Footwear

The Rise of Portugal and Spain for Australian footwear retail stores

A short decade ago you couldn’t have a sustainable footwear retail store if the business wasn’t built on the back of major footwear brands.

It suited everyone – consumers wanted known brands which had built value, reliability and quality based on a platform of consistency and trust. Most of the brands sold were and still are manufactured from one of Australia’s largest trading partner, namely China.

ahoes

Why?

Well apart from the obvious economic factors, footwear which is exported from China maintained a certain quality and consistency that wholesalers, retailers and consumers could live with, appreciate and grow from.

With the increase of labour costs in China, certain factories have now also raised wholesale order minimums to countries like Australia quite possibly to deal with increases of their own.

inkas

With these changes afoot, Chinese exporters and manufacturers main attraction, (quality, low minimums and keen prices) compared to European rivals have slowly been eroding. This erosion is what’s playing into the hands of European brands – in particular the price, quality, consistency and styling hailing from Spain and Portugal.

As the Australian dollar fluctuates season on season, price rises and falls in footwear in particular from China had an adverse affect on production costs in comparison to similar price fluctuations from Europe and the Euro. Labour costs in China are still better than Europe, but the gap between European and Chinese manufactured footwear is closing, fast.

hinako

This has given lead to other footwear producing economies like Germany, Turkey, Italy, Portugal and Spain, which otherwise could never compete with China on price, to now start beating China at their own game

This is the one area which Australian consumers still debate on – the comparison in quality, craftsmanship and price when compared to not so expensive but tangibly higher quality leathers and styling of European product. This has changed the landscape for wholesale suppliers in Australia which for the past decade, have solely relied and were interdependent on footwear produced in China. Independent footwear stores in Australia are leading this charge for quality and Euro driven product in mainstream sales. For them, it becomes increasingly difficult to compete with a plethora of volume and price driven, predominantly Chinese retail footwear brands which are discounted at department stores 6 out of 7 days a week.

Is this really happening and who’s leading the change?

Slider

In short, end consumers seem to be embracing a different mindset. Australian’s are travelling more and with their love affair and infatuation with European cars, architecture, food and fashion, it is only heading north.

The changing consumer who were once bent on buying long term known brand names are now looking for quality, difference and uniqueness with regard to footwear. It appears on the surface that country of origin is playing a large role as brand names. This opens the game up to anyone with a European label and quality service.

Ask any retailer who scoffed yet ordered the Spanish manufactured Carousel sandal from TAOS in its first year or the Willow ankle boot from EOS and they’ll tell you the consumer repeated a very important lesson – in the presence of quality and styling, price is almost a secondary consideration.

About the Author:

Motivational speaker and  Founder and Director of www.barrynicolaou.com & ShoeCircle,  Barry Nicolaou is a regular Exposed Online Contributor.

barry 6

 

“Cultivate the ability to deal with negative moments and bungee-up to positive actions and thoughts as soon as you feel yourself slipping into negative or doubtful thinking. You must do this with focus and as a conscious decision. Realise the lessons that will be learned from the current situation and take them on board with strategy and humility. If you can pass through these discovery moments, you’ll witness opportunities, the opening of doors and greatness manifest into your reality” – BN

 

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