University of the East

Manila Campus
College of Business Administration

CASE STUDY – NIKE INC.

Prepared by:

Abesamis, Bianca
Danao, Christine
De Jesus, Kyle Ian O.
Fabros, Jocel Kyra Rose
Jimenez, Gabrielle Anne F.
Placino, Shanea Ervy Bon C.
Sabeniano, Princess Carl Ally L.
Tanap, Angelika A.
Taguba, Mariel G.

Submitted to:
Prof. Josiah Barrameda
Background
Nike, which means "victory" in Greek, has been synonymous with victory since
its inception in 1964. Bill Bowerman and Phil Knight formed the company as "Blue
Ribbon Sports" on January 25, 1964, and it became Nike, Inc. on May 30, 1971. The
business is based in the Portland metropolitan area, near Beaverton, Oregon. Nike is a
sportswear, clothing, equipment, and accessory company that designs, creates, and
markets high-quality footwear, apparel, equipment, and accessories. Nike is the world's
largest retailer of athletic footwear and accessories. They've been around for a long
time and have established themselves as the most well-known sportswear brand. Nike
is a product designer, a consumer goods retailer, a brand communicator, a corporate
responsibility pioneer, and a portfolio of authentic and important products, among other
items.
A single emphasis – creativity – can be seen in every aspect of the Nike brand.
It is in our nature to be creative. It is the fuel that allows us to perform at our best. This
brand also produced various prototypes that corresponded to various sports around the
world. With its high demand all over the world, this brand has effectively become a
monopoly. “To bring inspiration and creativity to every athlete in the world,” reads Nike's
mission statement. “If you have a body, you are an athlete,” as co-founder Bill
Bowerman once said. Nike defines the infinite possibilities for human potential, sets the
stage and course for the many long-term growth opportunities we see, and continues to
empower new generations. Sports is a language that everybody understands. It cuts
through races, boundaries, and divides. Consumers have a lasting passion for it, and it
is a source of human aspiration and empowerment. Individual effort, teamwork, respect,
how to win, how to lose, how to compete fiercely and reasonably are all lessons that
sports teach us. In both good and bad times, sports encourage, amaze, and reward us.

Primary Activities

 Inbound Logistics
Inbound logistics refers to the transportation, storage, and distribution of goods
entering a company. Nike has procurement team that is in charge of supply chain
management. The company focused mainly sustainability and prioritized suppliers who
are willing to go beyond the minimum requirements and who could strictly adhere to the
sustainability guidelines. Transparency, efficiency, and sustainability remain a priority in
manufacturing plants, which is why only the most responsible companies are allowed to
be a part of the supply chain. After goods are sourced from suppliers, various regional
offices and distribution centers will be in control.
o Operation:
Given that Nike has offices around the globe. The biggest office and
highest number of workers are found at Oregon, North America, which is
also Nike’s headquarter.
 Outbound Logistics
Outbound logistics activities are those that deal with the management, sale, and
delivery of finished goods to end-users. From distribution centers, products are sent to
retail stores. Nike has set up a network of regional distribution centers to meet the
needs of its retail outlets, ensuring that consumers do not have to wait long for new
products. Tennessee is home to the company’s largest distribution center, where
footwear, apparel, and equipment of Nike and Jordan brands are found. In addition, a
well-functioning distribution system aids in the timely delivery of goods and shipments.
 Marketing And Sales
The famous “swoosh logo” by Nike positively affect its marketing strategy aside from
producing quality oriented products. The company also invested heavily on promotions
and employs athletes such as football stars to promote its goods and name. Nike has
two primary distribution channels: physical stores and online stores. For global
distribution, the company uses a combination of independent distributors, licensees,
and sales representatives in both physical and online stores.

Supporting Activities

 Firm infrastructure
Nike is a multinational company with a vast and diverse infrastructure that includes
headquarters, retail stores, and manufacturing and logistics centers. This extensive
infrastructure also aids it in effectively managing its global footprint. Its headquarters are
housed in a state-of-the-art structure with a lake and a variety of other extraordinary
amenities for its employees.
 It system across supply chain
 Empowerment of top management
 Strong brand product market place solution delivery and support
 Effective compliance process trough strategic knowledge and verification.

 Human Resource Management

Management of a multinational company is impossible without a broad and well-
trained workforce. The company employs over 70,000 people worldwide and has
developed a community and climate that values diversity and inclusion. Nike was
recognized for its great HR management and featured as one of the best employers and
as one of America’s Best Employers for Diversity on Fortune’s list. Nike places a high
priority on good HR management in its supply chain, and its manufacturers must adhere
to strict labor and HR management regulations as well.
 Strong management team
 Excellent employee relationship
  Blend of new hires and promotion
 High ethical values among employees they are well monitored labor audit add
brand audits.

