OVERVIEW

NIKE, Inc. is an athletic footwear industry with its headquarters in Beaverton, Oregon
that was formed in 1964 and is engaged in the design, development, marketing, and
sale of athletic footwear, apparel, accessories, equipment, and services. The company's
sales are distributed across North America, Western Europe, Central & Eastern Europe,
Greater China, and Japan. The Nike brand is depicted as being licensed in the global
label Divisions category. Casual shoes, clothing, and accessories are all sold under the
Converse category brand. The Corporate category has a comprehensive program for
managing foreign currency risk that oversees the organization's current international
hedging earnings and losses tied to revenues brought in by organizations over the
Converse and Nike labels. Phillip H. Knight and William Jay Bowerman are among its
founders.

Objectives:
1. To analyze the market condition of Nike Inc.
2. To identify the efficacy of Nike Inc. in handling administrative situations.
3. To understand the key distinction between commercial, course-related, and
social marketing.
4. To provide solutions to high levels of expenditure within the corporation of Nike..
5. To provide solutions to high levels of competition between Nike and other athletic
footwear firms.
 HISTORY

Based in Beaverton, Ortega, Nike is the world's largest designer, marketer, and
distributes sports-related apparel, equipment, and accessories.
Led by the company's flagship Nike brand footwear, as well as Nike Golf, the company
also owns a number of subsidiaries, such as Cole Haan, Converse, Hurley International,
and Umbro Ltd. Nike was founded in 1964 as Blue Ribbon Sports by Bill Bowerman, a
University of Oregon track and field coach, and Phil Knight, a talented middle-distance
runner.
The company introduced its Nike brand of shoes in 1972, just in time for the U.S. Track
& Field trials, which were held in Eugene, Oregon, that year.
By 1980, the company had reached a 50 percent market share in the U.S. athletic shoe
market and had become a publicly traded company.
Changes at the company by Phil Knight, particularly the introduction of a Michael
Jordan-endorsed basketball shoe in 1985, propelled Nike back to the top of the industry
by 1988.
 Nature of the Company

Vision
Bring inspiration and innovation to every athlete in the world.

Misson
To carry on Bowerman’s legacy of innovative thinking, develop products that help
athletes of every level of ability reach their full potential, and to create business
opportunities that set Nike apart from the competition and provide value for their
shareholders.

Strategic Goals
The company has set a strategic goal of $23 billion in revenues by the end of fiscal
2011.Commenting on this ambitious target, Parker states, “ When I stepped into the
CEO role the leadership team reaffirmed a simple concept that I knew was true from my
nearly as based on three principles: pursuing the greatest growth opportunities,
leveraging Nike resources and capabilities, and serving customer with premium
products and experiences.
 Statement of the Problem

This study set out to determine the issues related to Nike Inc. Additionally, assess the
problems to point out their impact on the business' performance in terms of its potential
for future growth and market prospects. In this case study, the following list of potential
issues is identified:

1. Increasing Level of Expenditures within the Corporation

The high levels of expenditure are one of the problems experienced by Nike
Corporation. Expenditures are the cost that a business incurs and affects the business'
profit margins. Therefore, higher margins of expenditures diminish the profit margin and,
in some cases, cause a loss for the organization. Due to Nike's extremely high
operational expenditures, the firm has seen an increase in internal losses. These costs
are from several divisions, including finance and procurement, as well as the expense
for marketing and production.
2. Increasing level of Competition within the market
The other problem that Nike Corporation is dealing with in its market is increased
competition from other market participants. Below are the following list of competitors
Nike is competing with in athletic and apparel industry:
Adidas
The number two competitor in Athletic footwear. The company is organized into three
main divisions: Adidas, Reebok, and TaylorMade Golf. In 2008, the company posted
revenues of 10.8 billion euros, a 4.9 percent increase over 2007. Reebok was acquired
by Adidas in 2006, with roots in women's fitness. TaylorMade Golf division sells golf
clubs, balls, footwear, and apparel. Net sales for this division were 812 million euros in
2008, a percent improvement over 2007 results.
Puma
Puma is the third-largest rival in the world market for athletic footwear. Shoes, clothes,
and accessories are just a few of the athletic and lifestyle products that Puma creates
and sells. It made 2.5 billion euros in sales in 2008. Puma's long-term goal is to
establish itself as the most desired athletic lifestyle brand. Not willing to be outdone by
its bigger rivals.
Other Competitors
There are several smaller competitors in the athletic footwear market all around the
world, including Li Ling Shoes in China and K-Swiss, Inc. in the US. Because
consumers frequently wear sports footwear for leisure and fashion, athletic shoe
manufacturers compete with other shoe manufacturers for customers. The following
businesses competed in the leisure and fashion shoe market: Crocs, Inc., Deckers
Outdoor Group, Skechers USA Inc., and Timberland Company.

