CUEGIS COMPANY

ON NIKE BY : ARIF AKMAL

About NIKE

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

Founded on January 25, 1964, as "Blue Ribbon Sports",

by Bill Bowerman and Phil Knight, and officially became
Nike, Inc. on May 30, 1971
 Chief Executive
Officer

John Donahoe
He was appointed on January 2020. He is one of
Nike board of director since 2014. He replaced Mark
Parker who have been the CEO of Nike Since
2006.He is on the board of directors at Nike, The
Bridgespan Group and is chairman of PayPal.
 Vision do everything possible to
Statement expand human potential

Improvement of lives Exceeding expectations Expanding human

Nike Corporation is a people-oriented
company whose operations targets
leaving a positive impact on the
people it comes in contact with. The
company does this by incorporating
objectives that improve societies to
run parallel to its primary goals – and
these form its corporate social
responsibility
Nike has proven beyond doubt that it
does not simply give what the customer
expects. The ever-growing reputation
of this company is directly linked to the
incredible efforts it puts in
manufacturing products whose quality
goes over and above the expectations
of the market and Nike competitors as
well
potential
The desire to give its primary
customers, the athletes the best
footwear, apparel, and other
equipment remains the major
priority of Nike. It is something that
the company has stayed true to for
years ever since it was founded
 Mission
Statement
Bring Inspiration and innovation to every
athlete in the world
Our mission is what drives us to do everything possible to
expand human potential. We do that by creating
groundbreaking sport innovations, by making our
products more sustainably, by building a creative and
diverse global team and by making a positive impact in
communities where we live and work.
Change
The adaptation of business
objectives, strategies and
operations to accommodate
changes, both internal and external,
within the dynamic business
environment
Change made to solve
issue (SWEATSHOP)
Nike begins creating the Fair Labor
Association, a non-profit group that
combines companies, and human
rights and labor representatives to
establish independent monitoring
and a code of conduct, including a
minimum age and a 60-hour work
week, and pushes other brands to
join.
Nike publishes a detailed 108-page
report revealing conditions and pay
in its factories and acknowledging
widespread issues, particularly in its
south Asian factories
The company continues to post its
commitments, standards, and audit
data as part of its corporate social
responsibility reports.
Nike change on approach to customer
In mid-2017 Nike unveiled its plan
for growth called the Triple Double
Strategy (2X). Through it, the
company promised to double its
“cadence and impact of innovation,”
double its speed to market and
double its “direct connections with
consumers.”
The cornerstone of the Triple Double
Strategy is the Nike Consumer
Experience (NCX), which includes
Nike’s own direct-to-consumer
network, as well as a vastly streamlined
slate of wholesale distribution
partners. It is through the NCX that the
company is feeding its 2X Innovation
and 2X Speed initiatives.
Culture
Ideas, customs and social behaviour
derived from different values and
backgrounds that influence
stakeholder motivations and
decisions
 Type of business
Public Limited Company
The biggest shareholders of the company is Phil
Knight
He directly owns 29,154,487 shares of Class A
and 11,385,687 shares of Class B Nike stock,
representing 9.3% of outstanding Class A
shares and 0.9% of outstanding Class B shares
as of April 2, 2020
Knight owns 2.6% of all outstanding shares as
of that date
 Organizational Culture
The combination of traditions, habits, values, and behavioral expectations
among employees.
Talented - Nike Inc. understands that talent
Nike’s workers are given a set of and innovation go hand-in-hand. This feature
instructions, rules and expectations is to emphasizes the need to provide human
on how to do their jobs, with resource support for product development
consideration for their relations with
and internal services in the corporation.
customers and other employees
Diverse - Diversity is continually developed in
As one of the giants in the global
athletic shoe, apparel and equipment Nike’s organizational culture. Nike's believes
market, Nike Inc. continues its that this feature will leads to a dynamic
policies and strategies to promote an workforce.
organizational culture that reinforces Inclusive - Nike Inc. emphasizes inclusiveness
business resilience and competence. in its organizational culture. The purpose is to
minimize barriers to employee performance.
Ethics
The socially accepted moral
principles that govern behaviour
and decision-making
 Ethical Objective
Manufacturing
Every supplier factory that makes
products for NIKE, Inc. must meet a
rigorous set of compliance
requirements. Nike’s Code of
Conduct lays out the minimum
standards we expect each factory or
facility to meet. Our Code includes
standards related to hiring practices,
wages, freedom of association and
health and safety.
Chemistry Product
The Restricted Substances List This policy applies to Nike
(RSL) sets out chemical standards brand products or Nike
for our materials that meet or affiliate brand products
exceed regulatory or legislative that contain animal skin
requirements from around the materials.
world and includes substances
that we have voluntarily restricted
or limited in our product. This RSL
is now aligned to the AFIRM
chemical limits list
CORPORATE SOCIAL RESPONSIBLE
-BASED ON NIKE FY20 GLOBAL REPORT ON CSR-
GIVING BACK TO
COMMUNITIES

