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Nike is still facing the challenges of poor child labor practices even though it has managed to turn its image around. A recent collapse of a factory in Bangladesh shows the problems that still exist with the company, and the eagerness of the public to lambast the firm. Nike’s business model is based on outsourcing manufacturing to nations that provide cheap labor. While this business model increases the firm’s return on investment, it also poses a major problem with public opinion. “Nike hasn’t been completely successful in bringing factories into line, but there’s no denying that the company has executed one of the greatest image turnarounds in recent decades” (Nisen, 2013).

This research is intended to find a solution to the problem of using cheap labor from overseas. The report is important in establishing the firm’s focus, and ensuring it is able to continue to improve its image, which was tarnished in the 1990s due to the company’s mistreatment of overseas workers. Much of Nike’s net profit depends on limited expenses associates with paying for labor. Since 2005, the firm has posted that it is committed to high standards of labor practices, and it posts audit data in corporate social responsibility reports (Nice, 2013). Nike has committed itself to improving its level of social corporate responsibility and this has improved the firm’s public image. However, Nike needs to make a bigger effort than most other companies due to its history of human rights abuses. As long as Nike is not abusing cheap labor policies, and it continues to disclose audits, the firm will be able to limit expenses associated with labor.

Nisen, M. (2013). How Nike solved its sweatshop problemBusiness Insider. 

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By Hanna Robinson

Hanna has won numerous writing awards. She specializes in academic writing, copywriting, business plans and resumes. After graduating from the Comosun College's journalism program, she went on to work at community newspapers throughout Atlantic Canada, before embarking on her freelancing journey.

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