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December 7, 2022

Nike is a large and successful firm in the design of athletic shoes. It could easily decide to forward-integrate and manufacture the shoes it designs. Thus, the firm has a credible threat over its current outsourced manufacturers.

Nike is a large and successful firm in the design of athletic shoes. It could easily decide to forward-integrate and manufacture the shoes it designs. Thus, the firm has a credible threat over its current outsourced manufacturers. If Nike has no intention of actually entering the manufacturing arena, is it ethical for the Nike supply chain management to bring up this credible threat during annual pricing negotiations? What are some reasons Nike may want to consider such a vertical integration more seriously?

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