Nike who took in a little over $18 billion in revenue in the year 2008 gets nearly 60% of its revenue from footwear. Just in footwear sales alone they took in nearly $10 billion. Followed by footwear sales were apparel sales in which another $5 billion was made. Nike also made another $1 billion in equipment sales and the rest of the revenue came from other products. Nike’s sales are primarily broken up into four divisional regions that include a U.S region, EMEA region, Asia Pacific region and an Americas region. By splitting up their revenues into four distinct regions they can measure what and where they make their best profits. Under Armour which is considered to be the next big company had a fairly good year but nothing compared to Nike. Under Armour took in over $800 million in revenue which is just 5 %…
Poor working conditions have been present for centuries. Often times little or nothing is done unless a tragedy occurs to persuade the public to rally for worker rights. This was definitely the case in the United States during the Industrial Revolution and even late in the 20th Century. These conditions have for most purposes disappeared in the United States, with the exception of some in the agricultural sector. However, internationally, mainly in poor third world countries, that is far from the truth. Large corporations from the United States have moved a large portion of their factories overseas to circumvent the strict working regulations within the United States. The third…
Nike plays an enormous role in our youth fashion and athletic attire and has a huge role in our world’s economy and the global effect it has on our earth. Working in the enormous Nike factories around the world is an opportunity to help these people survive. It is not slavery; it is a chance for the poor to get a job and support their families. Nike said they would change their practices and they have. Nike had a few steps to get back into the game. The first step was to identify the problems such as workers’ wages, working environment and then make the improvements, and while doing that they were helping the poor. In the past,…
The company employs 650 000 contract workers worldwide at relatively low labour costs. Because of the early decision to manufacture shoes in Asia allowed his company to enjoy lower labor and production costs, Nike was able from the outset to produce highquality athletic shoes at competitive prices. Nike’s presence provides an influx of U.S. currency with which host countries can buy the imports, such as high-tech…
Nike produces footwear, clothing, equipment and accessory products for the sports and athletic market. It is the largest seller of such garments in the world. It sells to approximately 19,000 retail accounts in the US, and then in approximately 140 countries around the world. Just about all of its products are manufactured by independent contractors with footwear products in particular being manufactured in developing countries. The company manufactures in China, Taiwan, Korea, and Mexico as well as in the US and in Italy.…
Other countries do not have these luxuries. In Indonesia there have been claims of worker abuse by a workers employed at a Converse sneaker manufacturing facility who is owned by Nike, a worker claimed she was kicked by a supervisor after making a mistake in cutting rubber for a shoe, other claim shoes have been thrown at them, other workers slapped or subjected to serious and egregious physical and verbal abuse. (Huffington Post, 2011). Bangladesh features some of the cheapest factories in the world, but not without cost. A Nike Inc employee knew of the dangers to produce goods in Bangladesh, this employee along with several other colleagues went to inspect one of the Nike suppliers. Unsafe working conditions, windows nailed shut causing a safety hazard if there was a fire, this location was shut down…
Nike has been targeted by various agencies and organizations throughout the world claiming how the workers who manufacture Nike shoes are denied of fair wage and benefits. The worker who make Nike shoes are been shutout while several sport megastars reap in multimillion dollar contracts to promote Nike shoes. Although Nike admits some wrong doings in the manufacturing facilities of its contractors, it claims to have started a commitment to improve the miserable working conditions in those facilities. To many Nike has become a symbol of the evils of globalization.…
To properly review the manufacturing in the footwear industry, it is necessary to first gain an understanding of the dominant leaders in the marketplace. The industry is currently experiencing hypercompetition, led by six main firms – Nike, Reebok, Adidas, Fila, Converse, and New Balance (see exhibit 1), with nearly $7 billion in revenues domestically. Nike is the industry leader, with a 47% market share, followed by Reebok, a distant second at 16%, and Adidas at 6% (see exhibit 2). This category is facing decreasing demand and the rising popularity of alternative footwear, resulting in more pressure than ever before to achieve high gross margins through effective global sourcing practices.…
Nike was established in 1972 by Phil Knight. This marketing company is famous for their athletic shoes and apparels sold in some 140 countries (Hill, 2009, p. 154). Nike does not manufacturer any of these products they only design and market them. These products are manufactured in other countries such as Vietnam, Indonesia, and China, where the cost of labor is low. For years Nike has had repeated accusations of their products being produced in “sweatshops.” A sweatshop is a working environment with conditions considered by many people of industrialized nations to be difficult or dangerous, usually where the workers have few opportunities to address his or her situation(s) (Moore, 2007). This can include exposure to harmful materials, hazardous situations, extreme temperatures, or abuse from employers (Moore, 2007). Sweatshop workers earn as little as half to one quarter of what he or she needs to provide for basic nutrition, shelter, energy, clothing, education, and transportation (Moore, 2007). The following topics will be addressed in this paper legal, cultural, and ethical challenges that confront the global business, various roles that governments played in this particular global business operation, and the strategic and operational challenges facing global managers.…
