Nike Inc (NYSE:NKE) has since operated mainly as a wholesale distribution business model, but not anymore! The small and independent retailers obtained products from the company to sell them out in different parts of the world. The company back then considered these retailers important to its general growth, but that has changed. Some of the products the business sells include clothing, shoes, and gears.
Company’s new business channels
The company’s latest strategy involves the sale of its wide-ranging products on Nike.com, Nike stores, and the company’s apps. Customers can also buy the company’s products from a more limited group of retailers such as Foot Locker and Dick’s Sporting Goods.
The company’s latest movie revolves around slashing the number of traditional retailers selling its products by a significant margin. Nike’s move is the best explanation of why most customers encounter difficulties getting Nike sneakers and related products in their neighborhood stores.
Moving from the traditional way
Nike wants to shift from its traditional business model, terming it unprofitable. The company believes that selling products online and through its channels could be more lucrative. Both the big and the small retailers have been hit by the company’s move, disclosing that they’ve lost a big business opportunity. Nike shocked most people when it cut ties with some independently-owned stores, but it got even more surprising when it put a stop to its business activities with Amazon.com, Inc (NASDAQ:AMZN) in 2019.
The company’s early business days impressed most customers because it was easy to learn about its upcoming modes. The customers just had to visit the local stores to know everything about the latest products, but that has changed.
Nike says considers its latest move a progressive one in business because it will start making double profits. Customers will visit the company’s physical stores and website to get the products they need.
This company wants to be in control, and it starts working on the shopper experience and the final selling price of products to consumers. Nike wants to focus on showcasing its products most enticingly as part of its product promotion activities.