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In the mid-1990s Nike, one of the world's most successful footwear

companies, is hit by a spate of alarmingly bad publicity. After years of high-


profile media attention as the company that can "just do it," Nike is suddenly
being portrayed as a firm that relies on low-cost, exploited labor in its
overseas plants. Nike officials vigorously deny the charges, claiming that Nike
has no control over the independent contractors who manufacture Nike
shoes. But the activists will not retreat. Eventually, Nike must learn to deal
with the activists' claims and with the tangle of conflicting data that
surrounds the concept of a "fair" or "living" wage.
Indonesia’s daily Ballinger published an
86% Nike sneaker minimum wage was annotated pay-stub from
barely $1, yet an Indonesian factory, Nike controlled over
First production production came
$24.40 per day in making the comparison 40% of the $14.7
while Phil Knight, from one of South
South Korea and $8 between workers’ wages Nike began billion US footwear
CEO, was still a Korea and Taiwan
per hour in US and Michael Jordan’s expanding its market
student
endorsement contract chain of giant
retail stores

1962 1972 1980 1982 1988 1990 1991 1992 1993 1996 1997 1998 1999

Revenue reach
CBS interviewed
to $60.000
Nike’s manufactures Indonesia workers
and startling
moved to China or who revealed that
$49 million in
Indonesia regarding they were paid just
10 years
Reebok had moved lower costs 19 cent an hour Nike Revenue
aggressively into the decreased from
human rights arena. $9,553 Million
Nike went Published a photo
Reebok Human Rights to $8,776
public at a 12 year old bot
Award Million
Wall Street stitching a Nike
soccer ball
Strength Weakness
• Strong Brand Identity • History of violation in many countries
• Low cost production • High Advertising Spending
• Offers their product world wide • High Prices of its Products
• Market leader in sport footwear • Excessive dependence on footwear
• Products innovation
• US Economic Scale

Opportunity Threats
• Create another segmentation for product such as • Competitors are becoming more aggressive and creating
wear, sunglasses, etc. high quality products
• Brand Images
• Support global sports event such as Olympics,
• Incompliance Nike’s Code of Conduct on Outsourcing
World Cup, Asian Games, etc. Company
• Small Number of competitors • Outsourcing companies corporate governance.
• NGO always giving highlights to NIKE for labour wages

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