Skip to main content

Nike Pushes “Express Lane” Supply Chain

In keeping with the trend in retail, Nike is looking to bring goods to market faster.

The athletic wear retailer said it is working on an “express lane” for its supply chain to reduce creation-to-market timelines from months to weeks—because speed matters to consumers, company chairman, president and CEO Mark Parker said.

“The Express Lane is becoming an important competitive advantage,” Parker said on an earnings call. “We’ve always given consumers high energy product in the right place at the right time. We’re now leveraging and creating capabilities on a much larger scale. The investments we make in manufacturing revolution and throughout the supply chain are going a long way in help us realize that. Editing to amplify and driving speed and agility are keys to winning now.”

Express Lane manufacturing led Nike to a develop its LunarCharge. Limited quantities of the comfort shoe dropped on Dec. 9 and the company said it is already seeing strong demand.

Nike said in its earnings report Tuesday that revenues are up 6 percent to $8.2 billion for the second quarter ended Nov. 30, citing global consumer demand as the driving force for the growth. This was the twenty-eighth consecutive quarter that Nike reported revenue growth.

“Nike’s ability to attack the opportunities that consistently drive growth over the near and long term is what sets us apart,” Parker said. “With industry-defining innovation platforms, highly anticipated signature basketball styles and more personalized retail experiences on the horizon, we are well-positioned to carry our momentum into the back half of the fiscal year and beyond.”

Growth in Greater China and emerging markets were in the double digits, fueling the 8 percent growth in Nike brand products, and the sportswear and running categories performed best.

Related Stories

Nike’s gross margin contracted 140 basis points to 44.2%, which came, according to Nike, “as higher average selling prices were more than offset by higher product costs, unfavorable changes in foreign exchange rates and the impact of higher off-price sales.”

Looking specifically at footwear, Nike seems to be banking on basketball.

On the earnings call, Nike Brand president Trevor Edwards said the company is seeing “incredible” momentum in basketball.

“To be clear, basketball is back,” he said.

After not performing to its potential in the category last year, Edwards said Nike redesigned some shoes and lowered prices to give consumers a better value.

As such, the Kyrie 2, the LeBron Soldier 10 and the Jordan 39, have been the hits this quarter and the coming Kyrie 3 and the LeBron 14 are already generating “a lot” of anticipation, according to Edwards.