Nike China Is No Longer Able To Repress The Spirit Of Changing Hands.

The decline in performance in Greater China has made Nike no longer able to repress the spirit of "changing the team".

Relying on large scale foundry and big agent to bring huge market share, once made Nike unlimited. The time is changing. Sports market As the growth rate slows down, Nike's original supply chain and channel advantages have also become the "bottle of oil" for the performance. In particular, the cost increase associated with the change of the foundry environment has become the crux of Nike's poor performance.

But sports brand is sensitive to cost, which makes Nike lack of motivation in changing traditional OEM mode.

Nike once did a statistical exercise. shoes It is especially sensitive to labor costs. Enterprises must control labor costs within 24%, so that they can be competitive.

Therefore, famous sports brands like Nike are always using the large scale foundry mode to reduce costs. The factory is located in developing countries, enjoying cheap benefits from cheap labor and cheap land rents.

Unfortunately, with the increasing processing costs of the large foundry countries represented by China, Nike's strategy of seeking cheap production is also becoming increasingly unsustainable.

In addition, with the shortening of the product renewal cycle in the sports industry, in terms of delivery time, Brand enterprise Higher requirements for foundries are put forward. Because once the rhythm of new products is not properly controlled, it may hurt the profits of enterprises.

This new change in the industry has also made Nike headache. At present, Nike's request for delivery time for the foundry has been shortened from 5~6 months to less than 3 months. But the laying of the giant foundry industry chain makes Nike powerless to control the production rhythm of every OEM enterprise. These unfavorable factors are hidden dangers of Nike.

If so, if Nike It is inevitable to sort out and adjust the supply chain in order to reverse the current predicament. It is probably a good choice to increase control over the production process and reduce the "bundling" of the large OEM mode for Nike, who is now in trouble.

At the same time, Nike's channel strategy in Greater China is also an important factor contributing to its sluggish development.

As we all know, an agent usually acts as a proxy for several brands, and some even own. brand 。 When planning the shop, the agents often choose to display high profit goods in the best position. And the profit margins that Nike can offer to dealers is really hard to compare with other sports brands in the country.

In this regard, I believe that the most important thing for Nike now is not to change the team. Instead, we should appropriately reduce the number of agents, increase the number of Direct stores, reduce the damage caused by the competition of agents' internal brands, and at the same time introduce parity products for the Chinese market. This will bring more benefits to consumers, reduce sales links, and enable enterprises to face the market more intuitively.