The effective tax rate in FY 2018 was 55.3% which was 13.2% in the year 2017. [Source: 2016 Annual Results Nike Inc] SWOT & PESTLE ANALYSIS OF NIKE . This SWOT Analysis of Nike Inc. shows that the company has the strengths needed to support its global leadership in the sports footwear, equipment and apparel market. All of them accounted for more than 10% of the company’s footwear production during the year. Luxury Swimwear Market SWOT Analysis 2020 by Players – Nike Inc, Perry Ellis International Inc, Swimwear Anywhere Inc., Adidas AG, Dick’s Sporting Goods December 9, 2020 Exltech Luxury Swimwear Market Overview: Table of contents. Roughly every four years, Nike throws a World’s Fair for sport tech, showcasing the brand’s latest innovations in gear ahead of the summer Olympic Games. It was found by Bill Bowerman and Phil Knight in the year 1964. How Does Credit Karma Work and Make Money? The pandemic has had a strong negative impact on the sales and revenue of businesses like Nike leading. Phil Knight (Founder and CEO) is frequently quoted as saying that ‘Business is war without bullets.’ Nike has a healthy aversion of is competitors. Nike’s growth in the recent years is a result of its consistent focus on product quality and growing investment in technology. Join mobilsocial social network mobilsocial This article source is re:Jerusalem Article is Global Basketball Uniform Market SWOT Analysis 2020 | Nike … Counterfeit products of lower quality and priced lower than original products can affect Nike’s brand image. Essay type Analysis . Nike is the most valuable brand for sports in 2018. For fiscal 2020, NIKE, Inc. gross margin decreased 130 basis points as higher full-price average selling price (ASP), on a wholesale equivalent basis, was more than offset by higher product costs due to incremental tariffs in the U.S., as well as factory cancellation charges, higher inventory obsolescence reserves and the negative rate impacts of supply chain costs on a lower volume of wholesale shipments in the fourth quarter of fiscal 2020.”. Its growth remained obstructed in many areas in the past and technology has helped it find new high growth segments. The company is providing its customers with an omnichannel experience and investing more in technology. Its sales from direct to customer channels have also experienced faster growth in recent years. Nike’s popularity rests on the design and quality of its products which are produced by independent suppliers and contractors. One of its core strengths is product quality and also one of the leading factors that differentiates Nike from the other brands. This SWOT analysis looks at Nike, a global retailer that specialises in sportswear, including shoes, clothing and accessories. Sexual Harassment: Former female employees also pointed out that sexual harassment and misconduct was very common in the company. The company must focus on building an organizational culture that brings higher creativity and fosters innovation. This is a great threat Nike is facing and it also affects its net income by 54% which is a great offset for the revenue growth. Nike is a very competitive organization. Remember me . Share your thoughts and experiences in the comments section below. This detailed SWOT analysis of Nike aims to examine the strengths and the weaknesses of Nike. It was found by, in the communities. Nike (NYSE: NKE) is the largest brand of sports shoes and apparel in the world with a global footprint. Apart from that, Nike’s debt is … 1 shoemaker. However, the role of technology in Nike’s ecosystem has grown exponentially in the latest years as the company has moved to offer an omnichannel shopping experience to its customers. Over the next several years, technology can also help Nike widen the gap between itself and its rivals. As Nike’s focus on customer experience has grown, the company is providing its customers with an omnichannel experience. It also aims to examine the opportunities the company should explore and the threats it should keep an eye on. The net profit of the company has decreased by approximately 37.5% in 2020. There’re approximately 75400 people are working for the company by the end of 2020. Hi Divya, Most of the information is from Nike’s annual report and few points have embedded hyperlinks for references. Due to the outstanding quality and design of Nike shoes and apparel, Nike products are the favorite of the young customers worldwide. However, in fiscal 2020, while Covid-19 has hurt Nike’s business, the company has managed to control the overall impact to a large extent. Based on its performance over the last five years, it is not difficult to infer that shaking Nike from its leadership position is very difficult for the rivals. The SWOT analysis of Nike discusses the strengths, weaknesses, opportunities and threats of the leading footwear brand - Nike. SWOT Analysis. NIKE annual/quarterly revenue history and growth rate from 2006 to 2020. The company generated $16.1 billion in FY 2019 from the United States market and in 2020, $14.6 billion. 334 factories in 36 countries produced Nike brand apparel in 2019. For the first nine months of fiscal 2020, gross margin expanded 30 basis points compared to the first nine months of fiscal 2019. 