On behalf of brand name : Nike leaders,

employee, Nike Foundation and NIKE
committed more than $30 millions to COVID-
19 response effort around the world
In China, NIKE committed $2 million to the
China Youth Development Foundation and
program partners in Hubei province to
support frontline health and medical workers
with needed supplies and equipment as well
as to aid overall community relief efforts
 NIKE keeping their employee healthy
March 2020, NIKE offered its employees paid COVID-19 sick leave
in addition to existing paid time off benefits and legally mandated
Other CSR sick leave programs.
This coverage expand in November beyond physical health to

activity include mental and emotional well being

Using innovation to help

NIKE works OHSU to provide an urgent needs for personal
protective equipment & powered air-purifying respirator to protect
against COVID-19
NIKE have produced and shipped more than 360000 units of PPE
to approximately 30 hospitals and healthcare provider across USA

Donating product to the athletes who need it the most

NIKE donated over 32000 pairs of Air Zoom pulse to hospitals and
Health System in USA & Europe.
This shoe designed specifically to meet the needs of healthcare
professionals, & given to doctors, nurses & frontline workers
it is worth $5.7 millions
Globalization
The increase in cross-border trade
and the gradual development
towards a unified, integrated and
international market
Innovations
The introduction and
implementation (commercial
pioneering) of new, radical and
improved products, processes or
ideas
Lebron James
Innovation Centre
On that floor, the Nike Sport Research Lab
(NSRL) is reborn, housing the world’s largest
motion-capture installation (400 cameras), 97
force plates, body-mapping equipment and so
much more.
The new scope of the NSRL is fivefold the
footprint of its predecessor. Facilities include a
full-size basketball court, a 200-meter
endurance track, a 100-meter straightaway, and
an artificial-turf training pitch
Strategy
Significant long-term planning
decisions that organisations make
in order to meet the needs and
wants of their stakeholders
SWOT Analysis
Based on Business Strategy Hub research
 Strength
1 Strong Brand Awareness
Nike is one of the most recognizable brands in the world
as its name alone is memorable, easy to pronounce, and
very unique. Its swoosh symbol is easily recognized by
everyone. Nike has captured approx. 31% of the global
athletic footwear market
3 Iconic Relationships
Nike’s long-term partnership with Michael Jordan has
proved to be beneficial in terms of sales for the
company. Their collaboration resulted in “Air Jordan 1
Shoes”. Additionally, Nike teamed up with the famous
basketball player to help design the “Air Jordan 1
Shoes”.
2 Huge Customer base
Nike has millions of customer from around the world
who loyally follow Nike’s trends, participate in Nike
events, and even provide customer feedback. Due to
its huge customer base, Nike’s market cap has
grown to $224 billion as of Feb 2021.
4 Low Manufacturing Cost
Most of Nike’s footwear is manufactured in foreign
countries. In the fiscal year 2020, Vietnam produced
50%, China produced 22%, and Indonesia produced
24% of total Nike’s footwear. Other operations are
in Argentina, Brazil, India, Italy, and Mexico.
 Weaknesses
1 Poor Labor Conditions in Foreign
Countries
In the last 20 years, Nike has been consistently targeted
regarding their poor labor conditions. These issues
include forced labor, child labor, low wages, and horrific
working conditions that were deemed “unsafe”.
3 Pending Debts
Although Nike’s income statements prove to be
prosperous, a quick glance at their balance sheet could
paint a different picture. Nike is still facing financial
threats. As of Aug 2020,Nike’s total long term debt was
$9.54 billion
2 Retailers Have a Stronger Hold
Nike’s retail sector makes Nike weak due to its
sensitivity against pricing. 65% of Nike products are
sold directly to wholesalers or retailers. With retailers
serving as their core customers, Nike does not put up
a fight against their pricing structures whatsoever
4 Lack of Diversification
Nike’s over-dependence on sporting apparel or lack of
diversification is a major weakness. The pandemic has
discouraged physical interaction and gathering with
