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"Sweatshop scandals have been the subject of more than 1500 news articles and opinion columns, and its stock has fallen heavily since 1995" (SOURCE: ("No Logo." Journal of Marketing; New York; Jul 2000; John Fahy [University of Limerick, Ireland]; Volume:  64 (3): 115). This is a review of No Logo by Naomi Klein (London: Harper Collins Publishers, 2000). 

The purpose of this site is to investigate the relationship between stories about Athletic/Campus Apparel and their stock value. In finance these are called "event studies," but in organization theory it is storying and restorying by a storytelling organization. Fama, Fisher, Jensen and Roll did the original event study stock market modeling.  They looked at residual patterns (looking at standard deviations in error terms) over time and assumed that the market enacts efficient reaction to relevant news stories so as to reduce investor risk.    Enjoy.

• The adidas-Salomon AG stock registration number (WPKN) is 500340. The Reuters symbol is ADSG.F. The Bloomberg symbol is ADS.
• Nike (NYSE:NKE)
• Reebok (NYSE:RBK)
• Converse (CVE:NYSE)
• Fila (NYSE:FLH)
• Vans (VANS:Nasdaq)
• K-Swiss (Nasdaq:KSWS)
• Timberland (TBL:NYSE)

This is relation of NIKE and SP500 index

TABLE ONE: GLOBAL FOOTWEAR MARKET SHARE (1999)

Source: 1999 Company Reports, US
Business Reporter *1998 figure; Washington Post, Sunday March 29, 1998; Wallace, 1997; ** Citing Morgan & Stanley, 2000; *** CCC Adidas Profile; Reebok figures

TABLE TWO: GLOBAL SOCCER MARKET SHARE 1998

Source: Portland Business Journal July 17, 1998 Gina Binole

TABLE THREE:  US FOOTWEAR MARKET SHARE adapted from Business Wire April 7, 2000; 2, 3)

Notes: U.S. market accounts for 40% of world-wide sportswear and sporting-goods sales (WSJ, Oct 11, 2000); *Down from 14% in 1998 (AP 9/9/1999); ** $2.899 billion sales (Reuters Feb 1, 2001); *** (Emporium 10/9/1997); **** Estimate for 1999 Report.

43.6 percent market share versus 15.9 percent for
Reebok, 7.4 percent for Fila and 5.2 percent for Adidas.

Table Four: Relative Market Shares (source Landrum & Boje, 2001)

Athletic Footwear Market Share Report Announced for First Quarter of 2000; Nike Holds Commanding Percentage of Footwear Market After First Quarter. Issue: April 7, 2000 Business/Sports Editors WEST PALM BEACH, Fla.--(BUSINESS WIRE)--April 7, 2000 SportsTrend.Info, latest sales figures for the athletic footwear market.

Using the most current point-of-sale data compiled from the nation's leading sporting goods retailers, department stores and specialty stores, SportsTrend.Info each week tracks exactly what products consumers are purchasing, as well as where and when.

The top-selling footwear manufacturers, first quarter of 2000 compared with the first quarter of 1999 based on market share dollars.

• After the first quarter of 2000, Nike products comprised more than 39% of the footwear market, including an astounding 65.5% of the basketball shoe market. Although down from last year's numbers (48.9% of the overall market and 73.6% of the basketball shoe market), Nike continues to dominate the footwear industry.
• In addition to its stronghold on the basketball shoe market, Nike's market share ranks first for cleated shoes (56.6%), second for aerobic shoes (22.7%) and casual shoes (12.0%) and third among court/fitness shoes (16.3%).
• Second among overall footwear is Adidas with a market share of 15.1%. After one quarter last year, Adidas was in the same position, holding the second highest overall market share (16.9%). In 2000, Adidas has closed the gap on Nike overall and ranks second in basketball shoes and cleated shoes.
• Remaining consistent from 1999-2000 is Reebok who's market share is 10.9% compared with last year's 10.9%. While remaining third in overall market share, Reebok continues to dominate the aerobic shoe market with a 61.4% market share, up from last year's first quarter share of 56.4%.
• Making a considerable jump from 1999 to 2000 is New Balance who's market share went from a 1999 first quarter percentage of 3.7 to a 2000 percentage of 9.4.
• K-Swiss raised its first quarter overall market share from 3.1% in 1999 to 3.6% this year and leads all manufacturers in 2000 with a market share of 28.5% in the casual shoe category. Timberland is number six for the first quarter of 2000 with a 2.9% market share, up from its 1999 first quarter share of 2.2%, while Asics raised its market share from 1.5% to 2.1% in 2000.

NIKE

Main Points and assumptions about the relationship between Storytelling and Stock Prices:

• Nike sells its products to approximately 20,000 retail accounts in the United States and through a mix of independent distributors, licensees and subsidiaries in approximately 110 countries around the world (source).
• Nike is one of the all-time great brand building stories and along with Coke and McDonalds one of the premiere global brand stories.  NIKE is the largest seller of athletic footwear and athletic apparel in the world.  It is impossible to escape the ubiquitous Nike swoosh or its "Just Do It" slogan. Nike sales zoomed from $3.8 billion in 1994 to $9.6 billion in 1998.
• But, fashion is fickle, and Nike serves that mistress with the new "I Can" slogan.  Nike has stayed above or even with the S&P 500 index. For much of the 1980's and 1990's Nike was on fire. Between 1995 and 1999 athletic shoe sales in the United States grew from $6.8 billion to $7.1 billion, or less than 1 percent, according to Goldman, Sachs.
• But, now the event history is catching up with the Swoosh. The company benefited as athletic shoes became a hot fashion statement that could be worn with jeans and suits alike.  But, now fashion is worshipping to new gods. "American consumers' new love affair with alternative footwear like rugged boots and lug-soled shoes" (press here).
• Bad press about labor and eco practices on occaision has an impact on stock prices. In 1997 and 1998, FAQs, or Frequently Asked Questions, on Nike's website were almost completely devoted to answering political questions about labor rights, not questions about its shoes or key endorsers such as Tiger Woods and Michael Jordan. After the stock fell in January, 1997, Nike engaged Andrew Young to salvage the tarnished image.
• The stories of major celebrity signings, stock splits, stock upgrade/down grades, shoe sales, expected excess inventories, the end to NBA strike, etc. has more impact than labor and eco practice stories. But there is an impact and it may be measurable. Insider and floor traders know how prices sink on bad news. Nike gets lots of coverage. For example, TheStreet.com has 353 Nike postings between 1996 and 1999.
• In 1996 CBS News and others began widely reporting alleged labor abuse by Nike in Vietnam and Indonesia. "Between the months of March to November, 1997, there have been four reports about Nike labor practices in Vietnam, Indonesia and China released by Vietnam Labor Watch (New York), Community Aid Abroad (Sydney), Hong Kong Christian Industrial Committee (Hong Kong) and Transnational Resource & Action Center (San Francisco). Each report generated many newspaper articles and editorials about Nike's horrible treatment of its factory workers" (press here). Tales of Nike exploitation have also sparked demonstrations back home in New York, San Francisco, Los Angeles and Seattle as well as Europe, Australia, and Canada.
• I assume while many investors buy stock and sit on it for long periods of time, those on the trading floor get their news by the hour and react accordingly. And "An interesting angle on Nike is that employees and management own an exceptionally high 69% of the stock, half of which is CEO Phil Knight's stake" (October 28, 1997 press here).
• Nike's abilty to restory and recharacterize its public image following a bad press story has commodity value. One new story is that sneaker customers are buying those rugged boots.  Another is that people do not want to buy shoes from firms with labor problems.
• Then there are the Asian financial problems. "Nike's total sales dropped from $9.6 billion in fiscal 1998 to $8.8 billion in fiscal 1999."
• Finally, I assume that Nike's 1,000 public relations and labor practices employees are out there correcting and putting their own spins on bad press stories that might dampen enthusiasum in their stock. Nike also creates news that is favorable to Nike's brand building.

NIKE - Where Shoes are made?
(Source 1999- Annual Report) (press here) - Virtually all of our footwear is produced outside of the United States. In fiscal 1999, contract suppliers in the following countries manufactured the following percentages of total NIKE brand footwear:

   Country                                                                Percent
   -------                                                                   -------
   People's Republic of China.....................................    40
   Indonesia.............................................................    30
   Vietnam...............................................................    12
   Thailand...............................................................    11
   Italy.....................................................................     2
   The Philippines......................................................     2
   Taiwan..................................................................     2
   South Korea..........................................................     1

We [Nike] also have manufacturing agreements with independent factories in Argentina, Brazil, and Mexico, to manufacture footwear for sale within those countries. Our largest single supplier accounted for approximately 8 percent of total fiscal 1999 footwear production.

