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Nike
Strategic plan

Prepared to / Prof.Dr. Amr Sukkar

Prepared by
1- Maged Magdy Metwally 21120893
2- Yomna Mohamed Mahmod 21121020
3- Mohr sha Ishak Elashmawy 21121389
4- Nevine Gerges Zaki 21120892
5- Farah Joseph habib 19221141
6- Akram Ahmed Bashir 21124071
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Table of Contents
OF CONTENTS
1. Introduction.............................................................................................................3
2. External Analysis ..................................................................................................4
2.1 PESTEL Analysis “External Macro Environmental Analysis” .................................. 4
2.1.1 Political, Governmental forces .................................................................. 4
2.1.1.1 Stability of Government…………………………………………………………..4
2.1.1.2 Global Warming Legislation………………………………………………………4
2.1.1.3 Trade regulations, tariffs, labor laws, and political stability…………………….5
2.1.1.4 Lobbies ……………………………………………………………………………6
2.1.2 Economic forces………………………………………………………………….7
2.1.2.1 GDP…………………………………………………………………………………7
2.1.2.2 Inflation rate……………………………………………………………………….7
2.1.2.3 Egypt Interest rate…………………………………………………………………8
2.1.2.4 Egypt Unemployment rate………………………………………………………...8
2.1.2.5 Currency devaluation ……………………………………………………………..9
2.1.3 Social forces……………………………………………………………………….9
2.1.3.1 Life Style ……………………………………………………………………………9
2.1.3.2 Culture ……………………………………………………………………………...9
2.1.4 Technological forces…………………………………………………………….10
2.1.5 Ecological forces…………………………………………………………….......11
2.1.6 Legal forces……………………………………………………………………….12
TABLE

2.1.6.1 Contract Law……………………………………………………………………….12

2.1.6.2 Customer Protection Law …………………………………………………………12
2.1.6.3 Patency Law ……………………………………………………………………….12
- PESTEL Issue Priority Matrix ………………………………………………………………..13
2.2 Porter's Five Forces Analysis (Industry Analysis)………………………….14
2.2.1 Competitive Rivalry or Competition with Nike Inc. (Strong Force)………15
2.2.2 Bargaining Power of Nike’s Customers/Buyers (Moderate Force)………15
2.2.3 Bargaining Power of Nike’s Suppliers (Weak Force)……………………….16
2.2.4 Threat of Substitutes or Substitution (Moderate Force)……………………16
2.2.5 Threat of New Entrants or New Entry (Moderate Force) …………………..17

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OF CONTENTS
- Porter’s 5 Forces Issue Priority Matrix………………………………………………………..18
2.3 External Factors Analysis Summary (EFAS)…………………………………..19
2.4 Competitive Profile Matrix ( CPM )………………………………………………..21
3. Internal Analysis…………………………………………………………………………..22
3.1 Value Chain Analysis…………………………………………………………………22
3.2 Internal Assessment – Internal Factor Evaluation Matrix ( IFAS) ……….24
3.3 VRIO Model ………………………………………………………………………………25
3.4 BCG Matrix ………………………………………………………………………………26
3.5 Financial Parameters………………………………………………………………….28
4. Strategy Formulation ……………………………………………………………….......29
4.1 SWOT Analysis………………………………………………………………………….29
4.2 SFAS……………………………………………………………………………………….30
4.3 TWOS………………………………………………………………………………………31
4.4 IE Matrix…………………………………………………………………………………..32
4.5 QSPM………………………………………………………………………………………33
4.6 Vision , Mission and Values………………………………………………………...34
5. Strategic Implementation……………………………………………………………....40
6. Strategic Evaluation & Control ……………………………………………………...41
7. Conclusion…………………………………………………………………………………...45
8. Recommendations…………………………………………………………….46
9. References…………………………………………………………………………………...47
TABLE

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1.Introduction
Nike, a global sportswear giant, has made significant strides in the Egyptian market,
establishing itself as a leading brand for athletes and fashion enthusiasts alike. The brand's
journey in Egypt reflects its global ethos of innovation, resilience, and commitment to
excellence.

1.1 Executive Summary

Nike's presence in Egypt has grown exponentially since its inception. With a focus on
understanding the unique needs of the Egyptian market, Nike has introduced products
tailored to local preferences, while also leveraging its global brand strength. The company's
strategic investments in marketing, retail partnerships, and community engagement have
solidified its position in the country.

1.2 Founding History

While Nike was founded in 1964 by Bill Bowerman and Phil Knight in the United States, its
entry into the Egyptian market came much later. Recognizing the potential of the
burgeoning youth population and the increasing interest in sports and fitness, Nike made its
foray into Egypt. Over the years, the brand has successfully tapped into the country's rich
cultural heritage, intertwining it with its global narrative.

1.3 Corporate Information

In Egypt, Nike operates through a mix of flagship stores, authorized retailers, and online
platforms. The company has also collaborated with local athletes and celebrities to enhance
its brand visibility and resonance. Nike's corporate initiatives in Egypt also emphasize
sustainability, community development, and promoting sports at the grassroots level.

1.4 Nike’s Turnaround

The journey hasn't always been smooth for Nike in Egypt. Like many international brands,
Nike faced challenges related to market dynamics, competition, and changing consumer
preferences. However, the brand's ability to adapt and innovate has been pivotal. One of the
significant turnarounds for Nike was its emphasis on digital transformation and e-
commerce, especially post the global pandemic. By enhancing its online presence and
offering a seamless shopping experience, Nike managed to capture a larger share of the
market. Additionally, localized marketing campaigns celebrating Egyptian athletes and
stories further bolstered the brand's image.
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2.External Analysis

2.1 PESTEL Analysis “External Macro Environmental Analysis”

A PESTEL analysis is a framework that helps to evaluate the external factors that affect a
company’s performance and strategies. It stands for Political, Economic, Social, Technological,
Environmental, and Legal factors. Here is a brief PESTEL analysis of Nike in Egypt 2023 based
on the web search results:

2.1.1 Political, Governmental forces

2.1.1.1 Stability of Government and Nike in Egypt:

- Description: The stability of the government in a country plays a crucial role in determining
the business environment. Egypt has experienced significant political changes in the past
decade, including the Arab Spring in 2011 and subsequent events. These political shifts can
have direct implications for multinational corporations operating in the country.
- Threat: Given the historical political changes and the potential for future shifts, Nike might
face uncertainties in its operations in Egypt. Political instability can lead to abrupt changes in
trade and business regulations, affecting Nike's operations. Additionally, periods of unrest or
security concerns can lead to reduced footfall in retail outlets and potential disruptions in
operations.
- In light of the recent political history of Egypt, Nike needs to be cautious and adaptive in its
approach. It's essential for the company to have contingency plans in place and stay updated
with the latest political developments to navigate potential challenges effectively.

2.1.1.2 Global Warming Legislation and Nike in Egypt:

- Description: Egypt, like many countries, is increasingly recognizing the importance of

addressing global warming and its impacts. The country is focusing on alternative energy
generation options to combat the hazards of climate change. As part of this strategy, there's a
push towards clean energy sources, including nuclear energy, to diversify energy supply and
reduce greenhouse gas (GHG) emissions.
- Threat: The shift towards stricter global warming legislation in Egypt can pose challenges for
businesses, including Nike. The company might face increased operational costs due to the
implementation of sustainable practices in line with the new regulations. Additionally, there
could be potential supply chain disruptions if suppliers are not compliant with the new
environmental standards. The emphasis on reducing carbon footprints might also necessitate
changes in transportation, manufacturing, and distribution processes for Nike.
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2.1.1.3 Trade regulations, tariffs, labor laws, and political stability can have a
significant impact on its business. Some of the political factors that may affect
Nike in Egypt :

