nike business plan executive summary

Nike Business Model: Not a business but an inspiration

Born in a family of runners, Nike has always been a household name. I would spend a considerable amount of time trying new models and visiting the Nike Website for any possible discounts.

Quite recently, I finished Phil Knight’s Memoir- Shoe Dog. The story behind the brand speaks of resilience. Nike entered an already dominated market, faced supply-chain issues, financial problems, and lawsuits.

Each hurdle had the potential to put them out of business, but they fought against all odds and emerged to be the most dominant player in the sportswear market. Today, let us analyze the industry and the business model & strategies that made Nike a success story.

The Sportswear Industry

The sportswear industry in the world is dominated by Nike, Adidas, Asics, and UnderArmour. The global sportswear market size is projected to reach US$ 113190 million by 2026, from US$ 93160 million in 2020, at a CAGR of 3.3% during 2021-2026.

The sportswear industry saw a hit during the COVID 19 pandemic; however, it fared far better than the rest of the apparel industry. There was a shift in the sales pattern; people started to buy sportswear for indoor sports rather than outdoor sports.

The industry saw a change in their customer base- there was an increase in women buyers, and currently, more than 50% of buyers are women. Moreover, the pandemic shifted the public’s focus towards physical health and the importance of an active life, which boosted sales for the sportswear industry.

The industry is highly competitive as there is a shortage of raw materials and incredible demand. This problem causes an imbalance in the supply chain. New companies often do not have the funds to handle such an imbalance. Nike faced the same issue for a very long time and was floating due to supply-chain delays but eventually dealt with it after it introduced the idea of “futures” to its stockholders.

The problem was then resolved after the cash inflow when the company became public. However, even a small market share in this segment can yield good profits. Nike was not the first to enter this market, but with its innovative designs and marketing strategies, it managed to make its way to the top. Nike doesn’t sell shoes. It sells an idea with its marketing strategy!!

Nike’s Outsourcing Business Model

Nike has a mass-market business model which caters to sports enthusiasts. The product categories are broadly shoes, sports apparel, and accessories. Their first products were running shoes, given that Phil Knight was a runner himself.

Before they went public, they opened their Apparel line, which has been equally successful. They ventured out to Basketball sneakers and slowly created a demand for shoes as footwear used for daily use.

Nike Inc. (originally known as Blue Ribbon Sports) first started as a reseller for Onitsuka Tiger shoes from Japan. Post their fallout, they outsourced their manufacturing from 300 independent suppliers in 35 countries such as China, Vietnam, Thailand, etc. Today, there are 1096 Nike retail stores worldwide, apart from E-commerce and online platforms. They sell their products in 170 countries across the world. Nike currently has a brand value of 34.8Bn USD.

They have the highest market share in the shoes and sports apparel department. They were the first American shoe-selling company to open their warehouse and sell their products in the Chinese market. Countries such as India, Italy, Mexico, and Argentina have manufacturing units catering to local markets. This move significantly lowers the supply chain woes and makes Nike accessible all over the world.

Value Proposition

Nike’s business model focuses on Innovation and Customization. Despite the sportswear being outsourced, Nike maintains strict quality checks. It spends a lot of resources and time for designing, research, and development.

Bill Bowerman (Nike’s early partner) would often use waffle irons to experiment with shoes! Their designs are admirable- anyone who has a pair of Nike’s Air Zooms can vouch for this. They introduced the world to Air-Cushioning technology in shoes.

There is a special team- Nike Explore Team Sport Research Lab, which is responsible for innovations. It employs researchers with doctorates in biomedical engineering, biomechanics, kinesiology, mechanical engineering, physics, physiology, and systems science. The company maintains advisory boards and research committees consisting of athletes, trainers, coaches, orthopedists, podiatrists, equipment managers, and experts who can guide the product design and development process.

Customization is another feature that Nike provides. NikeID is a service that allows buyers to customize their shoes. They can choose colors, sports style, and traction. One can visit Nike by You, Custom shoes and have a shoe tailored to their needs and likes.