NIKE - IN THE STOCK NEWS

1962 - Phil Knight's research paper at Stanford asserts that low-priced, high-tech, well-merchandised exports from Japan could replace Germany’s domination of the U.S. athletic shoe industry.

December, 1963, Phil Knight received his first shipment of "tiger" shoes from Japan. He began to sell them at track meets from the back of his truck.

1968 - Phil Knight founds Tiger Shoes -NIKE, Inc. was incorporated in 1968 under the laws of the state of Oregon. Prior to 1968, Mr. Knight was a certified public accountant with Price Waterhouse and Coopers & Lybrand and was an Assistant Professor of Business Administration at Portland State University.

1969: Knight resigns his position as Assistant Professor of Business Administration at Portland State University to devote himself full time to the company.

1971 - In 1971, when the company was called Blue Ribbon Sports (press here) -The SWOOSH logo is a graphic design created by Caroline Davidson  in 1971. It represents the wing of the Greek goddess Nike. Caroline Davidson was a student at Portland State University interested in advertising. She met Phil Knight while he was teaching accounting classes and she started doing some freelance work for his company. Phil Knight asked Caroline to design a logo that could be placed on the side of a shoe. She handed him the SWOOSH, he handed her $35.

1980 -NIKE stock goes public, offering 2 million shares of common stock to the public.Revenues exceed $269 million for the year.

1985 - Chicago Bulls basketball rookie Michael Jordan endorses NIKE line of AIR JORDAN
court shoes and specialized apparel.

1987 - Nike's Revolution ads commodify dissent: 1987 (press here).

1988 - "Just Do It" Campaign designed by Dan Wieden is introduced.

1990 - Spring -(press here) Ethics and Sneakers by Louis Corrigan (June 18th, 1997) "It's murder, gentlemen. No rhyme, nor reason, just murder. For sneakers. For jackets. Get it Spike? Murder."  --Phil Mushnick, columnist for the New York Post, 1990  In the spring of 1990, Nike's latest edition of the wildly popular Air Jordans and Reebok's new "high-tech" Pump basketball shoes hit the stores with a then unprecedented retail price of $175.  Around the same time, the media went wild over a handful of gory inner-city tragedies: kids shot down in cold blood by other kids who wanted their fancy sneakers or flashy team jackets and  would literally kill to get them. What blame should be meted out to a company (like Nike), a star pitchman (like Michael Jordan), and a hip director turned ad maestro (like Spike Lee) who could create such an iconic aura around a pair of shoes -- mere rubber and leather, after all -- that customers would either pay more for them than they could afford or maybe just blow someone away to enjoy a piece of such transcendent cool?

Nike's supreme success in marketing the romance of sport and the ascendant glory of His Royal Airness irrefutably contributed (and still contributes) to an ethos in which we are all constantly told to want what we cannot really afford and what may not necessarily be good for us. For many Nike investors, there's no doubt one easy answer: there are no ethics involved -- unless, of course, the company could charge even more.

• - After years of war and embargo, Vietnam decided in 1988 that it wanted back into the global mainstream. The country instituted a sweeping new policy known as "doi moi," or "open door." More than 35,000 Vietnamese workers walked through that open door in 1995 when six  Nike-aligned shoe factories opened for business. Nike's subcontractors pay those workers, on  average, $1.50 a day, making Vietnam the cheapest country for Nike manufacturing operations. China, at $1.80 a day, is next cheapest. In Indonesia, where more Nike products are made than any other country, the factories pay $3.30 a day.

 
• Nike quickly sank into a quagmire of controversy after accounts surfaced that workers were being hit and groped by foreign managers.

1996 - Nike increased its footwear production in 1996 by an amount that exceeded Adidas' total production.

May. 28, 1996. Knight Ridder, Tribune. (press here) Our purchases keep children in chains By Joel D. Joseph/Knight-Ridder/Tribune Tuesday, May 28, 1996- Nike is not only allegedly exploiting women workers in Vietnam, Indonesia and China. Nike products has been found to be made by child labor in Pakistan.

July 9, 1996 - AP News - (press here) Nike Profit Rises 38 Percent in Latest Quarter The sneaker industry leader said Tuesday it earned $156.4 million, or  $1.06 per share, in the three months ended May 31 compared with  $113.4 million, or 78 cents a share, a year earlier. That was above the consensus estimate of 98 cents per share held by 17 analysts surveyed before the earnings report by Zacks Investment Research.

July 23, 1996. AP-News. Jesse Jackson returns from far east criticizing factory conditions.

Sep. 17, 1996. AP-News. Nike rejected a plan that would required independent monitoring of its factories.

Sep. 19, 1996. AP-News. Investors Take a Stand Against Sweatshops.

1996 - Life Magazine (June) pp. 38-48.Schanberg, Sydney H. (1996) "On the playgrounds of America, Every Kid's Goal is to Score: In Pakistan, Where children stitch soccer balls for Six Cents an hour, the goals is to Survive." Additional reporting by Jimmie Briggs (See Pakistan).

October 3, 1996. CNW. Nike announces the establishment of Labor Practices Department headed by Dusty Kidd.

October 17, 1996 - Nike Labor Pracices in Vietnam - 48 Hours Transcript of CBS News 48 Hours, aired October 17, 1996 (press here)

• Baskin: (Voiceover) Thuy and 14 other team leaders were singled out and punished by their Korean supervisor, Madame Baeck, seen here sitting at a table with the Nike shoe she used to hit the women. It was in retaliation for some poor sewing.
• Thuy: (Voiceover) (Through Translator) She hit all the 15 team leaders in turn from the first one to the 15th..
• Baskin: Did she actually beat you with part of a shoe?
• Thuy:(Through Translator) Yes, she did.

e.g. In the spring of 1996, company officials heard the results of a Nike-authorized Harris & Associates survey. According to a highly placed former employee, participants in a survey of Nike's target audience - young people 13 to 25 years old - listed what Nike Inc. meant to them:  1. Athletics. 2. Cool. 3. Bad labor practices (source Oregonian - press here).
e.g. July, 1996. Life magazine published a shattering article replete with photos of Pakistani children stitching soccer balls for Nike, Adidas AG and other companies.... By May 1996, Nike was developing a plan with its Pakistani subcontractor to centralize stitching and eliminate  the child labor, said Dusty Kidd, manager of Nike's  labor practices department  (source Oregonian - press here).
e.g.  In August 1996, the company joined the Apparel  Industry Partnership, a coalition of companies and labor and human rights groups assembled by the Clinton administration, to draft an industry-wide code of conduct.

October 31, 1996. Nike Press Release. The opening of NikeTown in New York City is site of first consumer protest. This shoe store costs Nike over $200 million to build, 4 times more than what Nike paid to all of its factory workers last year.

November 1, 1996 - Nike: The Manhattan Jinx Strikes  (press here) 11/1/96 4:00 PM ET  Is Nike (NKE: NYSE) the latest company to fall victim to the "Taj Mahal Syndrome?" According to Wall Street lore, whenever a company  opens a posh corporate headquarters or a retailer  opens an extravagant flagship store in Manhattan,  investors see nothing but a loss of corporate savvy. Why, they wonder as they ride trains to Greenwich and take helicopters to the Hamptons, would  anyone want to open a fancy operation in Manhattan? Well, on Friday, as if directed from a script, Nike opened its largest and most "ambitious" Nike Town store to date amidst much hoopla and the stock got slammed harder than a Michael Jordan dunk. Nike  shares fell 4 + to 54 7/8. ... The sports apparel giant has the dubious luxury of  not needing to make the store profitable since they  dominate the athletic footwear market with 37%. For fiscal 1996, Nike earned $553.2 million, or $3.77 a share, compared with $399.7 million, or  $2.72 a share, a year earlier.

November, 1996 Report Released - (press here) Sweating for Nike A Report on Labour conditions in the sport shoe industry  Community Aid Abroad Briefing Paper, No. 16 - November, 1996 Tim Connor and Jeff Atkinson This report gives a thorough overview of the history of conditions in Nike factories inIndonesia up until November 1996.

November 29, 1996 - (press here) - Reebok Runs Like the Bulls By Avi Stieglitz  11/29/96 3:45 PM ET  Can Allen Iverson be like Mike?  Reebok (RBK:NYSE) has bet heavily--signing the fleet-footed, diminutive Philadelphia 76er rookie point guard to a $40 million dollar multiyear deal--in the hopes that he will be able to replicate the success Michael Jordan has had endorsing basketball shoes for Nike (NKE:NYSE).

