Nike Supply Chain Essay

1523 Words7 Pages
Forecasting in the fashion industry is usually a complicated due to the fact that it’s characterized by high demand, short product life cycles and different varieties of product lines. Consequently, managing customer demand tends to be difficult, for organizations have to avoid large volumes of stock. In this industry, there’s intense competition and consumers are price conscious; accordingly, these factors have slowed the growth of this industry. As a result, this made it difficult for the companies to create brands which can offer high quality products with cheap prices (Fernino et al., 2012). Nike is one of the most popular brands throughout the whole world and the world’s leading supplier. The company designs, develops and markets high…show more content…
They compete on marketing expenditures, pricing, product offerings, cost of production, technologies, and customer service (Fernino et al., 2013). The supply chain is made up of suppliers, manufacturing centers, warehouses, raw materials, retail stores, distribution centers, work in process inventory and finished products that typically flow between the suppliers reaching customers (Slack et al., 2013). Supply chain management on the other hand, combines all of these to ensure that the right quantities are distributed to the right locations at the right time(Barratt, 2004). Nike’s supply chain is centralized since the outsourcing, designing of the product, and logistics are all controlled by the company’s headquarters in Beaverton, Oregon. Nike outsource most of its manufacturing products to overseas factories so that it would produce shoes in Japan for lower costs than in the United States. However, when the production costs in Japan increased; Nike shifted its manufacturing firms to Korea and Taiwan. Later on, Korea and Taiwan experienced strong economic growth; as a result, Nike ended up relocating in Thailand, China, Cambodia, Indonesia and Vietnam (low cost countries). Nike operates by three distribution
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