Navigating Global Disruptions
As global tariffs fluctuate and economic tensions rise, Nike faces mounting pressure to rethink its supply chain strategies. With half of its footwear sourced from Vietnam—a country now hit with steep U.S. tariffs—Nike must act swiftly to mitigate costs and maintain consumer trust. Diversifying suppliers isn't just a tactic; it's a strategic imperative.
What Consumers Are Saying
Q: What's another fashion brand that you really trust or distrust?
Alyssa, 16
“I distrust Nike. Facebook always talking about how Nike has a bunch of sweat shops and stuff, so he doesn't like Nike and drilled it into my brain that I don't like it either.”
Why this quote matters: Alyssa’s distrust shows how labor practices and public perception can influence brand loyalty. For Nike, reducing reliance on high-risk sourcing regions may help rebuild consumer trust.
What the Data Says
- Reuters, 2025: Nike produces 50% of its footwear in Vietnam, where a new 46% U.S. tariff on imports is putting pressure on margins. Source: Reuters
- Reuters, 2025: Nike plans to raise prices on select products by $2–$10 to offset tariff-related costs. Source: Reuters
- ADEC Innovations, 2023: Nike relies on 103 strategic suppliers across Asia, demonstrating a starting point for broader diversification. Source: ADEC Innovations
Recommendations for Nike
- Expand supplier base to include underutilized markets in Africa, Latin America, and South Asia to reduce tariff exposure.
- Invest in transparency by showcasing fair labor practices and ethical sourcing to strengthen brand trust among skeptical Gen Z buyers.
- Reframe price hikes around quality and ethical manufacturing, emphasizing long-term value over fast fashion.