...About Nike, Inc. First established as Blue Ribbon Sports in 1964, Nike, Inc. changed itself to current branding in the year 1971. Nike is the number one athletic footwear and sports equipment brand in the world with over $25 billion in 2013 in revenue. Based in U.S. Nike, employees 44,000 employees worldwide. In the year 2014, Nike was valued at $19 billion for the brand alone. Nike is known for its “Just do it” slogan and “Swoosh” logo. Mission: Bring inspiration and innovation to every athlete in the world. Case discussion: Foot Lockers, one of the largest retailers of Nike, Inc. has decided to reduce sales of a number of Nike’s premium shoe ranges on the fact that consumers were turning more to midpriced shoes. Based on this, a series of events occurred from cancellation of orders to reshuffling of store strategy and replacing Nike brand shoes with Reebok & FootAction. Nike fought back by changing partnership strategy with Foot Locker’s competition, from launching new products to exclusive sales right. Company culture: - Fosters a culture of innovation. They create products, services and experience for today’s athlete and solve problems for future generation - Their leadership creates opportunity and inspires others to do their best work. - They are committed to building deeper connection with the community connections and spurring positive social change around the world. - They create sustainability by innovating better solutions to create a limitless future that...
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...Nike, Inc. Accounting Analysis Brian Knoske Harding University Abstract Nike, Inc. is one of the most successful companies in the world. They consistently post high revenue numbers, which can be attributed to their excellent worldwide view. They are the world leader in footwear sales, which was the product that the company was originally built on. When Phil Knight and Bill Bowerman originally formed a company, they only wanted to provide athletes with a better shoe. Their success keeps their return on stock consistently up, which is a difficult thing to come by in these tough economic times. If Nike wishes to remain a successful company, they will have to appropriately deal with their accusations of poor working conditions for their foreign warehouses. Description of Company Nike, Inc. is a company that specializes in designing and selling athletic footwear and apparel (Nike, inc., 2011). Their products are of high quality and reasonable price, leading them to be highly sought after by consumers. This has led Nike, Inc. to become the number one athletic footwear supplier in the United States (Nike, inc., 2011). Nike, Inc. is also one of the world leaders in selling athletic uniforms, apparel, and casual clothing. In addition to designing and selling their products, Nike also operates NIKETOWN stores, Nike Factory Outlets, Nike Women’s Shops, and an online website (Nike, inc., 2011). Nike’s products are sold in 690 of these stores worldwide as well as at an...
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...reduce cost or save on efficiency, however, more and more companies are employing outsourcing for other strategic driven initiatives. Some of these reason can be: 1. To focus on core activities 2. Reduced overhead 3. Operational control 4. Staffing flexibility 5. Continuity and risk management 6. Development of internal staff 7. Risk sharing One such company that uses outsourcing is Nike, Inc., a "corporation that is engaged in the design, development, manufacturing and worldwide marketing and selling of footwear, apparel, equipment, accessories and services" (www.reuters.com). In its earlier years of expansion, Nike acquired other businesses such as Cole Haan, Converse, Umbro and Bauer Hockey, among others. It has since then sold some of these acquisitions in an effort to refocus on its core activities. Although not an example of oursourcing, it does illustrate how important core activities are to a company. As great as diversification and acquisitions can be, they can take away focus from a company's star product, in turn affecting revenue. As part of their strategic planning, Nike probably weighed the cost benefits of outsourcing these acquisitions to others while retaining ownership, with the sale of these business lines altogether, and clearly selling was more financially beneficial for the company. But in other cases, outsourcing these business lines to others in order to concentrate on a core product or service can be the most sound strategy to...
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...Plan NIKE, Inc. Executive Summary As a heavyweight company that manufactures all its own products, NIKE is able to reach into just about every aspect of the sports market. All its’ products are developed, from the apparel to the footwear, and are able to reach women, men, and children throughout the globe. NIKE creates products tailored for just about every sports event: “running, training, basketball, soccer, sport-inspired casual shoes, and kids’ shoes. It also markets footwear designed for baseball, cheerleading, football, golf, lacrosse, outdoor activities, skateboarding, tennis, volleyball, walking, and wrestling”. All this gear is available through NIKE’s retail stores, including, but not limited to, trademarks such as “Cole Haan, Converse, Chuck Taylor, All Star, One Star, Star Chevron, Jack Purcell, Hurley, and Umbro”. Another successful marketing strategy is to implement the face of a famous athlete with the product in order to increase popularity. This has been done with Michael Jordan and the Nike shoes’ “Jordan’s”. Furthermore Nike has even granted customers the ability to have a degree of customization in shoe products that they order. This is yet another successful method that has greatly yielded to the customer’s specific designs. This idea of catering to a customer’s design is considered a breakthrough and currently this appears to be that path Nike is following on. A shop was opened where customers could design shoes that Nike would make and Nike has allowed...
