CONTENTES

•Introduction

•Nike History Timeline

•Financial analysis

•Industry Analysis

•Corporate structure

•Company analysis

•Current and future success

•Implementation plan and strategies

•Recommendations

INTRODUCTION Type: Public (NYSE: NKE) in NASDAQ market Founded : January 25, 1962 as Blue Ribbon

Sports 1978 as Nike, Inc. Founders :WilliamJ. "Bill" Bowerman Philip H.

Knight NIKE Headquarters: Washington County,

Oregon, United States (Near Beaver ton, Oregon)

Area served: Global Key people :Philip H. Knight (Chairman) Mark

Parker (CEO &President)

INTRODUCTION

Employees: 32800 (2009), 35000(2010) ,

Subsidiaries: Cole Haan,Hurley International, Converse Inc. and Umbro.

Industry :Sportswear, Sports Equipment, Athletic shoes ,Apparel ,Sports equipment Accessories

Website: www.nike.com

Nike History Timeline 1962: Phillip Knight, Stanford University, Blue

Ribbon Sports 1964: William Bowerman becomes a partner by

matching Knight's investment of $500. 1965: Hires a full time employee, and annual sales

reach $2,000. 1966: Blue Ribbon Sports, also known as BRS, rents

its first retail space; employees can now stop selling shoes from their cars.

1969: It now has several stores and 20 employees; sales are close to $300,000.

Nike History Timeline 1971: Nike, capitalizing on the Greek goddess

of victory. The first Nike product sold with the new symbol is a soccer shoe.

1970 ± 1975: Steve Prefontaine was turned to the University of Oregon by Bill Bowerman and wore Nike products

1976: The popularity of jogging increases revenue to $14 million.

1978: The company changes its name to Nike. 1980: Nike goes public, offering 2 million shares

of stock.

Nike History Timeline 1990: Nike files suit against competitors for

copying the patented designs of its shoes, and also engaged in a dispute with the U.S. Customs Service over import duties on its Air Jordan basketball shoes.

1997: Feb., Stocks reaches a high of $76 per share.

1998: Sept., Stocks tumbles to $31 per share 2000: The National Football League declines to

renew its exclusive apparel licensing arrangement with Nike.

Nike History Timeline

2001: Nike opens its first Nike Goddess store, a unit targeting women, in Newport Beach, CA.

2003: Nike purchases Converse Inc. for $ 305 million.

2008 :Nike acquired sports appar el supplier Umbro,

2009: Air Jordan Shoe 2010: Nike Future Sole Design

Competition

Evolution of the Logo

FINANCIAL ANALYSIS

ACCOUNTING POLICIES Management Estimates

The preparation of financial statements in conformity with generally accepted accounting principles Recognition of Revenues

Wholesale revenues are recognized when title passes and the risks and rewards of ownership have passed to the customer, based on the terms of sale.

Shipping and Handling Costs

Shipping and handling costs are expensed as incurred and included in cost of sales.

Advertising and Promotion

Advertising production costs are expensed the first time the advertisement is run. Media (TV and print) placement costs are expensed in the month the advertising appears.

FINANCIAL ANALYSIS Cash and Equivalents

Cash and equivalents represent cash and short−term, highly liquid investments with maturities of three months or less at date of purchase.

Inventory Valuation

Inventories are stated at lower of cost or market and valued on a first−in, first−out (“FIFO”) or moving average cost basis.

Property, Plant and Equipment and Depreciation

Property, plant and equipment are recorded at cost. Depreciation for financial reporting purposes is determined on a straight−line basis .

FINANCIAL STATEMENTS

.

NET INCO

ME

TOTAL

ASSETS

TOTAL

LIABIL

ITIE

S

TOTAL

EQUIT

Y

0.00

2,000.00

4,000.00

6,000.00

8,000.00

10,000.00

12,000.00

14,000.00

16,000.00

200820092010

FINANCIAL STATEMENTS

cash from operating cash from investing cash from financing

2008 1936.3 -489.8 -1226.1

2009 1736.1 -798.1 -733.9

2010 3164.2 -1267.5 -1061.2

-1,250.00

-750.00

-250.00

250.00

750.00

1,250.00

1,750.00

2,250.00

2,750.00

3,250.00

STATEMENT OF CASH FLOW

Axis Title

FINANCIAL ANALYSIS

FINANCIAL ANALYSIS

FINANCIAL ANALYSIS

FINANCIAL ANALYSIS

FINANCIAL ANALYSIS

STOCK HISTORY

RATIO ANALYSIS

INDUSTRY ANALYSIS

Sportswear, and sports accessories & footwear industries

Since the 2003 athletic footwear industry has begun to enter the high-cost, high-growth "double high" development mode.

