Nike says it is ceasing orders with its hand-stitched soccer ball supplier, Saga Sports, based in Pakistan, due to the contract factory's failure to correct significant labor compliance violations. The fitness company will continue to do business with its Chinese partners.
For its retail partners, Nike is working to mitigate any shortfalls between supply and demand. Nike will continue to work with several existing contract factories in China and Thailand to supply premium hand-stitched and machine-stitched soccer balls. Those contract factories already supply a significant portion of Nike's total soccer business.
As a result, Nike is limiting its supply of hand-stitched soccer balls for the foreseeable future.
"This contract factory has persistently broken its commitments and irrevocably breached its trust with us; most importantly, the factory has failed its employees," said Nike CEO and president Mark Parker. "Rather than continue with Saga, we have decided to limit our supply of hand-stitched soccer balls as we are developing new sources with factories committed to upholding our standards and treating workers fairly."
Nike made the decision to end its relationship with Saga following a six-month investigation into conditions and a concerted effort to remediate. Efforts included repeated meetings between Nike and Saga executives, detailed remediation plans and timeframes, and adjustments of Nike orders to provide Saga the opportunity to devote more management time and resources to implement the agreed-upon plans. Despite those efforts by Nike, Saga did not make needed changes.
