Nike Case Study: Nike's Benefuation Through Its Expansion Strategy

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Today, there is no doubt that Nike is one of the most famous and popular athletic footwear, apparels, and accessories companies in the world. Nike has been supplied attractive products over the years, and I am also one of the Nike product users. Nike founded in 1964 and Nike business model has started since then, and its model stays the same even today (Locke, 2012, p.4). Nike business model is to invest in design, development, marketing, and sales then contract with other companies to manufacture the products (Locke, 2012, p.4). While Nike 's global business looks successful, various unethical practices in their products’ manufacturers and suppliers were revealed to the world in the 1990s. • Explain how Nike came to that situation through its expansion strategy Nike business started to contract with lower-cost, high-quality Japanese producers in the 1960s. As costs increased in Japan in the 1970s, Nike shifted the production base to mainly Korea and Taiwan. As those countries also costs started to rise, their lead suppliers opened up the plants in Indonesia, China, and Vietnam (Locke, 2012, p.5). “Today, Nike’s products are manufactured in more than 700 factories, employing over 500,000 workers in 51 countries” (Locke, 2012), while “Nike has only 22,658 direct employees, the vast majority working in the United States “(Locke, 2012, p.5-6). Nike is not alone, but basically, Nike business model keeps looking cheaper cost labors’ locations for their product’ manufactures in

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