Feb, 1997 Nike stock peaks at $76.  (press here) The stock traded lower toward the end of 1996, possibly because many  investors concerned about the valuation began to sell. Nike had risen from a split-adjusted $32 1/2 in October 1995 to $62 in only one year and many thought that this was as good as it would get.

February 13, 1997 - (press here) - Converse Kicks Around the Super Show By Avi Stieglitz 2/13/97 2:00 PM ET ATLANTA -- It is fitting that Converse (CVE:NYSE), whose stock has been on the rebound in recent months, signed the NBA's king of  rebound, Dennis Rodman, to a sneaker contract  late last month. Converse's stock suddenly has the legs of the colorful Chicago Bulls forward, soaring from 3 7/8 several months ago to 20 3/4. On Wednesday alone, the stock moved 4 3/8, or more than 20%, on news that the company had settled legal problems and that two analysts had upgraded the stock to a buy. On Thursday, Converse rose 1/8 to 20 7/8.

February 18, 1997 - (press here) -  Nike stock climbed 72 percent in 1996 and has risen about 13 percent so far this year... Nike sales have shot up all over the world, including a 200 percent increase in Japan and a 93 percent gain in Britain. Its debt is down to below 5 percent of capitalization (compared with about 50 percent for Reebok).

February 22, 1997 - (press here) -  On February 22, hundreds of activists filled San Francisco's Union Square on the opening day of Niketown, a multi-floor Nike superstore. Outside theentrance, hundreds of protesters chanted, "Just don't do it!" and urged prospective customers tostay away. New Republic

February 24, 1997 - (press here)  Nike announces former Ambassador Andrew young will investigate the allegations of labor abuse. New Republic. (For Andrew Young Report, press here)

March 1, 1997 - (press here) - Tuesday: Sneaker Rumors Come Untied  By John J. Edwards 3/11/97 6:00 PM ET What little excitement there was Tuesday on the Street seems to have been for naught.  Nike's (NKE:NYSE) loss on the day appears to have been caused by a mere chimera. A report that the Foot Locker chain had pared its Nike orders for fall originated in Sporting Goods Intelligence, a trade magazine, and swept through the market. But after the close, Woolworth (Z:NYSE), Foot Locker's parent, said the rumor was bogus. "We had a terrific year last year and plans with Nike continue to go forward uninterrupted," a Woolworth spokeswoman told Reuters.

March 8, 1997 - Date that Nike workers in Vietnam run around the compound as punishment. The incident is reported in the Vietnam press and trickles into Western media columns.  Supervisor Hsu was accused of forcing 56 female workers at the Nike plant run laps as punishment for not wearing regulation shoes. She was  suspended by Nike in response to a labor rights report by activist Thuyen Nguyen. At least 12 of the women fainted and were hospitalized, Nguyen said in the report.

March 2-18, 1997  VLW- Vietnam Labor Watch Report is conducted (press here)- Vietnam Labour Watch Reports This report and its highlights are the result of a six  month effort by Vietnam Labor Watch (VLW) to understand the working conditions of workers at factories in Vietnam that make Nike products. The effort  was started in October 1996, after the CBS News program 48 Hours ran a segment detailing the abuse of  Nike workers in Vietnam.

March 21, 1997 (press here) - Nike running wild Analysts lace up excitement as earnings race past expectations  From Correspondent Bill Tucker March 21, 1997: 7:24 p.m. ET Converse rebounds - Feb. 21, 1997 Knight waffles on success - Feb. 4, 1997 Rodman splits  with Nike - Jan. 10, 1997 Running shoes  gaining - Nov. 8, 1997  Nike.com  NEW YORK (CNNfn) - Shoe giant Nike Inc.'s stock fell 2-1/4 Friday to close at 65-1/4, even  though the company unveiled marathon quarterly results late Thursday.

March 28, 1997 IN AMERICA / By BOB HERBERT, New York Times Aricle - "Brutality in Vietnam" -- "That was horrible," said McClain Ramsey, the chief spokeswoman for the Nike footwear empire. "That was definitely horrible. Nike is definitely outraged that that was allowed to happen in a factory. I know that the manager has already been suspended. Nike has called for a full investigation, as have the authorities. That was just totally outrageous. I mean Nike is completely horrified."

Storyline _ "On March 8, which happened to be International Women's Day, 56 women employed at a factory making Nike shoes in Dong Nai, Vietnam, were punished because they hadn't worn regulation shoes to work. Factory officials ordered the women outside and made them run around the factory in the hot sun. The women ran and ran and ran. One fainted, and then another. Still they ran. They would be taught a lesson. They had worn the wrong shoes to work. More women fainted. The ordeal didn't end until a dozen workers had collapsed."

April 14, 1997 (press here) - Monday: Dow in Correction Territory; Nike Gets a Tiger Boost By  By John J. Edwards III  4/14/97 11:45 AM ET  Staff Reporter - ... A note from the sporting world: The historic triumph of Tiger Woods at the Masters tournament is just doing it to Nike's (NKE:NYSE) shares, which are up 3/4 at 55 3/4.

April 16, 1997 - Riding The Roller Coaster by Risa Kaplan- (press here) -On April 16, retailer FOOTSTAR (NYSE: FTS) announced it would have lower-than-expected sales at its athletic shoe outlets. As the company is one of Nike's biggest customers, this appeared to confirm the comments Landis had made. As if Nike was not having enough problems, it was around this time that national press reports began to appear that characterized Nike as a big bad company engaged in "unfair labor practices" in Asia.

April 17, 1997 - (press here) - Nike: Bully on the Block? By Suzanne Kapner Staff Reporter 4/17/97 12:00 PM ET The Smith Barney/Nike (NKE:NYSE) tangle just keeps getting messier. A week after the Street reeled on reports from Smith Barney analyst Faye Landes that Nike would cut shoe production 20% from May through July -- a prediction Nike denied -- the chatter has turned ugly. During a Merrill Lynch conference last week,  Nike's chief financial officer, Robert Falcone, made  remarks that at least some listeners considered disparaging toward Landes.  "The comments had a venomous tone," says one person who was present but asked not to be identified. ... At least a couple of other analysts apparently agree  with Landes that Nike's in for some rough road. Days after Landes downgraded the stock from outperform to neutral, Gruntal & Co. and Donaldson Lufkin & Jenrette did the same. After Landes' downgrade, the stock dropped from 59 1/8 to 54 7/8. Though it subsequently regained some of  that loss, it was back trading around 53 1/4 on Thursday.

April 18, 1997 (press here) -  Kudos from Cramer to Landes and Kurlak  By James J. Cramer 4/18/97 10:15 AM ET - When she downgraded Nike recently she did so not  to make a name for herself -- she has a good one already. She didn't do it to get the investment banking business of Adidas. She didn't do it  because it was Institutional Investor balloting season. She did it because she was afraid she  would cost us money if she stuck with the Nike buy  rec. She did it to preserve clients' wealth.  That's all we ever ask for. She didn't do it lightly. I remember after a brutal Montgomery downgrade of Nike last year Faye kept me in through repeated phone calls. I averaged down, waged the war, made it back, and then some. And she was dead right. That anybody would take a shot at her from Nike now is unconscionable

April 23, 1997 - 13,000 Nike workers on Long March; Tangerang totally (press here) Jammed Republika, 23 April 1997 Angered by the failure of their employers to pay the increased minimum wage, at  least 13,000 workers of the Hardaya Aneka Shoes Industry, Tangerang, who  manufacture Nike footwear, marched ten kms to the local assembly building in Tangerang.

April 26 1997 - Strikes and labor  unrest in Indonesia  and Vietnam (press here) JAKARTA, April 26 (Associated Press) - Officials ordered a factory that makes Nike shoes shut down Saturday after workers burned cars and ransacked its offices, saying the company wasn't paying them a $2.50 a day minimum wage. Almost half the factory's 10,000 employees took part in Friday's demonstration at Tangerang, an industrial town outside Jakarta

May 2, 1997 -  Nike workers strike! Mike Rhodes (press here) "On April 22 and then again on April 25, 10,000 workers went on strike at a Nike factory in Indonesia. During the same week, 1,300 workers went on strike at a Nike factory in Vietnam. Also (press here) for similar report.