• The political situation in Egypt is expected to remain stable and supportive of economic development, as
President Abdel Fattah el-Sisi secured a second term in 2018 and is likely to run for a third term in 2022.
• Egypt has signed several free trade agreements with various countries and regions, such as the European
Union, the United States, the Arab League, and the African Continental Free Trade Area, which could
facilitate Nike’s market access and reduce trade barriers.
• Egypt has enacted several labor laws and regulations to protect workers’ rights and ensure fair working
conditions, such as the Labor Law No. 12 of 2003, the Social Insurance Law No. 148 of 2019, and the
Unified Labor Contract Law No. 206 of 2020 .Nike must comply with these laws and regulations to
avoid legal issues and reputational risks.
• Egypt maintains a balanced relationship with neighboring countries and has many trade agreements with
them, which enhances Egypt's position as a trading center in the MENA Region and Africa.
(Opportunity).
• Nike & BRICS :
- The BRICS is a group of five emerging economies that have been cooperating since 2009 to
foster trade, investment, and development among themselves and with other developing
countries. Egypt is not a member of the BRICS, but it has been invited to attend some of their
summits as a guest country. In 2023, Egyptian Prime Minister Mostafa Madbouly participated in
the 15th BRICS summit in Johannesburg, South Africa.
- One of the possible effects of Egypt's involvement with the BRICS is on its trade relations with
China, which is the largest exporter of athletic footwear in the world. China is also a major
supplier of Nike shoes to Egypt, as well as other countries in Africa and the Middle East.
According to a case study by MIT, Nike has been outsourcing most of its production to
independent contractors in Asia, especially China, since the 1980s. Nike does not own or operate
any of these factories, but it sets the standards and specifications for its products and monitors
their quality and compliance.

Opportunities:

1. Reduced Costs: Strengthened ties with China might lead to reduced tariffs or preferential access for
products manufactured in China. Given that Nike outsources a significant portion of its production to
China, this could mean lower costs for importing Nike products into Egypt.
2. Increased Market Access: As ties strengthen, the Egyptian market could become more accessible to
brands like Nike. As the economic conditions in Egypt improve through partnerships and
investments, the purchasing power of the Egyptian consumer might also rise, leading to a higher
demand for brands like Nike.
3. Supply Chain Enhancement: Strengthened ties with China can potentially streamline Nike's supply
chain processes, especially if logistical and transportation infrastructures between Egypt and China
are developed further.
4. Local Collaborations: Opportunities might arise for local businesses in Egypt to collaborate with Nike
or its Chinese suppliers, whether in distribution, marketing, or other ventures.

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Threats:

1. Political Pressure: As mentioned, Egypt might face pressure from Western countries, particularly the
US (where Nike originates), if it aligns more closely with BRICS policies or interests. This could
place Nike in a difficult position, potentially having to navigate between its home country's stance
and its operational interests in Egypt.
2. Increased Competition: As Egypt strengthens its ties with BRICS nations, other international brands,
potentially even from BRICS countries, might see Egypt as a favorable market, thereby increasing
competition for Nike.
3. Environmental and Social Concerns: Increased production or trading activities can exacerbate
environmental issues such as pollution and waste. Given Nike's past controversies related to labor
rights, there could also be heightened scrutiny over the conditions in factories that produce Nike
products. This is especially important if production scales up to meet increasing demand.
4. Cultural Dynamics: While not mentioned explicitly, cultural dynamics play a role in international
trade and business. Nike will need to be sensitive to the cultural nuances of the Egyptian market,
ensuring that its marketing and product offerings respect local customs and sentiments.
5. Over-reliance on Chinese Production: Over-dependency on production from one source, especially
from a geopolitical powerhouse like China, might pose supply chain risks in the future, especially if
geopolitical tensions rise or if there are disruptions in China's production capacities.

2.1.1.4 Lobbies

 Environmental protection associations.

Where Nike is adopting the environmental sustainability polices, Nike can use the support of the
Environmental protection associations to improve the company image inside the Egyptian market.

There is a good chance to gain the support of pressure group inside Egypt (Opportunity)

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2.1.2 Economic factors:

2.1.2.1 GDP
The Gross Domes�c Product (GDP) in Egypt was experienced upward trend from 2017 with GDP value of
248 UD dollar to 477 billion US dollars in 2022, represen�ng 0.21 percent of the world economy.

2.1.2.2 Inflation rate

The annual urban infla�on rate in Egypt rose to 37.4% in August 2023, up from 36.5% in the previous month,
remaining significantly above the central bank’s target range of 5-9% and compared with market expecta�ons
of 37.1%. It marked the highest level since records began in 1958, due to a low base effect and the further
rise in food infla�on (71.4% vs 68.4% in July), compounded by economic pressures, shortage of foreign
currency and successive devalua�on of Egyp�an pound. On a monthly basis, the CPI grew 1.6%, down from a
prior 1.9% rise and poin�ng to the so�est growth since September 2022. source: CAPMAS, Egypt

The inflation rate over the past 5 years

Due to increasing the infla�on rate, the purchasing power of Egyp�ans will reduce that will nega�vely
affect the investment opportunity. ( threats )

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2.1.2.3 Egypt Interest Rate
The Central Bank of Egypt raised its key overnight deposit rate by 100 bps to 19.25%, pushing the key rate to
1992 levels high in its August 2023 mee�ng, in a surprise move as market expected no change. The decision
was made to curb infla�onary pressures and anchor infla�on expecta�ons and the MPC reiterates that the
future path of policy rates will depend on the func�on of forecasted infla�on rather than prevailing infla�on
rates. The annual infla�on rates con�nued to be affected by persistent supply shocks, increasing to record
35.7% in June 2023 from 32.7% in May 2023. The commitee will con�nue to monitor all incoming
developments underlying the economic outlook and will not hesitate to u�lize all its available tools to ensure
that the policy stance is set at sufficiently restric�ve levels to bring the CBE's upcoming infla�on targets of 7
percent (± 2 percentage points) on average by 2024 Q4. source: Central Bank of Egypt

The increase in the interest rate forms an obstacle for businessmen to develop their businesses ( threats )

2.1.2.4 Egypt Unemployment Rate

Unemployment Rate in Egypt decreased to 7 percent in the 2023 from 7.40 percent in the 2022. source:
CAPMAS, Egypt ( Opportunities )

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2.1.2.5 Currency devaluation

Egypt is facing difficult economic condi�ons as a result of the ongoing instability in the Middle East, as well
as the effects of the climate change and the water crisis that put pressure on the local currency, the Egyp�an
Pound, which has slid by more than 20 percent against the United States’ Dollar as of Thursday 14,
September, reaching an all-�me low at EGP 30.95 for every USD 1. Egypt experienced another devalua�on in
2016 that decreased NIKE sales in the Egyp�an market by 30 percent to 200 million in 2017, which reinforces
the expecta�on that NIKE will be exposed to sales reduc�on inside the Egyp�an market in 2023. According
to Sta�sta, NIKE’s global revenue amounted to about 51.22 billion U.S. dollars in 2023, which is an increase
of approximately 4.5 billion compared to the previous financial year.However, this growth was mainly driven
by other regions such as North America, Greater China and Europe, while the Middle East and Africa region
saw a decline of 7 percent on a currency-neutral basis.NIKE’s strategy to cope with the currency devalua�on
and the economic challenges in Egypt is to focus on its digital leadership and innova�on, as well as to leverage
its strong brand recogni�on and loyal customer base. NIKE also plans to op�mize its pricing and product mix,
as well as to reduce its opera�ng costs and inventory levels in order to improve its profitability and cash flow
in the Egyp�an market. ( threats )

2.1.3 Social factors:

2.1.3.1 Life Style

The Egyp�an society is experiencing a change in its life style as following.

• Wearing international brands has become an important feature within the Egyptian society to show
belonging to a high social segment.
• Spreading of GYM and SPA Centers.
• heading to the mega mall to spend their time and purchase their needs instead of heading to the individual
shops and traditional markets.

Comments:
The Egyp�an life style is suppor�ng the sportswear industry and business (Opportunity)

2.1.3.2 Culture

- Ethnic
 Generally, Egypt is quite a homogeneous society, with 99.6% being ethnically Egyptian.
- Language
 Arabic is the official language, and the main foreign languages taught in schools, by order of
popularity, are English, French, German and Italian.
- Religion
 Egypt is a predominantly Sunni Muslim country with Islam as its state religion. An estimated 85–
90% are identified as Muslim, 10–15% as Coptic Christians, and 1% as other Christian
denominations
 The majority of the Egyptian people still adhere to the customs and values derived from the
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teachings of the heavenly religions such as
o Maintaining family relationships and respecting elders
o The majority of the Egyptian people are conservative; they do not allow sexual relations beyond
the scope of legal marriage.
o Homosexuals are not recognized and have no rights in Egypt.

