Nike to exit Russia operations as franchisee contract expires – Footwear News
Nike will end operations in Russia after temporarily suspending sales there in March.
The US sportswear retailer will not renew an agreement with its largest franchisee in Russia, Inventive Retail Group (IRG), Russian newspaper Vedomosti reported on Wednesday. The contracts between the two entities are due to expire on Thursday, May 26.
Through its subsidiary Up And Run, IRG operates 37 Nike stores across Russia. Nike and IRG first signed an agreement in 2012. According to the Vedomosti report, IRG President Tikhon Smykov said the company would be forced to close all of its Nike stores as supplies continue to run low. .
FN has contacted Nike for comment.
IRG said it could not comment due to the nature of its contract with Nike, although the company mentioned that Nike stores operated by IRG would remain operational until supplies of merchandise were depleted, which could take up to a month.
The news comes after Nike temporarily closed its owned-and-operated stores and halted delivery of products and its website to Russia in March. At the time, Nike referred to “the rapidly changing situation” between Russia and Ukraine. Earlier this month, Nike ended its sponsorship deal with popular Russian Premier League club Spartak Moscow.
Other brands have recently announced similar, more permanent moves as the situation in Russia continues. On Monday, Starbucks announced it would close all 130 locations in Russia, ending its presence in the country. McDonald’s, Exxon Mobil and British American Tobacco have also taken similar steps recently.
Other brands and retailers have announced more temporary measures. Adidas previously announced that it had suspended all retail and online sales in Russia. Adidas has also suspended its long-term partnership with the Russian Football Union (RFU).
As of March 20, Authentic Brands Group, which recently reached an agreement to acquire Reebok, has suspended all e-commerce and store operations in Russia in light of its “relentless attack on Ukraine and escalating humanitarian crisis”. Crocs said it has halted its DTC business in Russia, including e-commerce and retail stores. Crocs also stopped importing products into the country.