The Supply Chain of Nike Shoes

Different

Headquarters

Nike has 4 headquarters around the world:

• Nike World Headquarters- Beaverton, Oregon
• Nike Headquarters- New York
• Nike European Headquarters- Hilversum, The Netherlands
• Nike Greater China Headquarters- Shanghi, China

(jobs.nike.com).

Goals of Nike Headquarters: Product desgin, Product development, Management, Materials Research etc.

Nike European Logistics Campus- Laakdal, Belgium (jobs.nike.com).

Goals of Logistics Campus: Coordinates all logistical activities between 700 Asian Factories and 25,000 customers, and is based on a centralized configuration allowing goods to easily reach Asian and the Middle East.

(Notteboom, 2021).

China

Vietman

Indonesia

Polyester

• 19% of Nike’s polyester is recycled.
• Nike has used about 82 million plastic bottles to make polyester out of- The solid plastic water bottles are broken down and melted where they are then made into polyester strands.
• Nike gets the majority of its polyester from India and China.

(u.osu.edu)

Rubber

• Over 70% of Nike’s shoes use environmentally preferred rubber.
• Nike’s preferred rubber is altered rubber and is made by incorporating more benign accelerators and vegetable oils, additionally, the process to make the rubber is modified.
• Thailand, Indonesia, and Malaysia are the main sources of Nike's rubber.
• (u.osu.edu)

• EVA stands for Ethylene Vinyl Acetate.
• Eva Foam is an environmentally friendly material and is one of the cheapest materials that Nike uses in their shoes.
• Eva Foam is largely produced in China.

(u.osu.edu)

Eva Foam

Cotton

• Nike is using increasingly more organic cotton in their shoes every year.
• In order for cotton to be considered organic, it needs to be harvested without chemical pesticides, no fertilizer, and defoliants.
• Nike obtains the majority of its cotton from China, India, Turkey, and the USA.

(u.osu.edu)

Synthetic

Leather

• Synthetic leather is supposed perform better than real leather while still looking and feeling like real leather.
• Synthetic leather is cheaper, easier to clean, and more breathable than real leather.
• Nike obtains its synthetic leather from China and Taiwan.

(u.osu.edu)

Distribution

Strategies

• Nike's biggest distibution channel is via selling product to wholesalers both in the United States and international markets
• Nike also distributes their shoes through direct-to-consumer sales. This includes online sales, sales through retail outlets, and sales through their website.

(Oberoi, 2020)

Distribution

Centers

• Nike has 5 distribution centers in the US, all located in Memphis, Tenessee.
• At the end of the fiscal year 2014, Nike had 16 distribution centers outside the United States.

(Soni, 2014)

Sweatshops

• In 1991, it was reported that in Nike’s factories in Indonesia, workers were paid below minimum wages, there was child labour taking place, and working conditions were similar to that of a sweatshop.
• In a film released in the 90’s called "Behind the Swoosh", it was revealed that workers at Nike factories were paid only $1.25 per day and “were forced to live in slums near open sewers, and shared toilets and bathwater with multiple families.” (www.newidea.com.au).
• Nike has strict codes of conduct for their factories, however, it is difficult to ensure that these rules are enforced in developing countries.

(www.newidea.com.au)

Recent Developments

• In 2007, Nike provided a list of all of its factories in order to allow for others to to check if these factories were adhering to policy. (newidea.com.au).
• In 2017, it was reported by the International Labor Rights Forum that Nike was no longer adhering to the Worker Rights Consortium, which blocks labor rights experts from evaluating Nike’s factories. (Robertson, 2020).
• In 2020, Nike received a score of 51-60% in the Fashion Transparency Index, which encourages brands to disclose information about their products, policies, etc, which indicates that they are moving in the right direction again, although they still have a ways to go. (Robertson, 2020).

Nike's Climate Action Goals for 2025:

2025

Goals

• 70% reduction of greenhouse gas emissions in all of their facilities via renewable electricity and fleet electrification.
• Greenhouse gas emissions will be at or below 202 levels from manufacturing and transportation operations via the use of renewable energy, energy efficiency, and alternative fueling.
• 0.5M tons of greenhouse gas emissions reduced through the increased use of environmentally preferred materials.
• Reduce carbon footprint by 65% in facilities, and by 30% in the supply chain in order to meet 2030 Science-Based Target.

(purpose.nike.com)

Link to

Bibliography

I realize that my slide with all my sources on it is hard to read so I made a separate document with the bibliography as well:

https://docs.google.com/document/d/1FjumArlRLO84e4RAcyFCq9U_Q3fDCqmq2fUCkh3y9uY/edit?usp=sharing