Brand positioning and Advertising

When Knight first started Nike, he did not believe in the power of advertising. Funny how things change, Nike spent 3.59 billion U.S. dollars only on advertising and promotional events in 2020. Nike roughly spends 10% of its revenue on advertising. However, their marketing strategy often reminds me of a verse from the book and their spirit throughout the book.

I’d tell men and women in their mid-twenties not to settle for a job or a profession or even a career. Seek a calling. Even if you don’t know what that means, seek it. Phil Knight

The first employees of the firm were Shoe dogs. Bill Bowerman was Phil Knight’s track coach. Jeff Johnson and Phil Knight went for 13-mile runs when they met to discuss strategies. All of them loved running and shoes. Their love for running pushed them to sell shoes and build amazing designs for runners around the world.

They were passionate about the cause and reflected the same in their marketing strategies. More than advertising their shoes, they advertise running and sports. They are master storytellers; they create demand for themselves by inspiring people to take up sports.

Another amazing strategy that makes the brand alluring is that it is inclusive and takes a firm stand on social issues. Nike was one of the first brands to release Pro Hijab, a product for Muslim women in sports. They’ve encouraged women empowerment and involvement of women in sports- their social media channel NikeWomen inspires women to take up sport and a healthy lifestyle.

Nike’s worldwide fan following is certainly anchored to its essence of standing for social justice over and over again. The recent decision of  Nike to split with soccer player Neymar  based on an allegation raised by a female employee of sexual harassment by the soccer player affirms the brand’s willingness and effort to stick to social norms.

Check out this story on how Nikes stand for social justice has created a powerful  node  in its  brand association .

The company supported and debuted an ad campaign centered on Colin Kaepernick. He was a former NFL player who refused to stand for the national anthem before his games in protest of racism and discrimination in America. The sport boycotted him due to political pressure, but Nike debuted an ad campaign supporting the cause right after the event.

When Nike first started, celebrity endorsements were considered one-way tickets to putting a brand’s shoes on the map. Nike has indeed continued to follow this particular strategy and has the world’s leading athletes to promote its products, including Tiger Woods, Michael Jordan, Cristiano Ronaldo, Rafael Nadal, and many more. In the 2016 Olympics, In the category of shoe brands- Nike had the highest number of players who won medals.

Wrapping up

Shoes are one of the world’s oldest creations. One thing that can be observed is how Nike has always been a pioneer in innovating shoes and sports apparel. Nike has built a business model that observes trends and always stayed relevant to the market.

Entrepreneurs can surely take a leaf out of Nike’s books. Stay resilient, relevant, do not be intimidated by competition, and sell a vision rather than a product.

-AMAZONPOLLY-ONLYWORDS-START-

Also, check out our most loved stories below

Why did Michelin, a tire company, decide to rate restaurants?

Is ‘Michelin Star’ by the same Michelin that sells tires, yes, it is! But Why? How a tire company evaluations became most coveted in the culinary industry?

Johnnie Walker – The legend that keeps walking!

Johnnie Walker is a 200 years old brand but it is still going strong with its marketing strategies and bold attitude to challenge the conventional norms.

Starbucks prices products on value not cost. Why?

In value-based pricing, products are price based on the perceived value instead of cost. Starbucks has mastered the art of value-based pricing. How?

Nike doesn’t sell shoes. It sells an idea!!

Nike has built one of the most powerful brands in the world through its benefit-based marketing strategy. What is this strategy and how Nike has used it?

Domino’s is not a pizza delivery company. What is it then?

How one step towards digital transformation completely changed the brand perception of Domino’s from a pizza delivery company to a technology company?

BlackRock, the story of the world’s largest shadow bank

BlackRock has $7.9 trillion worth of Asset Under Management which is equal to 91 sovereign wealth funds managed. What made it unknown but a massive banker?

Why does Tesla’s Zero Dollar Budget Marketing Strategy work?

Touted as the most valuable car company in the world, Tesla firmly sticks to its zero dollar marketing. Then what is Tesla’s marketing strategy?

The Nokia Saga – Rise, Fall and Return

Nokia is a perfect case study of a business that once invincible but failed to maintain leadership as it did not innovate as fast as its competitors did!

