Nike Inc, originally named Blue Ribbon Sports, came to fruition in 1964. (https://www.britannica.com/topic/Nike-Inc). University of Oregon alumni Bill Bowerman and Phil knight are universally credited as the creators of the company. The world renowned athletic apparel manufacturer designs, develops, and sells athletic footwear, apparel, equipment, and accessories. (https://www.investopedia.com/articles/markets/080415/how-nike-nke-makes-its-money). Their apparel has become a staple globally. You can see Nike's logo endorsed on athletes across the world in every sport.

Nike routinely utilizes the mass marketing business model in regards to their products. This strategy gives the company the ability to market their product without preferential treatment to their customers. This indifferent stance, unfortunately, doesn't give Nike the luxury to use a uniform pricing strategy on their products. This is largely due to their massive diverse consumer base. Nike's revenue is heavily dependent on retail shoe stores that resell their products. Nike also has a home website to distribute their products to consumers.

A. Specialization:

Nike can focus their efforts on making the shoe production process more efficient. This can be achieved by hiring highly qualified engineers. The engineers enlisted will be specialized in the lean manufacturing process. This will give the company the opportunity to automate the shoe making process, eliminating the need for an excessive workforce. The reduction in the workforce will result in an increase in revenue for the company.

B. Division of labor:

Nike could also minimize the workload for their employees. This will increase the overall performance of their worker's craft immensely. The higher level of product quality will attract new customers. The newfound consumer base will result in an increase in sales, stabilizing a rather elastic product.

C. Advance technology:

The advance technology could potentially have a great effect on Nike products. The up to date techonoloy will result in a higher performing product. This will result in atheletes being more effective in their particular sport. A high performing athelete will influence the consumer to purchase the new and improved product.

D. Automation Devices:

Automation devices will result in a higher level of productivity in making shoes. The increased level of production will give Nike the supply required to expand globally. The global expansion will increase the brand image for Nike. The increased automation will also increase the sales volume, giving Nike the ability to scale all levels of operation regarding the company. The automation devices will also lower the cost of production due to the lower requirement of employees due to the automation process.

E. Quantity discounts:

Quantity discounts can potentially result in great benefits for Nike. Nike can leverage their suppliers to lower the cost of materials by purchasing larger quantities. The bulk discount factor will also give Nike the ability to recruit more retailers for their products. The quantity discount will also positively effect the consumer. The customer will instinctly purchase more product on the notion of getiing a greater bang for their buck. Nike will also reap a greater sales volume as a direct result of the discount.

F. Financial stregnth (credit)

Nike can leverage their stable financial stregnth to their advantage. For example, Nike can finance more equipment without investing a large sum of capital. This gives the company the resources to increase their level of production while having the extra resources to improve in other areas. Nike can also attract powerful new investors as a result of good creadit. The new investors will also give Nike the flexibity to store more cash capital, further increasing the financial stability of the company.

References

https://www.britannica.com/topic/Nike-Inc

https://www.investopedia.com/articles/markets/080415/how-nike-nke-makes-its-money

1. Of the six (6) ways to achieve economies of scale identified by your classmate's post, which is most feasible for the company to pursue in increasing economic profit?
2. Why did you choose that way (in letter a. above)? Provide five (5) reasons for your choice using microeconomic and macroeconomic concepts and terms in your response.