May 6, 1997 (press here) - Nike Battles Back Against Deluge of Bad News By Avi Stieglitz Staff Reporter 5/6/97 1:00 AM ET  A deluge of negative sentiment surrounding sneaker powerhouse Nike (NKE:NYSE), from consecutive pessimistic stories in The Wall Street Journal this past week to the steady stream of scathing commentary from Bob Herbert in The New York Times, may mean that it's time for contrarians to jump back into Nike stock.... After industry-wide euphoria emanating from the  sporting goods Supershow in mid-February pushed the stock to an all-time high of 76, Nike's stock slipped 32% to 51 3/8 by April 18 amid concerns of  weaker athletic footwear growth in the U.S.  The Wall Street Journal's influential "Heard on the Street" column rehashed many of these dated  worries on Friday, helping push down Nike's stock 1  5/8 to 55 7/8. The stock regained that ground early   in Monday's trading session despite a front-page story in the same paper outlining difficulties Nike is  facing as it attempts to build international sales. Midday Tuesday the stock was trading at 59 1/8.  The domestic slowdown should have come as no  surprise to anyone who follows the company closely; for the past year, Nike has been warning  that sales of its popular basketball and running  shoes in the U.S. would moderate and that it was emphasizing international sales for both revenue  and earnings growth. ... While Monday's 2,500-word Journal story made the  case that Nike is tempering some of its provocative marketing and advertising strategies overseas to avoid backlashes, the story did not offer any  concrete examples of why Nike's international  growth goals are unattainable.

May 27, 1997 - Riding The Roller Coaster by Risa Kaplan- (press here) -On May 27, the clouds appeared to part as Nike jumped from $55 1/4 to $60 in one hectic session and no one could pinpoint exactly why. The next day, rumors emerged that Warren Buffet's BERKSHIRE HATHAWAY (NYSE: BRK.A) was interested in accumulating more of the Oregon-based sneaker company. This was not as huge a surprise as it was painted, however, as Berkshire already owned five million shares of the 287 million outstanding through its GEICO insurance subsidiary.

May 27, 1997 - Riding The Roller Coaster by Risa Kaplan- (press here) - Just as things seemed to improve, the other sneaker dropped on May 29. Nike announced that earnings for the fourth quarter would be between $0.51 and $0.56 per share, well below the consensus estimate of $0.69 per share. The company blamed lower-than-expected revenues due to order mix, shipments timing in Europe, product shortages, and a slight increase in U.S. order cancellations. The company also reported that earnings would be impacted by a one time pre-tax charge of $18 million related to the shutdown of a manufacturing facility at its Bauer Inc. subsidiary as part of its long-term plan to reposition some manufacturing facilities to more cost-effective overseas operations. Disappointed shareholders drop-kicked the stock for $8 3/4 to close at $55 3/4. Since that nasty week, shares of Nike have slowly started to climb back on average volume to close Wednesday at $60 3/8. Even a Goldman Sachs & Co. downgrade  to "market outperformer" from the U.S. "recommended list" on June 6 hasn't had that much impact.

May 29, 1997 (press here) - Thursday: Market Looks Firm, Nike Looks Bad By Justin Lahart Staff Reporter 5/29/97 5:00 AM ET "The disaster of the day is Nike (NKE:NYSE)," says Baker.  Nike warned that its earnings for the fourth quarter ended May 31 will be between 55 and 60 cents a share, excluding charges. That's well below First Call consensus estimates for earnings of 69 cents a share. The shoemaker also said that it would take a charge of 4 cents a share for the closing of one of  its Bauer subsidiary's plants. Yesterday, Nike shares gained 3 7/8 to 64 on rumors that Warren Buffett has been putting more of his chips on the company. "Nothing like making a big sale ahead of news,"  says one trader.

May 31, 1997 - (press here) The cracks in the production process became apparent toNike investors in the fourth quarter of its 1997 fiscal year, which ended May 31. The company's revenue fell short of expectations in part because it was late in shipping some products, mostly apparel. Officials said the late shipments reduced fourth-quarter revenue by about $30 million.

June 3, 1997 - (press here) - WSJ After years of increasing market share, landing top endorsers and placing its Swoosh logo on just about everything, Nike suddenly seemed vulnerable last week when it announced its fiscal fourth-quarter earnings would be below Wall Street forecasts; the news sent Nike stock tumbling 13 percent in Thursday trading on the New York Stock Exchange. Expectations were high because of the company's remarkable growth over the past several quarters, with profit increases as high as 80 percent in recent periods.

June 27, 1997 - Nike Supervisor Gets 6 Months for Abusing Workers (press here)  By Ian Stewart  June 29, 1997  Ho Chi Minh City, Vietnam (AP) -- A floor manager at a  Taiwanese-owned factory that makes shoes for Nike was sentenced Friday to six months in prison for physically abusing workers.

July 1, 1997 - (press here) - Tuesday: Nike Earnings Fall Short of Lowered Estimates By 7/1/97 6:00 PM ET Compiled by John J. Edwards III  Staff Reporter ... Nike (NKE:NYSE) continued to tread a disappointing path, reporting fourth-quarter earnings  of 52 cents per share versus 46 cents a year earlier.  The 17-analyst First Call consensus estimate was 53 cents, however. Estimates were trimmed from 69 cents after Nike warned May 29 of a coming shortfall. Nike shares dipped to 58 after hours from their close at 58 13/16, Reuters reported.

July 14, 1997 (press here) - A Bangladesh newspaper, The Independent of Dhaka, reported on July 14 that nine workers from the Youngone factory were in jail, 300 injured (50 seriously), 97 fired and 800 charged with criminal offenses after they tried to present a statement to their employer, a Nike contractor. But before workers had a chance to make their statement, which included a demand for the release of two
colleagues arrested earlier that week, they were overwhelmed by a large police contingent.

AUGUST 25, 1997 - (press here) - Even by New York City standards, it was an impressive party. To celebrate the opening of the Manhattan Nike Town at 57th and Madison last fall, Nike held a gala. Its five-story footwear cathedral was outfitted with a giant movie screen, automated product displays and 66,000 square feet of Nike gear. More than 400 staffers, VIPs such as Donald Trump and Carl Lewis and select members of the media crowded into the space to toast Nike's new digs.

August 27, 1997 - (press here) - Nike Insiders Dump 467,492 Shares - WSJ - NEW YORK (Reuter) - A group of 12 Nike Inc insiders sold 467,492 shares in the company's stock last month, the Wall Street Journal reported Wednesday in its "Heard on the Street" column. The insiders, including Nike's president, Thomas Clarke, and its chief financial officer, Robert Falcone, sold the shares at prices ranging from about $59 to $63 a share, the paper said in its electronic edition Wednesday. "If you look at who sold, it was everyone who was important in the company," said Alice Ruth, an analyst at Montgomery Securities. Nike chairman and chief executive Philip Knight was not among the sellers, the paper said. Nike shares closed down 2/16 Tuesday at 55-3/16.

September 17, 1997 - (press here) - On Earnings Eve, Swoosh  Sucking Wind  By Suzanne Kapner Staff Reporter 9/17/97 5:55 PM ET Nike (NKE:NYSE) has been more like a foul than a slam dunk this year for investors. And according to  several analysts and portfolio managers, the pain won't subside in the next few months. The Swoosh slump began when retailers reported slowing sneaker sales this spring. Since then the Street has disagreed over Nike's prospects. Bulls champion international growth, which has been soaring. Bears point to the sluggish domestic market, which has slackened in the wake of the  much-publicized dip in basketball sneaker sales. Now there's Street chatter of problems in the fast-growing Asian market, and expectations for falling gross margins and rising inventories. Some company watchers say the stock could fall to the  mid-40s. Wednesday it closed at 53 1/8, off its 52-week-high of 76 3/8.

September 18, 1997 (press here) - Nike Beats Q1 Estimate, But The Game's Not Over  By Suzanne Kapner Staff Reporter 9/18/97 7:23 PM ET Nike's (NKE:NYSE) stock drifted higher Thursday ahead of the company's fiscal first quarter earnings report, released after the market closed, but certain details discussed in the conference call could damp any good feelings stemming from the profit news. Nike did beat analysts estimates for the quarter, as measured by First Call, by a penny, earning 85 cents per share. But analysts who participated on the conference call indicated that there is a strong possibility that the consensus earnings estimate of $2.95 for the fiscal year will be revised downward. Nike Chief Financial Officer Robert Falcone said earnings for the year would only modestly beat last year's $2.69 per share.

September 19, 1997 (press here) - Nike Takes it on the Chin After Earnings Report  By Suzanne Kapner  Staff Reporter  9/19/97 12:55 PM ET Nike (NKE:NYSE) shares drifted lower Friday  morning after investors digested the company's first  quarter earnings, which were released yesterday evening.  After a delayed opening, the stock traded as low as 53 1/2, before rebounding to 54 1/4 by midday.  Thursday shares closed at 54 7/8. ... As a result, one of Nike's staunchest supporters, Salomon Brothers analyst Brett Barakett, lowered his rating on Nike Friday morning from a strong buy  to a buy. He also lowered his fiscal year estimates from $2.97 per share to $2.72 per share. Salomon Brothers has not performed any recent underwriting for Nike.

