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Nike can turn its snarled supply chain to its advantage



A pedestrian walks past American multinational sport clothing brand, Nike store and its logo seen in Hong Kong.

Budrul Chukrut | SOPA Images | LightRocket | Getty Images

A lower sales forecast, slowing growth in China and a bottlenecked supply channel — the news coming out of Nike’s fiscal first-quarter earnings report wasn’t good.

Shares were down more than 6% on Friday afternoon following the report. Ahead of the results, shares had already tumbled roughly 9% from an all-time high of $174.38, which it hit in August.

Amid the sell-off some analysts see an opportunity for Nike to position its business — and its stock — for greater growth. Nike’s supply chain struggles are providing it with cover to accelerate its direct-to-consumer strategy, which has been a key driver of profitability in recent quarters.

It now takes Nike roughly 80 days to get goods from Asia to North America, which is double pre-pandemic transit times. Manufacturing facilities across Vietnam are beginning to reopen, but Nike has lost about 10 weeks of production due to pandemic shutdowns. About 43% of its total footwear and apparel units are made in the country.

For the next few quarters, Nike predicts consumer demand will outweigh supply. This means Nike will need to be much more strategic about where it’s stocking running shoes and workout tops. It will likely opt for its own stores, over wholesale partners.

“As long as inventory is constrained, it’s fair to assume the pivot to direct will be accelerated,” BMO Capital Markets analyst Simeon Siegel said. “They’re prioritizing their own channels with product first.”

Before the Covid pandemic struck, Nike was on a path to grow its direct-to-consumer business. It has been cutting partnerships with some wholesale retailers, while building its online business and opening Nike stores around the world. Over the past three years, Nike has pulled out of about 50% of its wholesale accounts.

Nike calls the transition a “consumer direct offense,” a play on sports terminology. In fiscal 2021, Nike’s direct revenue represented roughly 39% of sales for the Nike brand, up from 35% in the prior year. Selling more goods at full price has also been aiding profits. Nike’s gross margins for fiscal 2021 grew to 44.8%, from 43.4% in 2020.

Industrywide supply-chain havoc could accelerate Nike’s DTC push at an even faster clip and in turn drive profitability higher.

Nike ‘still has the demand’

“This means Nike now gets a free excuse to accelerate its DTC transition and say, ‘We don’t have the supplies to get to our wholesalers,'” said Stacey Widlitz, president of SW Retail Advisors, in an interview. “This is a major opportunity, because you’re seeing all of these other brands cut wholesale, but they don’t have the top line like Nike. Nike still has the demand.”

And even if Nike’s shelves are a bit bare in the coming months compared with normal times, Widlitz said, she doesn’t think it will permanently drive shoppers away to other retailers.

“People are always going to be drawn back to the big brands,” she said. “It’s the greatest pent-up demand, because they are basically telling the consumer, ‘You can’t have it right now.’ You’re creating FOMO [fear of missing out] by not having supply. It’s a no-brainer to take advantage of that.”

On Thursday’s earnings call, Nike’s management team said it is prioritizing its direct channels.

Nike’s top partners include Foot Locker, Dick’s Sporting Goods and Nordstrom, and investors in these stocks are concerned about what Nike’s troubles will mean for their businesses. On Friday, Foot Locker shares were down more than 6%, while Dick’s shares shed nearly 2%. Nordstrom’s stock was about flat.

Chief Financial Officer Matt Friend said temporary supply chain disruptions will “likely trigger an even greater acceleration in the transformation of the marketplace — toward Nike and our most important wholesale partners.”

“We’re going to have lean inventory,” he said. But he added, “Strong brands get stronger in this environment.”

And according to Citi analyst Paul Lejuez, a temporary supply chain problem is a much better issue to have than a demand problem. He doesn’t see Nike as having a demand problem.

“We view these supply chain disruptions as transitory … and [the delays] are impacting the athletic footwear space broadly,” Lejuez said in a research note. “The most significant impacts from Vietnam factory closures should happen post-holiday.”

Another way to shore up growth

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Job recruiters weigh up the value of video resumes



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When TikTok launched its resume feature this summer, it was trying to tap into a market for young professionals and graduates looking for jobs.