sporting events canceled or postponed. Several
sporting teams are on the brink of collapse. If the
crisis discourages sporting events for longer, Nike’s
losses can be catastrophic.
 Oppurtunities
1 Emerging Markets
Although Nike already has a presence in many foreign
countries, there is still plenty of opportunities for Nike.
This is because emerging markets like India, China, and
Brazil are gradually flourishing. ”.
Cutting ties with big retailers
3 Nike has decided to cut ties with some of the biggest
multi-brand retailers and wholesale partners.
According to the report, Nike will no longer work with
wholesale retailers such as Zapoo’s, Dillard’s, Fred
Meyer, Bob’s Stores, etc. The step is taken for better
product positioning and greater customer experience.
2 Innovative Products
Although Nike has produced many products, there is still a lot
to innovate. Nike has extended its reach in technology in
association with fitness and health. Products like wearable
technology that monitors physical activities, is the first step in
building innovative technology products. Combining technology
with athletic wear can prove to be beneficial as it is an aspect
of the fashion industry that still hasn’t been explored much.
4 Consumer Direct Strategy
Nike has accelerated the consumer-direct strategy, which
means shifting its focus to digital business and subsequently
closing physical stores. In fiscal year 2020, 35% of its Nike
brand revenue comes from online sales. Clearly, the pandemic
is shaping up how Nike interacts with its customers.
 Threats
1 Currency Foreign Exchange Risks 2
Since the brand operates globally, it is affected by
fluctuating foreign exchange rates. Nike reports its
financial earnings in U.S dollars. This affects its
revenue as the U.S dollar is exposed to volatility
against other financial currencies.
Trade Tensions
3 4
Nike depends on different markets across the world
evidenced by the recent increase in its stocks rallied by
an increase in sales in China. With China and the US as
its biggest markets, a large chunk of Nike’s sales will
be threatened if the trade tensions between the two
giants escalate.
.
Economic Uncertainty
Regardless of the industry, all companies are susceptible to
the negative effects of a global recession. Already, Nike has
registered a 38% decline in sales in Q2 of 2020 and can drop
further in the future if the recession strikes as hard as
predicted by experts
Patent Disputes
Regardless of whether a company is wrong or right, patent
disputes are hotly and fiercely contested in the public
domain and expose some dirty secrets about sides in the
dispute. Nike and Adidas have been engaged in a fierce
patent disputes over Primeknit and Flyknit shoes in U.S. and
German courts.
STEEPLE
ANALYSIS
Current data and investment
information
 Social

STEEPLE Worldwide increases in ‘health consciousness’ means that more and more
individuals are moving towards better lifestyles. These people will undoubtedly buy

ANALYSIS plenty of sports apparel, something which would make Nike very happy.
On the other hand, Nike receives much criticism for its dubious production
processes. In fact, the issue of Nike sweatshops is so prominent that it has
warranted an entire Wikipedia article on the topic

Technology

Social media allows things to blow up or whittle away faster than ever. Nike is
doing well with using social media to build their brand, but it can be a double-
edged sword if used incorrectly.
Nike also gets the opportunity to use valuable information based metrics
thanks to technological advances, allowing for them to optimize targeting and
production, and maximize revenue.
 Economic

STEEPLE A market collapse could mean bad news for Nike, along with many other big brands.
Consumers may choose to switch to lower-end, cheaper products if this were to

ANALYSIS
occur, or even just as a decent level of quality becomes easier to produce.
Nike’s revenues are to some extent dependent on the low cost of labour in Far
Eastern countries. This is changing, though, which might mean higher Nike prices
across the globe come with the development in Less Economically Developed
Countries
With its ‘deep pocket’ of finances, Nike has the resources to chase after small
emerging markets in which they could sell products.

