That is the attitude that proves the point. I’m not as sure as you are about the profit.
It does not cost much to make a/an _______
We tend to oversimpliy and ignore other things that need to be paid for. A short list of things that the markup has to cover that I can think of if the top of my head…
IT infrastructure and support for ~80,000 employees worldwide. Rent for stores, salaries and benefits for the staff that work in them. Furnishings, signage and maintenance of stores. Shipping of product to stores. Distribution warehouses. Logistics planning and execution staff and software. Corporate level sales management staff and software. Marketing including sponsorships, TV spots, billboards, etc etc.
Each pair of shoes has to contribute to each of these things and all the others I can’t think of right now or don’t even know are needed.
I don’t mean to say that they don’t make (good) profit, but it’s probably no where near as big as you imagine.
You can argue whether or not a all of that corporate machinery is needed as well, but Nike clearly thinks it is right now or they wouldn’t spend money there for no reason because that doesn’t make the line go up unless there is a payback for that spending.
So we oversimplify and say the markup is huge, they can afford to pay more to make their product and still be profitable… But it probably means job losses in other parts of the company a good number of which are probably American jobs that Nike currently does offer.
For shoes im not sure. They must have massive profits on those things.
That is the attitude that proves the point. I’m not as sure as you are about the profit.
It does not cost much to make a/an _______
We tend to oversimpliy and ignore other things that need to be paid for. A short list of things that the markup has to cover that I can think of if the top of my head… IT infrastructure and support for ~80,000 employees worldwide. Rent for stores, salaries and benefits for the staff that work in them. Furnishings, signage and maintenance of stores. Shipping of product to stores. Distribution warehouses. Logistics planning and execution staff and software. Corporate level sales management staff and software. Marketing including sponsorships, TV spots, billboards, etc etc.
Each pair of shoes has to contribute to each of these things and all the others I can’t think of right now or don’t even know are needed.
I don’t mean to say that they don’t make (good) profit, but it’s probably no where near as big as you imagine.
You can argue whether or not a all of that corporate machinery is needed as well, but Nike clearly thinks it is right now or they wouldn’t spend money there for no reason because that doesn’t make the line go up unless there is a payback for that spending.
So we oversimplify and say the markup is huge, they can afford to pay more to make their product and still be profitable… But it probably means job losses in other parts of the company a good number of which are probably American jobs that Nike currently does offer.