Business

Nike Overhauls ERP In Bid For Better Supply Chain Speed, Agility

Nike will launch its new ERP system across its global network this year in a bid to increase inventory visibility and productivity, CFO Matthew Friend said. The system, which Friend described as the company’s “biggest investment in its digital transformation,” is set to go live in Greater China this month, while Nike prepares to deploy it in North America in fiscal year 2024. The ERP system will be “foundational for increasing speed and agility across our supply chain” as Nike leans increasingly into direct-to-consumer sales, Friend said. Nike’s ERP launch comes as the retailer continues to face elevated in-transit inventories and extended lead times to get products to market, issues that the new technology system could be instrumental in tackling. Transit times remain at roughly two weeks longer than pre-pandemic levels and aren’t expected to improve significantly through the end of FY 2023, Friend said. As a result, the company is managing inventories to deal with the slower movement of goods, including adjusting product life cycles. “We’re taking some of our styles to seasonless that we can manage it on more of a rolling basis,” Friend said. In China, the extended transit times and factory closures have left Nike with bloated inventory reserves, with seasonal products arriving behind schedule.