Monday, 23 May 2016

Nike king of patents as well as sneakers

Nike is so innovative in shoes that it has more patents than most drug companies. Nike was granted around 500 patents last year. Macquarie research found that patents granted to Nike increased by 14% every year compared to the annual 4% rate of patents granted by the patent office. Recent technology includes self lacing shoes (no traditional laces). They automatically tighten when you place your heel in the shoe. Two buttons on the side let you tighten or loosen it yourself. No more tripped up shoe laces. You can actually hear the self lacing. It took Nike nearly ten years to perfect. We don't know the price yet but they go on sale at the end of the year.

Most other patents involve 3D printing and automating manufacturing, around 5% of their patents involve wearables. Automated manufacturing of their Flyknit technology (lightweight shoe that fits like a sock) is estimated to reduce labour costs by up to 60% and cut material usage by up to 20%. Being able to produce products locally will also give Nike quicker inventory turnarounds and less risk of out of fashion stock. It will be exciting to download a shoe design file from Nike and 3D print your own shoe. Nike was also awarded a patent for in built shoe fitness tracking basically a fitbit for your shoe. With a record number of patents Nike's future is looking comfortable.

At the time of publishing Decisive had no position in Nike (NKE). The material in this article is for informational purposes only and in no way constitutes a solicitation of business or investment advice. The material has been prepared without regard to any client's or other person's investment objectives. Before making an investment decision you should consider the assistance of a financial adviser and whether any investment or service is appropriate in light of your particular investment needs.