image: Nike

image: Nike

Goldman Sachs announced on Wednesday that Nike, the world’s biggest sportswear maker, is close to finalizing a deal to sell directly on Amazon, raising competition for brick-and-mortar sporting goods retailers and counterfeit sellers, alike, according to Reuters

Nike, whose products are already readily available on Amazon by way of third-party and unlicensed dealers, “could build an additional $300 million to $500 million of revenue in the United States or 1 percent of its global sales through its expansion as a wholesale dealer on Amazon,” per Goldman Sachs’ report. 

Through the partnership, Nike stands to weed out excess, discounted inventory available on the marketplace by way of third-party retailers and sell more full-price products through the online channel.

The move is interesting, as a number of brands have distanced themselves from Amazon for this exact reason, as opposed to partnering with the e-commerce giant. This time last year, Birkenstock announced that it would cut ties due to the influx of counterfeits and unauthorized selling on the online shopping site. As a result, the sandals company will no longer supply products to Amazon in the U.S. beginning January 1, 2017. Birkenstock also noted in a letter to the U.S. online giant that it will no longer authorize third-party merchants to sell on the site, either.

Similarly, high fashion brands have been vocal about their distaste for the platform, which has faced heightened scrutiny in recent years after it began allowing Chinese sellers to list goods on its marketplace. Most famously, LVMH – parent to Louis Vuitton, Givenchy, Celine, and Marc Jacobs – said in a statement last year that it did not think Amazon was an appropriate platform for its luxury brands and that there was “no way” it would authorize the listing of its brands’ goods on the site. 

Nike, on the other hand, see the influx of fake and likely, gray market goods, on Amazon, as an opportunity. “Taking this step would give Nike direct economic exposure to a large and fast growing distribution channel, while improving the brand presentation and expanding access to millennial shoppers,” Goldman analyst Lindsay Drucker Mann said.