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...Calculation of cost of debt by using IRR method : Formula : B0=I*t=1n11+rd t +M*11+2dn=I*PVIFA r d,n+M*PVIFrd,n B0=Value of the bond at time zero I= annual interest paid in dollars n=number of years to maturity m=par value in dollars rd=required return on bond B0=$956 Coupon Rate =13.5% I= coupon payment=13.5%*1000 = 135 Year to maturity =n=25 years Par value =1000 A trial –and – error technique: At the first consider rd=7.58%equal to method one and B0=$956 I= coupon payment=$135 1)The first try: 956=135*t=1251(1+7.58%)t +1000*(1(1+7.58%)25) 956= 135*(PVIFArd,n) +1000*(PVIFArd,n) From table A-4 and A -2 (Appendix A) r=7.58%, n=25 PVIFArd,n=11.164 1000*(1(1+7.58%)25)=1000*0.161=161 135*11.164=1507.1 956≠1507.1+22.3 2)Another try rd=0.10 956=135*t=1251(1+10%)t +1000*(1(1+10%)25) PVIFArd,,n=9.077 135*9.077=1225.4 1000(1(1+10%)25)=0.092 PVIFrd,n=0.092 ,1000*0.092=92 956 ≠ 1225.4 +92 3)An other try: rd:=12% PVIFArdn=7.843 PVIFrdn=0.059 135×7.843=1058.9 1000×0.059=59 956≠1058.9+59 4) An other try: rd=%14 PVIFArdn=6.873 PVIFrdn=0.038 135×6.873=927.9 1000×0.038=38 927.9+38=965.9 956≠965.9 5)An other try: rd=%14.2 PVIFArdn=6.791 PVIFrdn=0.036 135×6.791=916.8 1000×0.036=36 916.8+36=952.6 956≠952.8 6)An other try: rd=%14.15 PVIFArdn=6.810 PVIFrdn=0.037 135×6.81=919.3 1000×0.037=37 919.3+37 = 956.3 959=956.3 rd=%14.15= cost of debt=correct...
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...Nike INC.: Developing an Effective Public Relations Strategy Date: Thursday, February 9th/12 Summary Nike Inc. started as a venture between Phil Knight, current CEO, and Bill Bowerman. At the time Knight was a student at the University of Oregon and Bowerman was the University track and field coach. The company, originally named Blue Ribbon Sports, did not officially get started until 1964 when Knight, who pursued a MBA at Stanford, graduated. Blue Ribbon Sports started making athletic footwear after the two men took a trip to Japan to source a manufacturer for the high performance athletic shoes that Bowerman had been designing. The first shoe created by the duo helped University of Oregon runners break track and field records. After those first initial models were produced Knight started selling the shoes out of the trunk of his car, as he would travel to various track and field events. He was also employed as a certified public accountant and professor at Portland State University during the early years of Blue Ribbon Sports. The first shoe under the Nike name was released in 1972, known as the Cortez, and it became extremely popular immediately. As the company, now known as Nike, progressed Knight and Bowerman started to invest largely in research and development and a dynamic organizational culture. One of the things that made them successful was the outsourcing of offshore manufacturing in Japan. In the mid 80’s Nike’s manufacturing focus started to shift to...
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...industry. This purpose of research is to: (A) Evaluate the conditions of the Marketing environment of Nike INC as a sports equipment company (B) Evaluate the recourse capability of Nike INC using appropriate analytical tools, highlighting its thresholds and unique resources and core competences (C) Evaluate the strategic fit of Nike INC using the analysis gather highlighting its strength and weakness. Company’s Profile. Nike INC is a sport Equipment company, It was founded on the 25th of February 1964 by Bill Bowerman as at then it was known as Blue Ribbon Sports. Its named was official changed on the 30th May 1978 to Nike INC. It is said that Bill Bowerman developed his interest in starting up a business while in Stanford. He believed his business would grow because as at then most Sport Shoes companies spent a fortune on labour by cost by manufacturing their Athletic Sports Footwear in countries like the USA were labour cost were high. He was convinced that by out sourcing production to Japan where labour is cheaper, Blue Ribbon prices would be cheaper than its contributor and thus it break into the Athletic Foot Ware industry and this was the beginning of the company which later became Nike INC. Nice INC logo is an image associated with its distinctive "swoosh" logo was created by Carolyn Davidson while he was a student of graphic design student. Initially the word Nice INC was attached to the Logo, but when the company became successful the logo was adapted to reflect...
