Nike is a transnational company.
Employs 25,000 people directly and one million others are involved in making, supplying and selling goods.
In 2014, Nike had revenue of $25 billion.
Nike sponsors Lionel Messi, Tiger Woods, Wayne Rooney and Ronaldo. These people are seen around the world wearing the Nike clothing.
Nike Headquarters (Quaternary Industry)
The company headquarters is located in Oregon, USA (a developed country) for the following reasons:
The country has ahigh level of technology.
Highly educated people are available therefore the headquarters can hire expertise.
There is a highly developed transport infrastructure so workers can get to meetings easily.
The USA influences the world in terms of the latest trends and fashion so the headquarters is at the core of this and can pick up ideas quickly.
This is a prestigious location.
Nike Retail (Tertiary Industry)
The goods made in the factories are sold in Nike shops, which are located mainly in southern and western Europe, but also in North America and Asia (and a few in South America and Africa). Sales are highest in Canada, USA and Europe (developed countries).
The main market is in developed countries where customers are more affluent.
In developed countries people are more influenced by adverts they see on TV or computers and are more likely to buy goods with a recognisable label.
Nike Manufacturing (Secondary Industry)
Nike has factories in 40 countries around the world. clothing is mainly made in the Asia Pacific area and footwear in China, Indonesia, Vietnam and Thailand (just 1 per cent of footwear is made in Italy and no clothing or footwear is made in the USA.
The PT Kukdong International factory in Jawa Barat, Indonesia, is an example of a typical secondary industry in a developing country. The factory makes sports clothes, footwear and equipment for Nike. Nike has located its manufacturing here for the following reasons:
Improvements in technology mean that production can be far from Nike's headquarters in Oregon, USA.
Nike can pay lower wages to workers in developing countries.
The factory is already there so Nike can subcontract it and not have to build a factory.
Improvements in transport mean that goods can be manufactured far from the market and then flown or taken by ship to the market.
Access can be gained to markets all over the world.
Trade restrictions can be avoided.
Benefits to the Area
Provide jobs.
Attracts other factories to set up.
Increases Indonesia's wealth.
Provides expert managers.
Increases exports.
Increases skill of Indonesian workforce.
Improves Indonesia's roads.
Uses latest technology.
May provide healthcare benefits for workers.
Problems for the Area
Can cause environmental pollution.
Influences the decisions of the Indonesian government.
Low wages paid to workers.
Encourages poor working conditions.
Indonesia less inclined to develop its own industries.
Workers often sacked without any notice.
Sweatshops can develop.
Benefits
Greater profit for Nike due to low labour costs.
Consumers get cheaper products and greater choice.
Spreads the influence of more developed countries.
Problems
Loss of manufacturing jobs in more developed countries.