Analysis of Nike Inc. for Business Expansion in Germany

Create a report to provide analysis of
Nike Inc., looking to expand business
activities in Germany as allocated
country. The scenario to relate to a

INTRODUCTION
Business expansion is related to opening new stores in various physical locations while
still maintain current business locations. Expansion provides the opportunities to the business to
provide the diverse range of services and products in another country. Present report is based on
Nike organization as this is an American multinational corporation that mainly engaged in
development, manufacturing and designing apparel, footwear, equipments and some other
services. In this report, Nike is planning to expand its business activities in Germany as the
allocated country. Foreign Direct Investment is an investment in form of controlling ownership
in business in one country through entity based in the other country. In year 2018, Germany FDI
inflows at USD 25.7 billion. In first half of the 2019, FDI flows to Germany enhanced by more
than USD 20 billion (Chickering, 2019). From this analysis, Nike can able to expand its business
in Germany country as to target new customers and enhance its market share.
BACKGROUND INFORMATION
Nike is Multinational Corporation that is specialized in development, production and
designing the footwear, accessories and equipments. This company was founded in year 1964 by
Bill Bowerman and Phil Knight. It headquarter is in Beaverton, Oregon, United States. In this
organization, there are more than 731000 staff members working. It provides its services and
products in all over the world. Market share of Nike stands about 27.4% in year 2019. Fiscal year
2019 ended with $39.1 billion in revenue and it is 7% enhance from previous year, which saw
the revenue come at $36.4 billion. The business of Nike organization is performing in a better
manner. Net income of Nike organization enhanced to $4 as comparison to $1.93 billion
(Cuervo-Cazurra, 2016).
Nike organization has the geographic divisional organizational structure. It is based on
requirements of an organization in global company and also uniqueness of the situations in
regional markets. The General Public ownership of Nike holds 12.9% stake. Nike is publicly
traded under symbol of NKE. At present, stock is in $ 65.00 range. Currently, Nike conducts its
international business as it is well known brand and sell its shoes in all over world. This
company can keep the down labor cost through using the laborers in developing world. This

helps Nike to maintain more profit and keep the investors happy. At present, Apparel, athletic
shoes, accessories and equipments are mainly manufactured in more than 700 plants which
located in the 42 countries. At core of international marketing operations is creative that proved
to be strong edge for brand in order to maintain the superiority over competition (Euler and et.
al., 2016).
Figure 1: Revenue Performance of Nike
(Source: Revenue Performance of Nike, 2014- 2018)
BACKGROUND INFORMATION ON THE BUSINESS ENVIRONMENT
Business environment is sum of the internal and external factors like staff members,
supply and demand, suppliers, customers and activities through government, technological
innovation, market trends and many others. It is marketing term that is related to forces and
factors which impact ability of company to develop as well as maintain customer relationships in
successful manner. The business is mainly impacted through the various factors which
collectively form business environment (Fasone, Kofler and Scuderi, 2016).
PESTLE analysis is framework that is mainly uses to analyze factors impacting company
from outside such as political, economic, social, technological and environmental. These macro
environmental factors are used in environmental scanning elements of the strategic management.
In order to expanding business in Germany, Nike company is conducting the PESTLE analysis