Nike: Situation and Company Analysis Report - Business Development

This report provides a comprehensive analysis of Nike, examining its situation and the environments in which it operates. It delves into the economic environment, discussing factors affecting consumer purchasing power, labor costs, and international trade. The technical environment is explored, highlighting Nike's integration of technology and its impact on product development. The industry environment is analyzed, considering market trends, new entrants, and potential threats. The competitive environment is assessed, identifying key rivals and Nike's competitive advantages. The political environment is also considered, focusing on government policies and their impact on the company. Finally, the report outlines Nike's mission, objectives, and goals, providing a holistic view of the company's strategic direction and market position.

Running Head: NIKE 0
Situation and Company Analysis
Student Details:

NIKE 1
Economic Environment
Nike’s business is impacted by the economic downturn resulting in slowing purchases, for
instance, recent epidemic of Coronavirus impacting the sales and revenue while will affect
the company’s growth (Russo). Another impact of decreasing sales labour cost and increase
in raw materials prices which also affects the Nike’s profit margin. Lastly, there is an impact
of stability in terms of international trade nature as per the margins and costs due to change in
exchange rates.
Technical Environment
The development of products is based on fast integration of technology by Nike where the
brand keeps on changing its fashion when products become unfashionable as per the tastes
and preferences of consumers. Nike always aims at adopting latest technology while
developing and manufacturing its product.
Industry Environment
In an economy, the company has an impact of its slow down affecting the purchases of
consumer where is the biggest threat of economic recession for Nike. In terms of Asian
economic crisis, where the manufacturing is affected due to increase in material prices and
labour costs also affecting the growth by both local and international economy. Nike has a
negative impact due to weak Asian and Euro recession weakening the company’s sales. The
ethical issue faced by the company of child labour made a controversy for the company
where no work permits or regulations were issued in relation to young employees hiring
(Spellings).
Competitive Environment
In sports industry, there is a high competition for Nike competing based on technologies,
product offering, pricing, marketing expenditures, customers services and production costs
with its rivals which are Reebok, Adidas, Puma, and Woodland. The companies fight based
on the market share and not on market growth where Nike has created its own casual shoes
lines for competing in the market.

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Political Environment
Across the globe, the different impact of governments enforcing economic policies that
benefit the businesses and industries growth, for instance, the US policies enables Nike to
grow and markets its products. There is macroeconomic stability as well with stable currency
conditions, low-interest rates, and tax system competitiveness internationally during the
company’s foundation forming for growth (Bain). Other than this, there is an impact of
foreign direct investment and tariff on export and importing affecting the growth of Nike.
Mission, Objectives & Goals
In business, Nike’s mission is to target every consumer across the globe representing the
company’s position defining basic objectives being a leading athletic apparel and shoes
supplier in the global market. The mission of Nike prompts to support the athletes’ activities
which also help in maintaining its market position. Thus, the mission summarises to do every
possible thing for the expansion of human potential while innovating and inspiring every
athlete Nike wants to bring in across the globe.
Nike’s objectives are which makes the company to move towards accomplishing its mission.
The first objective of the company is making profits for the shareholders by expansion in new
markets, creating a work environment for utilizing resources at its best consisting tasks,
people and technology, and lastly, supply bets to its customers with new excellence level.
The goals of Nike is to aim at improving return on equity of stockholders by 20 per cent with
the increase in earnings per share along with increasing the quality of its products to keep
customers satisfied and maintain the position as a leader in the global marketplace (Simply
Wall St).

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References
Bain, Marc. “Nike is facing a new wave of anti-sweatshop protests.” 1 August 2017. Quartz.
Web. 30 March 2020.
Russo, Donovan. “Nike says the coronavirus epidemic will have ‘material impact’ on China
operations.” 5 February 2020. CNBC. Web. 30 March 2020.
Simply Wall St. “What is Behind NIKE Inc’s (NKE) Superior ROE?” 29 July 2017. Simply
Wall St. Web. 30 March 2020.
Spellings, Sarah. “This Could Be the Next Step for the New, Socially Conscious Nike.” 6
September 2018. The Cut. Web. 30 March 2020.