Michael Porter developed the Five Forces Analysis model to understand the effects of external factors on businesses. Though more risky and expensive, Nike would benefit from increasing the amount of basic research we conduct with hopes of uncovering potential opportunities of which Nike could take advantage.
Management of Accounts Receivable - Weakness Nike does permit sales in cash, cash equivalents and on credit. Thus, the overall bargaining power of Nike suppliers is low.
Nonetheless, this element of the Five Forces Analysis shows that Nike experiences only a weak force representing the bargaining power of suppliers.
The brand sets standards for its suppliers to comply with. Newness of Facilities - Weakness Our facilities abroad have attracted bad publicity in recent years.
The low switching costs further add to that likelihood. At times, we need to adjust our posture in relation to a particular product line or area of products. The external strategic factors that facilitate business growth are covered in this component of the SWOT Analysis. However, the cost savings due to the placement of our production facilities allows for cheaper production of our products despite the higher costs of transporting our products.
Company management stated, "We put a considerable amount of effort into improving product buying power patterns and as a result the composition and levels of inventory resulted in improved gross margins relative to a year ago. In relation, firms are highly aggressive in competing for bigger market shares.
Our collection period calculates to Despite the fact that in the past we may have overlooked the mid- to lower-price-point products, presenting another weakness with room for improvement, we are dedicating our time and money to better develop our competitive position at all price points to build strengths at each of these levels.
Moreover, the number of suppliers is high and they are scattered throughout the world. We had to terminate 51 employees.
Overall, the level of competition in the industry is strong. As a result, we have had to exit two manufacturing operations at our Bauer Nike subsidiary.
However, in such a case, the supplier would be losing a major source of revenue. The industry average of This element of the Five Forces Analysis identifies the force of substitution on the business and the industry environment. The current ratio, while not a major strength, shows that Nike is inline with the industry concerning ease of converting assets to cash to cover short-term obligations.
The following strengths are the most notable in the case of Nike Inc.: The number of its competitors is not so small if not very large. In these instances, Nike may choose a defensive strategy to remedy the current situation.
Our collection period calculates to Competitive Rivalry or Competition with Nike Inc. Nonetheless, the bargaining power of customers and the threat of substitutes are also significant. It is why individual suppliers cannot exert any pressure on Nike.
Management of Debt - Strength Our debt-to-total-assets ratio is While the prices are realistic given the nature of the products we offer to our consumers, at times our consumers may not agree. Threat of new entrants:.
Nike, with there marketing, innovation, technological advancements, and equitable manufacturing departments, has created an al around dominant strategic plan Nike has built there competitive advantage to the highest form possible.
Nike Versus Adidas Case Study and Competitive Analysis - Download as Text File .txt), PDF File .pdf) or read online.5/5(1). Transcript of Nike Competitive Analysis. About Nike Market leader in athletic footwear, apparel and equipment Works to drive product innovation for athletes and improve performance Mission statement is “To bring inspiration and innovation to every athlete in the world.
If you have a body, you are an athlete”. The competitive strategy that Nike introduced at the end of the 's concentrates on honing the focus of our marketing strategies and product offerings through product differentiation.
We realize that the team-mentality that captured the spirit of athletics in the late 's and early 's has been replaced by a sense of individualism. Nike Inc.’s SWOT Analysis emphasizes the importance of product development to maintain a competitive edge.
However, the results of this SWOT Analysis point out some possible new strategic directions to further enhance Nike’s global performance and leadership. Top 10 Nike competitors June 14, By Hitesh Bhasin Tagged With: Brand competition Nike is the leading sports footwear brands in the world and is known as one of the top 3 amongst the trio leading the sports footwear market across the world – Adidas, Reebok and Nike.Nike competitive analysis