Over the past years, Egypt has witnessed an increase in divorce rates, Divorce cases reached 245,777 in 2021
compared to 222,036 cer�ficates in 2020, recording an increase of 14.7 percent.

2.1.4 Technological Factors

Nike’s technological innovation and competitiveness are determined by the technological advancements and
disruptions in its industry and markets. Some of the technological factors that may affect Nike in Egypt 2023
are:

1. Egypt has invested heavily in developing its information and communication technology (ICT)
infrastructure and capabilities, such as launching the first Egyptian-made satellite in 2019, expanding its
fiber-optic network coverage, and establishing several technology parks and innovation hubs. These
developments could enhance Nike’s operational efficiency and digital transformation in Egypt.
2. Egypt has also witnessed a surge in e-commerce activity and online retailing amid the COVID-19
pandemic, as more consumers shifted to online shopping for convenience and safety reasons. This trend
could benefit Nike’s e-commerce strategy and online sales in Egypt.
3. Egypt has adopted various laws and regulations to regulate the technological sector and protect
intellectual property rights (IPR), such as the Cybercrime Law No. 175 of 2018, the Data Protection
Law No. 151 of 2020, and the Intellectual Property Rights Law No. 82 of 2002. Nike must adhere to
these laws and regulations to avoid legal disputes and safeguard its technological assets.
4. The ministry also launched in 2020 “Our Digital Opportunity” initiate to engage with SMEs in the
digital transformation process. The ministry’s Digital Egypt Project aims to supply all government
entities with fiber-optic cable connections. This process has been completed in 5,300 government
buildings across Egypt, and when completed will connect some 32,000 buildings at a total cost of 6
billion Egyptian Pounds (approximately $375 million).
5. The New Administrative Capital (NAC), 30 miles east of central Cairo, is expected to eventually house
most central government offices, with a target move-in date of mid-2021. The government is planning
for the NAC to be a “Smart City,” and is investing heavily in the new city’s telecommunications and
ICT infrastructure. The first phase of “Knowledge City,” which will be located inside the NAC, is
completed. It will include applied research centers for technology to facilitate technical training,
software and applications development, and data design. The Knowledge City is estimated to cost a total
of 12 billion Egyptian Pounds ($750 million). Within the city, they are planning to establish Creative
Innovation Hubs that will provide technical assistance to promote innovation and entrepreneurship.

The Ministry is also working on developing six technology parks in the cities of Minya, Menoufiya,
Mansoura, Sohag, Qena and Aswan. These parks are aimed at supporting entrepreneurship and
innovation and will consist of hardware design labs, startup incubators and training institutions and

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integrated systems for AI training, data science, and cybersecurity. The ICT industry in Egypt is
managed by MCIT. It oversees the following organizations:
o National Telecom Regulatory Authority – NTRA
o IT Industry Development Agency – ITIDA
o Egypt Post
o Information Technology Institute – ITI
o National Telecommunication Institute – NTI
o Smart Villages

Comment:

The improvement of the ICT sector supports the online purchasing and facilitate the business process
(Opportunity)

2.1.5 Ecological Analysis

• Over the past years, Egypt has been suffering from an increase in pollution, which prompted the
government to take a package of measures to prevent the crisis from worsening and preserve the
environment.
• According to World Bank estimates, the environmental degradation resulting from air pollution costs Egypt
about 5% of the annual GNP, or about $2.4bn annually.
• However, there is interest from the government in environmental affairs, hosting COP 27 conference and
developing laws to protect the environment, at the popular level we find that environmental awareness is
low and there is not enough interest from citizens in environmental problems.

Where NIKE’s sustainability policy matching with the goals of the Egyp�an government toward the environment,
there will be an opportunity for NIKE to gain the government support for any business development inside Egypt.
(Opportunity)

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2.1.6 Legal factors

Despite the availability of many professional law firms that can provide the consultancy service, we have to be
aware of the four Main Lows that important for our business are Contract law, Customer protec�on law,
Compe��on law and Patency law.

2.1.6.1 Contract law

• Egyptian law is obligated to protect the contractual rights of individuals or entities in accordance with the
signed contracts, unless it violates any of the country’s laws.

• However, Contract enforcement is not very efficient in Egypt. The issue still stands out in all major business
environment appraisal reports as one of Egypt’s main obstacles. In the World Bank’s 2010 Doing Business
Report, Egypt is ranked 148th in enforcing contracts, with no particular improvement over the past three
years. This measurement, which factors in how many days and procedures it takes to enforce a
presumptive contractual right, and what cost, shows that Egypt is seriously lagging behind some of its peers
in the MENA region.

• For example, it takes 41 different procedural steps and 1010 days for a contractual party to enforce its legal
right in Egypt, while in Morocco (ranked 108th in enforcing contracts) 40 steps and 615 days are required.

2.1.6.2 Customer Protection Law

• The Law on Protection of Competition and Prohibition of Monopolistic Practices in Egypt was promulgated
by Law No. 3 of 2005 and its Executive Regulation. The aim of the law is to ensure economic activity does
not prevent, restrict or damage the freedom of competition. The law sets out a number of rules that
regulates the economic activity of persons dealing in the relevant market.

2.1.6.3 Patency Law

• Patents are protected by Law no. 82/2002, it takes approximately 3 years for either approving or rejecting
the request.

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PESTEL Issue Priority Matrix
3- Inflation rate.
1- Egyptian IT sector 4- “Sociocultural” Egypt
is expanding
High
new life styletrend.
2- Interest Rate. 5- Environmental
regulation & Go Green
initiative.

1. Taxation.
Medium

1- GDP.
Probability

1- Income. 2. Currency devaluation

1- Competition Law.
Low

2- Consumer 1- Political
protection Instability.
Law.

Low Medium High

Impact

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2.2 Porter's Five Forces Analysis (Industry Analysis)

Nike: is examined in this Five Forces analysis (Porter’s model), in terms of the intensity of compe��ve
rivalry, customers’ bargaining power, suppliers’ bargaining power, the threat of subs�tu�on, and the
threat of new entry in the industry environment. These five forces are compe��ve forces based on
external factors that shape the spor�ng goods company’s strategies. Strong compe��on affects the
atainment of Nike’s corporate mission statement and corporate vision statement. This Five Forces
analysis reflects external trends impac�ng the growth of the sports shoes and equipment business
organiza�on. Such trends relate to the PESTEL/PESTLE analysis of Nike Inc. For instance, economic
trends influence compe��on among manufacturers and sellers of sportswear.

Nike’s market position as a leading global business depends on strategic effectiveness in addressing
the five forces affecting the industry environment. The external forces of competitors, buyers,
suppliers, substitutes, and new entrants challenge the athletic shoes and apparel company. The
business strengths enumerated in the SWOT analysis of Nike Inc. help overcome such challenges
noted in this Five Forces analysis.

 Overview: Porter’s Five Forces Analysis of Nike Inc.

Based on the sporting goods industry and external factors examined herein, this Five Forces analysis
determines the following intensities of the forces that define Nike’s competitive situation:

1. Competitive rivalry or competition – Strong force

2. Bargaining power of buyers or customers – Moderate force
3. Bargaining power of suppliers – Weak force
4. Threat of substitutes or substitution – Moderate force
5. Threat of new entrants or new entry – Moderate force

The intensities of the five forces indicate a competitive market, with rivalry among incumbent
companies, like Nike Inc., strongly influencing the industry. This competitive analysis shows that the
sporting goods company must prioritize competition and place the least priority on the bargaining
power of suppliers, although all five forces are significant in strategic planning. For example, to
address competitive rivalry, Nike’s generic strategy for competitive advantage and strategies for
intensive growth can focus on product development to integrate the latest technologies and advances
in materials, such as rubber and textiles. This approach can increase the desirability and profitability
of the company’s sportswear and equipment. Moreover, Nike’s organizational culture or corporate
culture can enhance service quality at company-owned Nike Town stores, as part of strategies to
attract and retain more customers. This Five Forces analysis describes competitive challenges,
although the industry remains attractive, especially for innovative sporting goods businesses.

