Nike Ends Online Sales Partnership with China's Largest Distributor

After 27 years of partnership, Nike is reshaping its business boundaries with its largest distributor in China. Sports retailer Toplife (06110-HK) saw its stock open sharply lower on Wednesday (22nd) and closed down 24%, erasing around HK$3 billion in market value, leaving it at approximately HK$9 billion.

The day before, Toplife received formal notice from Nike: effective January 1, 2027, all online platform sales operations for Nike products in mainland China operated by Toplife will be fully terminated.

Toplife’s total revenue for the 2025–2026 fiscal year was RMB 25.74 billion. Online sales of Nike products accounted for approximately 22% of total revenue. Based on this, the estimated scale of the affected business is around RMB 5.6 billion.

"This matter will have a significant impact on our business in the short term," Toplife stated in its official announcement.

Industry rumors as early as June suggested that Nike was preparing to reclaim online operating rights from distributors to rebuild pricing discipline through official channels.

Currently, when consumers search for the same Nike product on shopping apps, multiple prices from different distributors appear, making it difficult to distinguish between official, authorized, or gray-market sellers. Brand value has been diluted by aggressive discounting among distributors.

According to a report by 21 Finance, the partnership between the two companies began in 1999. Toplife was once Nike’s most trusted retail partner in China, with its network of thousands of directly operated stores accounting for about 30% of Nike’s business in the country.

Regarding the termination of online authorization, both parties have stated they will continue to cooperate in offline sales within China.

"We will leverage our strengths in offline operations, local services, and penetration into lower-tier markets to build new-concept stores and premium experience stores," Toplife said in its announcement.

"The core of this initiative is to build a stronger, more sustainable market ecosystem," said Cathy Sparks, General Manager of Nike Greater China, in an open letter. She added that the move would promote long-term growth for Nike and its partners, emphasizing that retail partners would continue to play a key role in bringing sports into communities.