September 21, 1997 - TRAC Study on Nike in China Released (press here) - Working Conditions in Sports Shoe Factories in China Making Shoes for Nike and Reebok  By Asia Monitor Resource Centre and Hong Kong Christian Industrial Committee, Hong Kong

September 21, 1997 - Nike Can Still Run Faster, Jump Higher - By Stacey L. Bradford (press here) Given the hubbub surrounding Nike earnings over the past few days, you'd think there was something new -- and newly bad -- to report about the world's largest shoe company. In fact, the first-quarter results announced after the close on Thursday were probably a little better than might have been expected, given Wall Street's gloomy predictions following the May quarter.  It is true that Nike's colorful chairman, Phil Knight, warned analysts that earnings for the year ending next May will probably be only slightly ahead of last year's. And the company predicted that a slowdown in U.S. sales this fall will dampen overall revenue growth as well. But this much had been predicted ever since Smith Barney analyst Faye  Landes noted this spring that Nike would slow production because of growing inventories. Nike overpriced its shoes and is now suffering the consequences. That's why the stock has fallen to 54 from its February peak of around 75.

September 23, 1997 - (press here) - Nike announced they are cutting ties with four Indonesian companies who refused to comply with the company's standards. Citing reviews of wage levels and "sweatshop" working conditions, Nike determined four companies, including Seyon, which makes its sports gloves, were not in compliance with Nike's code of conduct. The announcement was made at Nike's annual shareholder's meeting yesterday.

Sepember 27, 1997. Some Youthful Foes Go Toe to Toe With Nike from the New York Times. Dozens of young people from 11 settlement houses around the city  are planning to dump their old Nikes at the store to protest what they say is the shoe company's double exploitation of the poor.

October 18, 1997 (press here) there will be the 2nd international mobilization in support of the rights of Nike production workers. International Boycott Nike day (Has good analysis of Nike-Vietnam worker pay stubs). See also (press here) for paystubs.

October 26, 1997 -  - Nike Supports Women in Its Ads but Not Its Factories, Groups Say By Steven Greenhouse New York Times. A coalition of women's groups has attacked Nike as hypocritical for its new television commercials that feature female athletes, asserting that something is wrong when the company calls for empowering American women but pays its largely female overseas work force poorly. (Press here) for story and CLR site.

October 26, 1997. The Trouble With Role Models from Washington Post. Among the many carefully detailed omissions and distortions in the Young report is the highly embarrassing fact that Young, in talking with Vietnamese workers, used Nike translators. As Stephen Glass notes, Garry Trudeau -- in his widely  syndicated comic strip, Doonesbury -- presented a Nike translator rendering "the [Asian] workers' pleas of mistreatment into joyous reports of a labor paradise."

October 26, 1997. Women's groups blast Nike's latest ad campaign from Reuters. Fifteen U.S. women's groups, author Alice Walker and the head of the Congressional Black Caucus joined forces on Monday to put pressure on Nike Inc. (NIKE) to improve conditions for its workers in Asia. The groups took issue with Nike's latest advertising campaign, which features women empowered by athletics, saying Nike's treatment of Asian factory workers -- most of whom are young women -- must improve if U.S. women were to buy Nike products in good conscience

October 27, 1997 - (press here) New Jersey schoolchildren staged an anti-Nike play on Broadway Oct. 27.

October 28, 1997 - Nike: A Silver Lining to the Asian Crisis? (press here) So did Nike (NYSE:NKE - news) sidestep the market massacre on Monday? Hardly. It fell another 2-13/16 or 6% to a new 52-week low. Nike is also one of those companies that generates a lot of sales in Asia, but the damage to the top line (revenues) could be more than offset by lower costs, leaving the bottom line stronger in the end. Asia Pacific revenues jumped to $1.2 billion in fiscal year 1997, but that amounted to just 13% of total sales. Japan accounts for half of the region'ssales, and the currency problems there have been minor lately compared to many other Southeast Asian countries.This does not mean investors can expect Nike to rally while the rest of the market falls like a load of bricks. It does make a good case, though, for expecting less of a hit compared to other companies which manufacture here and sell in Asia. Of course, there are plenty of other issues affecting Nike's share price that investors must consider, and Nike's sell-off started well before the Asian currency crisis began to rattle U.S. stocks. Indeed, after months of speculation that the domestic market for athletic shoes and apparel was slowing early this year, the company finally warned that its revenues and earnings would fall well short of expectations for the quarter ending May 31. Then in September the company reported 10% growth in futures orders and warned "futures orders indicate that year-over-year revenue growth [in fiscal year 1998] will likely be slightly below our previously-stated long term revenue growth target of 15%."

• The stock has tumbled over 40% from a high of $76.38 to $45.75 currently. Nike's

Price/Earnings ratio has fallen to 16.5 (using trailing twelve month earnings per share) from as
high as 31 in recent years. That just goes to show even when you're a global brand powerhouse
like Nike, if you commit an earnings foul you get sent to the penalty box just like anyone else.
Nike's P/E is well below the S&P, which prior to Monday was trading at 23 times earnings. In
contrast, the aggregate earnings growth rate for S&P 500 companies is roughly 7%, compared to
the 15% rate expected by Nike and analysts who cover it.

November 7, 1997 (press here) - Transnational Resource & Action Center---Corporate Watch--- FOR IMMEDIATE RELEASE:  November 7, 1997 Secret Ernst & Young Audit of Nike in Vietnam Exposes Hazardous and Unjust Working Conditions: Accounting Firm's Labor and Environmental Auditing Competence Comes Under Fire as TRAC Independently Documents Even Worse Conditions Inside the Same Nike Factory Audit, TRAC Report and First Photos From Inside a Nike Vietnam Plant Available on Corporate Watch

November 8, 1997 Nike Shoe Plant in Vietnam Is Called Unsafe for Workers
By STEVEN GREENHOUSE. This is the NY Times article that broke the audit story (press here) but you will need to get free subscription to enter site.

November 10, 1997 (press here) - SMOKE FROM A HIRED GUN: A Critique of Nike's Labor and Environmental Auditing in Vietnam as performed by Ernst & Young by Dara O'Rourke  November 10, 1997 Transnational Resource and Action Center (TRAC)

Nike hired the public accounting firm Ernst & Young to conduct an audit of labor and environmental conditions inside its subcontractors' factories in Vietnam to see if the factories were in compliance with Nike's corporate code of conduct. This secret rep ort was recently leaked to a research associate of the Transnational Resource & Action Center (TRAC) in San Francisco, California.

• "Nike Tracks Across the Globe" - 450,000 workers power the athletic shoe maker's machine, but the opportunity to better themselves comes at a cost  (click here) for Oregon Live article and photos.
• "Huge subcontractors find they must dance the tune Nike calls Suppliers are dependent on - and  increasingly monitored by - the footwear and apparel giant By Jeff Manning of The Oregonian staff (Click here).

"Nike battles back, but activists hold the high ground" - The sneaker maker tries to repair its reputation as critics press on in the public relations fight By Jeff Manning of The Oregonian staff (press here).

November 11, 1997 (press here) East Timor/Nike Activists  on Hightower Radio! On Tuesday, November 11, Nina Maria da Costa, an East Timorese human rights activist, and Max White, founder of the "Justice--Do It, Nike" campaign, will be interviewed on Jim Hightower's national radio program, "Hightower's Chat & Chew". The  20-minute interview will be followed by 40-minutes of national call-in. Listeners on 120  stations across the country can join the conversation with Nina and Max by calling 800 TALK-YES.

Novermber 19, 1997 - Congress Critical of Asian Workplaces - Nike Defends Labor Practices  “We think the Nike labor record abroad is atrocious and Mr. Knight must  begin to treat Third World  workers, mostly women, with respect.” — U.S. Rep.Bernie Sanders,I-Vt. By Scott Sonner The Associated Press W A S H I N G T O N,   Nov. 19 — Nike President  Philip Knight defended his company's labor practices Wednesday in a letter to congressional critics of low wages and poor working conditions at Nike factories overseas. (Click here) for ABC News story.

December 4, 1997 (press here) - Nike (NKE:NYSE) can't outrun the options players who have been speculating on disappointing earnings this week. With Hambrecht & Quist down on the Swoosh, December and January puts at the 50 and 55 strike prices were busy earlier this week. Today, two traders hit the company's January 37 1/2 puts, trading more than 10,000 contracts. Options traders said today's action might have been market makers hedging themselves to offset the week's earlier activity. Nike is scheduled to report earnings Dec. 18. Nike shares have been in a slump since mid-August and today were trading slightly above 47.

