Critical Analysis on NIKE

Topics: Nike, Inc., Sweatshop, Industrial Revolution Pages: 7 (2231 words) Published: December 4, 2013

Critical Analysis of Nike


Nike began as Phil Knight’s semester-long project to develop a small business, which included a marketing plan. This project was part of Phil Knight’s MBA course at Stanford University in the early 1960s. Phil Knight had been a runner at the University of Oregon in the late 1950s. His idea for his project was to develop high quality running shoes. He thought that high quality/low cost products could be produced in Japan and then shipped to the United States to be sold at a profit. His professor thought that Knight’s idea was interesting, but not much more than a project.

In 1963 Phil Knight went to Japan and had a meeting with a running shoe manufacturing company called Tiger. He told them that he was the representative of an American distributor that wanted to sell Tiger running shoes to runners in the United States. This was all very much a spur of the moment idea, and Knight quickly made up a name and called his company Blue Ribbon Sports. Knight started small, and he continued to work with Tigers until he reached over a million dollars in sales in the early 1970s. In 1971 came up with the name Nike along with the Swoosh trademark for his products. The winged goddess of victory from Greek mythology inspired both the name Nike and the Swoosh symbol.

In the late 1970s Blue Ribbon Sports officially became Nike and increased its sales from $10,000,000 to $270,000,000. During the 1980s and 1990s the company and sales continued to grow. In 1996, Nike was named Marketer of the Year with sales at $6.74 billion. Sales and profits have continued to grow over the years, but at what cost to those who work in Nike’s factories worldwide?

As far back as 1998, Nike was being criticized for the way their footwear was being produced. Remember that Phil Knight wanted to produce high quality footwear at a low cost.

Michael Moore’s film “The Big One” brought to light Nike’s overseas labor practices and raised many questions about Mr. Knight and his company. In his film, Michael Moore questioned the number of hours Nike factory workers were working, the amount they were being paid, and the age of some of the factory workers. As a result of the film, Nike felt compelled to raise the minimum age of their factory workers in Indonesia to 18. Before the film, Nike had children as young as 12 working in their factories.

However, Michael Moore’s film did not bring an end to Nike’s problems related to child labor. In an article entitled “Nike Admits to Mistakes over Child Labor” by Steve Boggan, published on October 20, 2001 it says, “Philip Knight, the company chairman, clearly stung by reports of children as young as 10 making shoes, clothing and footballs in Pakistan and Cambodia, attempted to convince Nike's critics that it had only ever employed children accidentally. ‘Of all the issues facing Nike in workplace standards, child labor is the most vexing,’ he said in the report. "Our age standards are the highest in the world: 18 for footwear manufacturing, 16 for apparel and equipment, or local standards whenever they are higher. But in some countries (Bangladesh and Pakistan, for example) those standards are next to impossible to verify, when records of birth do not exist or can be easily forged.”

The article goes on to discuss a situation in 1995 when Nike thought it was producing footballs in a responsible factory with good conditions, only to discover that the work was being subcontracted to small villages and children were making the footballs.

It is clear that historically there have been problems with working conditions in Nike’s sweatshop factories as well as the use of child labor. Nike has taken steps to improve the conditions in its 1,000 factories overseas. However, there are many...
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