however, the forces and corresponding external factors enumerated in this five forces analysis must remain among the strategic considerations of nike inc. nike inc. enjoys a top position in the global athletic shoes, equipment and apparel market. there are a wide variety of external factors that determine the strengths or intensities of forces impacting nike inc. however, based on this five forces analysis, the following are the intensities of these forces currently influencing nike’s performance and industry environment in the athletic footwear, equipment and apparel market: recommendations. this element of the five forces analysis shows how competition influences the industry environment and the performance of individual firms.
based on this element of the five forces analysis, the external factors that lead to strong competition requires nike inc. to focus on market development and product development to ensure competitive advantage and a growing share in the global athletic shoes, apparel and equipment market. this element of the five forces analysis shows that the force of customers is a major consideration in nike’s strategies for the athletic footwear, apparel and equipment market. this element of the five forces analysis identifies the force of substitution on the business and the industry environment. nonetheless, this element of the five forces analysis shows that substitutes exert only a moderate force against nike inc. new entrants or new firms can disrupt nike’s industry environment.
nike is a multinational organization based in america that deals in the design, development, manufacturing, and marketing of the different apparel, footwear, and equipment. the competitive rival is intense because of the presence of multiple international level companies that are in direct competition with the nike. nike is the leading company in sports apparel in the us with an 18.3 percent market share while the adidas holds 6 percent of the market share (statista, 2019). the bargaining power of suppliers for nike is low because nike is an international brand and the suppliers look for a company like nike to attach with. the bargaining power of buyers is moderate because the high-end sportswear and accessories based companies are available in moderate numbers. the strong brand name of nike is another factor that keeps the bargaining power of the buyer at a moderate level as brand affiliation and loyalty takes the nike to the dominant position (lee & gereffi, 2015). opening a business of nike size is difficult but the local and small manufacturers have direct competition with nike and it is not possible to ignore them.
there is no doubt that the target market for those entrants is completely different from the target market of nike but they belong to the same industry with the potential to become a giant at the local level which can directly threaten the existence of nike in a particular region or country. bringing the innovation in the product is not a substitute but it is the up-gradation of the product. this is the reason the threat of substitute is near to zero for nike. jignasa international journal of commerce & management. global value chains, rising power firms, and economic and social upgrading. soccer ball production for nike in pakistan. footwear market share of nike and adidas as of 2017. available at: /statistics/895136/footwear-market-share-of-nike-and-adidas-by-region/ statista.
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