NIKE.doc

background nike can be called a perfect global company in many factors. it was established by a man named phil knight who is a former university of oregon track-and-field star. for now, nike is the leader of the enterprise which is do the sneaker and sportswear in the whole world. phil knight became one of the richest people in america because of nike company. the famous slogan of nike “just do it!” is a symbol of popular culture currently, as its logo, or its advertising spokesperson michael jordan and tiger woods image. and with all success of nike, its the products produced by sweatshops. in the sweatshops, the workers under a really bad condition work like salves and just get crummy wages, even part of workers are children.swot analysis(internal)strength: nike is global brand have strong competitive organization and it is the number one sports brand in the world. nike company use outsource manufacture and no factory to make the product high quality and low cost. exploit local labor to save money because of indonesia have cheap labor. persistent innovation can promote the company keep fashion in the market and innovation ability improve the popular trend. weakness:nike company has diversified range of products. the cost of secondary products relies on primary income. the revenue depend on market share, if the primary products like sneaker revenue become low maybe the secondary products will broke up. nike company use child labor has bad effect, and some people do not want to buy their product again.(external)opportunity:because of nike is a global brand and have well-know, it had more chance to develop new products. more fans and consumption trend help the nikes economic. advancing product research and development ability help nike company expand new market and new product.threatsnike company face with the fiercecompetition in the local corporations is like reebok, lining, adidas, anta and 360 sports. nike has high price than other brand, so the product alternative is strong.nike trapped in international trade. it is a global company they contact with different countries and use the different currencies. so it cannot make the cost and profit keep long-term stability. pest analysis(external)political:peace and stable environment benefit of nikes development and creative better condition. in case, at the beginning, indonesia it open market and welcome other countries trend comes in. go through with the nike company use local labor with lower price, unrest and long time working. and then, a rare wave of labor unrest swept across the country. at that time, indonesias government give embarrass and barriers for foreign investors. the government policy restricts the development of foreign.economic1998, indonesia are downturn with the business. nikes labors get fewer wages and nothing to do with the downturn. the economic environment benefits to company development and reduce the cost for payment.good economic can promote nikes development and provide more opportunities social：social culture influences the popular extent of the products. if a famous star gets sneakers maybe more people want to buy it. like china enters into wto organization and it provides a fair and wide market, so nike company have more opportunity.technology:advancing technology can reduce the cost of the products and services. and make the process quickly and more efficiently. technology can promote more innovative products, services and creative new products and make them more competitive. technology is an important part to effect the company development and it can promote the brand image. main factors make nike successful first, facing the force of global integration and coordination, the factor cost is a powerful reason of drive globalization. so nike didnt build its own manufacturer, it is contracted with some factories that could produce good quality products with lower cost. if the cost of manufacture in that country goes up, nike is flexible enough to move their partners from one country to another country for lower cost. and because of nike is good at marketing and design, so they could make their products more localized to fulfill demands of local consumers. second, phil knight focuses on advertising spokesperson, using popular and famous athletes, like michael jordan and tager woods for establishing an invincible brand to make customers remember them easily. nike spent a lot of money on young market and invite respectable athletes, because young people want to imitate stars, wear what stars wearing and do what they doing. and nike knows exactly young peoples psychology.strategy nike uses outsourcing with manufacturers in developing countries like indonesia, vietnam and china as their strategy. nike has no production facilities themselves. therefore, nike avoid the risks of politic, economy, culture, logistics etc. because of building factories in other countries. their manufacturers make products, then send them to the united states to attach trademark. this is one of the worlds first virtual corporations-a manufacturing firm with no physical assets.marketing strategy nikes target consumers are not only for athletics but also for ordinary people who like the sneakers in life. so nike designs professional sneakers and popular sneakers with comfortable. nike sold a fairly wide range of athletic footwear to a fairly wide range of consumers: men and women, athletes and non-athletes. this strategy pushed its revenues from a 1972 level of $60,000 to a startling $49 million in just ten years. david b. yoffie, nike: (condensed). hbs case 391-238 (boston: hbs press,1991), p.1. countries like indonesia, vietnam provided cheaper labor force on economy, and labors in these developing countries could give nike lots of benefits. nike could give more competiveness to their competitors. hitting the wall nike was exposed for its paying wages to labor in developing countries manufacture nearly nothing with poor working conditions. after the criticism came out, nikes market share was carved up by reebok, adidas. how they response about labor abuse problems? at the beginning, nike said we dont make shoes!. they escape responsibility in meeting them. at the beginning, nike denied the sweatshop charges and against critics. this caused more blame from other parties. therefore, the company changed their attitude and decided to solve problems. nike put their changing into practices, like making standard about hiring workers and minimum wages, monitoring labors performance and giving them better working condition. moreover, nike participates more charity activities for helping them improve image and reducing the negative effects.wages issue the questions of nike labor practice are about such as child labor, overtime working, inhumane or unsafe working environment. and there is a more contentious issue that is little wages. majority of social media and critic consider that, according to many labor activists, nikes payment is very low. compared with the americans wages, workers effort, the final price of goods or cost of living, there isa huge gapbetween the numbers. but there is a question, it is a reasonable that compared the indonesia employees payment with americans payment? its obviously not. the income level and living standardis different,the development level of economicmarketdetermines thatthis comparisonis not reasonable. in the spring of 1997, business students conduct a survey on “the suitability of wages and benefits paid to its vietnamese and indonesian contract factory workers” derek calzini, shawna huffman, jake odden, steve tran, and jean tsai, nike, inc: survey of vietnamese and indonesian domestic expenditure levels, november 3, 1997, field study.(dartmouth, nh: the amos，1997)，p.5. they hope to findthe right answer about the wages levels, by surveying both workers and residents salary and basic living cost and comparing the data. the actual situation isthe wages of nike workersdid not aslow as image,some workers evenuse their paymentfor purchasing ofluxury goods andsaving money. but nike as a mnc, the social comparison is unavoidable. compared to theirhigh profits,laborcostis really toolow.fla should nike responsible for workers in other countries companies but work for nike? there is two parts opinions of this questions. for opponents, thisis related with theone of nike operation strategy outsourcing. nike should not responsible for cooperative companies operating. but for supporters, the issue will effect reputation of nike. brandis a valuable asset, reputationaldamagewill seriously affectthe operation and development of the company. like the movement of anti-nike after nike labor abuse issue into the spotlight. after the initialattitude about ignore or deny the issue, nike make some substantialefforts toresolve labor abuse issues. one of the mostimportant and usefulstrategy is join in the fla. fla is fair labor association, this organization is to be private entity controlled evenly by corporate members and human rights or labor representatives. in sample, this can help company make sure labors have human rights in their company. nike has fully scheduled to operate fla by the fall of 2000. and when nike follows the fla well and has complete rules about keep workers human rights, how they make sure their cooperating factories also observe the standards and rules.recommendations for nike nike has to take a good attitude to solve this problem, it need admit the problem and accept social suggestions. a good attitude could help its decrease the negative effect for it. and nike could use the relationship to modify the negative influence, for exa