The gurus listed in this website are not affiliated with GuruFocus. Journal of management, 29 6 , 801-830. Adidas and Under Armour are also investing heavily in innovation and marketing creating competitive pressure on Nike. The rapid changes in technology and consumer preferences constitute significant risk factors for Nike. This may leave it vulnerable if for some reason its market shares erode. It designs and sells products in nine key categories. Walmart has been sued for unfair labor practices as well.
Common in stakeholder theory is compromises on both sides that can obviously haze over differences; this primary characteristic is accepted as contra-distinctiveness from the shareholder value. Nike does not have factories. Senior Services of Southeastern Virginia. This article was written by David Shabotinsky, a Financial Analyst at , and enrolled at the undergraduate Finance program at the Interdisciplinary Center, Herzliya. This was because of the negative publicity it got with regard to its overseas manufacturing facility. Costco Wholesale Corporation Costco Wholesale Corporation, popularly known as Costco, is an American multinational corporation that operates a total of 751 membership-only warehouses in the United States, Canada, Mexico, Japan, South Korea, Taiwan, Spain, Australia, Iceland, France, and the United Kingdom.
Or will the explosive growth continue for several more years to come, rendering this a worthwhile entry point? Graph 1: Here you can see how to match them, 1. Some of the countries where they have contract manufacturers include China, Indonesia, and Vietnam. We can see significant amount of fragmentation with Nike. The Mary Wells Senior Center is most commonly referred to as the Nike Park Senior Center. Disclaimer: This case study has been compiled from information freely available from public sources. It provides lightweight shoes by using lunarlite materials. Many of these materials used in production are available in the locations which the manufacturing takes place, but some specialised materials have to be imported to the manufacturing company.
Weaknesses Heavy Investment Spending: One has to look closely to find weaknesses here there certainly has been nothing weak about the stock price , but the high level of investment spending is at least a modest cause for concern. As the pioneer of this analysis, and one of the first strategy theorists Ken Andrew was the first who analyzed the strategy with considering capabilities and resources with the external environment. The dollar is expected to continue to strengthen in the coming months, so this will remain a concern for the near term. In the case of Nike, for example, there was a move into new sports areas away from the running heritage. It can either acquire a few of them or build some of its own which will help it have a more agile and stronger supply chain and find faster growth. Backward integration- Nike currently relies totally on independent manufacturers for the production and supply of its products.
Such high value items do tend to have associated with them, high profits. Still, the stock could start to look a lot cheaper quickly if earnings can maintain their current momentum. Indeed, the name Sweatshops is used to mockingly describe the abhorrent conditions in its overseas manufacturing facilities. Lifestyle section can be expanded and can be given more focus. What opportunities can we develop? This is evident in the statistics of the amount spent on online stores by citizens of the United States increasing every year and recently at a high rate. Nike is quite strong regarding its research and development; quite evident regarding its evolving and innovative product range.
However Nike sponsored the top athletes and gained valuable coverage. Although the futures method is currently working for Nike, Past options Futures ordering system Rationale a 6 month lead time for product orders, always knowing what is needed in production Future Options Rationale Critical Success Factor This is responsive to the market trends, but can also help retailers plan stock. A case sets forth, in factual manner, the events and organizational circumstances surrounding a particular marketing managerial situation. Look for critical success factors, matches and mismatches. To us, this may seem insignificant, but Political factors decide the survivability of an organization. Excellent advertising and branding make it a popular brand 9.
Nike does have its own. Under Armour has been one of the best growth stocks this decade. Additionally, it sells heavily to retails who themselves are price sensitive also. To manage the competitive pressure Nike will have to retain its focus on product quality, innovation and supply chain management. Identify any key areas that have affected Nike.
If a retailer hopes to increase its market share by purchasing a smaller retailer company, they can solidify their decision by performing a. The first of two major functions of the enterprises is producing goods and services, and the second is selling them. For analyzing and strategizing we should consider the following points: As Strength and Weakness we should answer the question: what can we do? When Footlocker reduced their purchasing form Nike, it created a reduction in turnover in the short term. Past options Sports personalities have endorsed the Nike product, although with numerous different sports and countries targeted Rationale To target all types of sport by choosing personalities which are at the top of their sports. Weaknesses - Labor violations, bad repercussion with sweat factory issues and unethical business practice can be faced. Asia has the highest number of Nike suppliers and especially in China, Indonesia and Vietnam.
Their multi-channel approach has substantially increased their reach and their customer base in total. Change of Focus Theorist Hummels, H and Timmer, D. They manufacture wherever they can produce high quality product at the lowest possible price. This means that the assiduously cultivated exclusivity is sometimes sacrificed because it has not yet spread its wings to include exclusive retailer outlets as part of its business strategy. While this has raised concerns about quality, the customers do not seem to mind as they are getting their moneys worth and the addition of value to the customers is another significant opportunity. However, like it or not, consumers that wear Nike product do not always buy it to participate in sport. Another worry is the fact that Nike is still not the choice of the price conscious shopper.
You may also check out. It provides a wealth of in-depth financial information, intelligently presented both in print and online subscriptions, plus objective research, insightful commentary, proven price projections, and advanced analytical tools. Therefore, the real impact of a long-term of this in worrying. Conclusion: Nike is the biggest sports shoe and apparel brand of the world which has focused on product innovation and marketing for growth. Nike is strong at research and development, as is evidenced by its evolving and innovative product range. They manufacture high quality product at a location which offers low prices.