Business Strategy and SWOT analysis of nike
Nike is a One of the leading company in the world which generally activated in design, development and global market with high quality of equipment, footwear and accessory products. Nike is one the biggest seller of athletic footwear and apparel in the world. The Nike is got the best position in the market to go with the approach of athletic market. The company is excavate into any niche in relates with sports market as well as technical breakthroughs, retailing, management of sports and sports promotions. Nike is now going into the particular market of the Pakistan. This is the best time for Nike to introduce its women’s footwear, apparel and equipment for the women’s of Pakistan because the women’s are getting freedom in Pakistan. Pakistan is already one of the biggest supplier for the Nike’s soccer. History of Nike’s.
In 1962, two people from the University of Oregon created a undersized company with the name of Blue Ribbon.In the 1972, the company transformed his name and became in to the market with the name of Nike. In the current situation, Nike owns amenities in Oregon, Tennessee, Netherlands and the North Carolina. It also working in leased services for 15 Nike-towns, more than 80 Nike Factory Stores, 2 NIKE goddess boutiques and more than 100 sales and administrative offices. There are just about 23,000 people engaged by the Nike, wide-reaching. The company's first year sales did not cross $ 10,000 however, its present revenues exceed well over$10billion.
Nike research lab is frequently pursuing modernization in the field of sports. The research work in the lab is circulated into three categories including biomechanics, physiology and sensory/perceptual attributes. The researches main purpose is to focuses on differentiating factors like geography, sexual category, age and skill level.
Products of Nike can largely be scattered into two categories as footwear and equipment. The footwear has been sub characterized into various product lines including sports culture, running, basketball and soccer. Nike is doing their business in a very customer slanting market. This means that the requirement for the Nike's goods seriously depends on the attractiveness of the different fitness actions. The company adjusts incessantly their product mix in direct to meet demands. It manages its business cautiously, leading in hostile marketing styles and pioneering products.
Nike Mission statement.
“our mission is to bring inspiration and and innovation to every athlete in the world”
“if u have body, u are an athlete”
(My strategic plan,2008)
Nike as Innovative Company.
According to (S. Parkash Sethi,2003) Nike is one of the highly enterprunual and innovative company that is running on more than one ways it took all the relevancy and utilitarian in all purposes its aims to one type fits all Nike has the high tech and high quality footwear and athletic sports equipment for all seasons.
Pakistan is the most passionate country in the world in terms of sports. It is the time for Nike to introduce his footwear and apparel for women’s because women’s of the Pakistan are now participating shoulder to shoulder with men in all fields of life. Most important challenges confronted women in Pakistan in the start of 1990s: rousingly
practical literacy, attainment access to service opportunities at all levels in the
economic, promoting revolutionize in the sensitivity of women's roles and status, and
getting hold of a public vote both inside and outside of the political process. Kiran khan and Robab Naz are considering role module for Pakistani women’s. After the getting ranking in international ranking now Pakistani women’s cricket is also very popular in the Pakistan.
According to (Bohim,2008) Examining a company internal and external environmental is essential in the process of strategic planning the swot analysis which includes the analysis strength , weakness, opportunities and threats investigates both internal and external as well as positive and negative factors of a corporation on the basis of swot analysis a marketing strategy can be deverlped using corporate strengths as well as avoiding corporate weaknesses to enable a company to benefits from future opportunities with regards of future risk.
Dependent on footwear sale.
Don’t have Nike’s own retailers.
Doesn’t able to capture the local market like international market.
Strong Research and development department.
Jumped into recycling.
Sunglasses and jewellery
By the competitors alternative brands
Maintaing e-co friendly envirement
Companies financial status
Nikes Company Situation Analysis.
Critical success factors
(David C Kimball, etc ,2009)
“Market Segmentation is the process of identifying different group of users with in a market who could possibly be targeted with a separate products or marketing programs.”(Michael j croft n.d )
“Pakistan with population of over 140 million has a demand of 220 million pairs of shoes annually.”
(Daily times, 2003)
Pakistan have the population of 140 million and the Women’s in that are 47.5% of the total.
Nike’s targeted location is the Pakistani market particularly women’s markets so they need to design the product according to the needs and of the Pakistani women’s.
Nike’s targeted gender are the women’s in the Pakistan that are the 47.5% of the total population that is the niche market for the Nike’s and the Pakistani women’s are not very much use to of exercise so they need to be very focused.
Nike’s targeted customers are from all the group fellows. The products must be varied from every group the mostly used customers are the teenagers between 13 to 25.
In Pakistan the majority of the Muslims and the other religions like Christians and Hindus are also have the customers in Pakistan. So the company needs to be care full the norms and values of the religion.
The economy of the Pakistan is not so strong so the company needs to set their prices at that level where majority of people are willing to accept that product.
The education level is not fully up to standard but now a day’s Pakistan sloly and gradually going towards the bitterness’ and people are now able to under to understand the importance of health and safety.
Cultural Influence and Business.
“Culture is the part of human action that is socially as opposed to gentacally transmitted. It comprises the idea through which we perceive and interpret the world, symbols we use to communicate thsese idieas, and institution which enable individuals to become socialised and satisfy their needs”(David Needle 1994 )
The culture of the Pakistan is very rich and the company needs to look at the culture of Pakistan where women’s are not mostly allowed to wear tide dress and so the company needs to understand the pros and norms of the particular culture and design the product according to the needs of that culture.
