History Of Nike Inc. ( Nke )

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Historical Background Nike Inc. (NKE) is a $32.3 billion multi-national enterprise headquartered in Beaverton, OR. Nike was originally founded as Blue Ribbon Sports in 1962, and in 1967, the company rebranded as Nike. Positioned as the worldwide leading brand in the sports apparel industry, Nike’s primary business activity is “the design, development and worldwide marketing and selling of athletic footwear, apparel, equipment, accessories and services” (Nike Inc., 2016). Products and Services Nike’s portfolio offering encompasses four brands: Nike, Jordan, Hurley, and Converse. These brands have helped Nike establish a dominant retail presence. The brands are made up of nine main product categories that includes Men’s Training, Nike…show more content…
At the end of FY2016, the company operated 362 retail stores in the US and 683 retail stores in its international markets. Nike products are available via e-commerce websites in more than 40 countries. Major Source of Foreign Exposure Nike recognizes that fluctuations in currency exchange rates could result in higher costs, overstated revenues and decreased profit margins. In a September 2016 SWOT analysis, Global Data lists foreign exchange risk as a major potential threat to Nike (Global Data, 2016). Most Nike products are produced and sold outside of the United States. In recent months, Britain’s decision to leave the European Union has caused what some call an “uncorking of a genie in a bottle” that caused uncertainty in currency markets (Martin, 2016). Nike is keeping a close watch on the United Kingdom. As a result of Brexit, the United Kingdom’s currency exchange rates have been volatile. Nike translates foreign currencies into U.S dollars for consolidated financial reporting. Given that international markets dominates Nike’s sales and earnings, weakening foreign currencies adversely affects their financials. As a global company, Nike has assets and liabilities comprised mainly of receivables and payables that are dominated in numerous functional currencies. Operating using various currencies exposes Nike to foreign currency fluctuations. Nike Transactions

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