Video resumes, where candidates film a short clip laying out their qualifications and fit for a job, have been around a while but TikTok’s move into the area shone a fresh light on the job-hunt tactic.

Jonathan Javier’s career consulting firm Wonsulting collaborated with TikTok on its feature.

“It’s sort of like a tell-me-about-yourself. It’s something you won’t necessarily see on a black and white paper but you dive a little bit deeper into it,” Javier told CNBC.

“Give a quick introduction of yourself, your background, are you first generation. For me, I would say I’m first generation, I come from a Filipino background, I graduated or am currently at XYZ school, talk about your occupation and talk about what you’re currently doing right now. Talk about your past experiences that are relevant to that job or company.”

Video resumes are still a rarity for most jobs but have gained some traction among tech start-ups. 

“A video resume helps show enthusiasm level and give you a feel for the person. I have definitely chosen to interview and hire candidates in part because they did a video resume. That said, I think a video resume is best combined with a written resume,” Shaun Heng, vice president of operations at CoinMarketCap, said.

Tyler Lessard, chief video strategist at Canadian video analytics firm Vidyard, is also a fan but advises that videos are kept succinct.

“The purpose of the video is not just to say what’s already on your resume so don’t just use it as a way to walk through your past experience and education,” he said.

“It’s important that these aren’t too long. As much as you might draw someone in, they’re usually not going to spend any more than one to two minutes watching a video, even for a very interesting candidate.”


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how travelers earn after moving to Spain, Norway



Many people dream of starting a new life in a new country.

But problems, such as earning money, finding a place to live and meeting people, hold them back.

Here are two women travelers who didn’t let these details stop them from moving to Europe — and how they feel about their decisions today.

From tropical island to the Arctic

It’s common to yearn for a slower pace of life. But moving from bustling Singapore to a small town in Scandinavia is likely too slow — and too frigid — for most.

However, for 27-year-old Weisi Low, living in the Arctic created exhilarating adventures and a stronger appreciation for the great outdoors.

After growing up fewer than 100 miles from the equator, Low now lives in Longyearbyen, Norway — a town of 2,300 residents that is one of the world’s northernmost permanent settlements. It’s located on the Svalbard archipelago, which is east of Greenland and about 650 miles from the North Pole.

Weisi Low moved to Norway’s Svalbard archipelago from Singapore in 2019.

Courtesy of Weisi Low

But Low knew what she was getting into. In 2017, she visited Svalbard as a tourist during its “dark season,” which blankets the town in darkness from November to January.

“I have always been fascinated with traveling to secluded places and was keen on experiencing something new and out of the ordinary,” said Low.

When I first arrived, I printed copies of my resume and went around town handing them out.

Weisi Low

Singaporean traveler

Back at home, she continued to think about Norway, realizing she preferred views of snow-capped mountains over high-rise buildings. After graduating from college in 2019, Low moved to Norway with 3,000 Singapore dollars ($2,229) and a 50-liter backpack.

“I didn’t want a life where I just woke up to buildings after buildings,” she said. “I knew early on that the conventional route many took will not excite me.”

She gave her new adventure a timeline too — three years. “If my plans fail, all I lose is just three years of my life,” she said.

Weisi Low spends most of her time in Svalbard outdoors, enjoying views of snow-capped mountains and the glaciers.

Courtesy of Weisi Low

To make ends meet in Svalbard, Weisi worked as a cycling tour guide and at a shop selling arctic equipment. She also works remotely as a marketing manager, with clients around the world.

“When I first arrived, I printed copies of my resume and went around town handing them out to establishments in Longyearbyen,” she said. “That gave me the chance to grow my network and meet new people.”

“Just like in Singapore, everyone knows each other as it’s a very small and tight-knit community,” she said. “Forging new friendships with people of different walks of life was one of the biggest highlights.”

The Northern Lights can be seen from Svalbard from late September to the middle of March.

Courtesy of Weisi Low

In a place where polar bears roam freely, and traveling via snow mobile is as normal as driving a car, Low spends most of her time outdoors, partaking in adventures she would never experience in Singapore.

