of duty regarding labor practices, they need to promote their new transparency. Indeed, the organization should change its full exposure to the clothing industries in an identification of respect. (Chandra & Kumar, 2000)
Critical success factors, risks, and cost drivers
Moreover, strong, Nike's supply chain and logistical supply can be compromised off because of many components. The largest area where Nike is likely to be most affected on the supply chain, is mainly in manufacturing because they do not have their own units.
Since they don't have their own particular manufacturing plants, so there is a little inspection of Nike about how to run these production lines. Along these lines, Nike runs the risks of small problems sneaking past splits and after that turns out to be costly over the long term when dramatic changes in the supply chain are without prior notice. For an instance, if a processing plant isn't put on a specific security standard, it can keep running for quite a while with no issue before the fire or there might be a day exploding because of safety guidelines. This can constrain assembling to be closed down and Nike may need to suffer inventory loss, and unable to take care of the demand of the client until the point when the production line is remade or replaced. Likewise, more Nike items are made intriguing, particularly in China, Vietnam, and Indonesia, Which implies that drastically changing the assembling part of Nike’s supply chain on various kinds of issues of those nations can be significantly changed. For instance, in every one of those three nations, the political condition is more unpredictable than the US. This implies there is a possibility of more agitation and more chances of riots. With this, production lines can be closed down or the laborers might be notable work
Producers need to locate the new point of view on the difficulties in their supply chains since they continually change. Expanding costs for work and logistics, fluctuations in physical expenses and accessibility, and changing the desires of the shopper and in the quick pace of advancement are factors that make supply chains more complex. Nike Athletic footwear holds roughly 37% of the market, with Adidas being the following strongest contender, with around 30% of Reebok on the planet's athletic shoe showcase. Nike comprehends to profit, with the mindset that you need to burn through cash, they go to the U.S. every year. Spends around $ 200 million on promoting.
Impacts on the operations management of the organization
An efficient supply chain monitoring framework can help solving the most noticeably awful practices. Moreover, this system is key to adopting more transparency. In the event that you don't know about it, you cannot settle it.
A protective methodology isn't a really long haul approach. Organizations are experiencing difficulty avoiding the media and they ought to replace defensiveness which utilizes code monitoring and authorization - lastly full disclosure - for their advantage.
Nike is a standout amongst the best organizations on the planet, which is over three decades. Their solid sense of duty regarding influencing the client to esteem, while concentrating individually assembling and conveyance forms, has made them the most creative organizations in the business and enabled them to overwhelming market share. With a solid concentrate on the advancement and change of economic and financially savvy supply chain arrangements, Nike will remain an effective organization for quite a long time to come.
Nike is concentrating on working with long haul, vital providers, which shows a promise to protect its specialists, safe working conditions, and ecological duty. They are the competitors who meet all the item prerequisites and give solid motivations to enhance their ecological and work execution. Alongside these objectives and goals, Nike trusts that they can remain in front of their rivals later on.
Bengtson, R. (2016, 10 20). The 100 Best Nikes of All Time34. Air Force Max . Retrieved from Complex: http://www.complex.com/sneakers/2012/12/the-100-best-nikes-of-all-time/air-force-max
Carr, A. (2013). Nike: The no. 1 most innovative company of 2013. Fast Company , 11.
Chandra, C., & Kumar, S. (2000). Supply chain management in theory and practice: a passing fad or a fundamental change? Industrial Management & Data Systems , 100-114.
Cooper, M. C., Lambert, D. M., & Pagh, J. D. (1997). Supply chain management: more than a new name for logistics. The international journal of logistics management , 1-14.
Earnest, L. (2002). The takeover of Hurley by Giant NIKE Changes the Dynamics. Los Angeles Times .
Krentzman, J. (2007). The Force Of the Nike Empire . Retrieved from KrentzmanCommunications: http://www.krentzmancommunications.com/s/stanford.pdf
Last Name, F. M. (Year). Book Title. City Name: Publisher Name.
Nisen, M. (2013, May 09). How Nike Solved Its Sweatshop Problem." Business Insider . Retrieved from Business Insider: http://www.businessinsider.com/how-nike-solved-its-sweatshop-problem-2013-5
O'REILLY, L. (2014). Things Hardly Anyone Knows About Nike. Business Insider , 1.
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