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Nike job cuts to cost as much as US$250m in one-time charge
[OREGON] Job cuts at Nike will cost it between US$200 million and US$250 million as the world's largest athletic brand refocuses on selling directly to consumers.
The company, which had already announced in June a new phase in its e-commerce push called the Consumer Direct Acceleration, didn't say how many jobs would be eliminated as a result of the strategy shift. It said in a statement the online push was "expected to lead to a net loss of jobs across the company" resulting in the one-time charge.
The company didn't immediately reply to requests for comment.
Nike's strategy shift comes as the pandemic expedites a rethink of physical storefronts that had already been bubbling for years. Brick and mortar stores, in particular mall-based ones, have been some of the hardest hit by coronavirus as scores of consumers turn to online shopping. E-commerce sales were a bright spot for Nike last quarter, growing 75 per cent at a time when overall revenue plunged.
Nike also announced Wednesday a series of senior leadership changes supporting the direct-to-consumer shift, including new leaders in Europe, the Middle East and Africa, and in its Asia Pacific and Latin America division. Additionally, Craig Williams, president of the Jordan brand, and G Scott Uzzell, chief executive officer of Converse, will join Nike's executive leadership team.
The company said the new structure and leadership changes will give it a "nimbler, flatter organisation," allowing it to make decisions faster.