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Nike Enlists Apollo In Major Manufacturing Shift to the Americas

When it’s deliver-or-die, supply chains become the lifeblood of a company. To that end, the fashion industry has embraced technology to navigate today’s hyper-complicated supply chain, with myriad solutions shaping the first, middle and last mile. Call it Sourcing 2.0.

There’s a sea change in footwear manufacturing and soon sneaker giant Nike will be at the forefront.

The Oregon-based company announced Thursday it had entered into a new strategic partnership with the private equity firm Apollo Global Managment. The deal will enable Apollo to build a new supply chain for Nike in the Americas, bringing the production of its shoes closer to home.

Not wasting any time, the Apollo-managed Special Situations I fund has already acquired New Holland, a Pennsylvania-based apparel factory, and ArtFX, a warehousing and logistics operator based in Virginia.

Apollo will acquire existing apparel suppliers in North and Central America, and plans to invest in advancing their manufacturing operations. Nike says this new supply chain will be better-suited to manufacture custom products.

“We are excited to be working with Apollo to rethink a new supply chain model to revolutionize apparel manufacturing in the Americas,” said Nike CEO Eric Sprunk.

Nike has not made capital investment in the manufacturing and logistics company that Apollo is building, but the sneaker brand’s support is “a testament to Nike’s commitment to increasing regional manufacturing capabilities,” said Josh Harris, co-founder and senior managing director of Apollo.

The move to American manufacturing comes as issues of sustainability, workers rights, and responsible sourcing are closer to the minds of consumers than ever before. Nike’s biggest rival, Adidas, is also pivoting towards a more local future, announcing earlier this year the first in a series of planned robot factories which will cut both cost and miles in its production chain.

“We see a tremendous opportunity to meet the rising demand for responsive apparel manufacturing to serve increasing consumer expectations for products delivered when and where they want them,” said Harris. “We intend to work with management to develop a regional supplier capable of servicing the needs of a wide variety of customers, and we are particularly enthusiastic to be working with such an iconic brand as Nike.”

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