Who belongs to the group of Chinese workers that continually face unbearable hardships? The largest group exploited workers is migrant workers, which is made up of men, children, but mostly women. But it is not only the migrant workers that are facing this plight. Anita Chan, author of China’s Workers Under Assault, discusses these other workers facing poor conditions. Chan explains that “For many formerly privileged workers in the state-owned industrial sector, working conditions, benefits and job security have declined precipitously over the past fifteen years.” (Chan 13) No matter who belongs to this group of mistreated workers they all face similar harsh conditions within their respective factories. Workers work for extremely low wages, often for a hundred hours a week, all the while receiving poor benefits. These low wages are commonly below the minimum wage which the Chinese government set in the Labor Law. In fact “In 1997, for a forty-four-hour week, the…
Based in Beaverton, Oregon, Nike had been a corporate success story for more than three decades. It was a sneaker company, but one armed with an inimitable attitude, phenomenal growth, and the apparent ability to dictate fashion trends to some of the world’s most influential consumer. Selling a combination of basic footwear and street-smart athleticism, Nike pushed its revenues from a 1972 level of $62,000 to a starting $49 million in just 10 years. In the 1980s and 1990s, Nike had been plagued by a series of labor incidents and public relations nightmares; underage workers in Indonesian plants, allegations of coerced overtime in China, dangerous working conditions in Vietnam. For a while, the stories had been largely confined to labor circles and activist publications, until a young female worker had died in a Nike contracting factory in 1997, the labor conditions at Nike had hit the mainstream. While the marketing of Nike’s products was based on selling a high profile fashion item to affluent Americans, the manufacture of these sneakers was based as an arms-length and often-uneasy relationship with low paid, non-American workers.…
China is among the countries in which labor rights are violated regularly. Independent unions are not permitted, and the only organization allowed to represent workers is run by the Chinese Communist Party. Although China is in the midst of economic "reforms", these serve only to help the Chinese economy and foreign investors, not workers. These workers, on an average, make less than $1.00 a day (Mann, 2000).…
There is lack of awareness about the problem of a sweatshop. Even the CEO of Nike Corporation is not aware of the problem, or does not want to be. In response to the conditions of the workers in China who make Nike products, Michael Jordan was quoted as saying, "I don 't know the complete situation. Why should I? I 'm trying to do my job.” How people would be aware of what is going on in sweatshop, if workers are forced to be happy when they give interview on TV, because they are scared to be punished. Nike also has a history of jumping from country to country in search of the lowest labor…
On January 25 the New York Times published an article entitled: Losing Ground- China's Leaders Manage Class Conflict Carefully. The article begins by comparing the Chinese commercial hub of Guangdong to the 19th century English commercial hub of Manchester, whose poor working conditions and division of labor and capital worked as a prime example for Marx's critique of capitalism. Much like Manchester, Guangdong's (and China's) industrial growth depends on cheap labor that attracts capital, in this case from multinational corporations who want to maximize profits. Demand for cheap labor in Guangdong has caused the population to increase by 10% over the past decade. On average these new workers make $50 to $70 dollars a month. This average wage has not changed since 1993 unless you consider the fact that these wages buy less today than they did ten years ago. Although China has attracted large amounts of foreign investment, become the largest exporter to the U.S. in Asia and developed a middle class, the benefits of this growth have not helped improve the lives of the 800 million Chinese who are farmers and factory or construction workers. This has caused political groups in China to criticize the economic policies of the government, one stating that the Chinese have "colonized their own citizens". Life has become so bad that some Communist Party officials feel that social unrest is inevitable, perhaps even another revolution. In response the Chinese government has said they would increase workers wages and stop their abuse of workers but many believe that nothing will be done. Considering the path that China has followed over the past decade it seems as if this reform is unlikely. With their minds only on growth the government sees workers rights and environmental protection as "threats to investment". Adding to the problem, workers are often not paid for work done for the state, instead the money is just pocketed by management, work sites do not have the proper…
China is one of the biggest countries in the world. This means lots of available workers. Not only is their abundance of workers but, also an increasing amount of cheap labor. This is one of many reason we chose China to start our business. China also has a huge supply of labor, which makes finding employees easier. Even though the labor laws are different from the United States to China, we would have to change some of our guidelines to meet there standards. Some of things that we would need to change would be the wages and hours they are allotted to by the Labor Contract Law of the People’s Republic of China. Workers, which are protected under the labor laws, are guaranteed a minimum wage of at least $48 a week. “The standard workweek is 40 hours and overtime shall not exceed three hours a day or 36 hours per month (Article 41). Overtime pay should not be less than 150 percent of an employee’s…