Yahoo! The story of strategic mistakes

Yahoo’s story or case study is full of strategic mistakes. From wrong to missed acquisitions, wrong CEOs, the list is endless. No matter how great the product was!!

Apple – A Unique Take on Social Media Strategy

Apple’s social media strategy is extremely unusual. In this piece, we connect Apple’s unique and successful take on social media to its core values.

-AMAZONPOLLY-ONLYWORDS-END-

Manasvi is an aspiring entrepreneur - always on hunt for problems she can solve. She’s an education, business and public policy enthusiast. She loves spending her weekends teaching underprivileged children or on her couch reading books.

Related Posts

How does Instacart work and make money: Business Model

What does Zscaler do | How does Zscaler work | Business Model

What does Chegg do | How does Chegg work | Business Model

What does Bill.com do | How does Bill.com work | Business Model

What does Cricut do | How does Cricut work | Business Model

What does DexCom do? How does DexCom business work?

What does CarMax do? How does CarMax business work?

What does Paycom do? How does Paycom work?

What does FedEx do | How does FedEx work | Business Model

How does Rumble work and make money: Business Model

Dollar General Business Model & Supply Chain Explained

What does C3 AI do | Business Model Explained

What does Aflac do| How does Aflac work| Business Model

How does Booking.com work and make money: Business Model

What does Okta do | How does Okta work | Business Model

What does Alteryx do | How does Alteryx work | Business Model

Write a comment cancel reply.

Save my name, email, and website in this browser for the next time I comment.

• Advanced Strategies
• Brand Marketing
• Digital Marketing
• Luxury Business
• Startup Strategies
• 1 Minute Strategy Stories
• Business Or Revenue Model
• Forward Thinking Strategies
• Infographics
• Publish & Promote Your Article
• Write Article
• Testimonials
• TSS Programs
• Fight Against Covid
• Privacy Policy
• Terms and condition
• Refund/Cancellation Policy
• Master Sessions
• Live Courses
• Playbook & Guides

Type above and press Enter to search. Press Esc to cancel.

Business Plan Executive Summary Example & Template

Updated: Jun 3, 2024, 1:03pm

Table of Contents

Components of an executive summary, how to write an executive summary, example of an executive summary, frequently asked questions.

A business plan is a document that you create that outlines your company’s objectives and how you plan to meet those objectives. Every business plan has key sections such as management and marketing. It should also have an executive summary, which is a synopsis of each of the plan sections in a one- to two-page overview. This guide will help you create an executive summary for your business plan that is comprehensive while being concise.

Featured Partners

ZenBusiness

$0 + State Fees

Varies By State & Package

On ZenBusiness' Website

Northwest Registered Agent

$39 + State Fees

On Northwest Registered Agent's Website

Tailor Brands

$0 + state fee + up to $50 Amazon gift card

Varies by State & Package

On Tailor Brands' Website

$0 + State Fee

On Formations' Website

The executive summary should mimic the sections found in the business plan . It is just a more concise way of stating what’s in the plan so that a reader can get a broad overview of what to expect.

State the company’s mission statement and provide a few sentences on what the company’s purpose is.

Company History and Management

This section describes the basics of where the company is located, how long it has been in operation, who is running it and what their level of experience is. Remember that this is a summary and that you’ll expand on management experience within the business plan itself. But the reader should know the basics of the company structure and who is running the company from this section.

Products or Services

This section tells the reader what the product or service of the company is. Every company does something. This is where you outline exactly what you do and how you solve a problem for the consumer.

This is an important section that summarizes how large the market is for the product or service. In the business plan, you’ll do a complete market analysis. Here, you will write the key takeaways that show that you have the potential to grow the business because there are consumers in the market for it.

Competitive Advantages

This is where you will summarize what makes you better than the competitors. Identify key strengths that will be reasons why consumers will choose you over another company.

Financial Projections

This is where you estimate the sales projections for the first years in business. At a minimum, you should have at least one year’s projections, but it may be better to have three to five years if you can project that far ahead.

Startup Financing Requirements

This states what it will cost to get the company launched and running. You may tackle this as a first-year requirement or if you have made further projections, look at two to three years of cost needs.