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2.2.1 Competitive Rivalry or Competition with Nike Inc. (Strong Force)

Competition among sportswear firms determines market share. This element of the Five Forces
analysis shows how competition influences the industry environment and the performance of athletic
shoes and equipment businesses. The following external factors create the strong force of
competitive rivalry in Nike’s case:

• High marketing aggressiveness of sporting goods firms (strong force)

• Large number of shoes, equipment, and apparel companies of various sizes (strong force)
• Low market growth rate (strong force)

Nike faces the aggressive marketing strategies of competitors, such as Puma, Adidas, Under Armour,
ASICS, New Balance, and Lululemon. Many large, medium, and small companies saturate the athletic
shoes, apparel, and equipment market. In Michael Porter’s Five Forces analysis model, this external
factor imposes a strong force on Nike Inc. Furthermore, the low market growth rate linked to market
saturation makes the sporting goods industry a strategically challenging business environment. Nike’s
marketing mix or 4P counteracts the strong force of competitive rivalry resulting from the above-
mentioned external factors.

2.2.2 Bargaining Power of Nike’s Customers/Buyers (Moderate Force)

Customers affect Nike’s sales performance. This element of the Five Forces analysis shows how
buyers or consumers influence business competitiveness in the industry environment. The following
external factors contribute to the moderate bargaining power of customers on Nike:

• Low to moderate buyer switching costs (moderate force)

• Moderate availability of substitutes to Nike’s sporting goods (moderate force)
• Low buyer concentration (weak force)

Low to moderate switching costs make it easy for customers to buy from Nike’s competitors. The
moderate availability of substitutes also enables customers to buy alternative products, such as non-
athletic footwear, instead of buying from the company. In the Five Forces analysis framework, this
external factor equates to the moderate bargaining power of buyers on Nike’s business. Easy access
to brick-and-mortar and e-commerce businesses adds to the strength of customers’ power. However,
the low buyer concentration reflects the small size of individual buyers and their sportswear
purchases, which weakens buyers’ influence on Nike and leads to the overall moderate force of
customers’ bargaining power in this Five Forces analysis.

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2.2.3 Bargaining Power of Nike’s Suppliers (Weak Force)

Suppliers affect sportswear companies’ access to materials. This element of the Five Forces analysis
tackles suppliers’ influence on sporting goods firms. In Nike’s case, the following external factors
create the weak bargaining power of suppliers:

• High supply availability for sporting goods manufacturing (weak force)

• Low to moderate supplier concentration relative to Nike (weak force)
• Moderate number of suppliers (moderate force)

High availability of supply weakens the bargaining power of suppliers on the company’s access to
materials. Also, the low to moderate supplier concentration means that many suppliers are relatively
small in comparison to the sporting goods giant’s supply chain. The Five Forces analysis model relates
these external factors to the weak force of suppliers on Nike’s business environment. On the other
hand, the moderate number of suppliers equates to their moderate bargaining power over sporting
goods businesses. The combination of these factors leads to the weak bargaining power of Nike’s
suppliers.

This element of the Five Forces analysis shows that suppliers’ power is a low-priority issue for the
sports shoes and clothing company. Nike’s organizational structure or corporate structure affects
supply chain management and how suppliers use their bargaining power on the company. In relation,
improving Nike’s corporate citizenship status may enhance relations with suppliers, who may want to
improve their own corporate social responsibility statuses in collaboration with the company.

2.2.4 Threat of Substitutes or Substitution (Moderate Force)

Substitutes can reduce Nike’s market share. The Five Forces analysis model considers substitution as a
contributor to the weakening of firms in the sporting goods industry environment. The following
external factors contribute to the moderate force of the threat of substitution against Nike:

• Moderate availability of substitute shoes, apparel, and equipment (moderate force)

• Moderate price-performance ratio of substitutes (moderate force)
• Low to moderate buyer switching costs between sporting goods and substitutes (moderate
force)

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The moderate availability of substitutes imposes a moderate force against Nike, as customers have
alternatives, such as non-athletic footwear and casual clothing. Also, many substitutes have a
moderate price-performance ratio, which means that alternative shoes and clothes have considerable
quality and performance that satisfy customers. In the Five Forces analysis model, these two external
factors lead to the moderate threat of substitution against firms competing in the sporting goods
industry. Furthermore, the low to moderate switching costs mean that customers can switch from
Nike products to substitutes with relative ease. Thus, the combination of the external factors in this
element of the Five Forces analysis makes the threat of substitution a moderate force on the sporting
goods company. In this regard, the product design component of Nike’s operations
management focuses on product improvement to address the threat of substitutes.

2.2.5 Threat of New Entrants or New Entry (Moderate Force)

New entrants or firms disrupt Nike’s industry environment. This element of the Five Forces analysis
identifies the extent of new entrants’ competitive influence in the sports shoes, apparel, and
equipment market. The following external factors create the moderate threat of new entry against
Nike Inc.:

• High cost of brand development (weak force)

• High economies of scale in sporting goods production (weak force)
• High-level access to distribution channels (strong force)

Strong brands, like Nike, are costly to develop, with brand development efforts often involving
advertising and sponsorship. Also, high economies of scale in manufacturing sporting goods challenge
the growth of new entrants. In the Five Forces analysis model, these two external factors are barriers
that weaken the threat of new entry against Nike and its competitors. However, new entrants can
access advertising and distribution channels for their athletic products. For example, new firms can
distribute their products through Amazon, Costco, Walmart, Home Depot, Target, and eBay; reach
target customers through apps on Apple’s App Store and Google Play; and advertise on Facebook,
Google, and other networks. The combination of the external factors in this element of the Five
Forces analysis leads to the moderate threat of new entry against Nike Inc.

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Porter’s 5 Forces Issue Priority Matrix
1-Comperitive rivalry

High
or competition.

2-Bargaining power of buyers

or customer.

4-Threats of substitutes or
Medium

substitution
Probability

5-Threat of new entrants or

new entry.

3- Bargaining
Low

power of suppliers.

Low Medium High

Impact

From the above Porter’s 5 Forces IPM, the most important factor which should be
taken into considera�on is the rivalry power of compe�tors.

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2.3 EFAS Analysis

Weighted
# Factors Weight Rating
score
Comment

Opportunity
1 Relationship with neighboring countries 0.05 4 0.2 O5
2 Lobbies Support 0.02 3 0.06
3 NIKE’s sustainability policy 0.11 4 0.44 Q3
4 life style is supporting the sportswear industry 0.015 3 0.045
5 Technological factors - Growth in ICT sector 0.02 4 0.08 O4
Legal factors – Customer Protection Law- It has been established
7 0.01 3 0.03
and effectively applied in 2006
Competition Law - the law is to ensure economic activity
8 0.01 4 0.04
does not prevent, or restrict the freedom of competition
Low bargaining power of supplier O1
9 0.08 4 0.32

Threat
14 Political Factors – Corruption 0.05 1.5 0.075 T5
15 Government instability 0.01 3 0.03
Economic Factors – High inflation rate reduce the purchasing
16 0.075 2 0.15
power inside the Egyptian market
Economic Factors – High interest rate form an obstacle for
17 0.075 1.5 0.1125 T4
business development
Economic Factors – currency devaluation will reduce the
18 0.1 2.5 0.25 T3
purchasing power inside the Egyptian market
Economic Factors - implementing some polices & procedures
19 0.11 1 0.11 T1
hinder the import of Final-made products
20 Porter’s 5 Forces analysis – High risk of New Entrant 0.1 1.5 0.15 T2
21 High risk of Competitive Rivalry 0.04 3.5 0.14
22 Legal factors – Contract Law is not very efficient in Egypt 0.05 2.5 0.125
Legal factors – Patency Law – it takes approximately 3 years for
23 0.02 1.5 0.02
either approving or rejecting the request
Moderate bargaining power of Buyer
25 0.015 3 0.045

Moderate risk of substitute product O2

26 0.04 3.5 0.14

Total Score 1 2.56

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Comments :
• Nike is doing slightly beter than "Below Average" (2) in responding to its external
environment, but it hasn't yet reached an "Average" (3) level of performance.
• There are opportuni�es for improvement, and the company may need to focus more
on leveraging external opportuni�es or mi�ga�ng external threats to move closer to
an "Average" or "Above Average" ra�ng.
• Nike's current strategies are somewhat effec�ve but not fully op�mized according to
the external factors considered in the EFAS table.