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...Nike, Inc.: Cost of Capital Nike, Inc.: Case Background: NorthPoint Large Cap Fund weighing whether to buy Nike’s stock. Nike has experienced sales growth decline, declines in profits and market share. Nike has reveal that it would increase exposure in mid-price footwear and apparel lines. It also commits to cut down expenses. The market responded mixed signals to Nike’s changes. Kimi Ford has done a cash flow estimation, and ask her assistant, Joanna Cohen to estimate cost of capital. What is WACC? and why is it important to estimate a firm’s cost of capital? The cost of capital is the rate of return required by a capital provider in exchange for foregoing an investment in another project or business with similar risk. Thus, it is also known as an opportunity cost. Since WACC is the minimum return required by capital providers, managers should invest only in projects that generate returns in excess of WACC. What is WACC? and why is it important to estimate a firm’s cost of capital? The WACC is set by the investors (or markets), not by managers. Therefore, we cannot observe the true WACC, we can only estimate it. Do you agree with Joanna Cohen’s WACC estimations? Why or why not? Issues Single cost or Multiple Cost? Cost of debt Cost of equity Weights of capital components Single cost or Multiple Cost? Should Cohen estimate different cost of capital for footwear and apparel divisions? I agree with the...
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...Summary: Nike, Inc. is a major publicly traded clothing, footwear, sportswear, and equipment supplier based in the United States. In this case we have learned about the struggle that Nike’s one director took to catch the market of china and the reasons behind the failure of the project. Tom Clarke, the president of Nike knew that many people could not afford nike’s product due to high price and for this reason they were losing many potential customers. So in 1998 he began the development of world shoe project that was intended to emerging markets of Asia, Africa and Latin America and command Hartge to handle the project. Nike used a triple-bottom-line consideration to be able to give answers to the shareholders and people about economic, social and environmental issues. The world shoe line project was manufacturing products in china and took a business model of ‘local for local’ where local raw materials and local Nike’s manufacturing factories were used to manufacture shoes and sell them only in china. Hartge found out exclusive design for the shoes so that the manufacturing cost could be reduced. Hartge classified the market in five tier and targeted mainly tier three who were developing with high potential customers. But after doing so many things Hartge could not compete with the local producer because of their low cost and low price. Again there was no formal marketing plan to introduce the world shoe lone among retailers and customers. The distribution channel in china...
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...Corporation Background and History Nike was founded on January 25, 1964 (O'Reilly, 2014) as Blue Ribbon sports by Bill Bowerman and Phil Knight. The company officially became NIKE on May 30, 1971. The name Nike comes from the Greek Goddess of Victory. Nike Currently has a net worth of 86 billion dollars. (Forbes, 2015) Currently Nikes trades were sharing at 124 dollars each on the stock market. II. Description of CSR Issue Nike has contracts with about 700 sweat shops throughout the world. (Nike, INC., 2007-2009) In 58% of Indonesian sweatshops their worker are between the ages of 20 and 24. 83% of these employees are females. (Nike, INC., 2007-2009) III. Organizational Stakeholder Impact A. Help prioritize key issues and develop procedures (Nike, INC, n.d.) B. Must engage to avoid issues again from the 90’s (Nike, INC, n.d.) IV. Societal Stakeholder Impact A. Reviews report for transparency (Nike, INC, n.d.) B. Had most recent report re worked to seek more candidly about lessons learned from both successes and failures (Nike, INC, n.d.) V. Current Status of Corporation Nike pays 25 million annually to implements and follow Corporate Social Responsibility. (Arias, 2010) However, Nike refused to pay 2.2 million dollars to Honduran workers in severance (Arias, 2010) when two subcontractors closed down their facilities. Years later they agreed to pay 1.54 Million dollars to help these workers. VI. Strategic CSR Nike agrees that innovation through the lens...
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...in according to the two given ethics theory, which is Shareholder Value Theory, and Stakeholder Theory. Nike Inc., the chosen company had implement the CSR practices in many of its business activities especially in its product design. Nike Inc. had preserved some serious ways of processing and promoting the CSR as they appreciate about the importance and the benefits of it. Nike Inc. had implement the business theory of shareholder value theory in, allowing the company’s shareholders been satisfied by the performance of the company and at the same time being the customers favorites which clearly indicates that the organization heading towards the right path. And at the same time, the Nike also implement the stakeholder theory whereby, the company includes the element of moral and values in its organization management in very healthy and innovative ways. This report also identifies how serious does Nike desirably tend to implement both of these theories in the company business practices. This reports also discussed few recommendations that can be implemented by the Nike Inc. in its practices to enlarge the CSR influence in its business practices. Improve labor practices, uses better and more nature resources and also emphasizing more on safety and healthy concern are few of the proposition that been highlighted in this report. This report clearly classifies that Nike Inc. had accomplish many achievement in its business practices by laying CSR as its main vision. This organization...
