Why Nike is canceling orders and what’s really going on – Footwear News
Update: November 24, 2021, 4:45 p.m. ET
Nike responded to FN’s request for comment with an email statement.
âWe continue to work with our suppliers and retail partners to support their efforts in response to the unprecedented nature of COVID-19 and supply chain constraints. As we all continue to experience global supply chain disruptions amid the ongoing pandemic, Nike remains focused on providing a distinctive service to consumers and partners during the holidays. We are confident in Nike’s ability to manage these temporary impacts, âthe company wrote in the email.
What we initially reported
Nike has canceled product orders at at least one retail store through the summer of 22, according to analysts and reports, and it’s unclear how many more stores could be affected.
The sports giant wrote in an email to a sneaker retail partner that products that had not yet been shipped to the store would not be delivered, Complex reported Tuesday evening. In the email, which was tweeted by Brendan Dunne from Complex, the brand said all orders placed during the summer of 22 with the unnamed retailer would be canceled due to complications from supply chain delays.
“COVID-19 continues to impact the global supply chain and create transportation disruption,” the email read. “Due to this dynamic and unprecedented situation, we regret to inform you that Nike Futures orders in SP22, SU22 and the balance of HO21 will be canceled.”
The email continued, âThis means that any HO21 orders that have not yet shipped will not be fulfilled, nor will the orders for SP22. Also, due to those same chain issues. supply, Nike will not be offering At Once orders until further notice. “
NPD Group Inc.’s senior sports industry advisor Matt Powell confirmed to FN that he had heard from about half a dozen independent shoe stores that the same situation had happened to them. However, shortly thereafter, Powell said Nike walked away from what was revealed in the email reported to at least one of those stores.
âNow I’m told Nike has retracted emails saying stores canceled futures. Very strange,â Powell wrote on Twitter today.
FN has contacted Nike for comment.
A retailer, who spoke on condition of anonymity, told FN that given the backlog in the supply chain, such communications are not unusual.
âSupply chain issues are likely to be a big disruptor in the short term. We have already felt this at several levels of each brand. We have been told about delays and shortages since early October. Sensing some delays, not much to undo yet. Nike is generally very good at anticipating problems, âthe retailer said.
Williams Trading analyst Sam Poser said the original retailer who received the letter was likely a small wholesale account who was upset and “sent the email to stir the pot.” Poser added that after checking with other accounts, it appears that large retailers that sell Nike products have not been affected by this issue.
âBased on recent reviews from Dick’s Sporting Goods and Foot Locker, as well as other reviews, orders are being fulfilled to the best of Nike’s ability,â Poser wrote. “However, Nike closely monitors the sales of its wholesale accounts and then comes up with a targeted product, with immediate availability to the retailer or retailers Nike deems worthy.”
One of those worthy retailers could be Dick’s, which leverages an existing supplier relationship and a new digital partnership with Nike. Supply chain issues aside, Nike recently terminated its wholesale accounts with various retailers such as Zappos, Dillard’s, DSW, Urban Outfitters and Shoe Show.
âDick’s is on the good list of most, if not all of the key suppliers,â Poser said in another note. “As such, Dick’s is securing a key product faster than its competitors and will continue to do so until 2022.”