The impact of Nike on the international markets in comparison to the Essay

The impact of Nike on the international markets in comparison to the local markets - Essay Example The firm that is analyzed in the paper is Nike, Inc. as a firm that deals with design, improvement and marketing of different shoe types. Nike is regarded as the best seller in athletic shoes as well as athletic attire around the world. The company vends its commodities to retailers via its own retailer stores, internet marketing as well as through autonomous distributors and other licensed individuals and groups. The company vends approximately 18,000 retail records in the US through its retailers and distributors. The shoes that the firm deals in are specifically for athletic purposes. In addition, it makes other athletic shoes and attires for different games such as football and baseball. The company also vends other sporting accessories such as sporting or gaming bags and other protective gear utilized in various games. The principal competitors within this industry are Puma and Adidas, which offer the company numerous challenges in maintaining their high profile and sales. Since the adoption of Nike, in 1978, the company has extensively grown into a global company specialized in footwear and other products related to sports. The financial analysis of the corporation through scrutiny of its financial, income statements, as well as, balance sheets allows reviewing of the company financial health and other achievements over the years. Over the period, since the company establishment, the management of Nike has generated value for the shareholders through the progression of the company’s operations in overseas nations in an extensive manner. The company’s trading and earnings have surpassed the Wall Street approximations with respect to FY 06 (Stilga, 2006). The income for the company hit approximately $15 billion while its income per share hit a high up by 18 percent. In the last 5 years, the compounded rate per split elevated by 20 percent while the average of the gross margins came to 42 percent (Stilga, 2006). In the precedent year, the compa ny’s margins were 44 percent seeing an enormous rise in profits. Currently, the company’s management has optimized the wealth for its shareholders although the company performance in Nike’s footwear has declined. The footwear performance in the sector generated an average of approximately 14.25 percent whereas the progression in stock reached 10.48 percent (Stilga, 2006). In view of performance for the management, the performance can be considered not noteworthy provided the augment in share value serves as the point of reference. The Price to Book relative amount for Nike is 3.97 whereas the segment in which the corporation operates has a relative amount of 3.96. Similarly, the company has a Price to Tangible Book relative amount of about 4.26 whereas the sector that Nike operates presents a relative amount of about 4.44 (Stilga, 2006). The brand name and image of Nike is considered the strength of the company thus the competitive advantage. In addition, to the brand name and image of the company, the company has acquired other strong points in global operations. The company’s processes in international markets have gradually expanded coupled with innovations and creativity in fresh products. The operational expansions in global markets can also be ascribed to the capability in relating with its consumers. As a multinational company, Nike has impacted on almost all nations although it overseas ventures have raised concerns over claims in exploitation of its employees. The company gains a lot of revenues from global markets than its receives from the internal markets. The international operations of the company earned approximately $6.5 billion as compared to $5.1billion from its local or internal markets. Therefore, the international o