Nike Is Saving A Ton Of Money On Its New Flyknit Shoes
The Flyknit material, which debuted two years ago, is lightweight, minimalist, and fits like socks.
Nike uses "automated, high-tech knitting [technology] to 'weave' the shoe's upper" half into one piece, instead of several pieces that are stitched together, according to a recent research note by Deutsche Bank.
The technology reduces labor costs by up to 50% and cuts material usage by up to 20%, resulting in .25% higher margins, analysts wrote.
The Flyknit shoes retail for $120 to $150 on Nike's website.
Nike is also utilizing 3-D printing machines to build the soles of some of its shoes, including the Vapor Laser Talon soccer cleat.
"Nike is transforming its footwear manufacturing process from a low value add, labor intensive process to one that is more automated, high value add using the latest technologies," analysts wrote.
Adidas is leveraging similar technology "and is targeting a fully automated footwear production platform," they noted.
Adidas' version of Flyknit is called Primeknit.