Nike and Adidas turn to Automation to meet growing customer demands

Athletic wear, as an industry, is growing rapidly and Adidas and Nike plan on being at the forefront of that growth.

Both of the companies are looking towards their supply chains as a means for optimizing operations, cutting costs and innovating to increase top-line revenue.

In a recent article from MarketWatch it was stated that “Nearly 20% of production for Nike Inc. and Adidas AG shoes will move to more automated factories by 2023” (MarketWatch).

This is all in an attempt to eliminate the prominence and reliance of/on outside manufacturing. Growing consumer demands are forcing the companies' hand to transition to a methodology of ‘fast-fashion’. Automating production could increase quality control and speed, but moreover, help manage supply chain risks caused by working with second or third party manufacturing.

As for the selling of their products, analysts from Morgan Stanley suggest that the shift in production could very well ripple into the retail sector of premium athletic goods. This means more online shopping, and big changes for the traditional brick-and-mortar retail.

These technological changes in the sector of athletic apparel aren’t all that most surprising. Shifts towards automation are beginning in many verticals, and the number of companies using automated technology will see a large influx in the coming years.

Adidas and Nike just happen to be a bit ahead of the rest of the pack; making innovation and tech solutions a priority.

“Nike shares are up 4.6% for the year so far while Adidas shares have risen more than 14% for the period. The S&P 500 index SPX, +0.16% is up 8.5% for 2017 to date” (MarketWatch)

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