Nike stock: analysis of 5 major suppliers (NKE)

2021-10-27 08:11:11 By : Mr. Shengzhao You

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Nike (NKE) is the world's largest seller of sports shoes and apparel. Its business focuses on product design and development, marketing and sales. The main product categories include running, basketball, Jordan brand, football, training and sportswear. Nike has 1,100 retail stores in the United States and around the world, and approximately 75,400 employees worldwide. In fiscal year 2020, it reported revenue of $37.4 billion.

Nike is supplied by 122 shoe factories in 12 countries. In fiscal year 2020, contract factories in Vietnam, Indonesia, and China produced approximately 50%, 24%, and 22% of Nike brand footwear, respectively. The company has also signed contracts with 329 apparel manufacturers operating in 38 countries. China is its largest source of clothing, accounting for 28%, followed by Vietnam with 23%, and Thailand with 12%.

Nike also relies on technology companies, equipment suppliers, professional services companies and other suppliers to conduct business. The following are a few of the major Nike suppliers operating in countries around the world.

Pou Chen Corporation is the world's largest manufacturer of branded sports shoes and casual shoes. Its customers include Nike, Adidas, ASICS, New Balance and Timberland. It produces more than 300 million pairs of shoes each year, accounting for approximately 20% of the wholesale value of global branded sports and casual shoes.

Baocheng was founded in Taiwan. It has factories in China, Indonesia, Vietnam, Bangladesh, Cambodia and Myanmar. In addition to producing footwear, the company also sells sportswear under its YYSports brand in China, Hong Kong and Taiwan.

PT Pan Brothers is a clothing manufacturer. In addition to Nike, its customer list also includes major brands such as Uniqlo, The North Face, Adidas, Hunter, Lacoste, H&M, J. Crew, LL Bean, Geox, Ralph Lauren, Armani, Prada And Colombia.

The company produces autumn and winter jackets, pants, shorts, slacks, formal shirts, snowboards and ski jackets, polo shirts, golf shirts, sportswear, sportswear and other sportswear in factories throughout Indonesia. The company sells products to Nike through its subsidiary PT Prima Sejati Sejahtera.

Fulgent Sun Group is a sports and outdoor footwear manufacturer based in Taiwan. The company produces shoes in Vietnam, Cambodia and China. In addition to supplying Nike, Fulgent Sun is also a contract manufacturer for other major brands such as Columbia, The North Face, Timberland, Toms and Under Armour (UA). Fulgent Sun has been supplying Nike since 2009.

Delta Galil Industries (DELTY) is a private label clothing manufacturer headquartered in Israel with factories in Southeast Asia. The company produces intimate apparel, socks and sportswear for global brands such as Nike, Victoria's Secret, Calvin Klein, Maidenform, Tommy Hilfiger, Lulu Lemon and Under Armour. Delta Galil also produces private label products for Walmart (WMT), Target (TGT), Marks & Spencer and Amazon (AMZN). Delta Galil produces various apparel products for Nike. It cooperates with Nike to become the strategic development center of American socks

Eagle Nice International Holdings is a manufacturer of down jackets, sweaters, sweatpants and other sportswear. The company is headquartered in Hong Kong and mainly produces clothing in China, Vietnam and Indonesia. In addition to Nike, Eagle Nice also produces products for brands such as Puma and North Face in the Asia-Pacific market. The company reported that its sales in 2019 were HK$2.7 billion, or US$348 million. It did not provide data detailing its business with Nike.

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