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Analysis Of Downsides And Threats Of Nike Company

With success in mind, Nike has changed the game of athletic wear for years and will continue to for years to come with strong strengths and opportunities sectors. With any company, they do have their weaknesses and threats. For instance, Nike has manufacturers all over the globe, which can cause lots of problems with labor and human rights issues. It has been rumored that Nike uses low paid labor and sweatshops to get their products mass-produced at a better cost. This is not the only threat that this company faces with the international section of their business.

Currency exchange is a tough game to play and, unfortunately for Nike, they play it by having manufacturing and the majority of their production done overseas, which means they have to hope that exchange rates stay in their favor in order to not lose money. Despite being a massive company with a huge overhead and expensive threats, Nike finds success and has been thoroughly profitable every year except one in the last thirteen. This is achieved by a well-grounded marketing team that does a strong job of pushing products on a huge target customer base. With this said, competition has never been higher, especially in Nike’s biggest department: shoes.

Nike’s Air Jordan line of shoes has never done better, grossing billions of dollars on its own without the help from the entirety of the company’s other shoe products. Competition for athletic footwear has never been higher with the style shifting towards shoes the way it has been the last two years. Companies like Adidas and Puma lead the race on giving Nike’s athletic shoe wear a run for their money on sales. This competition Nike is facing is what can be considered their biggest threat going into 2019, despite their powerful diversification and brand loyalty. Strengths and weaknesses aside, a massive company like this still has room to grow and has many opportunities moving forward. For starters, their stock price took a hit with the recent marketing campaign including NFL quarterback Colin Kaepernick, so there is plenty of room to grow concerning the stock market.

Second, the company has miniscule leverage in terms of accessories and has plenty of capital to expand the business. One business fit for expanding into is the slightly tapped watch industry. Apple does have the monopoly on the watch market now, but with the strengths that Nike has, they could easily purchase a company like Fitbit and take over the market for it in a matter of a year, specializing in athletic watches for athletes all over the world.

Another place where Nike could tap into is the previously mentioned international market. This being a difficult task due to costs and differences in culture, Nike could make a huge dent in any market it seeped its products into as long as research was performed and time was invested. Nike may have its downsides and threats, but they are still a behemoth of a success, and will continue to be so for many years.

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