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...Table of Contents Introduction 3 Nike, Inc. 3 Under Armour 4 Porter’s five forces analysis 5 Nike, Inc. and Under Armour innovation strategies comparison 7 Conclusion 9 References 10 Introduction Nowadays, more and more people become concerned about health; they develop special diet that include vitamins and advanced nutrition supplements, and of course they do sports. Any kind of sports demand at least basic sports outfit: a T-shirt, shorts or pants, and a pair of shoes. Industry of sports apparel and footwear is an important part of today’s global business, where big companies have to compete for a customer. It is rather hard to differentiate on this market, because all the goods have to fulfill only one goal: make a person feel comfortable during a workout. Thus, companies have to work harder to develop new innovative products to gain market share advantage. The market of sports apparel is now dominated by several big companies: Nike, Inc., Adidas group (which includes Adidas and Reebok), and Puma. But there is also a new fast-growing and very promising player - Under Armour that managed to enter this saturated market. The key success factor for Under Armour was their innovative approach in creating sports apparel. Observing Under Armour’s success Nike has reconsidered their strategy and made innovation the core part of their mission, and in 2013 Nike was announced a #1 innovative company by fastcompany.com. So now there are two key innovators on the market...
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...conditions as they rapidly change and do so with great rigor, consistency and discipline; applying the traditional four functions of management does this and they are planning, organizing, leading, and controlling. This paper will evaluate the organizing function of management at the Nike Company and show how it relates to human resources and Technology; this paper will also discuss whether or not it has optimized these resources for effectiveness and efficiency with justification. Organizing Function of Management In the leadership of business one of the most important aspect business is the organizing function of management. By correctly implementing the organizing function of management could easily break or make a business. The organizing function of management plays a big part on all levels of a business’s operations. To began with it addresses the manner in which people with the organization will interact, who will report to who in each department, which is a reason why an organizational chart is used and it shows the lines of authority. All of these are aspects of organization and personnel management that comes under the organizing function of management. Brief History of Nike Inc Nike was started in 1964 with a handshake and agreement between Bill Bowerman the track coach at the University of Oregon and Phil Knight. They started importing Tiger running shoes made by the Japanese brand Onitsuka, today they are called...
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...e-Business Analysis Bus 352 e-Business e-Business Analysis of NIKE Generally speaking, exercising was not something that our ancestors had to spend very much time thinking about. By and large, the lack of modern technologies and conveniences meant that their everyday lives tended to be more strenuous, and involve more inherent activity, than most of our lives today. However, as day-to-day living has become more sedentary in recent years, people have had to start planning activity into their days, and, consequently, exercise crazes have become a hot topic. From Jane Fonda’s Workout, to Cindy Crawford’s Shape-up; or from Total Gym, to Zumba, to P90X, or yoga, America has been embracing one exercise fad after another for decades. And because each fad seems to require its own unique workout apparel and equipment, several companies have made it the primary focus of their businesses to provide for this ever-growing market. One of the industry leaders in this business model is NIKE. According to NIKE’s official website, by 2011 the company employed over 40,000 people worldwide, and operated in more than 160 countries on six continents around the globe. ("NIKE inc. locations," 2011) The website also says that NIKE’s mission is to “bring inspiration and innovation to every athlete in the world.” ("NIKE inc. locations," 2011) In order to achieve this mission, NIKE supplements its extensive global presence with its online transactional website, in a business model known as...
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...Sustainability Assessment of Nike Shoes Andrew Derrig Jake Stocker Luke Warren Pearson King Ethan Tinson Ellen Winston For Sustainability Science ENVS 195, Fall 2010, Dr. Saleem H. Ali Introduction and Justification In Greek, Nike means “victory” and since the beginning of the company in 1972, victory has been a term that has represented many things about the Nike brand. The Nike corporation produces athletic shoes, apparel, equipment and accessories that can be found in distributors in over 170 countries worldwide, it sponsors many professional and college level sports teams and has grown to be one of the largest athletic apparel corporations in the world. In the early „70s they started out manufacturing running shoes featuring innovative new technology that increased traction and made the shoe lighter as a whole. (Nike, 2010) Since then the Nike brand has taken off and become more than simply successful, it is infamous though for a few different reasons. The Nike name, generally linked to success and wealth, first got into trouble in the early „90‟s when footage of sweatshop and child labor in their factories was broadcast on international television, smearing their name across the globe. (Beder, 2002) In 1998 cofounder and CEO Phil Knight even recognized that the Nike name and product “has become synonymous with slave wages, forced overtime, and arbitrary abuse.”(Levenson, 2008) Since those dark days however, Nike has made a concerted effort to both improve their reputation...
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