Vedomosti Daily reported that the head of the Inventive Retail Group (IRG), which operates Nike stores throughout Russia, confirmed that the company will no longer supply any merchandise to the country.
“As supplies of goods run out IRG will be forced to close all of its shops under this brand,” IRG President Tikhon Smykov said in a note to employees recently.
Smykov also told employees that the situation means the business can no longer exist, meaning that all 37 Nike stores in Russia are expected to be closed down
The Move Was Inevitable
With many American brands effectively forced to stop doing deals with Russia as part of the United States’ sanctions levied against the country, it was only a matter of time before Nike made the decision – either as a result of government pressure, or to keep in line with other brands doing the same.
In March, Nike announced that all operations would be temporarily suspended in Russia.
Earlier this month, Russian Premier League soccer club Spartak Moscow also revealed that Nike had ended its kit sponsorship deal with the team and that they will not be taking part in competitions in Europe next season. The deal has been in place since 2005.
Companies Face Increasing Pressure to Pull Out Of Russia
For brands not affected by sanctions, pressure from media outlets and customers may be enough to make them finally pull the plug.
CBS News reported this week on 27 U.S.-based companies that are still doing business with Russia, defying calls to curtail their activities in the country. The outlet published information from Yale University Professor Jeffrey Sonnenfeld which shows the status of American companies doing business with Russia.
The Yale School of Management running tally lists major American businesses and explains their current status in Russia.
“The list below is updated continuously by Jeffrey Sonnenfeld and his team of experts, research fellows, and students at the Yale Chief Executive Leadership Institute to reflect new announcements from companies in as close to real time as possible,” the site explains.
Operating statuses for the companies on the list include “still operating in Russia,” “still flying to Russia,” “distributors in Russia,” and more.
With pressure ramping up from all angles, only the businesses whose trading in Russia is essential for their survival are likely to defy sanctions or public pressure and continue doing business with the country.
For those businesses that continue to do business, however, making financial transactions with the country will prove exceptionally difficult.
Jack Buckby is a British author, counter-extremism researcher, and journalist based in New York. Reporting on the U.K., Europe, and the U.S., he works to analyze and understand left-wing and right-wing radicalization, and reports on Western governments’ approaches to the pressing issues of today. His books and research papers explore these themes and propose pragmatic solutions to our increasingly polarized society.