Nike is a sportswear company that has been around since the mid 1960s. Nike started small in Beaverton, Oregon and has grown to a global level. It employs many people throughout the world and has often been accused of operating sweatshops in third world nations. Nike is one of the top athletic apparel companies and many people strive to have their products. Owning these products says a lot about one’s image. Many people purchase Nike merchandise to satisfy a certain status level. Several individuals who purchase many of Nike’s products fail to recognize the hardships and inequalities many workers have faced when constructing these items.
Nike gets its name from the Greek goddess of Victory. The Nike swoosh was developed in 1971 and has been a large trademark for this corporation. Anywhere around the world someone can look at that symbol and know that its Nike. It wasn’t until 1972 that the first shoe line was released. Soon after that Nike had its first athletic spokesman, Ilie Nastase, a top tennis player. Nike has since prided itself on top professional athletes and wants to send a message that its products are for extreme dedicated athletes. Also, that by wearing these products a person can be more successful in the sport they participate in. This branding image has been very successful and has affected Nike’s business to explode.
A few years later in 1980 after the launching of their first shoe line, Nike decided to go public while having a 50% market share in the United States shoe industry. This market share occurred even before television commercials became prevalent. During the production of commercials the slogan, “Just Do It,” was formed, which is now a highly visible motto for athletes. With the increase in popularity and a net worth that kept on growing, Nike needed to build more factories and produce more products. It became so successful that Nike steadily grew to other countries of the world.
With the increase in demand and the need to produce more products, Nike needed to find cheaper labor and a larger workforce. These locations were found in some of the poorer countries of the world such as Vietnam, Indonesia, China and Mexico. Many Labor Watch Unions have witnessed minimum wage violations and overtime infraction laws in Vietnam as recent as 1996. Much of their goods are produced in these Free Trade Zones where cheap labor is exploited. Nike has schmoozed its ways around certain regulations by developing factories in other regions of the world with less of an emphasis on monitoring regulations. These sweatshops are not slowing down and are in fact being created more so in poorer, less-governed regions. The cheap labor is driving profits for Nike which increased its yearly revenue from 6.4 billion dollars in 1996 to 17 billion in 2007.
Nike has been aware that many of its practices are not accepted by everyone. They say they have taken steps to minimize the dangerous working conditions and long hours they employ third world individuals to endure. Nike is still being criticized for its poor wages and locations it chooses for producing its products. For being one of the largest athletic suppliers in the World Nike must lead by example and place more of an importance on humanity and less of an emphasis on earning a buck.
- Reference: http://en.wikipedia.org/wiki/Nike,_Inc.
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Tuesday, February 23, 2010
Saturday, February 13, 2010
Outsourcing of Nike Products
Topic Overview
Nike is one of the biggest suppliers of athletic apparel in the world today. Much of these products are produced overseas and in areas with cheap labor and production costs. These cheap labor costs lead owners and other stakeholders within the company to earn large profits. The low labor costs are putting a burden on many of the workers in these third world countries. The construction of these products takes place mostly in Vietnam, China, and South Korea. Outsourcing to these countries is necessary for Nike because the workers are not able to form unions and it keeps costs down. Many of the locations within these countries take place in large factories with poor facilities and hazardous risks. A common name for these low quality facilities are known as "sweatshops." Bambi Turner explains more on Nike and the history they hold.
While outsourcing jobs to cheaper third world countries is good for many atop the Nike food chain, this keeps jobs from being created within the US and only solidifies the struggle many people in these poor countries share with poverty and health risks. Many can defend the fact that those working in these locations are surviving by the wages they make in these sweatshops. An argument can be made that if it weren't for Nike outsourcing to these countries, then many of the workers would be left off to starve to death and be unemployed. It is also important to consider the opportunities and weaknesses sweatshops deliver to these third world countries.
Why Nike?