032c returns to an old corporate strategy favorite – the SWOT (Strengths, Weaknesses, Opportunities, and Threats) analysis – to consider Nike’s position and message for 2020, and beyond. From releasing new product lines to building new brands, to outsourcing, and establishing a global presence alone is an extraordinary achievement. This creates the perception that Nike is not committed to addressing climate change and its pledge is just a marketing stunt. It designs and sells shoes for a variety of sports including baseball, golf, cheerleading, volleyball, tennis and football. This SWOT analysis looks at Nike, a global retailer that specialises in sportswear, including shoes, clothing and accessories. Its approach differs sharply from rival brands. It is also using digital technology heavily to manage suppliers throughout the world which are located mainly in the Asian nations. Apart from that, it is relying heavily on cloud technology to manage the digital experience it offers. Nike SWOT Analysis Presentation. The abbreviation represents strengths, Weaknesses, Opportunities and Threats. It enjoys one of the most impressive profit margins in the entire shoe industry. However, the company must focus on optimizing its direct channels more to grow its profitability. Nike’s SWOT Analysis – Recommendations. The result was that it brought down Nike sales, and its revenue was severely hurt. Cloud technology has been driving swift changes across Nike and all functions including manufacturing, marketing, and sales, and relying on it to grow operational efficiency. There are various strengths, weaknesses, opportunities and threats of Adidas. Your favorite Nikes might be made from forced labor. Further, the product was introduced to common customers in late 1980 (Nike Air Jordan, 2018). 1 shoemaker. Through the interviews, it was established that Nike did have a toxic working environment, where sexual misconduct was rampant. Now, Nike is a digital-first company that is using digital technology to serve and engage its customers worldwide. Its focus on customer experience has only increased with time resulting in growth in brand equity and profitability for the brand. Players Profiles. The fiscal 2020 proved to be successful for Nike. The brand has excellent marketing campaigns and, Recently, a former employee accused Nike of, Multiple female employees reported that they had complained to the HR but saw no action being taken from their part. In the year 2020, about 41% of Nike’s sales came from the U.S, while the rest of 59% came globally. As of 2020, Nike is one of the leading brands in the lifestyle and retail sector. Due to the intense competitive pressure, Nike has also started investing more in customer experience and technology. Nike is a very competitive organization. Together, the three countries accounted for 27%, 22%, and 10% of Nike’s apparel production during the year. Some even left their jobs. Using for my management program – Leadership & People Management. Read out this article, to get an understanding of where Adidas stands. It’s a great help. Nike’s primary goal is to supply athletes with exceptional products and wearable that aids them in better sports performance. October 17, 2020 . Nike’s sales from direct to consumer channels have increased in 2020. According to sources, the previous CEO Mark Parker has once accepted that Nike was facing internal challenges related to organizational behavior. 4.2 Product Introduction. Nike has leveraged the power of marketing quite well. As a sports shoes and apparel brand, Nike enjoys the strongest popularity of all the brands in the industry. Abhijeet has been blogging on educational topics and business research since 2016. ... Puma SWOT analysis 2020: Case Study in 4 Steps. The SWOT analysis of Adidas differentiates the brand’s strengths, weaknesses, opportunities, and threats that would be useful for the company to grow. At the Atlanta Olympics, Reebok went to the outlay of sponsoring the games. However, the competitive pressure has kept intensifying and to beat the competition, Nike grew its focus on technology, customer experience, product quality and marketing. Lack of Diversification: Nike’s over-dependence on sporting apparel or lack of diversification is a major weakness. October 23, 2020 8 . Together, the three countries accounted for 49%, 23%, and 21% of Nike brand footwear, respectively. There are several types of legal threats and compliance in all areas including labor and product quality is essential for Nike to avoid hefty fines. Thanks. S.K. 112 factories located in 12 countries supplied Nike shoes in 2019. Extensive global production and di… In fiscal 2020, Nike’s gross margin reduced mainly due to the impact of Coronavirus falling to 43.4%. Nike has previously courted a lot of controversies related to supply chain management and its labor force. Another major threat before Nike is that of counterfeits. In the year 2020, about 41% of Nike’s sales came from the U.S, while the rest of 59% came globally. Opportunities for Thailand. Thank you Gargi, I have been through business school not so long ago, so I can totally relate to you. ... Adidas used to be the main apparel sponsor for the NBA, however, it lost the contract to Nike. Other sports shoes and apparel brands are also investing heavily in marketing, product design, quality, and innovation. Category Sports; Show more Show less. The Puma SWOT analysis examines where it is in the market these days as well as how Puma has managed to stay relevant all these years. This article analyses the company using the SWOT Methodology. The company has experienced growth in its revenue from direct to customer sales channels. Category Swot Analysis. Economic fluctuations caused by other factors can also hurt Nike’s sales and revenue globally. Here’s why. ET If the company successfully resolves the problems related to organizational culture, it could find its growth momentum increasing. ... Tesla SWOT analysis 2020 - Duration: 11:09. However, due to the success, Nike has gotten the company now provides athleisure wear as well. Technological innovation is an area Nike must take very seriously. Coronavirus severely hurt economic activity across several markets and various industries, including travel and fashion. Needless to say, the most important strengths are Nike’s powerful brand and low product cost. While organizational culture is a critical pillar of organizational success, this is an area where Nike has been unable to achieve significant progress. The women were left devastated and felt unsafe while working at Nike. Nike Threats in SWOT Analysis. While the company took several significant steps to resolve the problem, it has not been able to establish a culture that fosters higher inclusion and creativity. The growth of Nike can also be attributed to its focus on quality and investment in technologies that have helped it consistently improve the quality of products and customer service. These benefits were partially offset by higher production costs. Category Sports; Show more Show less. Thank you. The product was first launched for legendary basketball player Michael Jordan in 1984. 