Nike will cut ties with thousands of online distributors across China starting in January as the sports wear giant moves to streamline its digital marketplace and revive declining sales in one of its biggest markets.
The company announced the decision on Tuesday, saying the overhaul will reduce the number of online sellers, improve control over product distribution, and strengthen its business strategy in China.
Beginning next year, Nike’s online presence in China will shift primarily to its official website and app, along with its store fronts some of the country’s largest e-commerce and social platforms.
Currently, Nike products are sold through local channels as well as thousands of additional store fronts operated by brick and mortar partners and secondary distributors. While that broad network has made Nike widely accessible, it has also created inconsistent branding and pricing, complicating the company’s efforts to turn around sales in the region.
Cathy Sparks, Nike’s newly appointed vice president and general manager of Greater China, said the updated flagship stores will serve as a single, elevated destination within these platforms, offering clearer product presentation and a more connected shopping experience.
Word of Nike’s plans first surfaced last month in a local Chinese media report, prompting a note from BNP Paribas analyst Laurent Vasilescu, who compared the move to Nike’s earlier decision to cut off wholesalers in North America, a move widely blamed for the company’s declining market dominance and steep sales drops in that region.
Top sports CEO Yu Wu acknowledged the adjustment would create short term pressure on the business but said the shift would ultimately support a healthier, more sustainable retail environment in China over the medium to long term, while improving the overall consumer experience.
Nike’s China sales have declined roughly 30% over the past five years, adding pressure to the company’s broader turnaround efforts in one of its largest global markets.
