Catch 22


I am not a huge fan of Michael Moore so when I had to watch the clip of him speaking with Nike’s CEO Phil Knight I was skeptical. I have to say though that I was thoroughly surprised and enjoyed it. He gave a great insight into the wrongdoings that the Nike company has been committing for years. Nike is obviously an extremely successful company that is revered by many. I’m sure it’s a model for many businesses as well. Their business model is one that cuts costs while still increasing profit. By outsourcing all of the manufacturing to Indonesia there is a ton of cost that is saved. Michael Moore showed how Nike is paying its workers next to nothing. Most of the workers are below the age of 18 as well. This is obviously something that in our society is unnacceptable. Phil Knight was not willing to take accountability for him and his company that have made billions of dollars.

This however is a fact that most companies are profit driven and their social responsibility is just that. Nike is just like countless other companies that outsource its production to developing countries in order to cut costs. There are plently of companies who manufacture in the United States and are able to run high profit companies. Then I think of companies like American Apparel who choose to do all their manufacturing in house. Everything is done under the American Apparel brand. This company as most know is not doing well and could file for bankruptcy. The margin between costs and profit are becoming smaller and smaller. Looking at companies like this can you blame Nike for choosing to outsource to developing countries? Obviously the way they treat their workers is inhumane and it is not something that I agree with, but I understand why companies choose to do this. In this case as in most cases looking at large companies greed drives Phil Knight’s business model. Will this ever change looking at companies? And if this does will people enjoy rising costs due to rising production costs? I believe they won’t which is why this problem is a catch 22.

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4 Responses to Catch 22

  1. tpm011 says:

    I don’t believe that a company has the duty to provide for the community. It is disgusting that Nike uses that type of labor but it should be the government’s responsibility to enforce fair labor practices. While Nike makes a huge profit they also probably pay a lot of taxes that should give the government enough money to be able to clean up the way Nike does business.

  2. MDHarbin says:

    Nike, the creator of all the best shoes and clothing for all the kids out to become the Michael Jordan of the 90’s, is an innovative scapegoat. And because of great management and strategy still produces the best sports apparel with the best marketing slogans not only for the U.S. kids out to become the next Lebron James (http://www.youtube.com/watch?v=cdtejCR413c), but for consumers all around the world. Yes, the company did receive negative publicity in the wake of widespread worker unrest in Indonesia, a country unfamiliar with foreign corporations promoting production on such a large scale. However, their creative marketing strategy and competitive designs cannot go unnoticed as they currently hold a $42.4 billion market cap.

  3. csmb12 says:

    I also agree that it is not Nike’s job to worry about the morality of who they are employing. If they start doing that, then they too will lose money and could possibly get driven out of business by its competitors. I would also say that waiting for the government to step in could take a while, if it will happen at all. Since Nike does most of its manufacturing outside the US, foreign governments would need to create laws protecting its workers. The issue with that is that these 3rd world countries that allow child labor and don’t have minimum wages don’t have them for a reason. They are trying to attract big corporations to come to their shores. If they start having these laws, companies like Nike will just pick up and move to the next 3rd world country. I believe the only way that Nike will change its manufacturing practices is if its customers stop buying Nike products until something is done about Nike’s labor practices. The bottom line is what Nike cares about and until having child labor hurts the bottom line due to customer outrage, Nike is going to continue to employ children.

  4. katiebaum13 says:

    I found myself in the same position as you after watching the Michael Moore clip in class. I also am not a fan of Michael Moore, so before watching the clip I already was skeptical, but to my surprise I enjoyed it. I thought he did a great job in getting his point across. Although American Apparel is going out of business, I think that more companies should try to follow a similar idea of manufacturing in America and not outsources to other countries. I feel people are more inclined to buy their item if they know it is made in America and are creating more jobs for Americans. My brother and his friends recently started a clothing line in Los Angeles that sells the idea that they are American made and are creating more jobs in America. Although they are a new company, they have found quick success because many larger brands such as Saks Fifth Avenue and Fred Segal have asked and offered deals with my brother’s company to sell his products in their stores because they are promoting the whole made in America idea. It sets themselves apart from other brands and they attract a lot more customers because American want to support other Americans.

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