Nike invests in sustainable supply chain technology

Nike took a minority stake in a Michigan company that makes software for supply chain optimization.

Nike took a minority stake in a Michigan company that makes software for supply chain optimization. 

Nike Inc. on Tuesday said it has made a minority investment in LLamasoft Inc., a Michigan software company that makes supply chain and transportation design software.

The Washington County sporting goods giant (NYSE: NKE) has been a customer of Ann Arbor-based LLamasoft for two years. But now the companies will work together to co-develop products capable of making Nike's global supply chain operations more efficient and environmentally sustainable.

Terms of Nike's minority investment weren't disclosed.

"Innovation and sustainability are core to Nike Inc.'s operations and this new partnership with LLamasoft represents unique opportunities in both of these areas," Hans Van Alebeek, Nike’s vice president of global operations and technology. "Through working with LLamasoft as a customer, we recognized the potential to collaborate on innovative supply chain solutions that offer real time logistics benefits and the potential to positively impact our efforts around carbon reduction."

LLamasoft's software can be used to create simulation models that allow companies to consider elements of service, performance, costs and risk associated with making changes in their supply chains. A separate product allows companies to add transportation routing to its supply chain design models.

LLamasoft CEO Donald Hicks said in a news release that the partnership with Nike will help his company accelerate the development of its products.

The partnership hits on two major initiatives for Nike: It furthers its sustainability mission, while also tackling the issue of unpredictable supply chain costs that in recent quarters have cut into the company's profit margins.

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