Nike to cut thousands of online distributors in China from Jan 2026

The Nike flagship store on Nanjing Road Walkway in Shanghai, Nov. 4, 2025. Source: Cfoto | Future Publishing | Getty Images

Nike announced Tuesday that it plans to cut off thousands of online distributors in China beginning in January, as the sneaker giant seeks to clean up a fragmented digital marketplace and return the region to growth.

Key Changes

• Nike will concentrate online sales through its own website and app, as well as official storefronts on Tmall, JD.com, and Douyin — some of China's largest online marketplaces and social platforms.
• The move will eliminate thousands of other online storefronts currently operated by Nike's brick-and-mortar partners and secondary distributors.

Rationale

Currently, consumers can shop Nike through a vast digital network that includes both official channels and numerous partner-operated storefronts. While this has provided widespread access to Nike products, it has also led to:

• Inconsistent branding and pricing experiences
• Hampered efforts to reverse a sales decline in the region

In a letter, Cathy Sparks, Nike's new vice president and general manager of Greater China, explained the strategy:

"These new flagships will serve as the single, elevated destination for Nike within these ecosystems, with clearer product presentation, stronger storytelling and more connected consumer journeys. This is about strengthening the platforms where consumers already begin and end their shopping journey, making sure those experiences are direct, consistent and unmistakably Nike."

She added: "This is not about reducing access. It is about reducing fragmentation and strengthening the consumer journey. When the experience is consistent, the brand becomes stronger."

Potential Risks

While the restructuring is designed to create a healthier marketplace and give Nike greater pricing control, it carries significant risks:

• Revenue decline: The region has already shrunk approximately 30% in the last five years, and the move could lead to a material drop in revenue.
• Analyst concerns: Laurent Vasilescu, equity analyst at BNP Paribas, compared the move to Nike's ill-fated decision to cut off wholesalers in North America, which contributed to a collapse in market dominance, sales, and margins.

"This strategy opened up shelf space for competitors and the strategy ended poorly for Nike. We believe the same could happen if it takes the same approach in China," Vasilescu wrote last month, adding that BNP maintains its underperform rating. "We don't think Nike has a distributor problem but rather a product problem which also applies in other markets."

Impact on Partners

The change is expected to hurt Nike's brick-and-mortar partners in the region, which have expanded their online presence in recent years. However, Topsports, Nike's largest distributor in mainland China, expressed support.

Yu Wu, CEO of Topsports, said in a statement:

"Topsports has worked with Nike for 27 years based on the principle of mutual benefit and shared growth. This adjustment will bring some short-term pressure to our business. But we firmly believe that, over the medium- to long-term, this direction will help promote a healthier, more orderly, and more sustainable retail ecosystem in China, while further improving consumer experience and product appeal."

Wu added: "Looking ahead, we will continue to work closely with Nike, leveraging our strengths in offline retail operations, local consumer service, and deep market development across city tiers. Through new concept sport stores and high-quality physical retail experiences, we will bring Chinese consumers richer and more meaningful sport experiences."

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