December 11, 1997 (press here) - Market Skids on Asian Jitters, Earnings Warnings  By Justin Lahart Staff Reporters  12/11/97 11:16 AM ET Traders took to their desks this morning knowing that they were in for an ugly market. Asia had  tanked overnight, and the news out of Korea, where more bankruptcies are expected and anger over the austerity measures demanded by the IMF bailout package are rising, is grim.... The shoe stocks are getting hit, as investors  wonder if Reebok's troubles are sectorwide. Reebok is off 3 3/4 at 21 9/16, while Nike (NKE:NYSE) is down 1 at 45 1/2. Woolworth (Z:NYSE), which  derives most of its earnings from its Foot Locker division, is down 1 3/16 at 20 5/8.

December 11, 1997 (press here) - Reebok's Warning Reveals Weakness in Overall Sneaker Market  By Amy Olmstead  Staff Reporter 12/11/97 5:14 PM ET Sneaker stocks are getting trampled today, after Reebok's (RBK:NYSE) earnings warning revealed a worn-out sports shoe industry.  Reebok, the number two athletic shoe company in the world, announced that it will not meet earnings expectations for 1997 and that problems would seep into the first half of 1998.  ... Reebok's stock closed down more than 11% at 29, compared with industry leader Nike (NKE:NYSE), off about 3% at 45 1/16, number four player Fila (FLH:NYSE), off 5% at 22 15/16, and Converse (CVE:NYSE), 4% lower at 6 1/16. Reebok is now suffering its third significant price drop this month, but analysts point out that no company is escaping the pain.

December 12, 1997- Real life lessons taught through fictitious team Jaynes: Company's eye on future by Dwight Jaynes of The Oregonian staff  (press here) Perhaps you have seen the first commercial in the series already. It began a week ago, running on such network shows as "Buffy the Vampire Slayer" and "Moesha." They will show up on MTV and ESPN, too -- so perhaps we all eventually will see them. Nike calls the spots "The Championship Season," and there are 12 parts, a mini-soap opera that takes you through an entire season with a high school girls basketball team -- from cut day through the state championship game.

December 12, 1997 (press here) - Asia Remains the Focus for a Nervous Wall Street By Justin Lahart Staff Reporter  12/12/97 6:38 PM ET ... Investors will get an idea whether Reebok's (RBK:NYSE) warning last Thursday signals an industry-wide problems when Nike (NKE:NYSE) reports its second quarter on Thursday. The  shoemaker is expected to post earnings of 55 cents per share.

December 18, 1997 (press here) - Nike (NKE:NYSE) reported second-quarter  earnings of 48 cents per share, 7 cents short of the 18-analyst estimate and down from the year-ago 60  cents. The company also set a buyback of up to $1 billion worth of its shares. Nike is no stranger to earnings struggles, as TheStreet.com reported in a Sept. 17 story and a Sept. 19 follow-up.

December 19, 1997 (press here) - As If Triple Witch Wasn't Enough, Asia Collapses and  Nike Misses  By Justin Lahart Staff Reporter 12/19/97 9:24 AM ET  Put your tin helmet on. Even on a normal day, this morning would not be good. An earnings disappointment from Nike (NKE:NYSE) la st night on Asian and inventory woes, and then drops in Asia's and Europe's bourses. Those are the kinds of things that set Wall Street up for a hard slog. But today is triple-witching Friday, the quarterly expiration of index futures and of options on stocks and index futures. Any moves today will be amplified through the triple-witch.

December 20, 1997 (press here) - Analyst Scorecard After Nike Miss  By Suzanne Kapner Staff Reporter 12/20/97 12:33 PM ET  As Nike (NKE:NYSE) missed its quarter this week, one  thing became clear: Wall Street is not always of one  mind. Some analysts and money managers had  abandoned Nike long ago, while others stayed loyal until  the problems were impossible to ignore.  As the dust settles, a look back shows how some lost faith in Nike despite company reassurances. For instance, in April when Smith Barney analyst Faye  Landes said that the company would cut shoe production by 20% from May to July, Nike Chief Financial Officer  Robert Falcone said Landes was wrong. He also made disparaging remarks about the All-Star analyst at a Merrill Lynch conference.  Then in early September rumors about a slow down in Asia spread through investment circles. But on a conference call after Nike released first-quarter earnings on Sept. 18, the company insisted Asian business was strong. It pointed to a 38% increase in futures orders -- those scheduled for advanced delivery.  Later in the month, Nike President and Chief Operating  officer Tom Clarke endorsed analyst earnings estimates of 2.80 per share for FY 98, which ends May 31. But Thursday, in its second-quarter earnings release, Nike Chairman and Chief Executive Philip Knight warned that earnings for the year would range between 2.00 and 2.15 per share.

December 30, 1997 (press here) -  'I Can' might just do it for Nike  The company takes a risk calculated to boost sales despite fickle fashion trends and sullied sports appeal  By Jeff Manning of The Oregonian staff  "Just Do It" is no longer doing it.

December 31, 1997 (press here) - AP - Nike hopes motto will give buyers new can-do attitude `I Can' replaces dated `Just Do It' By BOB BAUM

January 2, 1998 (press here) - A model of understatement In his quiet way, Michael Jordan makes a difference...   By Steve Marantz The Sporting News 01/02/98

January 23, 1998 Nike: Calling All Contrarians? (press here) The problem for Nike was fairly simple: the market for athletic footwear and apparel slowed. What seemed to make it worse, though, was that on several occasions when problems for other companies in the industry surfaced, Nike contested efforts to extrapolate that trouble onto their business. When Nike eventually warned of disappointing quarterly earnings, the company tried to downplay it with statements like "We really think that we're going to have an outstanding year this year." Nike also said it expected annual growth in the neighborhood of 15%-18%, only tocome back a few months later and warn "futures orders indicate that year-over-year revenue growth [in fiscal year 1998] will likely be slightly below our previously-stated long term revenue growth target of 15%."Analysts have repeatedly slashed earnings estimates over the past several months to where they now expect a decline in Fiscal Year 1998 (ending in May) earnings per share. The FY98 consensus is for $2.03, a 24% decline versus FY97. The FY99 consensus has also dropped nearly a dollar to
$2.29.

• Then there's the new slogan, "I can" which left some marketing experts scratching their collective

noggin. "Just do it" is a tough act to follow given the way it became a catch phrase of pop
culture, but Nike has a history of unconventional yet successful marketing campaigns. Speaking
of unconventional, Nike will debut a new campaign during the Superbowl with ads featuring
famous athletes performing in the nude.

• In May, the last time a rumor surfaced that Buffett was buying Nike stock, the shares rose nearly $4 in one session. The next  day, the stock fell more than $8 after Nike said its fiscal fourth-quarter earnings would be below analysts' expectations.

March 19, 1998 (press here) Nike swoosh sags, but still cool for  some G.I. residents  Last modified at 7:30 a.m. on Thursday, March 19, 1998  Staff and wire reports Nike just isn't doing it anymore. After spending millions to put its swoosh logo on sports stars from Michael Jordan to Tiger Woods and enjoying annual growth of 35 percent over the  last three years, the shoe manufacturer has hit a wall. Nike announced a 69 percent drop in profits Wednesday, the second  straight quarterly decline, and said it would lay off 1,600 workers.

March 23, 1998 The Trouble With Nike by Jim Surowiecki(press here) Now, as the numbers in Nike's third-quarter earnings report --  issued last Wednesday -- suggest, much of what's wrong with the shoe and apparel manufacturer right now is simply a function of poor inventory management and demand forecasting, coupled with the ongoing and dramatic slump in Asian sales. Nike had anticipated a doubling of Asian revenues this year, but saw instead a decline. In no small part as a result,  in the middle of last month the company reported that its  inventory had soared $500 million, to $1.4 billion. Nike has had recurring problems managing the flow of goods from manufacturers to retailers and is seeing the full effects of those problems at this moment.

ADIDAS/NIKE - March 30, 1998 - Can Nike Get Unstuck?  By BILL SAPORITO /BEAVERTON (Time.com) Once a brash, hard-running firm with soaring numbers, Nike lurched to a stop this year. A new product line and a new attitude are the keys to hitting its stride again

March 30, 1998 (press here) VOL. 151 NO. 12 Time.com  Taking A Look Inside Nike's Factories  By BILL SAPORITO Last week an activist group called the National Labor Committee accused Nike and other companies of running virtual slave factories in China, alleging that workers are habitually overworked and underpaid. It's the kind of charge Nike has faced, and denied, repeatedly regarding its operations in Asia. Nike subcontractors employ nearly 500,000 workers in plants in Indonesia, China and Vietnam.

