Sneaker War

Nike currently enjoys a 47% market sell of the domestic footwear industry, with sales of $3. 77 one million million million. Nike has been manufacturing throughout the Asian character for over twenty-five years, and there be over calciferol,000 people immediately directly engaged in the productionion of their products. They habituate an outsourcing strategy, using notwithstanding subcontractors throughout the globe. Their majority of their output today is produced in factories in China, Indonesia, and Vietnam, merely they also swallow factories in Italy, the Philippines, Taiwan, and South Korea.These factories ar 100% have by subcontractors, with the majority of their output consisting solely of Nike products. However, Nike does employ teams of four expatriates per from each one of the big three countries (China, Indonesia, Vietnam), that focalization on both quality of product and quality of working conditions, visiting the factories weekly. They also developed their code of lead in 1992 and have apply it across the globe, as its goal is to educate the standard for subcontractors to follow if they wish to do business with Nike.However, due to a manufacturing network of this magnitude, they have faced numerous violations involving factory conditions and human rights issues, which have been widely publicized. They have responded to these issues through the Andrew Young report, the Dartmouth Study, and Ernst & Youngs continual monitoring, but are still approximately two years away from completely addressing these problems throughout the globe. Reebok Reebok, as the second leading manufacturer of footwear, has domestic revenues of $1. 28 billion and a market share of 16%.Similar to Nike, they also utilize a 100% outsourcing strategy and manufacture their products throughout Asia. They have created and implemented their own code of conduct for manufactures to follow, but have less base than Nike across the globe to enforce it. They are facing scr utiny in regards to wage, overtime, and air quality issues, and like Nike, are working to address these issues. However, their strength, the cosmea and distribution of a global brand, is allowed to foster under this manufacturing strategy, as hey focus on their core competencies, and out source their production.Adidas is currently enjoying the fastest festering of any brand domestically, with a market share of 6% and revenues of $500 million. They have been shielded from bad publicity by the two Goliaths of the industry, Nike and Reebok, and are reaping the rewards substantially. They have adjusted their manufacturing strategy, from a vertical operation in Germany in the 60s and 70s, to an outsourcing focus today throughout Asia.Unlike the big two, they do not have a code of conduct, and their factories are considered to be the worst in the industry. It is just a matter of time before they are exposed, with an opposition swelling of negativity already occurring today. In order to avoid the nix effects and lost revenues that Nike and Reebok have received, they need to immediately begin to tamp down a pro active stance in regards to the working conditions of their factories.