Competition forces Nike to slash 2% jobs, 25% products

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Nike has announced that it will cut about 1400 jobs out of its 70,000+ workforce worldwide. This comes as the athletic brand wants to revamp global operations.

The overhaul is an attempt to speed up product development and refocus on key markets, said CEO Mark Parker. Nike had more than 70,000 jobs at the end of fiscal 2016, suggesting that the cuts could affect about 2% of its employees.

The Beaverton, Ore.-based company also plans to reduce the number of product lines by 25% introducing more selections for the remaining lines, such as Flyknit shoes.

Nike

“This new structure aligns all of our teams toward our ultimate goal – to deliver innovation, at speed, through more direct connections,” said Trevor Edwards, president of the Nike brand unit, which includes the Jordan Brand, Action Sports and Hurley.

Nike, known for its swoosh logo, will make its sneaker-selling apps available in more countries at a time when online sales mean many big retailers and department stores are closing stores. Its various retail operations – Nike.com, retail stores and the loyalty program – will be grouped under a single business unit.

“We’re getting even more aggressive in the digital marketplace,” said CEO Mark Parker.

This “consumer direct offense” – as Nike called the strategy – will also entail paying more attention to sales and shopping trends in 12 key cities where more than 80% of its sales growth will come from in the next three years. They are New York, London, Shanghai, Beijing, Los Angeles, Tokyo, Paris, Berlin, Mexico City, Barcelona, Seoul, and Milan.

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