Compare and Contrast: Nike and Alta Gracia

1139 words (5 pages) Business Assignment

16th Jun 2020 Business Assignment Reference this

Tags: Business AssignmentsManufacturingBusinessNike

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Clothing manufacturing is a billion-dollar industry around the world and with the globalized nature of this industry, clothes can come from all corners of the world. Not all are created equal and each one has its pros and its cons that must be considered for individual purchases, and even more so for large contracted purposes. With this in mind, it becomes important to understand that a contract with a clothing company can mean an endorsement of the quality, the price and the background of said item. Nike is a well-known brand around the world for competitive prices and high-quality wears that are preferred by many consumers. Alta Gracia makes comparable items that while not as well-known by name, are also high-quality items that many use around the world. Deciding between Nike and Alta Gracia can be done along many factors. There are more similarities than differences between Nike and Alta Garcia clothing companies, with one major difference setting them apart, which is the ethical nature of their business.

The major similarity between these two organizations is that they both are engaged in making similar items in apparel goods. Both companies make collegiate clothing that can be sold individually and also sold wholesale to other companies. Both brands are already in contact with many universities and sell their items both online and in their campus bookstores. Each makes high-quality sweatshirts, t-shirts, pullovers and hoodies. The items in apparel are therefore very comparable between the two and no major difference exists in quality or number of clothing items that are available from each brand.

The first major difference in the items starts with the number of provided alternative to apparel items. This refers to the non-clothing items. The Alta Gracia online catalog lays out the items that are available, and they are vast in apparel, but lacking in non-apparel items. Nike has shoes as well as socks, hats, jackets and pants, none of which are listed on the Alta Gracia online catalogue as an option to purchase. This means that the Alt Gracia line is limited to only apparel tops such as t-shirts, hoodies and sweatshirts. The Nike brand gives access to a far wider and more diverse number of products to choose from and have ordered wholesale from them versus the Alta Gracia line.

Pricing is another area that the two companies are more similar than different from each other. While many may assume that the Alt Gracia line is more expensive because it is a sustainable and ethical company, this appears to not be the case at all. According to a recent report on the company, it was found that the living wage amounts to approximately 90 cents per garment made, with the conventional company like Nike paying less than 50 cents per garment on average (White, 2017). Alta Garcia triples the per garment pay to its workers and adds 90 cents to the normal 50 cents per garment. The costs remains the same as Nike because retailers and wholesalers both have about a “75 percent markup”, but with the Alta Garcia supply chain that 90 cents gets absorbed by the company and is not passed on as a higher cost to the consumers which leaves the company paying a livable wage while retaining a comparable price as Nike (White, 2017).

The biggest difference between Nike and Alta Gracia is that one has an ethical practice in place for its workers and products while the other is more conventionally mainstream and uses sweatshops for its products. The issue of ethics is where Alta Garcia sets itself apart in a big way with its respect for workers, while Nike as a brand hurts workers with its use of sweatshops (Bigelow, 1997). Their overall company differentiation is that they not only pay a livable wage, but they have a company culture that revolves around respect and equity for its workers leaving them with dignity and the ability to care for their families through a healthy work environment. Nike on the other hand still uses sweatshops and employs manufacturers who rely on low wages and inequitable conditions to keep costs low and profit margins high. This is a major difference between the two organizations as many college campuses are calling for companies that use sweatshops, like Nike and Under Armour to be set aside in factor of more ethical companies like Alta Gracia (Ukrop, 2012).

When making their ultimate decision, the university should look towards its own ethics, mission, vision and overall image as key variables in the decision-making process. As a university, there is an opportunity to not only make a decision but make an important impact as well in terms of how students and others see the decision and its meaning. For the case of Nike versus Alt Gracia, it comes down to a more traditional choice, and a more unconventional one that can make an impact on the students as well. To know that the university takes issues of sustainability, human and worker rights and green realities into consideration, is an important stance that can influence students in the short and the long-run. A large part of this is because they can see that their own school cares about the impact of their choice, which can in turn have an impact on the students. Comparatively, these two companies offer similar items and similar prices. The standout features on each side are with Nike having more choices of products, and Alta Gracia having more thought and consideration into worker rights.

The university’s choices are not easy as there are benefits and drawbacks in either company that they choose from. However, it comes down to more choices, versus choosing a company that gives its employees dignity and rights. This choice should lead them towards the Alt Gracia brand as it is able to meet the cost needs of the school, while also helping to be in line with the schools own mission and vision as an institution. The majority of the items that are needed are t-shirts and other apparel tops, which mean that the one advantage Nike has may not be that relevant in this case anyway.

References

  • Alta Gracia. (n.d.). Our Story. https://altagraciapparel.squarespace.com/our-story
  • Bigelow, B. (1997). The human lives behind the labels: The global sweatshop, Nike, and the race to the bottom. Phi Delta Kappan, 79(2), 112-19.
  • Ukrop, J. (2012). MUSAS wants MU Bookstore to sell Alta Gracia. Missouri University Student Newspaper. https://www.themaneater.com/stories/campus/musas-wants-mu-bookstore-sell-alta-gracia
  • White, G.B. (2017). The Tiny Dominican Factory That Disproves the Need for Sweatshops. The Atlantic. Retrieved from: https://www.theatlantic.com/business/archive/2017/11/factory-apparel-industry-ethical/546419/

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