3.3 Porter’s & Five Forces Analysis and SWOT Analysis. However, the company’s investment in its own digital sales and distribution channels has paid off during the coronavirus crisis. The pandemic has brought a major and long lasting impact in terms of consumer behavior and digital technology will become the primary driver of growth for Nike and its rivals. From 2016 to 2020, Nike’s net revenue has grown by around $5 billion. Did you find this article interesting? Nike therefore needs to grow its focus on the other economies and particularly the emerging economies that are seeing faster growth. The women were left devastated and felt unsafe while working at Nike. While the company faced several controversies in the past related to supply chain management, with time it has improved its supplier management practices a lot with a clear focus on ethics, quality, and labor management. Read more about Nike in this swot analysis analyzing its key strengths and weaknesses in 2020. Nike’s DTC revenue increased to $12.9 billion in 2020 from $12.3 billion in 2019. Nike suppliers follow a code of conduct that ensures they are managing their labor force and sourcing raw materials responsibly. SWOT ANALYSIS: Strengths. Further, the product was introduced to common customers in late 1980 (Nike Air Jordan, 2018). The Washington Post. SWOT Analysis is a proven management framework which enables a brand like Nike to benchmark its business & performance as compared to the competitors and industry. A management consultant and entrepreneur. This has led to superior customer experience and growth in sales from the direct to consumer channels apart from increased customer loyalty. Thanks it will help me my upcoming presentation. Regulations related to consumer data have also grown . While Adidas has advanced fast in recent years and poses a formidable challenge before Nike, the industry leader has still maintained a strong edge over its rivals. The entire controversy has significantly affected the company’s image. 4.1 Company Profiles. Before we begin in-depth on the SWOT analysis of Adidas, let us understand a bit of the background of the company Adidas. We respect your privacy. Nike is a brand of premium sports shoes and apparel that has been enjoying strong sales and profitability over the past several years. In countries like India, Brazil, and Mexico, a large group of middle class buyers has emerged in recent years. While Nike’s core market, the United States, is the main source of revenue for the brand, the impact of a recession or a pandemic on the US economy will also hurt Nike sales and profitability. The CEO ensures that Nike will help to contribute. Puma SWOT analysis 2020: Case Study in 4 Steps. The interest payments on its debt are also well covered by EBIT. Gupta understands how to create and implement business strategies. Nike’s 2019 Income before income taxes increased 11%, as revenue growth and gross margin expansion were partially offset by higher selling and administrative expenses. However, based on the increased focus of the company on DTC sales, it may not take Nike very long to be there. Nike SWOT Analysis Presentation. Words 1144 (4 pages) Views 381. While its net income also slipped, the company has still performed well during the crisis. As the pandemic’s impact has been the strongest on the US market, its impact on Nike’s revenue has been harsh since the US is Nike’s largest market. Nike, despite being the world’s biggest sports shoes and apparel. Just like the retail industry technology has been driving sweeping changes in the sports shoe industry as well. Check Also. The stock price of Nike is $72.63 on NYSE in 2018. Unequal Wealth Gap. Apart from bringing products that fit into their customers’ lifestyles, Nike has also altered its sales and marketing strategy to suit its customers’ tastes. However, none of the producing factories accounted for more than 10% of footwear production in the year; the largest factory accounted for only 9% of the total. Nike Threats in SWOT Analysis. who wrote this article ? Throughout its history, the company has introduced several market leading technologies that have helped it dominate the sports shoes market. All rights reserved | email@example.com | Logo designed by Looka. Nike’s leading strength is the brand equity the company has built over the years. Tell us what you think? ... Bata, Reebok, Nike, Adidas, etc. finding a solution against these environmental issues. Global GOLF CLUBS Market Analysis by Regions. Several sporting teams are on the brink of collapse. The top five apparel manufacturers together accounted for 49% of the company’s apparel production in 2019. Nike is headquartered in Beaverton, Oregon, USA. contact: firstname.lastname@example.org, email@example.com, Easy Ways Businesses Can Incorporate Sustainability, What You Need To Know About Marketing for Your New Business. 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