Based on the total EFAS score of 2.56 and the typical Thomas Rating interpretation, here are some strategic
suggestions for Nike:

 Focus on High-Impact Opportunities

 Nike should prioritize the opportunities with higher weights and ratings, such as sustainability
policies or relationships with neighboring countries. Investing more resources into these areas
could yield higher returns.

 Reevaluate Low-Performing Factors

 For opportunities where the rating is low, it's crucial to identify the gaps in the current
strategies. Reevaluation could lead to better alignment with market needs.

 Risk Mitigation
 If there are external threats identified in the EFAS table (not displayed but usually part of
an EFAS), it would be advisable for Nike to develop risk mitigation plans for those
threats.

 Diversification
 Given the score, diversifying into different markets or product lines could be a good way
to mitigate risks and take advantage of untapped opportunities.

 Market Research
 Conduct more market research to better understand customer needs, preferences, and
pain points in different geographical or demographic segments. This will help in tailoring
products and marketing strategies more effectively.

 Enhance Brand Equity

 Continue to build on brand reputation and customer loyalty through CSR initiatives,
high-quality products, and effective marketing campaigns.

 Digital Transformation
 Embrace technological solutions for better customer experiences, supply chain
management, and data-driven decision-making.

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 Collaboration and Partnerships
 Form strategic partnerships with other companies or governmental bodies to gain a
competitive edge. Collaboration could be in the form of co-branded products, distribution
partnerships, or joint marketing campaigns.

 Continuous Monitoring
 Periodically review the EFAS table to update it with new data and insights. This will help
Nike adapt its strategies to a changing external environment.

By taking a multi-faceted approach to improvement, Nike has the potential to increase its total EFAS score and
improve its strategic position in the external environment.

2.4 Competitive Profile Matrix (CPM)

Competitive Profile Matrix (CPM)

Critical Success Factor

Nike Adidas Puma Rebook Under Armour
Weight

Score Weighted Score Weighted Score Weighted Score Weighted Score Weighted
score score Score score score
Price competitiveness 0.25 2.1 0.525 2 0.5 2 0.50 3 0.75 3.5 0.875
Customer Loyalty 0.12 3.5 0.42 3.6 0.432 3 0.36 2.5 0.30 1 0.12
Advertising 0.18 4 0.72 3 0.54 3 0.54 3 0.54 3 0.54
Product Quality 0.2 3 0.6 3.1 0.62 2.5 0.5 2.6 0.52 2.4 0.48
Brand Image (Reputation) 0.15 2.7 0.405 3.5 0.525 3.2 0.48 3 0.45 3.5 0.525
Portfolio diversification 0.1 2 0.2 2 0.2 1.8 0.18 1 0.1 1 0.1
Global Expansion 0.1 2 0.2 2 0.2 2 0.20 1.5 0.15 1.5 0.15
Market Share 0.09 2 0.18 2 0.18 1.9 0.171 1 0.09 1 0.09
Financial Position 0.09 3.5 0.315 3.4 0.306 3.3 0.297 2 0.18 3 0.27
Total Score 3.685 3.503 3.228 3.08 3.045

 The competitive profile matrix showing that NIKE company

is in an acceptable to good condition However, the other
competitors also have a good condition that put the
company in risk.

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3.Internal Analysis

3.1 Value Chain Analysis

3.1.1 Primary Activities

3.1.1.1 Inbound Logistic

# Activity S/W
1 Strong Logistic network over worldwide S

3.1.1.2 Operations

# Activity S/W
1 Low Manufacturing Cost S

3.1.1.3 Marketing & Sales

# Activity S/W
1 Strong Brand Awareness and Brand Value S
2 Huge Customer base S
3 Superior Marketing Capabilities S
4 High Market Share S
Dependency on US Market – Even after having established itself globally, Nike still relies on
5 W
the U.S Market in terms of sales and revenue.

3.1.2 Support Activities

3.1.2.1 General Administration

# Activity S/W
1 Aimed For Sustainability S
2 Lack of Diversification: Nike’s over-dependence on sporting apparel W

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3.1.2.2 Human Resource

# Activity S/W
1 Highly qualified In-house Professionals S
2 Poor Labor Conditions in Foreign Countries W
3 Lawsuits W

3.1.2.3 Procurement

# Activity S/W
1 Use recycled material that will reduce the dependence on suppliers S

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3.2 Internal Assessment —Internal Factor Evaluation Matrix (IFAS)

Weighted
Internal Factors Weight Rating
Score
Comments
Strengths
1- Strong brand name. 0.07 4 0.28
2- Nike is the world's largest supplier and
manufacturer of athletic shoes and apparel,
0.03 4 0.12
as well as a major supplier of sports
equipment.
3- Innovative products as they have strong
0.07 4 0.28
R&D.
4- Mass production associated with low
0.02 3 0.06
manufacturing costs.
5- Nike has different products from
0.04 4 0.16
footwear, apparel & accessories.
6- High distinctive quality products. 0.06 4 0.24
7- In-house Professionals. 0.05 4 0.20
8- High Market Share approximately 39% ofthe
global athletic footwear market 0.03 3 0.09
and 13% of global athletic apparel market.
9- Move to zero & forward initiatives 0.06 4 0.24
10- Well stablished company. 0.02 3 0.06
11- Strong reputation. 0.05 4 0.2
Weaknesses
1- Expensive products. 0.15 2 0.3
2- Major focus on footwear only. 0.12 2 0.24
3- Though the company provides a world-
wide service, the company largely depends 0.1 2 0.2
on the North American market.
4- Nike has no online shopping in Egypt. 0.13 2 0.26
Total 1
Total Weighted Score 2.93

 A score of 2.93 suggests that Nike is in a relatively strong position but has room for
improvement, especially in addressing its weaknesses.

Recommenda�ons
• Nike should look into diversifying its product range and reduce dependency on the North
American market.

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• The company could also focus on making products more affordable or introducing
budget-friendly lines.
• Expanding its online presence in markets like Egypt could also be beneficial.

3.3 VRIO Model

Impact on
Resource Valuable Rare Inimitable Organization Competitive
Advantage
Strong POP
Global Yes Yes No Yes Competitive
Presence Advantage
Temporary
Strong R&D Yes Yes No Yes Competitive
Advantage
POP
High Quality
Yes No No Yes Competitive
Products
Advantage
Distinctive
Distinctive
innovative
Products like Yes Yes Yes Yes Competitive
“Air Jordan” Advantage
POP
Customer
Yes No No Yes Competitive
loyalty
Advantage
Temporary
Sustainability Yes Yes No Yes Competitive
advantage
POP
Brand Image Yes Yes No Yes Competitive
Advantage

 So, it is noticed from the VRIO Model that Nike has a distinctive advantage
which is Distinctive innovative Products & two temporary competitive
advantages which are strong R&D, new sustainable recycled products & move to
zero & renewable energy initiatives.
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3.4 BCG Matrix

BCG stands for Boston Consul�ng Group, which is a

management consul�ng firm that helps businesses
analyze their market posi�on and growth strategies using
a matrix that divides products into four categories:
1- Cash cows,
2- Stars,
3- Question marks,
4- Dogs

Nike is a global leader in athle�c footwear, apparel, and equipment, and has different product
segments that can be classified according to the BCG matrix. Here is a summary of what I
found:

3.4.1 Cash Cows

Nike’s cash cows are its hardware, equipment, and apparel products, which have high
market share but low market growth. These products generate more revenue than they
consume and provide cash for inves�ng in other products.

