Nike Ends China Online Distribution Deal in Strategy Shift

By Jason Chau

Nike has ended online sales through its existing distributors in mainland China as the U.S. sportswear company overhauls its operations to revive sales amid intensifying competition from local rivals.

In a post on its website on Tuesday, Nike said it will shift online sales to its official website and app, as well as its flagship stores on e-commerce platforms Tmall, JD.com and Douyin from January.

Barring some exceptions with licensee partners, partner-operated online storefronts will transition out of selling Nike products, the athletic footwear and apparel company said.

Shares of Topsports International, Nike's largest distributor in China, suffered a record drop, plunging as much as 28% in Hong Kong.

The Chinese company on Wednesday said it received formal notice from Nike about the sales termination and expects the move to pose a significant hit to its business in the short term. Online sales of Nike products accounted for about one-fifth of Topsports' total revenue in the previous fiscal year, according to the Shanghai-based distributor.

Both companies said they remain committed to partnering on offline sales.

Nike's decision to end online sales through its distributors is part of its strategy to tighten control over a digital marketplace that it said has become too fragmented and has undermined brand consistency and affected growth.

The Oregon-based company has been facing mounting competition in China from fast-growing local rivals such as Anta and Li Ning, which have chipped away at its market share in recent years and pressured sales.

Its revenue in the Chinese market fell 12% in the three months ended May and 11% for the latest fiscal year.

"Some of the steps we took created an experience that is less consistent, less trusted and not delivering the growth we expect," said Cathy Sparks, Nike's vice president and general manager for greater China.

"[The new strategy] is not about reducing access. It is about reducing fragmentation and strengthening the consumer journey."

Analysts were less optimistic about the overhaul.

Nike's offline channels are facing substantial challenges from weaker traffic, Citi analysts Xiaopo Wei and Vincent Young said. They expect the shift toward a direct-to-consumer strategy will likely result in further market-share loss and the closure of offline stores.

"It is a risky China strategy for Nike to aggressively push online [direct-to-consumer] while its offline business remains challenged," they wrote.

Write to Jason Chau at jason.chau@wsj.com

(END) Dow Jones Newswires

July 22, 2026 02:37 ET (06:37 GMT)