The trend: With Nike reducing its wholesale obligations, adidas, Puma, Reebok, and other brands are stepping into the void.
How we got here: Nike has spent the last few years focusing on its direct-to-consumer (D2C) business as it looks to take advantage of higher margins and develop stronger relationships with consumers.
The opening: While some retailers, like Under Armour, have followed in Nike’s footsteps by expanding their D2C business, others, like Puma and Reebok, are doubling down on wholesale.
Looking ahead: While D2C offers higher margins than wholesale, it also limits the number of channels that brands can sell on, which in turn can curb their overall reach.
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