May 25, 2022, 08:55am
According to news reports on Wednesday, Nike is leaving Russia after suspending operations in March, another symbolic departure of a major American brand.
According to reports, Nike is leaving Russia.
Nike temporarily closed most of its Russian stores in early March and withdrew its sponsorship of Spartak Moscow, but a number of independently operated but authorized retail stores have remained open.
According to Russia's Vedomosti paper, Nike's largest franchisee in Russia said that the sportswear brand had stopped shipments and supplies were running low.
IRG, which operates 37 of Russia's 56 remaining authorized Nike stores, said the brand has not renewed its contract or offered them a new one to sign.
The company's agreement with Nike is due to end on Thursday.
According to Forbes, Nike has decided not to enter into new business commitments in Russia due to operational challenges, including agreements with franchisee Up&Run.
IRG didn't respond to Forbes' request for comment.
Nike repudiated Russia over the war in Ukraine. Burger King, the Marriott hotel group and British supermarket Marks and Spencer were among companies that struggled to extricate themselves from the Russian market due to complex franchise agreements. McDonald's and Starbucks are two of the brands that are leaving the country after the invasion of Russia. Russian President Vladimir Putin said he will nationalize companies that leave the country and suspend operations. The first major nationalization of a Western company's assets was done by Renault, which handed its factory over to Moscow for a nominal sum of one ruble.
Marks and Spencer, also known as M&S, said it would leave the Russian market on Wednesday. Like Nike, franchise agreements prevented it from leaving Russia. The company said it stopped shipments to Russia on March 3. The company said it would have to pay $38.7 million for leaving.
Putin is on an island because of the exodus of Western brands from Russia.
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