Nike’s inventory turnover of 7.32 exceeds the industry average of 4.34. That’s how most big corporations (and some small businesses) make their operational business decisions. Retrieved November 27, 2015, from http://help-en-us.nike.com/app/answers/detail/article/returns-policy/a_id/29785, Nike – Shoe Box Packaging. (n.d.). This demand forecast is then used to determine optimal inventory levels, reorder points, material lead times etc. In 2001, Nike has updated version of their inventory management software and this idea was to help predict which their product can be a high demand. Optimal Inventory Management is a competitive advantage for Nike and an essential part of the service to our consumers. The number of shoes in each container depends and varies on what is required by the buyer. The fact remains that wearing a running shoe for any athletic activity will definitely result in an adverse effect. Hence, when these occur, safety stock will help the business retain its life and efficiency. Nike as a company considers the responsibility of their product with respect to the environment. The other categories of variation include the prices, weights, warehouse handlings, product information, etc. Nike’s Long Uphill Battle with Supply Chains. The retail price of this product ranges between $20 and  $250. This brand is a very reliable, supportive and durable fit that is an improved quality over its predecessors. (2015). It may be difficult to imagine that such a well-established corporation could have a massive operational failure like this, but they did. (2006). Especially if you are a small business owner and can’t withstand a massive loss in sales! Retrieved October 25, 2015, from http://www.6pm.com/converse, Why it’s Important to Invest in Good Running Shoes. (2010, September 12). #. But there are different seasons for athletic activities, which may vary with respect to sporting time in different locations. When there is fluctuation in the sales of a product, it could affect the daily stock inventory since most inventories are based on a regular order and delivery routines. Retrieved October 25, 2015, from http://www.demandsolutions.com/ds-blog/abstracts/safety-stock.html, Earnings Review: Nike Continues Its Strong Run. Things to Consider Before Taking a Franchise, Willy Loman Character Analysis Death of a Salesman, Advantages and Disadvantages of Limited Liability Company, Fee Waive off Application Sample for University. Retrieved October 25, 2015, from http://www.adidas.com/us/men-running, Converse. Light weighted, durable, attractive and sophisticated. As important as inventory is, so is product life cycle, the knowledge of product life cycle affects inventory because the product life cycle may not be constant due to some factors that can affect the product. It is using technology to optimize its inventory across channels with hyper-localized demand predictions to ensure customers can find and purchase what they’re most interested in. Here is the process in a nutshell –. The Nike running shoes are provided with a warranty of 30 days of the shipping date. Manufacturing this product is not as difficult as it appears. Inventory can be defined as the total value of inventories in all stages of completion. (2011). Since I’m just a retailer and would always expect the products supplied from the brand. Some of the impacts include: Increase in storage cost: When the large volume of those items remains in the warehouse for some time, there wouldn’t be space to store any more inventory. As a purchasing and inventory professional, this information helps to put me ahead of time and helps to track exactly where the goods are at any particular time. 8. Warehousing is so important as it is the major storage of large volume of items, taking inventory of the daily stock will help to keep track of the sales of the business. Nike said that because of the store closures, product shipments to its wholesale partners have stalled, resulting in "significantly lower wholesale revenue and higher inventory." Nike delivers innovative products, experiences and services to inspire athletes. Retrieved October 25, 2015, from http://www.fitday.com/fitness-articles/fitness/equipment/why-its-important-to-invest-in-good-running-shoes.html, Demand Management. This includes putting RFID chips in its shoe packaging so it can know how … It is equally important to make sure that you enter all the requisite data and double check everything! Therefore, these factors definitely affect the cost of the product. Thank you for studying “Nike Running Shoes Marketing and Inventory Management Project”. (2011, July 3). Supply Chain Management. (2014). Since the items are staying longer than expected, discounts can be placed on them. Though it requires intensive labor, quality materials and sophisticated technologies to manufacture this product. Nike, selling $9 billion worth of athletic shoes annually, does so without owning any factories itself, performance, and reducing claim… Reviews from Nike employees about working as an Inventory Associate at Nike. Nowadays, runners feel much better running with shoes that are light weighted and less cushioning, and this makes them seek to buy the best products that suit their desires and wants. Building up a brand implies that an organization is taking on the responsibility of creating substantial value, brand visibility and desirability of a product. Easy 1-Click Apply (NIKE) Senior Director, Technical Product Management, Operations & Logistics - Inventory Management job in Beaverton, OR. Nike Running Shoes Marketing and Inventory Management Project. It is made flattened out, new, and a Dynamic Flywire, a typical strategy to keep it extraordinarily with great experience of relief and confidence. This estimate is based upon 4 NIKE Inventory Manager salary report(s) provided by employees or estimated based upon statistical methods. Also, it would also help to plan for the budget involved in the shipment, and also understand the intending risks. (2015). ... the company adopted an updated inventory management software