Our Approach to Sourcing
At Nike, we build long-term relationships with our contract manufacturing suppliers (suppliers) because we know having trust and mutual respect supports our ability to create product more responsibly, accelerate innovation and better serve athletes*. Over 90% of Nike footwear and branded apparel is made by factory groups that we have worked with for over 15 years.
Nike is growing with suppliers that share our commitment to sustainability and understand that empowered workplaces are productive, profitable and successful. We scale capability building programs, such as Worker Engagement, Culture of Safety, and Environmental Minimum Programs with suppliers that share our values.
Incentivizing Suppliers to Constantly Improve Sustainability Performance
We encourage improvements in sustainability through a scorecard that assesses supplier performance on quality, delivery, cost, and sustainability. We also have tools that assess growth and potential in leadership, operations, innovation, product creation, and sustainability. We use the information to inform our long-term sourcing strategy, increasing business with the best performing supplier. Harvard Business School published a case that explores the evolution of Nike’s global product sourcing strategy, in particular ongoing efforts to improve working conditions at its suppliers factories.
Supporting Suppliers to Meet Our Standards
We help our key suppliers advance sustainability by providing resources that create more transparency and predictability. Our sourcing teams provide multi-year sourcing forecasts and have processes designed to help address the issue of excessive overtime and other issues that can be associated with overly disruptive fluctuations in demand. The Fair Labor Association reaccredited Nike’s social compliance program in February 2019 and evaluated Nike’s responsible purchasing practices, among other aspects of our sustainability strategy. The FLA Reaccreditation Report can be found here.
Nike collects feedback from suppliers through Better Buying, an anonymous rating initiative that collects supplier feedback on purchasing practices. Nike collaborated with Better Buying to invite our suppliers to participate and we use the information to help inform system and process improvements.
Nike’s strong, long-term relationships with suppliers help us create innovative product responsibly. Our approach also supports better outcomes for our suppliers, the people who work in our supply chain and for the planet.