---"TIME visited Nike plants in China and Vietnam recently and found them to be modern, clean, well lighted and ventilated, and paying decent wages by local standards--although by no means are they trouble free. Make no mistake: these are factories, not amusement parks, and even in developing Asia, where jobs are scarce and getting scarcer, this is not the employment of choice. It's low-tech assembly work that hasn't changed much since Nike chairman Phil Knight first started sourcing sneakers in Japan 35 years ago. Since then, the work has migrated in search of ever cheaper labor."

---"Research conducted by Dartmouth College, for instance, found that Nike subcontractors in Indonesia and Vietnam paid above subsistence levels, allowing workers to save a portion of their earnings. TIME found this to be true at Yueyuan."

• In February and March 1998 several workers from the factory, including Ms. Lap,  were interviewed by the US sports channel ESPN. They described problems at the  factory, including use of violence by security guards towards workers.
• To find out what happend to Ms. Lap (press here).
• Interview with Nguyen Thi Lap, a worker for Sam Yang in Cu Chi, HCMC Vietnam (press here).

April 21, 1998 Nike was sued over its Asian factories With help from lawyers who beat Joe Camel, a "concerned citizen" goes after the sneaker giant, saying it misrepresents work conditions overseas. Articles is By Jeff Manning of The Oregonian (press here). "San Francisco resident Marc Kaskey sued the sneaker giant Monday, claiming the company is violating state law by negligently misrepresenting the working conditions in the Asian factories where its shoes and apparel are made. Kaskey, whom his attorney described as "a concerned citizen," contends that contrary to Nike's claims, factory workers are exposed to corporal punishment, wage and hour violations, and  dangerous chemicals.

May 12, 1998 - (press here) - NIKE CEO PHILIP H. KNIGHT ANNOUNCES NEW LABOR INITIATIVES May 12, 1998 NIKE's PRESS RELEASE  Washington, DC (May 12, 1998) - At a National Press Club luncheon today, Nike CEO Philip H. Knight announced a series of new initiatives to further improve factory working conditions worldwide and provide increased opportunities for people who manufacture Nike products.

May 12, 1998-Nike to Improve Conditions - Nike has seen  its image tarnished by repeated criticism from human rights groups that the company takes  advantage of its workers in  developing countries by  paying them low wages under poor working conditions  By Harry Dunphy  The Associated Press  W A S H I N G T O N, May 12 — Seeking to lift the "cloud that has been over Nike's head,"  chairman Phil Knight said today that the shoe giant is raising the minimum age for workers and making other improvements in working conditions in Asian factories. (click here) ABC News story.

May 13, 1998 -  NIKE ANNOUNCES NEW INITIATIVE Nike critics voice hopes and reservations Nike, whose Asian workers already enjoy the highest standard of empty promises of any in the industry, unveiled yet another initiative yesterday in a long-standing effort to clean up its tarnished image. (press here) for CLR newsletter.

May 13, 1998  (press here) Nike Pledges to End Child Labor and Increase Safety  New York Times By JOHN H. CUSHMAN Jr.  WASHINGTON -- Bowing to pressure from critics who have tried to turn its famous shoe brand into a synonym for exploitation, Nike Inc. on Tuesday  promised to root out underage workers and require overseas manufacturers of its wares to meet strict U.S. health and safety standards.(press here) for CLR reactions to Nike Pledges.

May 14, 1998 - (press here) - Workers wary Nike reforms will fit  The scope of Phil Knight's promises elude  Indonesians with more immediate needs By Richard Read of The Oregonian staff T ANGERANG, Indonesia -- Shoe factory worker Dominguez Pirida strained Wednesday to comprehend workplace improvements pledged by Nike Chairman Phil Knight, a man whom he'd vaguely heard of half a world away. Better air quality inside plants sounded good. Improved independent monitoring of Nike's contract factories seemed fine.--- Nike, the world's largest athletic footwear and apparel company, posted $9.1 billion in sales last year. But demand has slowed for its products, and stock prices have dropped, resulting in layoffs of 1,600 Nike employees. That does not include the workers who have lost their jobs at factories operated by contractors.

May 21, 1998 Nike Blinks  - (press here) IN AMERICA / By BOB HERBERT The New York Times   Let's not be too quick to canonize Nike.  Philip Knight, Nike's multibillionaire chairman and chief executive, managed to generate a lot of positive press last week when he announced that independent organizations would be allowed to inspect the overseas factories that make his company's products, that he would toughen the health and safety standards in the factories and that he would crack down on the use of child labor.

June 15, 1998 (press here) - Factories struggle to cope amid Asia's economic crisis Falling orders, sliding currencies tempt subcontractors for Nike to cut corners as their profit margins shrink   Monday, June 15 1998 By Richard Read of The Oregonian Live staff  CU CHI, Vietnam -- Lim Dukjoo, who runs a troubled factory that makes Nike sneakers,  told authorities in April that he couldn't afford to pay each worker a $45 monthly minimum wage. D.J. Lim wrote twice this year asking government officials to exempt his plant from the minimum wage of Ho Chi Minh City, which administers his rural district. He said the factory  lost $6.1 million in 1996 and $2.4 million in 1997.

August 14, 1998 (press here) - NO BONUS FOR PHIL KNIGHT - Bloomberg News reported on August 14 that Nike awarded no bonus to Chairman and CEO Philip Knight for the most recent fiscal year, cutting his pay to $1.68 million. Consumer concern about sweatshop issues, added to Asia's currency crisis and a sluggish U.S. market, slashed Nike earnings 40 percent to $479.1 million. Nike shares fell 20 percent during its fiscal 1998. Knight, including his family and charitable trust, holds a 34 percent stake in Nike. NIKE MOVES ITS SHAREHOLDER MEETING TO MEMPHIS, TENN.

September 17, 1998 Nike Earnings Report Relesed- (press here) There's no question about it, Nike's earnings report today was a disappointment. The company may have exceeded analyst's earnings expectations... Nike Stockholders Meeting Moved to Memphis, TN  It appears that Nike has moved it's September 21st stockholders meeting to Memphis, TN (press here).

September 18, 1998 - (press here) - On September 18, 1998, " Nike shares rose as much as 11 percent today after the world's biggest maker of athletic shoes said lower costs and fewer markdowns resulted in better-than-expected earnings in the fiscal first quarter."

• "Nike said first-quarter profit fell 35 percent to $163.8 million, or 56 cents a diluted share, from $253.1 million, or 85 cents, a year earlier.,,, Beaverton, Oregon-based Nike's revenue fell 9.5 percent to $2.50 billion in the quarter ended Aug. 31 from $2.77 billion. While Nike's Asian sales were cut almost in half to $199.1 million, U.S. sales fell 13 percent to $917.4 million, continuing a slide that began last year when sales declined at the footwear maker. Consumers have been buying more hiking boots and dressier shoes instead of sneakers. They've also been picking casual clothes such as khakis over sweat pants. "  (Seattle Times, 1998).

• The company is still reeling from U.S. retailers’ faux pas of misgauging consumer demand last year. Retailers, believing that 1997 would be even better than 1996, ordered way too many shoes from the world’s largest footwear maker. Demand, while decent, failed to outstrip the immense amount of supply available, meaning that Nike has had to suffer while the inventory was worked through. But there is some good news. Nike officials said that its U.S. shoe inventory fell 35 percent from May 31, and dropped 29 percent from Aug. 31, 1997, indicating that supply is finally moving through the retail channel.

Harrington introduced the proposal on behalf of Jeanne Henry, a Portland, Ore., shareholder who last year told Knight that her 12-year-old daughter was boycotting the company because of its labor practices at contractor factories in southeast Asia. ... Harrington said that Knight earned 5,273 times the annual pay of the average worker in Nike shoe factories last year. Average executive pay in Japan is about 16 times the average worker's, and in Germany it's about 21 times as large, he said.

October 16, 1998 (press here) - October 16, 1998 -- The 25 Percent Minimum Wage Increase Comes in Response to the Asian Financial Crisis, But Critics Say the Company Has a Long Way to Go. By Cristine Gonzalez The Oregonian October 16, 1998.

• In response to the Asian financial crisis, Nike Inc. announced Thursday a 25 percent minimum wage increase for Indonesian factory workers. The monthly wage rises to 250,000 rupiah, or $27, from the government-mandated 200,000 rupiah, or $22. The increase is retroactive to October and is based on an exchange rate of 9,000 rupiah to $1. ... [According to CLR] " The increase applies to 21,000 employees, or 30 percent of Nikes total work force of 70,000 in Indonesia, according to Vada Manager, a company spokesman. Nike, which had fiscal 1998 revenues of $9.6 billion, will split the $105,000 cost of the increase with a dozen factory subcontractors... Nike stock closed Thursday at $39.9375, up $1.0625. Its 52-week high was a year earlier at $52.6875."
• .In response to the Asian financial crisis, Nike Inc. announced Thursday a 25 percent  minimum wage increase for Indonesian factory workers. The monthly wage rises to 250,000 rupiah, or $27, from the government-mandated 200,000 rupiah, or $22. The  increase is retroactive to October and is based on an exchange rate of 9,000 rupiah to $1...Nike stock closed Thursday at $39.9375, up $1.0625. Its 52-week high was a year earlier at $52.6875 (press here). .