The executive summary is found at the start of the business plan, even though it is a summary of the plan. However, you should write the executive summary last. Writing the summary once you have done the work and written the business plan will be easier. After all, it is a summary of what is in the plan. Keep the executive summary limited to two pages so that it doesn’t take someone a long time to peruse what the summary says.

Start A Limited Liability Company Online Today with ZenBusiness

Click to get started.

It might be easier to write an executive summary if you know what to expect. Here is an example of an executive summary that you can use as a template.

Bottom Line

Writing an executive summary doesn’t need to be difficult if you’ve already done the work of writing the business plan itself. Take the elements from the plan and summarize each section. Point out key details that will make the reader want to learn more about the company and its financing needs.

How long is an executive summary?

An executive summary should be one to two pages and no more. This is just enough information to help the reader determine their overall interest in the company.

Does an executive summary have keywords?

The executive summary uses keywords to help sell the idea of the business. As such, there may be enumeration, causation and contrasting words.

How do I write a business plan?

If you have business partners, make sure to collaborate with them to ensure that the plan accurately reflects the goals of all parties involved. You can use our simple business plan template to get started.

What basic items should be included in a business plan?

When writing out a business plan, you want to make sure that you cover everything related to your concept for the business,  an analysis of the industry―including potential customers and an overview of the market for your goods or services―how you plan to execute your vision for the business, how you plan to grow the business if it becomes successful and all financial data around the business, including current cash on hand, potential investors and budget plans for the next few years.

• Best LLC Services
• Best Registered Agent Services
• Best Trademark Registration Services
• Top LegalZoom Competitors
• Best Business Loans
• Best Business Plan Software
• ZenBusiness Review
• LegalZoom LLC Review
• Northwest Registered Agent Review
• Rocket Lawyer Review
• Inc. Authority Review
• Rocket Lawyer vs. LegalZoom
• Bizee Review (Formerly Incfile)
• Swyft Filings Review
• Harbor Compliance Review
• Sole Proprietorship vs. LLC
• LLC vs. Corporation
• LLC vs. S Corp
• LLP vs. LLC
• DBA vs. LLC
• LegalZoom vs. Incfile
• LegalZoom vs. ZenBusiness
• LegalZoom vs. Rocket Lawyer
• ZenBusiness vs. Incfile
• How To Start A Business
• How to Set Up an LLC
• How to Get a Business License
• LLC Operating Agreement Template
• 501(c)(3) Application Guide
• What is a Business License?
• What is an LLC?
• What is an S Corp?
• What is a C Corp?
• What is a DBA?
• What is a Sole Proprietorship?
• What is a Registered Agent?
• How to Dissolve an LLC
• How to File a DBA
• What Are Articles Of Incorporation?
• Types Of Business Ownership

Next Up In Business

• Best Online Legal Services
• How To Write A Business Plan
• Member-Managed LLC Vs. Manager-Managed LLC
• Starting An S-Corp
• LLC Vs. C Corp
• How Much Does It Cost To Start An LLC?

What Is SNMP? Simple Network Management Protocol Explained

What Is A Single-Member LLC? Definition, Pros And Cons

What Is Penetration Testing? Definition & Best Practices

What Is Network Access Control (NAC)?

What Is Network Segmentation?

How To Start A Business In Louisiana (2024 Guide)

Kimberlee Leonard has 22 years of experience as a freelance writer. Her work has been featured on US News and World Report, Business.com and Fit Small Business. She brings practical experience as a business owner and insurance agent to her role as a small business writer.

Cassie is a deputy editor collaborating with teams around the world while living in the beautiful hills of Kentucky. Focusing on bringing growth to small businesses, she is passionate about economic development and has held positions on the boards of directors of two non-profit organizations seeking to revitalize her former railroad town. Prior to joining the team at Forbes Advisor, Cassie was a content operations manager and copywriting manager.

• English (United Kingdom)
• Español (América Latina)

Investor News Details

Nike, inc. reports fiscal 2022 fourth quarter and full year results.

