Nike Inc: Macro and Micro Environment

Strategic Analysis

The assignment will describe Nike’s strategy when entering Vietnamese market. In order to accommodate and adapt to a changing environment, the company needs pay attention about the relationship between its’ external and internal environment.

Task 1: External environment

The report firstly mentions about the external environment by using macro-economic factors (PEST) which includes the analysis of Political, Economic, Social and Technological factors (Credo Reference, 2011) when Nike enters Vietnam market.

Political factors

Since independence in 1975, Vietnam was unified under the leadership of a single party was the Communist Party of Vietnam. The guarantee of the Party in the 11th National Congress in January 2011 on the long-term political stability in at least 5 years is Vietnam’s trump card in attracting foreign investors. In addition, in recent years, with some engagements in war against far off countries, counter-terrorism policies and negative impacts of economic recession, the level of political stability of Vietnam has been plunged. As the result, according to The World Bank (2012), Vietnam always keep a high percentile rank more than 50 from 2008 and it was higher than majority countries in ASIA and was a bit higher than the average of the world (Figure 1). This proves Vietnam government can hardly be affected or be overthrown by political violence or terrorism.

Figure 1: Political Stability and Absence of Violence/Terrorism: Percentile Rank of Vietnam.

Source: The World Bank (2012)

In addition, based on Marketline (2014), Vietnamese government issued policies against corruption and inflation; as a result, it reveals that the control of corruption index was a small fluctuation and increased in the rank from 25.7 in 2008 to 35.4 in 2012 (The World Bank, 2012).

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