3.4.2 Stars

Nike’s stars are its footwear products, which have high market share and high market
growth. These products generate the highest amount of cash and require constant
innova�on to maintain their posi�on.

3.4.3 Question marks

Nike’s ques�on marks are its brands Converse, Jordan, and Hurley, which have low
market share but high market growth. These products have the poten�al to become
cash cows or stars if they can increase their market share.

3.4.4 Dogs

Nike’s dogs are its golf products, which have low market share and low market growth.
These products do not generate much cash and may be divested or discon�nued.

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Comments

 Nike has a strong compe��ve advantage in the athle�c apparel industry through product
differen�a�on and brand recogni�on. Nike’s value crea�on is based on offering premium
products at a higher-end price and crea�ng an emo�onal connec�on with its customers.
Nike has also expanded its presence in emerging markets, such as China and India, where it
has more room to grow. Nike’s main challenges are the increasing compe��on from rivals
like Adidas and Under Armour, the changing consumer preferences and trends, and the
environmental and social issues related to its supply chain.

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3.5 Financial Parameters

Parameter
Comments
May- May-20 May- May- Industry
Parameters
19 21 22 Average
Current Ratio Although the results show a downward trend in 2022, after
(Current Assets/ Current 2.001 2.481 2.717 2.629 1.72 three yearsof continuous ascent, it still remains higher than
Liabilities ) industry average values, this indicated that the firm has a lot of
money tied up in non- productive assets (Shareholders point of
Quick Ratio view). Creditors point of view,highlights firm ability to cover
1.39 1.59 2.01 1.85 0.79
(Current Assets – short term obligations
Inventory)
/ Current Liabilities
Debt Ratio 61.7% from the company asset are financed by debt and the
(Total Liabilities (Debt) 0.384 1.198 0.737 0.617 - other 38.3% from asset are financed by Equity
/Total
assets)
Gross Margin 44.671 43.421 44.82 45.983 - Since 2020 the gross margin is in increasing trend that confirm
(Gross Profit /Total Sales) Efficient performance of production & logistics

EBIT Margin 12.199 8.328 15.575 14.29 Since 2020 the EBIT margin is in increasing trend that confirm
(EBIT / Total Sales) the efficient operation management performance.

Net Profit Margin 10.299 6.788 12.858 12.943 High combined performance of liquidity, assets and debt
Net Income / Total Sales management on operating results

ROE The ROE is in increasing trend since 2020 and higher that
(Net Profit (Income) / 44.56 31.52 44.857 39.565 31.46 theindustry average confirming high performance
Total
Equity
The ROA is in increasing trend since 2020 and higher that the
ROA 16.987 8.101 15.174 14.994 12.54
(Net Profit (Income) / industry average confirming high performance in
Total managingAssets that facilitates planning for expansion.
Assets
Book Value per Share 5.765 5.17 8.09 9.726 Both Book value per stock and EPS are in increasing trend
since2020 confirming the good performance of the company
Earnings per Share - EPS 2.49 1.06 3.56 3.75
Source Macrotrend

 The financial ratios showing a very strong financial position for NIKE

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4.Strategy Formulation

4.1 SWOT analysis

Internal Factors
Strengths Weaknesses
1. Strong brand name. 1. Expensive products.
2. Nike is the world's largest supplier and 2. Major focus on footwear only.
manufacturer of athletic shoes andapparel, as 3. Though the company provides a world- wide
well as a major supplier of sports equipment. service, the company largely depends on the
3. Innovative products as they have strong R&D. North American market.
4. Mass production associated with low 4. Nike has no online shopping in Egypt.
manufacturing costs.
5. Nike has different products from footwear,
apparel & accessories.
6. High distinctive quality products.
7. In-house Professionals.
8. High Market Share approximately 39% ofthe
global athletic footwear market and 13% of
global athleticapparel market.
9. Move to zero & forward initiatives.
10. Well stablished company.
11. Strong reputation.

External Factors
Opportunities Threats
1. Relationship with neighboring countries. 1. Political factor – Corruption
2. Nike’s sustainability policy. 2. Government instability
3. Life style supporting the sportswear industry. 3. Economic factor – High inflation rate reduce
4. Technological factor – Growth in ICT sector. The purchasing power inside the Egyptian
5. Legal Factor – Customer protection Law market.
6. Low Bargaining power of supplier 4. Economic factor – High interest rate form a
obstacle for business development.
5. High risk of Competitive Rivalry.
6. High Force of new entrant.
7. Moderate risk of substitute product
8. Economic Factor – currency devaluation will
reduce the purchasing power inside
Egyptian market.

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4.2 SFAS

Weighted
Strategic Factors Weight Rating Duration
Score
Opportunities short med long
Relationship with neighboring countries 0.05 4 0.2 x x

NIKE’s sustainability policy 0.02 4 0.08 x

Technological factors - Growth in ICT sector 0.1 4 0.4 x x x

Low bargaining power of supplier 0.08 4 0.32 x x
Total 0.25 1.00

Threats short med long

Political Factors – Corruption 0.05 1.5 0.075 x x x

Economic Factors – High in�lation rate 0.08 2 0.16 x

Economic Factors – currency devaluation 0.1 2.5 0.25 x

Economic Factors - implementing policies &
0.07 1 0.07 x
procedures
Porter’s 5 Forces analysis – High risk of New Entrant 0.1 1.5 0.15 x
Total 0.4 0.705

Strengths short med long

Strong brand name 0.05 4 0.2 x
Nike as the world's largest supplier and
0.03 4 0.12 x
manufacturer
Innovative products with strong R&D 0.02 4 0.08 x x

Mass production with low manufacturing costs 0.02 3 0.06 x

Diverse product range 0.04 4 0.16 x x

High distinctive quality products 0.04 4 0.16 x x

Total 0.2 0.78

Weaknesses short med long

Expensive products 0.09 5 0.45 x
Major focus on footwear only 0.05 3 0.15 x
No online shopping in Egypt 0.01 2 0.02 x
Total 0.15 0.62
Grand total 1.00 3.105

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4.3 TOWS matrix

Strengths (S): Weaknesses (W):

S1. Strong brand name W1. Expensive products
S2. Nike as the world's largest W2. Major focus on footwear
supplier and manufacturer
Internal factors S3. Innovative products with strong only
(IFAS) R&D W3. No online shopping in
S4. Mass production with low Egypt.
manufacturing costs
S5. Diverse product range
External factors S6. High distinctive quality products.

(EFAS)

Opportunities (O): SO strategies: WO strategies:

O1. Relationship with S1O1. Exploit the strong brand to build a W1O2. Focusing on the
multinational marketing campaigns. sustainability and recycling
neighboring countries.
S2O4.Securing a sustainable supply chain and materials within product to give
O2. NIKE’s sustainability
consistent production. more value to mitigate the high
policy. prices.
S3O3. Spreading the innovative competencies
O3. Technological factors - wide awareness through social media. W3O3. Catching the growth in ICT
Growth in ICT sector. S2O2. Having a leading position in sector to cover limited online
sustainability projects. customer service.
O4. Low bargaining power of
supplier.

Threats (T): WT strategies:

ST strategies
T1. Political Factors –
S4T3. Building on the mass production W1T3. Exploring other markets
Corruption capabilities and lower cost to provide with better political and economic
T2. Economic Factors – High affordable quality products to customers with situation to maximize profits.

inflation rate a decreased buying power.

S5T2. The diverse product range could be
T3. Economic Factors –
exploited to minimize the effect of inflation
currency devaluation rate by providing competitive products.
T4. Economic Factors -
implementing policies &
procedures
T5. High risk of New Entrant.

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4.4 Internal-External Matrix (IE Matrix)

External factor evalua�on 2.56

Internal factor evalua�on 2.93

 Where IF and EF score are 2.93 & 2.56 respectively which means that the point will fall in V
square that mean we should Hold and maintain that limiting the strategies to Market
penetration and Product development.

