Nike's ongoing restructuring

By: Leonie Barrie - 11 February 2009 18:51

Nike is keen to stress that a cull of up to 1,400 jobs is part of a wider restructuring announced a couple of years ago rather than a symptom of the current economic climate.

The realignment will “bring the company closer to consumers, reduce management layers and leverage efficiencies to increase speed-to-market advantages globally,” the company said. And it will include a review of the sportswear giant’s entire supply chain from the sourcing base to the retail footprint.

Although Nike has largely been shielded from the economic slowdown – in December it recorded a 9% increase in second quarter profit to US$391m, boosted by strong performances in Asia Pacific and the Americas – US demand is slowing and profits have been hurt by the strong dollar.

But it is pinning its future growth on a focus on six core categories: running, basketball, football (soccer), women’s fitness, men’s training and sport culture. These areas alone are expected to generate about 75% of the Nike brand’s growth by 2011.

US: Nike restructuring poised to cost 1,400 jobs