Hence, Nike faces extreme competition from companies such as Adidas, Puma and
other competitors. These high-end businesses, which are specifically noted for having
extremely large facilities at their disposal, play a significant role in the performance of
the apparel industry to increase demand for goods and brands. The Nike Inc. brand has
faced difficulties as a result of the presence of these competing businesses (Christine,
R., 2017).
Nike's Solution/Strategies

1. Conducting Research and Development

Nike's ability to develop unique designs for its industry has been greatly aided by its
quick invention methods. Nike's stance is thorough, regularly measuring to a stable
position, and frequently using a reach-out stance. It takes pride in being a leader in the
delivery of high-quality sports apparel and accessories. The organization's ability to
think creatively has been crucial in helping it achieve industry leadership (Jason, D.,
2015).
2. Market and Selling
The name of the business and its image have been seen on a variety of items, such as
player apparel, shorts, caps, stadium posters, and even walls. The label's expansion is
aided by top marketing initiatives, celebrity endorsements, and conventional products.
At the 1992 NCAA Basketball tournament, Nike displayed an illustration of their brand
presence when 42 out of the 64 athletes were wearing sneakers. The company's most
recent label-development problems are centered on building strength through
cooperation with female games. Examples include Nike's advertising of the FIFA
Women's World Cup in 1992 and their promotion of the United States Skating Team at
the Olympic Skating Competition the following year (Mullin, Hardy, Sutton & Stern,
2014).
3. Diversified holdings
A strength that enables the corporation to contribute to supremacy of the global
demand is its large global manufacturer and management approach. South American
and Asian nations are home to some of Nike's facilities. To ensure efficient operation
everywhere, the resources are distributed geographically. The industrial facilities are
close to where cheap labor and raw supplies are easily accessible. In a planned
manner, the facilities are set up solely for this responsibility (Jason, D., 2015).
 Strategist Solution and Implementation

Problem Statement 1: Increased level of Expenditures within the Corporation

● Solution 1. Inventory Management

The cost of acquisition and storage and storage of inventory is a significant expense for
the firm. Since Nike is a manufacturing brand it employs a lot of inventory in its
everyday manufacturing process. As such, the process of inventory management
should make sure that costs associated with it are effectively handled and that
unnecessary costs are removed. The procedures involved in inventory management will
vary as a result of the process. Nike should adjust its inventory such that products are
only held for a brief period before being used in production or sold. Therefore, knowing
which products need to be stocked based on volume, cash flow, sales projections, and
supplier capacities is critical for businesses (Vinson, 2016).

● Implementation 1: Standard Management

The unnecessary expenditures made by Nike Inc. attributes to poor management. To
solve this problem standard management needs to be implemented. Establishing quality
management processes can be as simple as creating a list of all the processes that
employees must take to evaluate the products they receive. Quality will increase once
every employee has the same goals in mind. Also, commodities are known to be
returned to suppliers if they are unable to help the organization reach its goals. Hence,
through effective inventory control strategy, it guarantees that Nike's stock levels won't
increase unnecessarily and that employees won't provide customers with inappropriate
goods (Vinson, 2016).

● Implementation 2: Optimization of Inventory

Effective and efficient inventory control is knowing about merchandising and controlling
it competently. Through enforcing excellent inventory methods, the organization can
directly perform optimization of merchandise quantity to not only improve efficiency but
also attain ever-changing client necessities. When consumers' needs aren't met they
will just look for a different company to satisfy their wants and needs, since consumers
in the modern market won't wait to socially discuss their terrible incidents. Hence, the
economic development of Nike Inc. depends on optimization techniques. Failure to
implement inventory management best practices may result in customer loss, inventory
reductions, and ultimately, job cutbacks. As a result, when the best procedures for
inventory control are used early on, numerous issues can be avoided. Thus, prioritizing
inventory control can help avoid glaring performance inefficiencies and support
tomorrow's precise strategy (Jim,2017).

Problem Statement 2: Increase level of Competition

● Solution 2: Identify New Niche Markets

Nike now operates in saturated areas with high levels of competition in the athletic
footwear industry. As such, Nike should locate and approach new target markets to exit
those markets. The industry will be able to increase its market share and get
competitive advantages in the market by reaching out to new market segments.
Growing the consumer base and distributing the risk are two benefits of trading to
capture a significant market share.

● Implementation 1: Reaching out to customers' needs and wants

People are hesitant to conduct business with organizations that don't have original
concepts and brands. Customers enjoy the excitement, which innovation brings to the
marketplace. Nike should take the time to research the kind of response the general
public would have to a new product or service before launching it.
Nike should employ innovation which will give the marketplace something to converse
about. The implementation of new, high-quality features is vital to keep customers
engaged with the product since they constantly become delighted when they discover
something fresh and exciting in the product. The rest of the businesses will use it as a
searchlight if a company succeeds in becoming the leader in the sector, and the
following are some real-world implementations (Shaw, 2011).
● Implementation 2: Defining Your Brand
There is a need for branding because businesses, brands, and customers are all
typically unique. What values does the business uphold? What distinguishes the
business from others operating in the same sector? What does the business hope to
stand out for in the industry? What is the company's area of expertise?
Nike Inc. should be ready to deal with the introduction and appearance of new
competition in order to avoid losing some market share. Consequently, outlining the
brand and often defining its unique selling proposition is a great approach (USP). The
emergence of competition clearly distinguishes between the powerful and the weak.
During times of intense competition, businesses that do not explicitly stand for
something are typically challenged. A corporation will give in to anything if it doesn't
stand for anything.
Organizations must maintain their distinctiveness to remain competitive. There must be
something fascinating going on in the business that gives customers second thoughts
about adjusting to brand rivalries (Scott, 2008).