 Technology Development
Nike's manufacturing approach prioritizes both technology and product quality.
Although the focus is on high quality, Nike has also made sustainability a priority. It is
using best-in-class technology to reuse waste created by Nike factories, as well as other
technologies that are focused on producing user-friendly and sustainable materials. It
employs technical strategies to reduce its environmental effects and increase the quality
of its goods on a continuous basis.
 Research and product development
 leading edge in technology development
 Great product technology such as motion analysis metabolic rate and blood
work
 Air sole technology expert

 Procurement
High quality raw materials are used to make high quality goods. At Nike, quality is a
top priority, so an entire sourcing team is dedicated to analyzing and evaluating
qualifying suppliers. It only keeps those who can provide more than the bare minimum
in terms of quality. Raw materials are sourced from a number of different countries.
 Long term and trusting relationship with suppliers
 Just in time strategy as finished goods are shipped as soon as they ready for
sale
 buffer and safety stock in hand
 Localized and bulk procurement

Strategies

 Competitive Advantage
Nike's strategic advantage over other athletic footwear and clothing brands is
shown by their differentiation strategy, which enables them to have authenticity and
individuality in all of their products. Their large-scale market awareness and product
innovation are two main aspects of this strategy. To begin with, Nike has more global
brand awareness than any other company. Nike is more recognizable than any other
company in their industry thanks to the well-known Nike swoosh and slogan, "Just Do
It." Nike also uses successful professional athletes to advertise their goods.
 Total Product
Nike Inc. (NIKE) is a global athletic footwear, apparel, equipment, accessory, and
service organization that designs, creates, markets, and sells athletic footwear, apparel,
equipment, accessories, and services. Many of its items are worn for casual or
recreational activities, despite being mainly built for athletic use. Running, NIKE
Basketball, the Jordan Brand, Football (Soccer), Men's Training, Women's Training,
Action Sports, Sportswear (its sports-inspired lifestyle products), and Golf were among
the nine categories on which the company centered its NIKE brand product offerings. It
sells its products to nearly 18,000 retail accounts in the United States and to nearly 200
countries through a combination of independent distributors, licensees, and
subsidiaries. NIKE is the world's largest retailer of athletic footwear and accessories.
 Post – Purchase Cost
The Nike brand means a high premium price. Nike is popular among teenagers
to adult with moderate to high income status. It offers most of the best athletic shoes,
clothing, or accessories in the world. According to Gilly and Gelb (1986), the buyers’ job
does not end when the product is brought. After purchasing the product, the consumer
will be satisfied or dissatisfied and will be engaged in post purchase behavior. The
satisfaction or dissatisfaction of the purchase of a particular product depends on the
relationship between the consumer expectation and the consumer disappointment, if it
meets the consumer expectations, the consumer can get satisfied. And if it exceeds
he/she is delighted.
 Cost Leadership
Nike's cost leadership policy helps the company retain a cost advantage. There
are a few different options in the marketplace for consumers to purchase athletic shoes,
clothing, and the like, but Nike's products are unique for a number of reasons that
enable them to benefit from sources other than cost control. The business cuts
manufacturing costs to increase profitability or lower market prices in this generic
strategy. To increase the company's competitive advantage by implementing new
technology solely to minimize production costs Nike's profit margin should be
maximized as a financial goal based on the differentiation strategy. Nike's differentiation
approach results in one-of-a-kind goods. For example, in its shoes, the company
incorporates cutting-edge designs. Nike's global success is boosted by a combination of
cost leadership and differentiation strategies.
 Product Differentiation
Nike's differentiation strategy is to place the brand as the industry leader in
athletic apparel. They are able to deliver high-quality products that meet consumer
needs by concentrating on their product line.
FOCUSING
Nike's mission is to inspire and innovate for every athlete in the world. Our
Mission is to use the power of sport to move the world forward by breaking down
barriers and fostering culture to improve the game for all.

References:

 Business summary: Nike, inc. essays. (n.d.). Retrieved from

https://www.megaessays.com/viewpaper/1594.html

 Pratap, A. (2018, December 10). Nike value chain analysis. Retrieved from
https://notesmatic.com/2018/02/value-chain-analysis-of-nike/

 Pratap, A. (2020, June 24). Nike sources of competitive advantage. Retrieved from
https://notesmatic.com/2018/12/nike-sources-of-competitive-advantage/

 Johnston, M. (2021, January 08). How Nike makes money: Most revenue is
generated by footwear sales. Retrieved from
https://www.investopedia.com/amp/articles/markets/080415/how-nike-nke-makes-
its-money.asp
 Mary C. Gilly, Betsy D. Gelb The Journal of Consumer Research, Vol. 9, No. 3
(Dec., 1982), pp. 323-328 This article consists of 6 page(s). Post-Purchase
Consumer Processes and the Complaining Consumer

 Gregory, L. (2017, February 07). Nike Inc. generic strategy & Intensive growth
strategies. Retrieved April 17, 2021, from http://panmore.com/nike-inc-generic-
strategy-intensive-growth-strategies