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4.5 QSPM

Retrenchment-
Market Market Product
Acquisition Turnaround
# Factors Weight Penetration development development
strategy
Weighted Weighted Weighted Weighted Weighted
Rate Rate Rate Rate Rate
Score Score Score Score Score
Opportunity
O1 Relationship with neighboring countries 0.05 4 0.2 4 0.2 1 0.05 4 0.2 4 0.2
O2 Nike’s sustainability policy 0.02 4 0.08 4 0.08 2 0.04 4 0.08 4 0.08
O3 Technological factors - Growth in ICT sector in Egypt 0.1 4 0.4 4 0.4 3 0.3 3 0.3 4 0.4
O4 Low Burgeoning power of supplier 0.08 2 0.16 2 0.16 1 0.08 4 0.32 4 0.32
Threat
Political Factors – Corruption
T1 0.05 1.5 0.075 2 0.1 4 0.2 2 0.1 2 0.1
T2 Economic Factors – Hight inflation rate 0.08 2 0.16 2.5 0.2 3 0.24 1.5 0.12 3 0.24
Economic Factors – currency devaluation will reducethe
T3 0.1 2 0.2 2 0.2 3 0.3 2.5 0.25 3 0.3
purchasing power inside the Egyptian market
Economic Factors – implementation policies & procedures
T4 0.07 1.5 0.105 1 0.07 3 0.21 1 0.07 2 0.14
T5 Porter’s 5 Forces analysis – High risk of New Entrant 0.1 2 0.2 1 0.1 2 0.2 1 0.1 2 0.2
Strength
S1 Strong Brand Awareness and Brand Value 0.05 4 0.2 3 0.15 1 0.05 4 0.2 4 0.2
S2 Nike as the world’s largest supplier and manufacturer 0.03 4 0.12 2 0.06 1 0.03 4 0.12 4 0.12
S3 Innovative products with strong R&D 0.02 4 0.08 2.5 0.05 1 0.02 4 0.08 4 0.08
Mass production with low manufacturing costs
S4 0.02 3 0.06 2 0.04 1 0.02 2.5 0.05 4 0.08

S5 Diverse product range 0.04 4 0.16 4 0.16 1 0.04 3 0.12 4 0.16

S6 High distinctive quality product 0.04 4 0.16 3 0.12 1.5 0.06 2 0.08 3.5 0.14
Weakness
W1 Expensive products 0.09 3 0.27 1 0.09 4 0.36 1 0.09 3 0.27
W2 Major focus on footwear only 0.05 2 0.1 2 0.1 2 0.1 1 0.05 4 0.2
W3 No online shopping in Egypt 0.01 1 0.01 1 0.01 3 0.03 1 0.01 1 0.01
Total Score 1 2.74 2.29 2.33 2.34 3.24
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4.6 Vision , Mission and Values

4.2.1 Vision Statement

A company's vision statement indicates how the founders foresee the company to be in
the distant future. It presents a future image of the company upon the realiza�on of its
long-term goals. The Nike vision statement is “to remain the most authen�c, connected,
and dis�nc�ve brand.”

Take note of the explicit use of the term “remain” in the Nike vision statement. This
indicates the company's self-recogni�on that it has already achieved the status of being
the most authen�c, connected, and dis�nc�ve brand in the global spor�ng goods industry
and that its goal is to stay at this spot. No one would dare ques�on this claim as any
market data clearly verifies that Nike is indeed the top-performing company in the
industry today. Thus, the Nike vision statement is targeted to keep the company in this
top posi�on.

4.2.1.1 Authenticity

Over the years, Nike has proven its authen�city in terms of product lines and services.
Nike has always created products that deliver superior performance and exceed the
customer's expecta�ons. It do not simply sell products to generate revenue, but it exert
insurmountable efforts to expand human poten�al at every possible opportunity.

4.2.1.2 Connectivity

The marke�ng strategies of Nike are geared towards crea�ng and maintaining a strong
personal connec�on between each of its consumers. Since the beginning, Nike
Corpora�on has always been people-oriented and focused on the improvement of
people's lives. Nike has several programs that support different sectors of society, making
the company very relatable and keeping Nike posi�vely connected to the market.

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4.2.1.3 Distinction
The journey to the top entailed overcoming a lot of difficult challenges and required
heavy investment, but it has all paid off because Nike is easily the most dis�nc�ve brand
in athle�c shoes and clothing today. Its logo and slogan are known all over the world. As
of the latest 2021 reports, Nike has a brand value of $34.6 billion compared to its closest
rival Adidas which is worth $16.5 billion.

4.2.2 NIKE mission

To bring inspira�on and innova�on to every athlete* in the world.

If you have a body, you are an athlete
do everything possible to expand human poten�al.

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4.2.2.1 Mission Statement

A company's mission statement represents its short-term goals and draws aten�on to
what it intends to deliver in order to achieve these goals. The Nike mission statement
is “to bring inspira�on and innova�on to every athlete in the world.”

If we break this statement down, it is easy to see that the company's mission has three
core components: bringing inspira�on, crea�ng innova�on, and suppor�ng every athlete
in the world. To beter comprehend the Nike mission statement, let us discuss what each
of these components signifies.

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4.2.2.1.1 Bringing Inspiration

Nike's slogan “Just Do It” embodies this component perfectly. With this very simple
catchphrase, the company is able to inspire and mo�vate athletes of all levels to push
themselves beyond their limits and achieve their bodies' maximum poten�al. The
company also has a very efficient marke�ng strategy of using well-known role models in
the sports community to empower the ordinary person, par�cularly the youth, inspiring
them to go into sports and break outside their personal boundaries.

4.2.2.1.2 Creating Innovation

Nike is con�nually making groundbreaking innova�ons in all its products to enable

people to constantly improve their fitness performance and earn accomplishments that
it previously didn't even think possible. A clear example of this is when Nike readily took
on the challenge of enabling a human to run a marathon in under 2 hours, a feat that
has never been accomplished before. There was quite a lot of controversy about this
challenge, with many skep�cs saying it can't be done, but Nike's research and
development team pummeled through. In the end, the highly innova�ve running shoes
created by Nike proved instrumental in taking Kenyan runner Eliud Kipchoge across the
finish line with a �me of 1:59:40.

4.2.2.1.3 Supporting Every Athlete in the World

One of Nike's founders, Bill Bowerman, had released a statement saying that “if you have
a body, you are an athlete.” This is an accurate reflec�on of the company's point of view
that every single person is an athlete, not just professional players or those that have a
natural talent for sports. With this in mind, Nike manufactures sports apparel, shoes, and
equipment meant for a diverse market. The company embraces universality and
provides a wide range of products to athletes of all skill levels, body types, and personal
goals.

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4.2.3 Core Values
Nike's core values define what the company considers to be the most important.
However, Nike consistently strives to become a bigger and beter player in the sports
industry. You can break down this point of Nike’s mission into further four aspects.

4.2.3.1 Community
Just like a team in any sport, Nike believes in the spirit of unity and community. Each
member of the company is equally valuable, and individual contribu�ons are always
appreciated as everyone works together to achieve a common goal.

4.2.3.2 Sustainability
Not many people realize it, but Nike is heavily invested in environmental endeavors, like
its extraordinary efforts in recycling plas�c botles to create sustainable footwear in the
form of its Flyknit technology.

4.2.3.3 Diversity

Nike Corpora�on has built a very diverse and crea�ve interna�onal team that has been
very effec�ve in making the company's compelling presence felt all over the world.
Because of its impressive diversifica�on strategies, Nike products appeal to people of all
ages, races, walks of life, and athle�c backgrounds.

4.2.3.4 Social Responsibility

Along with maintaining its corporate goals, which are depicted in Nike’s mission
and vision statement, Nike never loses track of its social responsibility. In addi�on
to its numerous programs for the awareness and promo�on of environmental
conserva�on, Nike also has a plethora of other programs that align with its core
belief that sports can change the world for the beter.