BEAVERTON, Ore.--(BUSINESS WIRE)-- NIKE, Inc. (NYSE:NKE) today reported financial results for its fiscal 2022 fourth quarter and full year ended May 31, 2022.

• Fourth quarter reported revenues were $12.2 billion, down 1 percent compared to prior year and up 3 percent on a currency-neutral basis*
• NIKE Direct reported revenues for the fourth quarter were $4.8 billion, up 7 percent compared to prior year and up 11 percent on a currency-neutral basis
• Wholesale reported revenues for the fourth quarter were $6.8 billion, down 7 percent compared to prior year and down 3 percent on a currency-neutral basis
• Gross margin for the fourth quarter decreased 80 basis points to 45 percent.
• Diluted earnings per share was $0.90 for the fourth quarter
• The Company announced its Board of Directors has authorized a new four-year, $18 billion program to repurchase shares of NIKE's Class B Common Stock

“NIKE’s results this fiscal year are a testament to the unmatched strength of our brands and our deep connection with consumers," said John Donahoe, President and CEO, NIKE, Inc. “Our competitive advantages, including our pipeline of innovative product and expanding digital leadership, prove that our strategy is working as we create value through our relentless drive to serve the future of sport."**

Fourth quarter NIKE Direct revenues grew 7 percent on a reported basis and 11 percent on a currency-neutral basis, led by 25 percent growth in EMEA, 43 percent growth in APLA and 5 percent growth in North America, partially offset by a decline in Greater China. NIKE Brand Digital grew 15 percent on a reported basis and 18 percent on a currency-neutral basis, driven by double digit growth in APLA, North America and EMEA. NIKE-owned stores declined 2 percent on a reported basis and increased 1 percent on a currency-neutral basis.

“In this dynamic environment, NIKE's unrivaled strengths continue to fuel our momentum,” said Matt Friend, Executive Vice President and Chief Financial Officer, NIKE, Inc. "Two years into executing our Consumer Direct Acceleration, we are better positioned than ever to drive long-term growth while serving consumers directly at scale."**

Non-recurring Items Impacting Comparability in the Fourth Quarter

Fourth quarter results contain several non-comparable items, including non-recurring charges recorded in Other (income) expense, net, totaling approximately $150 million, associated with the deconsolidation of our Russian operations , and the transition of our businesses in Argentina, Chile and Uruguay to strategic distributor models.

Fourth Quarter Income Statement Review

• Revenues for the NIKE Brand were $11.7 billion, down 1 percent on a reported basis and up 3 percent on a currency-neutral basis, led by 20 percent growth in EMEA.
• Revenues for Converse were $593 million, down 1 percent on a reported basis and up 3 percent on a currency-neutral basis, due to wholesale revenue declines offset by growth in our direct to consumer business.
• Gross margin decreased 80 basis points to 45.0 percent, primarily due to higher inventory obsolescence reserves in Greater China and elevated freight and logistics costs, partially offset by strategic pricing actions, favorable changes in net foreign currency exchange rates, including hedges, and margin expansion in our NIKE Direct business.
• Demand creation expense was $1.1 billion, up 6 percent, primarily due to increased sports marketing expenses and continued investments in digital marketing to support heightened digital demand.
• Operating overhead expense increased 8 percent to $3.0 billion, due to higher strategic technology investments, and an increase in NIKE Direct variable costs and wage-related expenses.
• The effective tax rate was (4.7) percent compared to 18.6 percent for the same period last year, due to a shift in our earnings mix and a non-cash, one-time benefit related to the onshoring of our non-U.S. intangible property.
• Net income was $1.4 billion, down 5 percent, and Diluted earnings per share was $0.90, down 3 percent compared to prior year.

