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Nike Furthers Investment Into Supply Chain, Speed to Market Innovation

With an eye toward cutting its overall product creation cycle in half, Nike’s leadership said last week that the company will continue to invest significantly in capabilities that “will help unlock speed and flexibility in our supply chain.”

Among the key initiatives supporting that goal is Nike’s Express Lane system, which, when launched in 2016 promised to cut the company’s time-to-market down “to a few weeks, rather than months,” Nike CEO Mark Parker said at the time.

During Nike’s first quarter 2019 earnings call last week, Parker said the system “continues to be the engine that’s creating the most agility in our supply chain right now. We’re driving double-digit growth in many of our key cities through the Express Lane as we capitalize on the local energy for key icons like the Cortez and sports moments like the World Cup.”

Nike Inc. reported a 10 percent increase in revenue, to $9.9 billion, in the three months ended Aug. 31, with net income rising 15 percent, to $1.1 billion.

Parker said the company’s growth and success rely on its ability to be operationally optimized.

“Our vision is to leverage automation to deliver amazing innovative products, faster and more responsively, while being more sustainable and cost efficient,” he said on the call. “With this end-to-end view, our entire value chain, we’re delivering the right product to the right consumer in the right moment. And across product lines…and with our partners around the world, we’re relentlessly driving speed at a scale that is creating impact for our business.”

According to Nike CFO Andy Campion, the company’s 2019 investments in new capabilities include digital demand sensing, consumer data and analytics, connected inventory, digital product design and creation, a digital content engine and “a new enterprise resource platform that will help unlock speed and flexibility in our supply chain.”

“We’re using data in our supply chain to tighten our demand and supply management,” Campion said following Parker’s remarks. “And you see that already beginning to impact our full price versus off price sell-through…We will continue to invest in the capabilities that will differentiate and create competitive advantage for Nike long-term.”