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5.Strategy Implementation
Product Development Increase our market share by 5 % over the coming 3 years

Action & Time

Function Objective Needs Evaluation
Procedures Year-1 Year-2 Year-3
Find a New products Human
Increase Research
& developed old resources creative employees
& Development Number of
Production Products financial 4.8 million 30% 70% 95%
Department out researches
Take over 5% from Planning 3 years
put
market share Description R&D
Quality Use A New Procedures Human
Assurance for Increase of quality resources QA & QC engineers
& quality to insure raising control team financial 1 million Number of 40% 60% 80%
Quality product to reach 35 person Planning 3 years heired
Control quality by 30% per shift Description quality procedures employees
enhance the sales of Human
Nike products the aim is resources AI Experts
Marketing
to financial 5 million Number of 20% 40% 60%
Campaigns
augment the clientele Planning 3 years people
Marketing using AI Description AI Program subscriptions
Human
resources 15 person
Human Hireing the required Evaluation
Recrutiment plan financial 0.5 million 50% 70% 90%
Resources Skillful employees report
Planning 3 years
Description HR
Human outsource financial
Increase the working resources team
Funding 13.5
Finance capital Financial in house ROI 30% 70% 95%
Million $
by 10% during the next 3 Planning 3 years ROA
years Description profitability

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6.Strategic Evaluation & Control
6.1 Balance scorecard:

Financial Objectives Measures Targets: Timeline/ Metrics

Increase market share Total Revenue Increase 5% in first year
To increase the total yearly revenue Increase the market shares by 5% in the next one year
Introduce products to one of the two Conduct research analysis to Third Quarter
identified new markets find best fit
Reach new audiences in the two Market brand awareness and Reduce the marketing budget by 1%
identified market. effective products using preexisting campaigns

Customer Objectives Measures Targets: Timeline/ Metrics

Increase customer value Increase profit contribution per Increase 5% in first year
customer
To increase customer value to contribution per customer by 5% in the first year
increase the profit
To Introduce online retail shops To reduce the cost of operations and Consolidation and review after 6
transport months
Go through customer feedbacks Monthly basis to address issues the Rollup of quarterly findings to
customers are facing address concerns

Internal Business Measures Targets: Timeline/ Metrics

Process Objectives
Decrease lead times for new Project implementation time frames Decrease time by 3% in first
contract implementation year
To decrease the project Review and revise SOP and workflows to reducing the lead time of new
implementation time frame adjust the process and fill the gaps contract by 3% in the first year
Outsource some of the Reduce the workloads and costs involved 6-month contracts for revision
services to subcontractors with implementing a project and implementation
Increase the number of Reduction in workloads and revised process Increase by 1% during the
projects handled implementation creates room for more current financial period
meaningful work

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Learning and Growth Measures Targets: Timeline/
Objectives Metrics
Decrease employee turnover Facilitate regular training and opportunities for Reduce by 4% in
development first year
Reward and recognize results Create a rewards program with monetary 3 Months
achieved by employees at all incentives
levels
Career development Work with human resources to establish career 6 months
opportunities through ladder development and career track checkpoints
promotional advancements for promotional opportunities
Promote internally instead of Increase employee retention by 10%. Within the next 3
outsource labor years to evaluate
success.

6.1.1 Why are the above objectives appropriate for the project?

6.1.1.1 Financial objective:

Nike's strategic financial manager seeks to identify the most effective strategies to
maximize the organization's market value. Additionally, it makes sure the
organization's plans are accomplished efficiently so it can achieve short-term and
long-term goals and maximize shareholder value. It aims to achieve the business
goals of the organization by managing financial resources.

6.1.1.2 Customer objective:

Customer service's primary goal is to answer customers' questions, resolve support

issues, earn their trust, and maintain relationships. Companies recognize the
importance of customer service, but not all do so. A company must boost its
reputation and maintain customer loyalty to improve customer retention and
increase sales.

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6.1.1.3 Learning grown objective:

Among the primary purposes of the Learning and Growth Perspective is to

understand how the company's intangible assets generate value (Niven, 2018). These
intangible assets consist of human capital, information capital, and organizational
capital.

6.1.1.4 Human capital:

For the business strategy to succeed, employees need to have the necessary
knowledge and skills. Positions that are critical for strategy execution should be filled
with the best people. In other words, these positions should have no skills gap. It
may be necessary to employ training, valid selection procedures, and effective
succession planning to achieve this goal.

6.1.1.5 Information capital

The strategy is carried out using information systems, networks, and infrastructure.
To achieve the strategy's objectives, IT should be aligned properly with technology.

6.1.1.6 Organizational capital:

Managing change effectively across the organization is essential for delivering the
strategy. Leadership teams need to assess their company culture regularly to make
sure it aligns with the company's. Otherwise, you might need to adjust how
employees are rewarded and supported to align their actions with the company's
mission, values, vision, and strategy. Also, the company may need to change the type
of candidates it recruits and selects and alter its training program.

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6.1.2 Why are the metrics and timeline appropriate?

As for the timeline, the companies usually have financial periods that end after one
year, which are subdivided into quarters. Therefore, it is only appropriate to measure
progress after one year when the financial period comes to an end. The other reason
why one year is an appropriate timeline is that the budget is allocated for various
company activities each year. So, if the resources were not enough for a given goal,
more can be reallocated to that activity. The measures are appropriate for one
reason. They are realistic and not very ambitious. The maximum measure has been
5%. This is a very good move.

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7.CONCLUSION

 Based on the strategy report a conclusion incorporate the following points:

7.1 Knowledge City Initiative:

The Knowledge City initiative in Egypt represents a significant investment in the nation's
telecommunications and ICT infrastructure. It is designed to foster innovation and
entrepreneurship, providing a supportive environment through Creative Innovation
Hubs. This development could potentially offer opportunities for companies like Nike to
leverage advanced technologies and a more innovative environment in Egypt.

7.2 Environmental Concerns:

With increased pollution in Egypt, the government is taking steps to mitigate

environmental degradation. Companies operating in Egypt, including Nike, may need to
align with these environmental protection measures and demonstrate corporate
responsibility and sustainability in their operations.

7.3 Nike’s Market Position:

Nike holds a robust market position, with different product segments showing varying
levels of market share and growth. While its footwear segment is thriving with high
market share and growth, other brands under Nike have potential for growth. Nike faces
challenges like stiff competition and changing consumer preferences, necessitating
continuous innovation and adaptation to maintain its market lead.

7.4 Financial Stability:

Although specific financial ratios are not provided, the document suggests that Nike is in
a strong financial position. This financial stability is crucial for driving innovation,
expanding market presence, and navigating through competitive and market challenges.

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8.Recommendations:

 Nike should leverage the opportunities arising from the Knowledge City initiative
in Egypt by possibly investing in innovation hubs or collaborating with local
entities engaged in technology and innovation.

 Given the environmental concerns and governmental measures in Egypt, Nike

should intensify its sustainability practices and perhaps launch initiatives that not
only comply with local environmental laws but also contribute positively to
environmental protection in the country.

 To enhance its market position, Nike should strategically invest in its 'Question
Marks' brands to increase their market share. Continuous innovation and
attention to consumer preferences are vital to maintaining the market share of its
'Stars' segment, particularly the footwear products.

 While the company is financially stable, it’s imperative to continuously monitor

and analyze its financial performance and market trends to make informed and
strategic investment and operational decisions.

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9.References

1. researchandmarkets.com
2. studocu.com
3. panmore.com
4. nike.com
5. about.nike.com
6. thomasnet.com
7. sis.gov.eg
8. https://ijarlg.journals.ekb.eg/article_306477_557688dd14068896cfb01bf630baf
9. exchange-rates.org
10. bcgmatrixanalysis.com
11. iknowfirst.com
12. Niven, P. R. (2018). Balanced scorecard step-by-step for government and
nonprofit agencies. Hoboken, N.J: J. Wiley & Sons.
13. Bright, D. S., Cortes, A. H., Hartmann, E., Parboteeah, P., Pierce, J. L., Reece,
M., Shah, A., ... OpenStax (Nonprofit organization),. (2019). Principles of
management.
14. Due tomorrow: nike project plan powerpoint presentation - risks and |
Management homework help (sweetstudy.com)
15. pestleanalysis.com
16. www.globaldata.com

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