after losing around $100 million in … The predictions the software made were totally off, so Nike didn’t produce enough of certain products that consumers were interested in buying. This product is also very light weighted and helps the feet carry without stress. Therefore, this product is really booming the market. The mode of transportation to convey those items to different parts of the world from the manufacturing factories is through the Air. This erroneous manufacturing plan eventually resulted in lost sales worth millions of dollars. Taking the advertisement to the next level. In order to make profits, there must be provision of quality that matches any environmental factors. (2013). Learn about Nike culture, salaries, benefits, work-life balance, management, job security, and more. Warehousing incorporates storage of goods depending on a large-scale in an orderly manner for easy accessibilities when needed. Retrieved October 25, 2015, from http://www.forbes.com/sites/greatspeculations/2015/06/29/earnings-review-nike-continues-its-strong-run/, How Nike Re-Defined the Power of Brand Image. Some of these competitions include: I have observed from these competitors that they offer outstanding quality images on their websites, attractive graphics, detailed description of the products, use of customer languages, best and affordable prices, free shipping aid, instant and available customer care services, reasonable money back policy guarantee and valid contact details. This is because the container is 20’ sized and can conveniently occupy any quantity within the previously stated range. The objective in this strategic decision area of operations management is to align the supply chain with the companys overall strategic aims. Retrieved October 25, 2015, from https://www.unleashedsoftware.com/blog/losing-sales-the-importance-of-safety-stock, Men’s Nike Hyperdunk 2015 Basketball Shoes. Due to our ability to quickly turnover inventory, Nike benefits from greater cash flows, reduced storage costs, and less spoilage. Also, it is one of the leading product in its segment. Basically, Nike running shoes were designed to be used in the environment and therefore, comes in a quality unmatched to suit environmental factors. Often with an orange and brown box with a Swoosh. The quality of the product keeps helping it thrive successfully in the market. Inventory managing is important to every business in order to scale up the business. The Nike running shoes business needs a special inventory managing for the following reasons: The Nike running shoes have existed for many years and it had effectively passed through the developmental stages of the product life cycle. It is definitely designed with a midsole that features a triple density foam provided with a Stock fit medial post to decrease over pronation and then provide a cushioned ride to enhance everyday training. But to prevent any kind of blisters or related pains  resulting in effects of sore feet and the legs, this product is manufactured to address these issues and ensure a safe use during related activities. I feel very happy to run the sales of this product, though there are challenges faced by many retailers of this product. It could be returned through the websites or any accredited Nike store. NIKE, Inc. is a family of brands. (2012, September 14). The product brand is Nike running shoes which come in different categories. The thought of this recently executed stock control programming was to anticipate which items they would offer the most, and along these lines set up the appropriate measure of supply to take care of the demand. Their logo has gone so globally recognize with respect to the quality of products they manufacture. The shoes are designed to fit for Men, Women, Grade School, Pre school, and Toddlers. Branding is an important aspect of the market that creates and defines the identity of an organization, business or company. Brand is something that surrounds a lifestyle, provides customers with something to identify with, and then offer a product with meaning and considerable substance. (2015). It also helps to know exactly the weight of the items. Additionally, if items are kept for a longer time, it wouldn’t be possible to request for newer items. Key Responsibilities • Provide subject matter expertise in the development and deployment of the future-state capabilities necessary to execute GC’s strategic vision • Identifies the GC-specific gaps and requirements to support the critical capabilities needed for Nike’s future strategic vision This product is a footwear, though it’s designed for athletic activities, which definitely makes it a seasonal product. The efficient management of sourcing strategy obtained Nike to manufacture goods as low cost and thereby its market share and profitability increased. We see the rise of such concepts already. As a result, I’m good dealing with this product and will always ensure the ethics of the business is strictly adhered to. Choosing the best key-words of the product title and description will help the item on the first selections on the internet, making it easier to be located. This brand is a very reliable, supportive and durable fit that is an improved quality over its predecessors. Based on historical sales data of different products, and based on some market growth estimates, Nike would first prepare a demand forecast for different families of products. First they would produce a demand forecast and based on that forecast, they would prepare a manufacturing plan. View job description, responsibilities and qualifications. (2015). Save my name, email, and website in this browser for the next time I comment. These will be based on intellectual capital-brands, technology, new product development, new channel strategies-with operations activities largely outsourced. Converse also offers running (Athletic) shoes, chucks, sneakers, clothing, eyewear, and boots. In Nike’s situation, however, they ran into some serious software implementation issues  – bugs, and data errors – which resulted in incorrect demand