“In the winter, you can drive over the glaciers as it’s all frozen. We took a hike up one of the glaciers called Longyearbreen and went under an ice cave where we had coffee,” said Low. “In the summer, the glaciers will melt, and you can see the water flowing down into the rivers and seas. It’s really beautiful.”

The Northern Lights are a common sight too, said Low. “During the polar season, you can see the lights in the middle of the afternoon since the sky remains dark for months,” she added.

Spending the past two years in Svalbard has allowed Low to grow independently and prioritize her life.

“Svalbard has taught me the importance of having a balanced lifestyle,” she said “I prioritize my work and friendships, but… also… my desire for adventure.”

Starting a hotel during a pandemic

The Covid-19 pandemic caused many to rethink their work lives. But Filipina Christine Cunanan took a much bigger leap of faith by moving over 7,000 miles from home to open a hotel in Spain.

Amid the Covid-19 pandemic, Christine Cunanan opened the Spanish luxury villa hotel La Esperanza Granada in August 2021.

Courtesy of Christine Cunanan

“Manila turned into a ghost town overnight and everything from work to birthday celebrations went online,” said Cunanan.

When the international airport in Manila reopened, she booked a flight to Tokyo, where she lives part-time and works as the editor-in-chief of a travel magazine.

On the flight, she decided to look into buying a house in Spain despite having no ties to the region. She had traveled there twice before the pandemic closed borders around the globe, and Spain was still on her mind.

“When I got back home to Tokyo, before even unpacking my bags, I went online and searched properties in Spain,” she said. “When I saw this one in Granada online, I said ‘Wow, this is beautiful.'”

The house was owned by a British couple, and it was licensed to function as a small hotel, although the owners used it as a private home.

“It was perfect,” said Cunanan, despite being “in a region where I initially knew absolutely nothing and no one.”

“People may think I exaggerate but… everyone I needed for this move and for my new business…appeared in my life at exactly the right time,” she said.

A lawyer she’d never met handled the sale, an acquaintance she had “spoken three words to at a cocktail party a year before” took possession of the keys in her absence, said Cunanan, who bought the house sight unseen.

“This acquaintance’s best friend came along to help him, and the best friend has not left the property since Day 1,” she said. “He’s now my business partner.”

La Esperanza Granada, a hotel and villa in Spain.

Courtesy of Christine Cunanan

Approximately one year after buying the house, Cunanan opened the luxury villa hotel La Esperanza Granada in August of 2021.

“Moving to Spain and renovating a hotel amidst Covid was simply a matter of one door opening after another,” she said. “Some things are just meant to be.”

In the 10 weeks that the hotel has been open, it’s hosted weddings almost every weekend, said Cunanan, adding that online reviews have been overwhelming positive.

“With just a little inkling of the adventure that awaited and way too much recklessness, I jumped from Manila to Tokyo and then straight into the life of a hotel owner in Spain,” she said. “So far it has been one of the happiest times of my life.”

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China’s Xiaomi plans to mass produce its own electric cars in 2024



Xiaomi CEO Lei Jun holds a press conference about Xiaomi’s new logo and Xiaomi’s car building on March 30, 2021 in Beijing, China.

VCG | Visual China Group | Getty Images

GUANGZHOU, China — Chinese smartphone Xiaomi is expecting to mass produce its own electric vehicles in the first half of 2024, its CEO Lei Jun said on Tuesday.

The comments were made during the company’s investor day and confirmed later in a post by the CEO on China’s Twitter-like service Weibo.

Xiaomi’s shares in Hong Kong jumped over 5% on Tuesday.

Read more about electric vehicles from CNBC Pro

When Xiaomi officially launches an electric car, it will face off against its Chinese rivals like Nio and Xpeng as well as larger automakers like Elon Musk’s Tesla and BYD.

China’s electric vehicle market has had favorable government support over the last few years which helped the industry grow. While some of that support has been reduced, the market is still growing.  

Market research firm Canalys forecasts 1.9 million electric vehicles will be sold in China in 2021, growing 51% year-on-year.

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