American sportswear and apparel company Nike is set to stop selling its products to dozens of retail stores and chains across Israel.
Nike is considered one of the most popular sports brand in Israel and has become a staple for many sportswear stores around the country, which heavily rely on the brand.
The move, confirmed via a letter sent to the affected stores by the company’s Israeli branch, will come into effect on May 31 and is part of its new global marketing strategy, which is meant to encourage customers to purchase its wares through Nike's own online and physical stores and select retailers.
“Following a comprehensive review performed by the company and considering the changing marketplace, it has been decided that the continuation of the business relationship between you and the company does no longer match the company's policy and goals,” the company wrote in its letter to retailers.
"We strongly encourage you to already start anticipating this termination in order to successfully continue your business without Nike products in your assortment,” the letter continued.
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The move is part of the company’s new global marketing strategy meant to encourage customers to purchase its wares through its own platforms and select retailers
(Photo: Shutterstock)
David Benny, the owner of the Ram Sports store in Ramla, has been selling Nike products in his store for the last 35 years.
“Three years ago, [Nike] started limiting the [show] models we can order, claiming that they were exclusive to Nike and Foot Locker,” said Benny.
“We were told in advance that some models were off-limits to us, and sometimes we would not receive a model we had already ordered,” he added.
According to Benny, his contract with the company changed about six months ago to include a clause stating that Nike can terminate it at any time.
“On Thursday I got a phone call from my saleswoman, who told me that because of a reorganization, [Nike] will cease their communication with us,” he added.
As it turns out, about 70 other owners of small and medium-sized shops and chains received the same message.
Another store owner who refused to identify himself said: “[Nike’s] conduct is draconian. We will move to buy from parallel imports, but it will be very difficult.”
Adv. Guy Serrusi, who is representing some of the retailers harmed by the company's new policy, said: "Nike Israel decided unilaterally to part with dozens of retail stores and leave many businesses without a major source of income.”
“This is another in the chain of steps taken by Nike Israel in recent years that has decided to virtually stop contacting retail stores… Our office will continue to stand by the store owners to prevent the unilateral cessation of cooperation, while finding an appropriate solution for the store owners."