Nike Sweatshops Case Study

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A. Executive summary
In this paper we will explore the important issues concerning the Nike Sweatshops in Asian countries. Nike is one of the famous brands for sportswear apparel. Nike was uncovered by an image as a sweatshop operator that takes advantage of workers in Nike Asian subcontractors. The paper looks into detail the ethical problems that Nike and also the important decisions the Company had to make in regards to its operations, followed by the main issues regarding the sweatshops, such as wages of workers, long hours of work and unhealthy work conditions and lastly, the initiatives taken by Nike successful in bringing back its good image.
B. Keywords: Nike Sweatshops, worker exploitation, ethical dilemmas, social responsibility,
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Introduction Nike, Inc. is a supplier of footwear, clothing, sportswear, and equipment supplier based in the United States . Nike came into existence in 1964 as a company and the earlier name of the company was Blue Ribbon Sports. After being in operation for 10 years, Blue Ribbon sports changed its name to Nike in 1978. Nike is the name of the Greek winged goddess of Victory. After “displacing Adidas in the early 1980s and Reebok in the early 1990s, Nike has become the largest and most important athletic shoe company in the world” (Locke, Qin & Brause, 2006). Currently, Nike is a powerful market leader in terms of all aspects of marketing, designing, and distributing superb athletic apparel, footwear, equipment and accessories for numerous sports and fitness activities. Furthermore, Nike is a world-wide known business that operates on six continents. Employs more than 34,000 people and currently sells to over 51,000 retail accounts in more than 120 countries. According to Kochergin (2007), the Company Nike Inc, also includes many wholly-owned subsidiary companies such as:
• Hockey Equipment manufacturer, Bauer Nike Hockey.
• Converse
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in 1978 chaired by Phillip Knight, and eventually Nike outdid its major competitors (Adidas in 1980s and Reebok in 1990s) and became the largest athletic footwear supplier by a long shot ((Locke & Siteman, 2002) .Around the 1970s the American footwear industry became huge. “The demand for athletic footwear grew dramatically through the 1980s and 1990s, and thus began the wave of subcontracting, almost all of it in Asia “(Donaghu & Barff, 1990).” Nike’s entire manufacturing and production facilities have been, and still are subcontracted to Asian factories (Donaghu & Barff, 1990) .Nike’s process of subcontracting began in Japan, and then moved to South Korea and Taiwan in the 1980s “where 86% of all Nike footwear was produced, then to China, Indonesia, Vietnam, Thailand, Cambodia, and the Philippines” (Locke & Siteman, 2002). The reason why Nike moved so much was primarily due to enforced wage increases, import quotas, and ‘flexibility’ issues (Donaghu & Barff, 1990)

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