China has been saving grace for Nike despite its fourth quarter being a disappointment!
Image Courtesy: highsnobiety.com
Sales in China last year jumped by 11 per cent for Nike – yet again bringing a double digit sales growth for the American sports retailer in China. That’s impressive!
What makes it more impressive is that all this has happened despite the pandemic havoc and extended lockdowns being a part of fourth quarter.
There were definitely some initial hiccups but now almost every Nike store has reopened in China and sales are picking up fast.
The fashion label said, while speaking to media, that retail traffic continues to improve week-over-week with higher conversion rates compared to what it was last year.
Notably, the sales of flagship Nike brand rose by 1 per cent on a currency-neutral basis in the country in Q4. With things returning to normalcy, Nike has been having good times with China market.
However, on a global level, it’s been a different story for the retailer! With 90 per cent of its stores closed in US, Europe and most of the Asia-Pacific during the quarter, sales fell by 38 per cent to clock US $ 6.3 billion.
There were shipping and returns expenses as well, which affected brand’s profits. The margins in Q4 fell to 37.3 per cent from 45.5 per cent last year.
Even in China, sales in Q4 fell by 3 per cent, but taking the whole year into consideration, China has been good for Nike and now with stores reopening and doing well, one can expect the market to do wonders for the label in the days to come.
Known for its athletic footwear and apparels, Nike generates revenue of US $ 36.39 billion.