US sportswear giant Nike is set to stop selling its products to dozens of retail stores and chains across Israel.
The measure will come into effect on May 31, 2022, Nike said, as part of a new global marketing strategy which aims to encourage customers to purchase its wares through Nike’s own online and physical stores and select retailers.
In a letter sent to store owners on Sunday, Nike said: “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.”
“We strongly encourage you to already start anticipating this termination in order to successfully continue your business without Nike products in your assortment.”
The decision is in line with Nike’s global plans to reduce the number of stores it works with, preferring to direct customers to buy its shoes, clothing, and gear on its website and in company-owned stores.
Nike believes it can earn much higher profits and control its premium product experience by managing the entire sales process itself. The company also ended its relationship with Amazon in 2019.
However, stores in Israel say the move would harm their abilities to remain profitable, according to the Jerusalem Post.
Speaking to YNet news, David Benny, the owner of the Ram Sports store in Ramla, said he 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.
A Nike spokesperson commented: “Nike has a global strategy to create the marketplace of the future where we serve consumers through Nike Digital channels, Nike stores, as well as strategic retail partners who share our vision to create a consistent, connected and modern shopping experience.
“We remain committed to serving Israeli consumers with the best of Nike product innovation through Nike Direct and local retail partners.”
The decision follows the announcement that ice cream company Ben & Jerry’s would end sales in the Occupied Palestinian Territories.
In July, the company issued a statement saying it is “inconsistent” with its company values for Ben & Jerry’s ice cream to be sold there.