As a Sport Management major I come into close contact with many athletic related services, products and events. Nike is a large supplier to many of those related in my field. Recently this year Washington State University also changed it's official contract of athletic apparel over to Nike (formerly Russel). The passion I share for sports carries me over into my desire to discover the true realities that unfold with a large multinational corporation. I aspire to uncover the inner workings of a large corporation and their needs to outsource overseas. Working in athletics I find it very intriguing to have the opportunity to view many of the Nike products. I am interested in where these products come from, who makes them, and the hardships that are overcome for seemingly simple items.
Class Themes
This topic relates to the themes in class to such that many inequalities are occurring with the workers in Nike factories overseas. Much of the burden is falling on the workers in these factories because of the harsh working conditions and low paying wages they are receiving. Not much attention is paid to the working facilities or the opportunities many third world citizens can explore. With a spotlight and deeper look into a multinational corporation hopefully more people will see the inequalities and lack of opportunity many face. A deeper look into outsourcing and sweatshops along with the reasons behind it, will hopefully engage more citizens to act in a more humane and caring manner.
What To Get From This Topic
I wish to understand the deeper reasons multinational corporations make the decisions that they do. Whether it is financial, or personal I find it captivating the risks large corporations are willing to take. I also wish to find a better understanding for the less privileged in other countries and the hardships they must overcome in order to become successful. I also hope to find many connections between western culture and that of other countries of the world. Also where ideas are generated and the consequences for the actions many powerful leaders and businessmen make.
Nike is one of the biggest suppliers of athletic apparel in the world today. Much of these products are produced overseas and in areas with cheap labor and production costs. These cheap labor costs lead owners and other stakeholders within the company to earn large profits. The low labor costs are putting a burden on many of the workers in these third world countries. The construction of these products takes place mostly in Vietnam, China, and South Korea. Outsourcing to these countries is necessary for Nike because the workers are not able to form unions and it keeps costs down. Many of the locations within these countries take place in large factories with poor facilities and hazardous risks. A common name for these low quality facilities are known as "sweatshops." Bambi Turner explains more on Nike and the history they hold.
While outsourcing jobs to cheaper third world countries is good for many atop the Nike food chain, this keeps jobs from being created within the US and only solidifies the struggle many people in these poor countries share with poverty and health risks. Many can defend the fact that those working in these locations are surviving by the wages they make in these sweatshops. An argument can be made that if it weren't for Nike outsourcing to these countries, then many of the workers would be left off to starve to death and be unemployed. It is also important to consider the opportunities and weaknesses sweatshops deliver to these third world countries.
Why Nike?
As a Sport Management major I come into close contact with many athletic related services, products and events. Nike is a large supplier to many of those related in my field. Recently this year Washington State University also changed it's official contract of athletic apparel over to Nike (formerly Russel). The passion I share for sports carries me over into my desire to discover the true realities that unfold with a large multinational corporation. I aspire to uncover the inner workings of a large corporation and their needs to outsource overseas. Working in athletics I find it very intriguing to have the opportunity to view many of the Nike products. I am interested in where these products come from, who makes them, and the hardships that are overcome for seemingly simple items.
Class Themes
This topic relates to the themes in class to such that many inequalities are occurring with the workers in Nike factories overseas. Much of the burden is falling on the workers in these factories because of the harsh working conditions and low paying wages they are receiving. Not much attention is paid to the working facilities or the opportunities many third world citizens can explore. With a spotlight and deeper look into a multinational corporation hopefully more people will see the inequalities and lack of opportunity many face. A deeper look into outsourcing and sweatshops along with the reasons behind it, will hopefully engage more citizens to act in a more humane and caring manner.
What To Get From This Topic
I wish to understand the deeper reasons multinational corporations make the decisions that they do. Whether it is financial, or personal I find it captivating the risks large corporations are willing to take. I also wish to find a better understanding for the less privileged in other countries and the hardships they must overcome in order to become successful. I also hope to find many connections between western culture and that of other countries of the world. Also where ideas are generated and the consequences for the actions many powerful leaders and businessmen make.
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