Scribd Logo
Upload

Welcome to Scribd!

  • 781 views

    Nike in China

    Uploaded by

    Anurag Pandey
    Nike operates globally and is the largest seller of athletic footwear and apparel. In China, Nike faced challenges including bureaucratic obstacles, outdated technology, lack of employee motivation, and quality issues with B-grade production. Nike addressed these issues by importing goods from other countries, increasing physical oversight of Chinese factories, relocating production to special economic zones, and sponsoring the Chinese Olympic team to build goodwill. The document analyzes Nike's business environment in China using PEST, SWOT, and internal/external factor frameworks.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd

    Nike in China

    Uploaded by

    Anurag Pandey
    781 views22 pages
    Nike operates globally and is the largest seller of athletic footwear and apparel. In China, Nike faced challenges including bureaucratic obstacles, outdated technology, lack of employee motivation, and quality issues with B-grade production. Nike addressed these issues by importing goods from other countries, increasing physical oversight of Chinese factories, relocating production to special economic zones, and sponsoring the Chinese Olympic team to build goodwill. The document analyzes Nike's business environment in China using PEST, SWOT, and internal/external factor frameworks.

    Original Title

    Nike in China (1)

    Copyright

    © Attribution Non-Commercial (BY-NC)

    Available Formats

    PPT, PDF, TXT or read online from Scribd

    Did you find this document useful?

    Is this content inappropriate?

    Nike operates globally and is the largest seller of athletic footwear and apparel. In China, Nike faced challenges including bureaucratic obstacles, outdated technology, lack of employee motivation, and quality issues with B-grade production. Nike addressed these issues by importing goods from other countries, increasing physical oversight of Chinese factories, relocating production to special economic zones, and sponsoring the Chinese Olympic team to build goodwill. The document analyzes Nike's business environment in China using PEST, SWOT, and internal/external factor frameworks.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    781 views22 pages

    Nike in China

    Uploaded by

    Anurag Pandey
    Nike operates globally and is the largest seller of athletic footwear and apparel. In China, Nike faced challenges including bureaucratic obstacles, outdated technology, lack of employee motivation, and quality issues with B-grade production. Nike addressed these issues by importing goods from other countries, increasing physical oversight of Chinese factories, relocating production to special economic zones, and sponsoring the Chinese Olympic team to build goodwill. The document analyzes Nike's business environment in China using PEST, SWOT, and internal/external factor frameworks.

    Copyright:

    Attribution Non-Commercial (BY-NC)
    Download as PPT, PDF, TXT or read online from Scribd
    Download as ppt, pdf, or txt
    You are on page 1of 22
    At a glance
    Powered by AI
    The key takeaways are that NIKE designs, develops and markets high quality footwear, apparel and equipment worldwide. It is the largest seller of athletic footwear and apparel. Some of its main competitors are Reebok, Adidas, Converse and New Balance.

    NIKE's principal business activities are the design, development and worldwide marketing of high quality footwear, apparel, equipment and accessories. It is the largest seller of athletic footwear and apparel in the world. Some of its main competitors are Reebok, Adidas, Converse and New Balance.

    Some of the trends NIKE is facing in the Chinese market include shifting focus to the apparel business, moving production to new countries, increased labor costs, higher demand for new models and shorter product life cycles.

    NIKE in China

    Group No. 1

    Overview
    NIKEs principal business activity is the design, development and worldwide marketing of high quality footwear, apparel, equipment, and accessory product The largest seller of athletic footwear and athletic apparel in the world Distributed in over 160 countries around the world Main competitors Reebok, Adidas, Converse, New Balance, etc

    Where is the environment headed for NIKE Fitness boom creating new market opportunities Competitors becoming more aggressive Rapidly changing market from a sellers perspective to the buyers perspective

    Trends emerging therein. Shifting focus to apparel business Moving to new countries for production Increased Labor Cost Increase in the demand for new models Decreased product life cycle Employee lacking motivation

    Internal Environment Analysis


    Men
    Cheap labor Lack of motivation

    Machine
    Reluctant to use imported technologies Available technology was outdated

    Money
    Prices fixed through Authority, not market based

    Material
    Unavailability of material in local markets Foreign currency couldnt be used to buy materials. Bureaucratic obstacles in purchase of materials Inadequate shipping & transportation provisions

    Market
    Capacity of market increasing Competitors were growing in number and strength Chinese market not quality conscious

    Issues
    Demand for exclusive rights in factories(for meeting quality standards) B-Grade production Defective returns

    Legal Issues
    All contracts based on specific shoe model price , volume , delivery & specifications Compensation trade agreements 1) B-grade shoes @20% discount for first two years and @40% there after Manufacturers could not sign contracts with Nikes competitors Payment for purchases to Ministry of foreign trade

    PEST ANALYSIS

    Issues
    Bureaucratic obstacle in procuring local available material B-grade Products

    Strategies
    Started importing goods from Taiwan & South Korea Discounted selling(20%),reduced quality specifications Physical presence of Nikes people , Manuals of S.O.P, Hire Chinese inspector for each factory Relocated to Guangzhou & Fujian in SEZs

    Maintaining International quality Cost and supply management

    Contd
    Establishment of goodwill & image Sponsored national 1984 Olympic team & hosted Chinese officials visiting The US

    Political Factor
    Government intervention(visa issues) Promotion based on seniority and political factors. Communism Changes in trade practices (forbidden zones removed) Encourage trade in backward areas Willing to enter into joint ventures Always changing decision makers led to delays in decisions

    Economical Factor
    Chinas economy does not rely on market mechanism Pricing issues(central planning system) Prices were not based on market needs and demands Iron Rice Bowl policy

    Social Factor
    Demographics China a major untapped resource for a relatively labor-intensive product(2 billion people) Change in social living conditions Expected product quality Trust and reliability Requirement of alignment with Chinese culture

    Technological Factor
    Speed of change of product Resistance to adopt new processes Lack in know-how of making A-grade sports shoes Poor telecommunication Made video tapes of operations and technical advancements

    SWOT Analysis

    Strengths
    Very competitive organization Strong presence and experience in industry Expected strong Chinese Market Product Range Contract manufacturing Strong at research and development Global brand Labor

    Weakness
    Chinese culture Contract manufacturing Delivery time Heavily dependent upon its share of the footwear market

    Opportunities
    Fitness boom created new markets Product development offers many opportunities Opportunity to develop products such as sport wear, sunglasses and jewellery. Such high value items do tend to have associated with them Business could also be developed internationally

    Threats
    Exposed to the international nature of trade Market for sports shoes and garments is very competitive Quality assurance Lack of information, resources and government policies Retail sector is becoming price competitive Communication barrier Product life cycle reduced

    Firm's response to these trends. Entered apparel business Moved from Japan to Korea, and then to China. Introduced new product lines Diversifying their product portfolio Provided better living conditions and attractive incentives

    Thank You

    You might also like