Fiscal 2022 Income Statement Review

• Revenues for the NIKE Brand were $44.4 billion, up 5 percent on a reported basis and 6 percent on a currency-neutral basis, driven by double-digit growth in NIKE Direct, partially offset by slight declines in wholesale revenues.
• NIKE Direct revenues were $18.7 billion, up 14 percent on a reported basis and up 15 percent on a currency-neutral basis, led by NIKE Brand digital growth of 18 percent and NIKE-owned stores were up 10 percent.
• Revenues for Converse were $2.3 billion, up 6 percent on a reported basis and up 7 percent on a currency-neutral basis, led by double-digit growth in our direct to consumer business, partially offset by lower wholesale revenues.
• Gross margin increased 120 basis points to 46.0 percent, primarily due to margin expansion in our NIKE Direct business, a higher mix of full-price sales and favorable changes in net foreign currency exchange rates, including hedges, partially offset by elevated freight and logistics costs and higher inventory obsolescence reserves in Greater China in the fourth quarter.
• Demand creation expense was $3.9 billion, up 24 percent compared to prior year, primarily due to normalization of spend against brand campaigns and continued investments in digital marketing to support heightened digital demand.
• Operating overhead expense increased 11 percent to $11.0 billion due to higher strategic technology investments, and an increase in wage-related expenses and NIKE Direct variable costs.
• The effective tax rate was 9.1 percent, compared to 14.0 percent for the same period last year, due to a shift in our earnings mix and a non-cash, one-time benefit related to the onshoring of our non-U.S. intangible property.
• Net income was $6.0 billion, up 6 percent, and Diluted earnings per share was $3.75, up 5 percent compared to prior year.

May 31, 2022 Balance Sheet Review

• Inventories for NIKE, Inc. were $8.4 billion, up 23 percent compared to the prior year period, driven by elevated in-transit inventories due to extended lead times from ongoing supply chain disruptions, partially offset by strong consumer demand.
• Cash and equivalents and short-term investments were $13.0 billion, $479 million lower than prior year, as free cash flow was offset by share repurchases and dividends.

Shareholder Returns

NIKE continues to have a strong track record of investing to fuel growth and consistently increasing returns to shareholders, including 20 consecutive years of increasing dividend payouts.

In the fourth quarter, the Company returned approximately $1.5 billion to shareholders, including:

• Dividends of $481 million, up 11 percent from prior year.
• Share repurchases of $1.1 billion, reflecting 8.5 million shares retired as part of the four-year, $15 billion program approved by the Board of Directors in June 2018.

In fiscal 2022, the Company returned approximately $5.8 billion to shareholders, including:

• Dividends of $1.8 billion, up 12 percent from prior year.
• Share repurchases of $4.0 billion, reflecting 27.3 million shares retired. As of May 31, 2022, a total of 77.4 million shares for $8.7 billion had been repurchased under the current program.

In June 2022, the Board of Directors authorized a new four-year, $18 billion program to repurchase shares of NIKE's Class B common stock. The Company's new program will replace the current $15 billion share repurchase program, which will be terminated in fiscal year 2023. Repurchases under the Company's new program will be made in open market or privately negotiated transactions in compliance with the Securities and Exchange Commission Rule 10b-18, subject to market conditions, applicable legal requirements and other relevant factors. The new share repurchase program does not obligate the Company to acquire any particular amount of common stock, and it may be suspended at any time at the Company's discretion.

Conference Call

NIKE, Inc. management will host a conference call beginning at approximately 2:00 p.m. PT on June 27, 2022, to review fiscal fourth quarter and full year results. The conference call will be broadcast live via the Internet and can be accessed at http://investors.nike.com . For those unable to listen to the live broadcast, an archived version will be available at the same location through 9:00 p.m. PT, July 15, 2022.

About NIKE, Inc.

NIKE, Inc., based near Beaverton, Oregon, is the world’s leading designer, marketer and distributor of authentic athletic footwear, apparel, equipment and accessories for a wide variety of sports and fitness activities. Converse, a wholly-owned NIKE, Inc. subsidiary brand, designs, markets and distributes athletic lifestyle footwear, apparel and accessories. For more information, NIKE, Inc.’s earnings releases and other financial information are available on the Internet at http://investors.nike.com . Individuals can also visit http://news.nike.com and follow @NIKE.

View source version on businesswire.com : https://www.businesswire.com/news/home/20220627005703/en/

Investor Contact: Paul Trussell [email protected]

Media Contact: KeJuan Wilkins [email protected]

Source: NIKE, Inc.