In 2010, the United States athletic apparel market become the world’s largest Sportswear market.

Competition ADIDAS AG: 2009 revenues - $13.8

billion. It competes in the overall

sporting goods market.

PUMA: 2009 revenue - $3.3 billion.

Puma AG is a Germany-based

competitor in the sells sports footwear, apparel, accessories, and equipment.

UNDER ARMOUR: 2009 revenue - $856.4 million. Its products, which are designed with microfibers intended to wick away perspiration, extend across the sporting goods, outdoor, and active lifestyle markets.

In addition to Nike's footwear competitors, the company also competes with other makers of outdoor apparel, such as V.F. Corporation, Columbia Sportswear and Quicksilver

Competition

PESTEL ANALYSIS

POLITICAL

Political unrest in the production countries

Terrorism in the home country

ECONOMIC

Barriers of entry to the

EU

economic recession

The labor costs and

material prices are going up

Social

Increase in the female share of the market

demand for fitness

products Social

responsibility toward its

labor

PESTEL ANALYSIS

Technological

Design Ability

Speed of change of product

Specialist employees

Environmental

Re use a shoe

Climate impact

Sustainability philosophy

Legal

child labor issue

Unsafe working

conditionsLaws

protecting copying products

PESTEL ANALYSIS

Geography

Production in Asia, Latin America and

Africa

Assets located in many different countries

Monitor product quality

International

More demand on products

Support athletic women

Bigger share of the market globally

Porter’s 5 forces Potential Entrants (LOW)

Barriers to entry in the athletic footwear industry are high due to several factors: It is as very capital intensive industry Economies of scale The industry itself is in a consolidation phase and only the big

ones will survive.

Buyers (Very High) Customers more affected by price There has been and increase in women purchasing the

shoes The buyers for this industry are retailers and end users.

Porter’s 5 forces Substitutes (HIGH)

They are an attractive alternative product or service, which customers can easily shift to if there are low switching costs

The availability of substitutes invites customers to make price, quality and performance comparisons

Suppliers (LOW) The suppliers do not have the power to bargain the

price of their product, since there are numerous suppliers.

Using production facilities in the Far East has give Nike economies of scale.

Porter’s 5 forces

Competitive Rivalry(HIGH)Reebok, offering more choice of shoeAcquisition between Adidas and Rebook

COMPANY STRUCTURE• Philip H. Knight

• (Chairman of the Board of Directors(

• Mark G. Parker• (President and Chief Executive Officer(

• Charles D. Denson• (President of the NIKE Brand (

• Jeanne P. Jackson• (President, Direct to Consumer (

• David J. Ayre• (Vice President, Global Human (

COMPANY STRUCTURE

Nike’s mission statement is: Nike aims to lead in corporate citizenship through

proactive programs that reflect caring for the world family of Nike, our teammates, our consumers, and those who provide services to Nike

Its vision statement is:“To bring inspiration and innovation to every

athlete in the world”(If you have a body, you are an athlete)

PRODUCTSBaseball equipments Running shoe

AIR MAX T-shirts ,hoodies

PRODUCTS

Outfits Golf equipments

Tennis shoes and balls Footballs

COMPANY ANALYSIS (SWOT)

Strengths

• Nike is strong at research and development

• Offers their products worldwide• Nike is a globally recognized

• Nike has no factories• It has a strong sense of marketing

strategy• Strong financial position

Weaknesses

• reported to have applied child labor in Pakistan

• Accusations of poor conditions in the work place.

• History of violations of over time laws

• Searching for cheap labor• income of the business is still

heavily dependent upon its share of the footwear

COMPANY ANALYSIS (SWOT)

Opportunities

• Product development that changes as the trends change.