forecast. Nike’s case illustrates just how crucial it is to manage your inventory and your inventory management system properly, irrespective of whether you are a small, medium or large business. The major purpose of this product is to provide the characteristics of shoes while performing athletic activities. And as a result, it has had difficulty keeping inventory under control. Retrieved October 25, 2015, from http://www.runningwarehouse.com/Nike_Zoom_Structure_19/descpage-NZS19M1.html, The Manufacturing Practices of Nike and its competitors. Most especially high levels of inventory, they lead to higher insurance costs. Safety stock will guide against these factors and would keep the business running on. It features an advanced and attractive fit that takes into consideration a 100% guarantee of comfortability. The company suffered a severe loss of profit in 2001 because of the failure of the system designed for specific purpose. Nike has excellent supply chain management, which facilitates efficient production to support the global sports shoes, apparel and equipment business. I2's supply-chain software is designed to improve the management of inventory, production, shipping, and sales forecasting. Retrieved October 25, 2015, from http://www.purelybranded.com/insights/why-a-good-brand-is-important-to-your-marketing-strategy/. Obsolescence: Manufacturers of items such as Nike running shoes produce different trends of shoes overtime, when the particular ones stored up are kept for too long, they may lose value and become old in trend. At NIKE, Inc., we believe in pursuing greatness everywhere: on the field, on the court, on the beach and on the street. Adidas is another brand that offers running shoes, apparel, and accessories. Therefore, it is in its maturity stage because it had thrived successfully in the market. Problems faced by nike in Inventory management and supply chain management Nike Inc To explore ideas and apparatuses used to successfully oversee tasks, let us consider an association that has experienced issues with the management of their worldwide supply chain before. When these occur, safety stock would help balance the business. In a more specific term, the sizes occur in Small, Medium, Large, Extra Large, etc. Inventory Manager salaries at NIKE can range from $21,185 - $119,198. Also, it would cost more having to keep items in stock for a longer time. Retrieved November 27, 2015, from http://www.marketing91.com/benefits-and-limitations-of-product-life-cycle/, Get Help. Their products are environmentally responsible. Retrieved October 25, 2015, from http://runrepeat.com/ranking/rankings-of-reebok-minimalist-running-shoes, Why a Good Brand is Important to Your Marketing Strategy. The statistics of the outstanding success of Nike from Forbes posts and other related posts have been fantastic. As one of the most recognized athletic brands in the world, Nike has a lot of goods to manage. Minimum order quantity of the Nike running shoes should be 2,500 pairs of Nike running shoes. Retrieved October 25, 2015, from http://www.eastbay.com/Nike/Running/Shoes/_-_/N-x7Z1dwZne, Nike Zoom Structure 19 Men’s Shoes Crimson/Volt/Green. However, the Nike running shoes are the best products to deal with. The retail prices of these competitions vary with respect to the competition individual differences. (2014). However, it depends relatively. Safety stock is very important to this product. Plus, continued innovation and … Retrieved November 27, 2015, from http://www.deq.state.or.us/lq/pubs/docs/sw/packaging/csnikeshoebox.pdf, The Product Life Cycle: Managing Your Product to Maximize Success. (2015). The company lost around $100 million in sales due to these issues. Business cannot thrive successfully if there are no measures prepared to ensure the proper management of product purchase and inventory. Also, buyers who require that the shoes be shipped to them, probably if they purchase it over the internet, then delivered it to them in the box. Here’s what happened to Nike and how the company recovered: In 2001, Nike implemented an updated version of their inventory management software. We may not look or act the same, but we all share the same drive for greatness. For the buyers, the storage of the running shoes is based on high volume with high frequency shipments. For the end consumers, a pair of shoes is stored in the box, and sold to directly. The importance of Nike as a unique brand is narrowed down to how excellent they have refined themselves and their products, especially as an athletic and fitness company; not just like any other shoe company. Retrieved November 27, 2015, from http://www.scanco.com/top-five-benefits-of-a-good-inventory-management-strategy/, Wholesale Shoes – Shoenet.com Home page | Your leader in Wholesale Shoes, Shoes Wholesale, Wholesale Products, Wholesale Handbags, Wholesale Purse, Handbags Wholesale, Wholesale Bags, Brand Name Shoes, Overstock Shoes, Customer Return Shoes, Wholesale Fli. Financial impact: This has a big financial impact on the inventory management team. A full understanding of product cycle enlightens me as a buyer of the development process of a particular product, whether to venture into it or not. Annually, the product sales are growing effectively and the rate of increase is tremendously reasonable. The paper also identified the errors of Nike and recommended a change in their strategies of operation man… For colors: The product occurs in Black/Cool Grey/Anthracite, Neutral Grey/Bright Crimson/Dark Grey, Black/White/Persian Violet/Ink, Black/Anthracite/Black, Black/White/Black, Pure Platinum/Game Royal/Cool Grey, Wolf Grey/Black/Dark Grey/Pure Platinum, Wolf Grey/White/Cool Grey/White, Midnight Navy/Neutral Grey/Dark Obsidian, Black/Lyon Blue, White/Court Purple/Yellow, White/Black/Lyon Blue/Bold Berry, Black/White/light pink/Retro, Black/Metallic Silver, Soar/Volt Green Strike, Bright Crimson/Black/Dark Grey, Vivid oink/Black/Pink Powder/white, laser Orange/Black/Bright Crimson, Black/Metallic silver/University Red, Red/Metallic Silver/Bright Crimson, etc.