November 12,  1998  Nike fights battle over bad image (press here) WILLIAM MCCALL BEAVERTON, Ore. (AP) - For years, the Nike name conjured up heroic images of Michael Jordan and Tiger Woods. The swoosh made many people feel as if they were winners.  That Nike cachet has been clouded by a new image - of Asian workers in hot,  noisy factories, stitching together shoes for as little as 80 cents a day. Suddenly, Nike doesn't seem so cool anymore. The biggest swoosh now is the sound of falling profits.

November 18, 1998 Nike Said to Just Do It - Brutally Labor Group Charges Harsh Conditions Persist  (press here) by Marc SelingerThe Washington Times p. B7-B8. The famous Nike slogan "Just Do It" might include he words "Or Else" if Salvadoran garment worker Julia Esmeralda Pleites could rewrite it.  Miss Pleites, 22, said through an interpreter that she endured brutal conditions making Nike shirts at a factory new San Salvador. (press here) for report on conditions in El Salvador plant. (press here) for witness testimony. And (press here).

November 18, 1998 (press here) - Nike Sweatshop Worker Calls Low Pay `Unjust'  THE ASSOCIATED PRESS  WASHINGTON -- Until she was fired, Julia Esmeralda Pleites earned 40 cents an hour in El Salvador sewing together shirts with  the Nike trademark. She was amazed to find her work selling for $75 apiece in North America.

December, 1998 - (press here) - Nike: NBA not carrying swoosh   The Beaverton company says its earnings this quarter are half of last year's total largely because its supermodels are locked out Friday, December 18 1998 By Jeff Manning of The Oregonian staff  Perhaps Philip Knight could get himself appointed mediator of the acrimonious negotiations between the NBA and the players union. Knight's company, Nike  Inc., Thursday laid another quarter of declining sales and earnings in part at the feet of the NBA, which has not had a season to date because of its labor dispute.  In surprisingly strong language, Nike managers repeatedly referred to the lack of a National Basketball Association season as a leading factor in limp U.S. consumer demand for its sneakers and apparel.

January 7, 1999 - (press here) Nike shares rise on NBA resolution The effect on athletic footwear stocks overall, up 7.7 percent, may be mainly psychological Thursday, January 7 1999 By Julie Tripp of The Oregonian staff - Nike shares scored Wednesday with a 7.2 percent jump aided by settlement of the NBA lockout and abetted by a robust day in the stock markets. Shares of Nike -- the favored brand among NBA players -- closed at $43.625, up $2.94. Shares of Nike's competition

Jan 07, 1999 -Nike: Leading the League in Rebounds? (press here) Much was made of the jump in Nike's stock price Wednesday after the NBA lockout was settled. But Nike's stock (NYSE:NKE - news) was already on the rebound before this news, up about 30% from its $31 low. While the salvaged NBA season certainly helps Nike, it is hardly the linchpin to this company's fate... A Reuters story quotes a Reebok spokesman as saying "Quite frankly, the fashion cachet of basketball shoes has been in decline for the last 12 to 18 months," so an end to the lockout "...is not going to immediately cure what ails the industry..."

January 13, 1999 (press here) - Can Nike soar without Air on the court? Endorsers worry whether Michael Jordan has the star power to sell even in retirement  Wednesday, January 13 1999 By Jeff Manning of The Oregonian staff An uncertain new era will begin today at Nike Inc. when Michael Jordan, the most effective pitchman ever to lace up a pair of sneakers, is expected to announce his retirement at a news conference in Chicago.

January 14, 1999- (press here) - Jordan, Nike linked  until 2023 The sneaker giant is under contract to oversee the superstar's name brand, but it's unclear how much time he will devote to the effort after retirement Thursday, January 14 1999  By Jeff Manning of The Oregonian staff  Michael Jordan has 24 years left on his Nike contract. Now the Beaverton company must figure out how to use them.  As expected, Jordan, Nike's marketing silver bullet since 1984, announced his retirement Wednesday. The sneaker giant has Jordan under contract until the year 2023 (he'll be 60).

February 1, 1999-  (The Street) The stock got a lift Monday, gaining 2 7/16, or 5%, to 47
15/16, after Bloomberg.com posted comments from Nike's Chairman and Chief Executive Philip Knight, who said earnings would improve in the fiscal year ending in May 2000.

February 10, 1999 - Nike Rediscovers Advertising By Suzanne Kapner(press here) -  In the year ended May 1998 -- one of the toughest in Nike's history as sales growth slowed to 4% and earnings dropped 40%, excluding a restructuring charge -- the company spent $314 million on advertising airtime. In the current fiscal year, Nike is spending just $240 million on advertising airtime, says spokesman Lee Weinstein, who suggests that there's a potential link in the decline in ad spending and sales.

February 25, 1999 K-Swiss: Investor Shoe-phoria! (press here) The strong performance of K-Swiss--not just the stock, but the company itself--is definitely impressive against the backdrop of such a difficult environment for footwear and athletic apparel companies in the past two years. Industry leaders like Nike (NYSE:NKE - news) and Reebok (NYSE:RBK - news) have been absolutely devastated. In stark contrast, K-Swiss (Nasdaq:KSWS -news) continues to rack up amazing results and its stock is up over 400% in the past two years. K-Swiss, which specializes in high-performance tennis shoes, just reported another fantastic
quarter a few weeks ago. The company also announced a 2-for-1 stock split and hiked its
dividend by 50%.

• The K-Swiss web site proudly states that they don't pay high-ticket athletes to endorse their shoes, they don't change their color schemes every six weeks, and they don't spend a hundred million dollars on flashy marketing campaigns. K-Swiss did recently announce plans to step up ad spending, from $9 million last year to $17 million in 1999, but the message remains the same: they focus most of their resources on making high-quality, high-performance shoes. Apparently that message is getting out.

March 12, 1999 - Nike treads on a limb with promise of disclosure (press here) - Breaking with the industry, Chairman Phil Knight sends university presidents letters about subcontractors, with conditions on release Friday March 12, 1999 By Jeff Manning of The Oregonian staff -  Nike Inc. raised the stakes Thursday in the fast-evolving debate about apparel industry working conditions. The Beaverton company broke ranks with the rest of the industry and offered to publicly disclose the names and locations of factories manufacturing collegiate licensed products.  Public disclosure has become a central demand of a growing student movement protesting sweatshop conditions in some apparel factories.The industry has, until now, consistently rejected the demand arguing it would put the companies at a competitive disadvantage. But administrators at some of Nike's most  important university partners, concerned about their schools' reputations, unexpectedly sided with the students. Duke, Georgetown and Princeton, among others, have officially called for full disclosure.

March 17, 1999 - Nike  Colleges join effort to fight sweatshops (press here) Ivy League and other schools interested in protecting the integrity of their apparel become members of a factory-monitoring association - Wednesday March 17, 1999- From wire and staff reports - Seventeen colleges and universities, including Harvard, Yale, Princeton, Duke and Notre Dame, announced Monday that they would be the first to join a new factory-monitoring association that the White House supports in an effort to ensure that apparel carrying their names is not made in sweatshops.

March 18, 1999 - Nike Beats Estimates (press here) By Heather Moore Staff Reporter 3/18/99 8:46 PM ET Nike (NKE:NYSE) reported third-quarter earnings of 44 cents a share, 6 cents higher than the 14-analyst First  Call estimate and ahead of the year-ago 25 cents. But the retailer said it's cautious about near-term growth and it posted revenue down 2% from the year-ago period. Nonetheless, the stock inched up to 55 from a close of 54 1/2 in late composite trading.

March 19, 1999 - Nike to Give Pay Raise in Indonesia (press here) - PORTLAND, OR (March 19, 1999) - Nike will increase the entry-level cash wages for its Indonesian footwear factory workers from 250,000 Rupiah (Rp) to 265,000 Rp per month. In addition, Nike also pledged to implement a new minimum monthly wage package for workers totaling 332,000 Rp, including bonuses, housing, health care, transportation and meal allowances. The new Nike wage standards are effective April 1, 1999, concurrent with an anticipated increase in the Indonesian minimum wage to 231,000 Rp monthly. Maria Eitel, Nike's vice president for corpo