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Nike is the latest global brand to completely leave Russia

Topline

Sportswear giant Nike is set to exit the Russian market for good, Reuters reported on Thursday, becoming the latest multinational to abandon operations in the country since its invasion of Ukraine.

Highlights

Nike’s decision to exit the Russian market comes three months after it suspended retail operations in the country.

In an emailed statement shared with ForbesNike said it would “responsibly reduce” its operations over the next few months while “fully supporting” its employees in the country.

The move is likely to have very little impact on the company’s bottom line, as revenue from Russia and Ukraine accounts for less than 1% of Nike’s overall revenue, the report adds.

Key Context

In March, Nike announced it was temporarily closing all retail stores it owned and operated in Russia, but authorized outlets owned by third-party franchisees remained open and continued to sell Nike products. In May, Nike confirmed that it was not renewing its business commitments in Russia, including an agreement with its largest franchisee in the country, Inventive Retail Group (IRG). Earlier in the same month, Nike canceled its sponsorship deal with Russian soccer club Spartak Moscow.

Tangent

Nike now joins a large group of top global brands that have left Russia since its invasion of Ukraine and subsequent Western sanctions against the country. Among sportswear brands, Adidas closed its retail stores in March after suspending its partnership with the country’s soccer federation. Uniqlo’s parent company, Fast Retailing, also suspended retail operations in the country in March, citing “a number of difficulties”. Other big companies leaving Russia include Starbucks, McDonald’s and Coca-Cola.

Further reading

Nike to exit Russia completely, shrink in coming months (Reuters)

Nike is reportedly leaving Russia after failing to renew its master franchise contract (Forbes)

Spotify, Nestlé, S&P Global Ratings—Here Are the Companies Severing Russian Ties Following Ukraine Invasion (Forbes)

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Post expires at 9:05pm on Sunday July 3rd, 2022