Nike gave up on its wholesale partners and bet on direct sales

Nike decided to terminate its existing supply contracts with nine wholesale companies.

Nike, the largest manufacturer of sportswear and footwear, has decided to terminate existing product supply contracts with nine wholesale companies - Zappos, Belk, Dillards, Boscov's, Bob's Stores, Fred Meyer, EBLens, VIM, and City Blue.

As a result, Nike products will no longer be sold in more than 1000 stores. The new strategy of the American brand involves the transition to a digital model "directly to the consumer," writes the publication Charged. Analysts note the decision of Nike as a significant step in the desire to "take control of their destiny. 

The new strategy is also good news for some sports goods retailers, including Footlocker, Dick's Sporting Goods and Shoe Carnival, which will continue to receive Nike products. 

Earlier, the company reported that investment in digital channels has led to a significant increase in sales - for the first time in history, sales outside the physical stores accounted for about 30% of Nike revenue. According to the company's CEO John Donaho, in the "foreseeable future," their share of online sales will reach 50% of their total Nike portfolio. The company also promised to increase direct sales by the end of the year to 16 billion rubles against 12.4 billion a year earlier. The decision to distance itself from wholesale and move to a new model of direct digital sales at Nike was announced in early 2020 with the arrival of the Donaho CEO. 

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