• Diversification in products range• Expansion in the global markets

• Make efforts to reduce the pollution generated from the Nike manufacturing

factors.• Reduce prices in Asian and third world

countries • Expansion into sport sunglasses and

jewelry lines.

Threats

• currency value fluctuations that can lead to losses

• Competition is strong among athletic footwear

• Managing the financial conditions in the economy

• Maintaining the reputation of being eco-friendly.

Value chain analysis

COMPETITIVE ADVANTAGE

Technology in Products

Nike technology allows

consumers to connect their iPod

devices to sensors inside the

shoes to record time, distance,

pace, and calories burned. Manufacturing Skills

Due to cheap labor in foreign countries, Nike outsources virtually all production to other areas of the world.

COMPETITIVE ADVANTAGE

Strength of Patents

One of Nike’s most revolutionary technologies comes through its footwear cushioning. Competitors have tried to match rival Nike’s cushioning systems, but none have matched their success

Economies of Scale

Nike is the single largest producer of athletic footwear and apparel, allowing them large cost advantages over competition.

Current and future success

Nike challenges Tightening competition – growth of Adidas, New

Balance, Marketing expenditures are growing steadily. Losing market share in China Nike’s premium and high quality brand image

doesn’t sync with the expectations of the customer

Nike is heavily dependent on information technology systems across its supply chain

Current and future success

Nike success Nike shoes and other accessories have also become

the favorite fashion products for teenagers. Nike is known around the world for being one of the

iconic brands The Nike Air Max 2010 has been a great success for

Nike The Global 100 Most Sustainable Corporations in the

World one of the World’s Most Ethical Companies In 2009 NIKE, Inc. scored the highest in nonprofit

organization Climate Counts’ annual rankings.

Current and future success

Future Success Nike future performance is subject to the inherent

uncertainty presented by volatile macroeconomic conditions that may have an impact on Nike operations around the world.

The company will continue to implement its corporate projects and programmes to suit the demand and social needs of its worldwide customers.

will become more socially responsible in the eyes of average consumers, and so the availability of its brand products will further increase.

R&D

Nike has an underground research lab full of geniuses toiling to create the newest and most advanced designs and technology in the sneaker business

Research is primarily divided into three parts:

Biomechanics

How the body moves.

Physiology

How the body works, especially under stress.

Sensory/Perception

The evaluation of how a product works, feels, and wears; how a person feels when wearing the shoes.

R&D

The research and development (R&D) centre's role is to identify the

physiological needs of athletes

Nike spends a lot out of its revenue into R & D of new products and designs to

constantly stay ahead of the competition.

NIKE STRATEGIES

Segmentation Strategy:High, medium and low income levels that can

be clubbed with here lifestyles of high, medium and low end customers.

Target Market:The company has targeted the market of high-

end, high income level between the age of 16-55

NIKE STRATEGIES Marketing Strategy:

Nike focuses all of their attention on the Athlete, but delivers much more than shoes; they deliver all the surrounding products that the Athlete needs for experience. It is part and parcel of what makes Nike such a great consumer-focused brand.

Organizational Strategy:With over 35,000 employees worldwide, the company

was organized into departments by both geographic divisions and product categories, which created overlapping management responsibilities and a fluid leadership structure

NIKE STRATEGIES

Advertising strategy:

The company focuses its marketing on celebrity endorsement, i.e. athletes in basketball, golf, soccer, and tennis. Lately, Nike has also began to sponsor big sporting events so as to create huge awareness and brand following

FUTURE PLAN

Nike expects to Increase its future orders for delivery. Nike will continue to focus their resources on those

investments that drive sustainable and profitable growth. The Company announced plans to grow the NIKE Brand in

all six of its geographies the Company outlined plans to open approximately 250-

300 new NIKE-branded stores worldwide over the next five years

Increasing dividends within a target calendar year payout range of 25-35% of trailing four quarter earnings per share

Nike expected to have Return on Invested Capital of 25%

Our Recommendation

Improve its marketing plan including advertising. SIMPLFY ITS WEB SITE Focus on setting up a reliable Information

system Nike should focus more on its labor working

conditions and wages Increase its market share in the middle-east. Increase its acquisition due to increasing the

threat from adidas and rebook merger.