According to (Management Bluffers 2000) Now a day’s environmental is changing day by day and its reached there where it wasn’t before constantly changing the environmental make mangers job is so tough now a days. That’s why the PEST analysis is useful and simple tool for the manager where they can track the environmental changes impacts on the business it includes the social, Political , Economical ,and technological. It is difficult for others to resist comparison with (a) an inept user and (b) vermin to be eliminated.
“Countries have both market and non-market environment. The market environment involves the interaction between households( or individuals ) and companies to allocate resources, free from governmental ownership or control. The non-market government agencies and government owned business ).(Johan D,Daniel , lee 1998)
According to the current political situation of the Pakistan is trying to stable the economy of the country and if Nike’s introduce new products into the market the market condition will be more better because the Nike’s has the brand name in the footwear industry.
“Economics factors are affect the purchasing power of potential customer and firms cost of capital”(John William, Curtis,2006)
Nike’s needs to consider the economic factor as a main role in Pakistan. During the year of 2008 Pak rupee value is decreased and Pakistan is facing the Bank crisis as well so company needs to have a very strong capital to face these situation. The company needs to consider the following steps.
Current economic system in the Pakistan.
Exchange rate and stability.
Economic rate of growth
Rate of unemployment
Rate of Inflation.
Social factors includes the demography of the people. How the people behave to towards the products and What are the norms and value of respective countries. In Pakistan women’s are not allowed to go out for exercise so company needs to give the awareness and provide the facilities to the women’s of Pakistan.
According to blab bulb is needs to be consider
New purchasing mechanism
New production technology
New distribution mechanism
New method of working
Opportunities for new products to sell
The Pakistan is developing country so the trend of online shopping is not so much popular in Pakistan still people go to the market for shopping so and distribution method is also same like people would like to by through suppliers chain.
“No firm can exists in vacuum”(Lay young Man,1998)
It is really very important for the company to know who are their potential competitors and what the strategies they are using to capture the market as the CEO Philip kotler says a quite that” business is a war without bullets”. Nike’s main competitors are in the Pakistan market are
And local Firms
Although Nike is one of the biggest company in the world in soccer and footwear with a high brand name but its rival company Addidas giving really very tough time in china addidas take over china with 60% shares and Nikes is 2% behind the addidas but in Pakistan culture people are mostly brand oriented and Nike is already working in soccer industry in Pakistan so Nike has competitive advantage that Nike is contributing in the economy of the Pakistan.
To introduce the new product into the market the company needs to analyse the the porter five forces as well to compete with rivals the company needs to understand and make a good strategy for these forces.
Marketing Mix .
“ The set of tools that management can use to influence sales”(Philip Kotler)
Every targeted market needs to be a exceptional marketing mix to convince the needs of the beleaguered consumer to achieve the firms goal the strategy must be followed by the each of the every single 4p and Because these four ps are the basics of the strategies that to achieve the firms goals. Nike also must follows this strategy to enter into the Market of Pakistan.
Nike’s Product in respect of Pakistan market is the women’s footwear and apparel Nike’s needs to design the product as the demand of the market in Pakistan and needs to keep in mind the cultural barriers that are faced by the women’s of Pakistan.
According to(Stafanie Hoffmen 2005) Price is a potential marketing mix because it has the direct impact on the consumer , economy and the company as well. The price is major indicator about the quality of the product. Due to depressed economy and like other developing countries people of Pakistan buying power is not so strong 98% people are living average level life so Nike’s needs to set that price for the products that are acceptable by the majority of the population .
Place or Distribution.
Place or distribution strategies are concern with “making product available when and where customer want them”(Charlas W lamb,2009 )
In Pakistan the areas of capturing where the more output the company get is the main cities of Pakistan like Karachi, Lahore, Islamabad. These are the main markets for the Nike’s to be captured. And needs to be the access able for the customers.
“Promotion or Marketing communication is the component of marketing mix used to inform and persuade the targeted audience to buy or use and organization products promotion is the element in the marketing mix that communicates the key message to targeted audience”(Richard barker, Gorge,nd )
In Pakistan Nike’s has the best opportunity for promotion to use the Pakistani women’s hero’s like Robab and Kiran khan and the Pakistani women’s cricket team players to promote and products and the brand name in the country. The best method of advertising and promotion in Pakistan is electronic media.
CONSOLIDATED FINANCIAL STATEMENTS
FOR THE PERIOD ENDED MAY 31, 2010
(In millions, except per share data)
YEAR TO DATE ENDED
Cost of sales
Selling and administrative expense
Intangible and other asset impairment
Other (income), net
Interest expense (income), net
Income before income taxes
Weighted Average Common Shares Outstanding:
Balance Sheet of Nike.
Cash and equivalents
Accounts receivable, net
Deferred income taxes
Prepaid expenses and other current assets
Total current assets
Property, plant and equipment
Less accumulated depreciation
Property, plant and equipment, net
Identifiable intangible assets, net
Deferred income taxes and other assets
LIABILITIES AND SHAREHOLDERS' EQUITY
Current portion of long-term debt
Income taxes payable
Total current liabilities
Deferred income taxes and other liabilities
Redeemable preferred stock
Total liabilities and shareholders' equity
In current situation Pakistan market is niche for women footwear and apparel. According to the research. It is recommended that Nike’s needs a very strong and tactical strategy for Pakistan because in Pakistan women’s are getting rights but still that is a conservative country. Pakistan is an Islamic state where women’s are not allowed to wear tides and bikinis and also in Pakistan only in big cities there are separate exercise clubs for the women’s so Nike’s also needs to develop health clubs and take a part in spreading the awareness of health issues. Pakistan market is good market but more than 80% population is under the poverty level so price needs to consider most in this.
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