How Much Does Nike Franchise Costs?
Nike is the world’s most well-known sportswear brand and one of the most popular global brands period. Founded in 1971, Nike sells products ranging from sneakers and clothing to sports gear and accessories. It’s also the owner of popular brands like Jordan and Converse.
The average Nike franchise cost is $107,500. Entrepreneurs with at least $75,000 in funding used to be able to apply to become Nike franchisees. The most expensive Nike franchises used to cost up to $140,000.
These days, Nike rarely works with franchisees. Instead, the company allows retailers to resell its products through the Nike Marketplace Partner program.
How much does it cost to become a Nike authorized reseller? And how can you get started with the program? We’re answering these questions and more in this guide, so you better keep reading.
Does Nike Franchise?
Nike doesn’t franchise in the traditional sense. In other words, it doesn’t offer entrepreneurs the opportunity to open their own Nike stores.
The one exception was Nike’s franchise model in India. These “franchisees” could then sell Nike products through their retail outlet store centers.
However, in October 2019, Nike pulled the majority of its franchise agreements in India. Now, Nike only has one strategic franchise partner — SSIPL Retail.
But here’s the good news: business owners can get involved with the brand through Nike’s authorized reseller program. Becoming a Nike Marketplace Partner allows you to sell Nike products in your retail storefront or online shop.
Nike Franchises vs. Authorized Retailers
By now, you may be wondering: what’s the difference between a Nike franchisee and a Nike Marketplace Partner?
Franchises, by definition, are independently-operated entities that use the parent company’s branding and business model. Franchisees are required to pay fees and a percentage of sales to the parent company (i.e., Nike) in exchange for branding, marketing, and, sometimes, startup investments.
A Nike Marketplace Partner, on the other hand, doesn’t own a Nike store. Instead, these entrepreneurs own a unique physical or digital retail business and sell Nike products within that store. These resellers don’t have to pay franchise fees or percentages of their product sales to Nike.
How Much Does It Cost to Become a Nike Authorized Reseller?
There is no cost to become a Nike authorized reseller. However, since you must own a physical or digital retail shop before applying to the program, you will have to invest in a sportswear store.
The exact amount of startup funding you’ll need varies depending on whether you want to own an online or brick-and-mortar sportswear shop.
Brick-and-Mortar Sportswear Store Startup Costs
| Expense | Cost |
|---|---|
| Rent | $1000–$80,000 per month |
| Decor | $0–$5,000 |
| Business Formation Fees | $100–$1,200 |
| Business Insurance | $500–$1,500 |
| Software | $150–$2,000 |
| IT Support | $150–$2,000 |
| Payroll | $0–$4,000 |
| Inventory | $350–$15,000 |
| Advertising and Marketing | $2,200–$140,000+ |
| TOTAL | $2,200–$140,000+ |
The most significant expense for new sportswear shops is rent. But choosing a retail space in, say, Texas would save you money compared to paying rent in an area like New York.
Another major cost is advertising and marketing. You can also cut these expenses since you don’t technically need to run ads or pay influencers in the first few months you’re open. The only necessary advertising expense for your store is the cost of signage, which will run you anywhere from $75 to $2,500.
If you plan to operate a website for your new business, add $250–$6,500 to the total cost above. Or, instead, you could choose to run an online business alone, which can save you money on startup expenses.
Online Sportswear Store Startup Costs
| Expense | Cost |
|---|---|
| Website Design | $200–$6,000 |
| Website Domain | $12–$200 |
| IT Support | $150–$2,000 |
| Payroll | $0–$4,000 |
| Office Space Rent | $0–$2,000 |
| Software | $12–$1,100 |
| Business Formation Fees | $50–$500 |
| Inventory | $350–$15,000 |
| Advertising and Marketing | $0–$27,500 |
| TOTAL | $775–$59,000+ |
Starting an online sportswear business can slash your startup costs in half compared to opening a physical store.
You won’t have to pay rent or for store decorations. Technically, you don’t even need to hire employees because you can outsource many of your website expenses, IT support, and advertising and marketing operations.
Lower total startup costs are an excellent reason to choose this format for your sportswear store. Plus, e-commerce is growing rapidly. Nike’s online sales, in particular, have increased nearly 20% since 2011, and the company expects e-commerce to continue to increase in importance.
How to Become a Nike Authorized Reseller
US and Canadian business owners can become Nike authorized retailers through the Marketplace Partner program. If you live outside of Canada and the US, get in touch with the Nike regional headquarters near you to find out how to sell Nike products in your store.
To become a Nike authorized reseller in the US or Canada, you must first have an established online and/or brick-and-mortar retail business. You’ll be required to submit proof of your business license when you apply for the Marketplace Partner program.
In some rare cases, Nike may approve a reseller based on his or her business idea alone. These individuals may not have a retail store in place already. But they should have significant experience, a solid business plan, and funding.
Nike allows online business owners to become Marketplace Partners, too. The application process is the same whether you have a digital or physical store. Though, keep in mind that the company won’t consider applications from Amazon or eBay store owners.
Here’s everything else you need to know to apply for Nike’s Marketplace Partner program.
Fill Out an Electronic Retailer Application
Anyone who wants to sell Nike products must fill out an Electronic Retailer Application (ERA). Even if you’ve been a Marketplace Partner in the past, you must reapply for the program to become an authorized reseller. Previously authorized partners whose businesses change ownership must also fill out a new ERA.
There’s no fee to submit your ERA. You will need a valid business license and/or your business plan. You may also need to submit proof of your store’s financials, photos of your physical storefront, or the website address for your online shop.
Make sure your application is 100% complete, or else Nike will automatically reject it. And if your app gets rejected, you must wait one year from the date listed on the official denial letter from Nike before you can reapply for the program.
Nike gets tons of requests to become an authorized reseller. As such, its approval process is rigorous and competitive and can take up to 90 days to complete.
Check the Status of Your Application
Once you’ve applied to become an authorized reseller, you’ll have to wait for approval before you can start selling Nike products in your store. You can log onto the ERA website to view the status of your application.
How long does it take to get approved for Nike’s Marketplace Partner program? In general, it takes up to two months for Nike to let you know whether you’re approved.
Start Selling Nike Products in Your Store
As soon as Nike approves your application, you can use Nike branding to advertise its products in your retail shop. You can also start selling Nike products in your physical store or online. Here’s how it works.
You’ll purchase products at wholesale cost, which is a discounted price from what you’ll resell those items for in-stores. You may buy your products from Nike directly. Or you could purchase them from one of Nike’s authorized wholesalers.
The exact number of products you can purchase from Nike will depend on how much distribution your business can do. Your store’s sales capabilities will also determine product pricing and payment terms. Nike may extend its partners a line of credit, which it will dictate based on your business credit profile.
If your store ever changes business address, you’ll need to update that information on your ERA. You can also add new addresses if you open a second retail location under the same business license and model.
Become a Nike Marketplace Partner Today!
The good news is that any retailer can become a Nike product reseller through the Marketplace Partner program. Applying to the program won’t cost you anything, but you will need a storefront or digital shop to get approved.
In 2021, the cost to open a sportswear store ranges from $775 to over $140,000. The exact price depends on whether your business is online or brick-and-mortar.
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