Political

The United States, Nike’s ‘home country’ so to speak, has fantastic policies for
growth which are especially valuable to this corporation. These include low-
interest rates and well arranged international tax agreements.
As a company that produces and sells physical goods, Nike is, however, always
subject to changes in tax and manufacturing laws
Various political conflicts can always make customs related processes difficult,
or prevent imports and exports.
STEEPLE
Legal

It shouldn’t surprise you to hear that, like most massive corporations, Nike also
ANALYSIS dodges substantial amounts of tax. In recent years, there hasn’t been too much of a
crackdown on this, but it’s still valuable to consider.
Nike occasionally meets legal repercussions for its shady marketing practices,
which include false discounts.

Enviromental

Nike’s mass production factories are, without a doubt, harming the

environment. Not only do they release plenty of aerial pollution like most
factories, but Nike’s production centers occasionally go as far as directly
polluting rivers.
Nike also shows promise of a change in their current practices, with a strong
resolve to become more ‘eco’.
As example, NIKE target on absolute reduction of greenhouse gas (GHG)
emissions in owned or operated facilities, through 100% renewable electricity
and fleet electrification
ANSOFF MATRIX
 Product Development
. Product development deals with the innovation of the latest
goods to increase the profit income of the firm and is involved in
this intensive growth plan. For instance, the mission statement of
Nike focuses on the execution of new and innovative product
features like unique and different designs of shoes. Modern
techniques increase the number of goods and keep them apart
from market rivalry. Despite fluctuating buying behavior of the
consumer the value and attractiveness of new products remain the
same. Therefore, the product development strategy of Nike
supports its generic competitive strategy of differentiation. The
main objective of this intensive growth plan is to expand the
market share of Shoe Company by integrating the latest
technologies in the design and quality of its sports shoes
 Market Penetration

It is Nike's secondary growth strategy for penetrating the existing

market. This method aids in the generation of huge sales earnings.
Nike's market penetration strategy, for example, is to deliver a
larger number of athletic shoes to American customers. Despite
holding a dominant position in the worldwide shoe business, Nike's
penetration strategy is considered a backup plan. The firm is
penetrating the competitive market in a variety of ways, such as
through its cost leadership approach, which has resulted in
increased market penetration due to reasonable productivity. The
primary goal of this strategy is to increase market share. Nike sells
its shoes and bags at a low cost, and buyers are always drawn to
the low cost. As a result, more people are purchasing their
product, increasing the company's market share.
 Market Development
NIKE is planning to open its shoe retailing shops in Africa and the
Middle East to generate more profit through sales. Additionally,
market development strategy is executed by a firm through the
production of modified and innovative products in new markets to
involve in new market segments like the production of goods and
services for bodybuilders. However, the growth of a company can
be determined through a worldwide market saturation of Nike
shops. It has also been observed that intensive growth plan is
playing a vital role in the financial, demographical and
geographical growth of a firm. Whereas, a generic competitive plan
of differentiation supports the company to interfere in the fresh
market by producing attractive products. The strategic objective
related to market development is to generate revenues by entering
into new markets of Africa and the Middle East
 Diversification

Nike has already executed this strategy at the beginning of the

business operations like the development of apparel and sports
goods in the product Mix. In earlier times, the production of the
company was based only on sports shoes. The competitive generic
plan of differentiation for Nike can be supported by diversification.
The major goal of this strategy is to reduce the chances of
financial risks by entering into new markets
THANK YOU