According to Reuters, on the 23rd local time, the American sports brand Nike said in an email statement that it would fully withdraw from Russia after suspending its Russian operations for about three months.
The statement said, “Nike has decided to leave the Russian market. Our first priority is to ensure that we fully support our employees while we scale back operations responsibly in the coming months.”
Nike suspends Russian e-commerce services in March
In March this year, Nike said it would temporarily close stores it owns and operates in Russia.
According to multiple media reports, on March 1, local time, Russian users discovered that they could not purchase Nike brand products either on the official website or in the app.
The company said it could not guarantee delivery of goods in Russia.
What Russian users may not know is:
Nike suspends Russian e-commerce services
Sportswear giant Nike recently announced the suspension of e-commerce services in Russia, including its official website and App, because the brand cannot guarantee the delivery of products to consumers in the country on time.
Some analysts predict that this move may have a certain impact on Nike’s performance.
In May, according to the Russian Satellite News Agency’s report on the 25th:
American clothing and footwear manufacturer Nike has not renewed its franchise agreement with IRG, according to a letter from Tikhon Smykov, president of Inventive Retail Group “Innovative Retail Group” (IRG), to the company’s employees.
According to reports, Nike did not renew its franchise agreement with IRG, which owns the largest single-brand chain of American retailers in Russia. Smykov explained the decision as Nike was unable to organize supplies to Russia in the foreseeable future.
According to the report, the public relations manager of IRG confirmed that the supply of Nike products has been suspended and the products themselves are in shortage. She said the company would no longer be able to continue operating single-brand stores and would be forced to close them.
Russian partner operates 37 Nike stores
In an interview with “Vedomosti”, the IRG president said that under such circumstances, Nike would not be able to arrange shipments to Russia “for the foreseeable future.”
“After running out of stock, IRG will have to close all stores under the brand,” Smykov wrote, adding that the news was a blow to all employees. Ludmila Semushina, the group’s head of communications, confirmed that deliveries of Nike products have been suspended and that there are no products in franchise stores that are still open.
Ukrinform wrote that IGR manages 37 Nike franchise stores, but nine of them have not been open for some time.
IRG manages a total of 37 Nike stores. From March to May, the number of Nike single-brand stores in Russia has shrunk from 116 to 56.
In March, most foreign companies temporarily closed their operations in Russia.
These companies hoped that the situation in Ukraine would stabilize quickly and that normal trade might resume, but since nothing seems to be going as expected, more and more headquarters are deciding to finally leave Russia. In addition to Nike, other Western sportswear manufacturers have also begun to gradually withdraw from the Russian market. Adidas said in March it would close its Russian stores and suspend online sales. Puma also suspended operations in March. Reebok suspended sales in March and is in talks to sell more than 100 stores to Turkish footwear retailers.
Competitors may benefit
Cisco joins companies like Nike, McDonald’s, and Renault in exiting Russia entirely. More companies are expected to leave in the coming weeks ahead of the new laws.
Companies preparing to exit may have difficulty returning, Musgrave said. “This provides opportunities for domestic companies in some markets, but there are greater opportunities for brands from China and elsewhere to make inroads.”
Nike rival Adidas said in March it would close its Russian stores and suspend online sales.
Adidas has no current plans to resume operations in Russia, the German sportswear company told Reuters on Thursday.
“Adidas stores in Russia and Adidas online retail operations will continue to be suspended until further notice, and this also applies to shipments to Russia,” the company said in an emailed statement.
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