Nike, the Greek goddess of victory, helped others succeed in times of war. NIKE, the world's #1 maker of athletic footwear and apparel, does more dominating than assisting, to capture a hefty share of the US athletic shoe market. It designs and sells footwear and uniforms for a wide variety of sports. NIKE also sells upscale Cole Haan shoes, as well as athletic apparel and equipment. It operates NIKETOWN shoe and sportswear stores, NIKE factory outlets, NIKE Women shops, and sells its products online. Overall, the company sells its items in some 690 NIKE-owned retail stores worldwide and through about 23,000 retail accounts in the US and via independent distributors and licensees in other countries.
Given NIKE's ranking as a top athletic products firm, it's noteworthy that the behemoth logged only a modest decline in revenues for fiscal 2010 among some of the more bleak results of some of its rivals and manufacturers in general. NIKE is working hard to climb out of the economic downturn and return to its status as a far-reaching retailer and manufacturer. Indeed, NIKE sales will get a boost when it replaces rival Reebok as the maker of NFL-branded apparel and uniforms for a five seasons period beginning 2012.
The footwear and apparel peddler in 2010 grew its retail business faster than its mainstay wholesale business. Its NIKE-owned retail segment comprised some 15% of revenues for the total NIKE brand for fiscal 2010 as compared to 13% in 2009. The Total NIKE Brand -- NIKE's largest reporting segment -- generated 87% of its business. And while the NIKE brand footwear business was down 1% compared to the previous year, footwear still accounts for more than half of NIKE's sales.
The balance of NIKE's 13% of sales came from its "Other Businesses," which include Cole Haan, Converse, Hurley, NIKE Golf, and Umbro. While more affluent brands NIKE Golf and Cole Haan slipped in sales in fiscal 2010, NIKE's other units -- Converse (known for its classic and retro-style shoes), Umbro, and Hurley (sports apparel for skateboarding, snowboarding, and surfing) -- were able to pick up the slack with a 4% increase.
Before consumers and corporations began to tighten their belts in 2008, NIKE acquired UK-based global soccer brand Umbro for about $576 million. The deal has provided NIKE with a firm foundation in soccer in the US and England and has positioned the company for growth in emerging soccer markets, such as China, Russia, and Brazil, while its US business slowed. For a couple of decades, NIKE has built a $1.5 billion soccer business from its beginnings of about $40 million. Umbro, which sells directly and through licensees, has brought high-profile sports marketing agreements with soccer players, teams, and leagues and its own global reach.
To help fund its soccer purchase, NIKE shed its hockey business. More than a dozen years after acquiring Bauer NIKE Hockey, NIKE sold the hockey unit in early 2008 to a group of investors, including Kohlberg & Company and W. Graeme Roustan, for $200 million. It divested its hockey unit after a strategic review of subsidiaries that didn't reach the $2 billion mark in sales, a long-term growth strategy for the company.
While North America accounts for about a third of NIKE's total revenue, domestic sales growth has slowed in recent years. To make sure it doesn't slip from its #1 spot atop the athletic shoe and apparel market, NIKE in 2009 adopted a new business model centered around half a dozen geographies: North America, Western Europe, Central/Eastern Europe, Greater China, Japan, and Emerging Markets. The company also slashed its global workforce by about 5% in a bid to streamline its operations.
NIKE is led by Mark Parker, a longtime brand executive with the company, who was named president and CEO in 2006. Parker succeeded short-lived CEO Bill Perez, who replaced NIKE co-founder Philip Knight in 2005. Chairman Knight controls the company.