The Week at a Glance:
- India Allows Kanpur Tanneries a Trial Run
- ‘Made In’ Legislation Stalls in Europe
- Chinese Tanneries Saw Moderate Growth
- South Korea, China Formally Sign Free Trade Pact
- Portugal’s Footwear Industry Grows
- Deckers Has Record Q4 and Annual Results
- New Adjustable Female Shoe Based on Smart Materials
- JBS Couros Opens US Distribution Center
- Michael Kors Suffers First-Ever Drop in Comp Sales
- Swedish Institute Expands Clean Textile, Leather Project
- Spring ANPIC Ends
- US Heavy Texas Steers Down $2
- Looking Ahead: “Made in”
Chinese Leather Sector Profits Rise 1.9%
According to a report released by State Statistics Bureau, the main business in leather sector that includes leather, fur, feathers and footwear, earned revenue of 417.96 billion yuan, recording a growth of 6.1% in the first four months. The total profits were 24.48 billion yuan, a 1.9% increase in the industry.
India Allows Kanpur Tanneries a Trial Run
The National Green Tribunal Tuesday allowed the closed-down tanneries situated on the banks of Ganga River at Kanpur to operate on a trial basis for 19 days in June, during which their effluent levels will be checked by a team of experts. The period is June 17 to June 15.
The tribunal, while passing an order on a bunch of pleas, asked all the industrial units to furnish details of steps taken by them to curb pollution level to the joint inspection team, comprising experts from Uttar Pradesh Pollution Control Board (UPPCB), Central Pollution Control Board (CPCB) and IIT-Kanpur by June 6.
The green tribunal added that after the effluent samples are analyzed by the joint inspection team, the reports should be placed before it and posted the matter for further hearing on July 25. It made it clear that the units which are closed and allowed to operate for the trial period shall shut down after the period, while those units which are operational will continue running.
The NGT, which had earlier termed the 700 tanneries in Kanpur situated on the river bank as one of the “highest sources of pollution,” had also warned them of coercive action if they failed to comply with environmental laws.
Pakistani Leather Industry Saw Mixed 10 Months
Pakistan’s total export earnings from the leather sector during the first 10 months of the current financial year (July 2014 to April 2015) fell by almost 4% compared to the same period a year ago, reaching just over $1 billion.
For footwear exports the news was mixed. There was a decline year on year in volumes, falling by 8.9% to 11.5 million pairs, but values were up, by 12.9% to reach $108.6 million.
‘Made In’ Legislation Stalls in Europe
The European Commission stalled in Brussels on Thursday as country representativeswere unable to agree on so-called “Made In” legislation that would make product-origin labels mandatory for goods sold in the EU, rather than optional.
Italy has been among the most vociferous advocates for country-of-origin labeling, as leaders from its fashion, textiles, footwear, home design, jewelry and ceramics industries have joined forces to push for change. An April 2014 vote found that 76 percent of European parliamentarians, especially those from the south, support more stringent labeling legislation — but a vocal minority of northern European MEPs continues to form a powerful barricade against it.
Following last year’s vote, Italy’s vice minister for economic development Carlo Calenda was optimistic that five sectors could meet approval across the 28-country board for mandatory labels: ceramics, footwear, jewelry, textiles and home furnishings.
But despite ongoing discussions and a watered-down “Made In” compromise advanced by Latvia, which is currently presiding over the EU as part of a six-month rotation, the commerce meeting on Thursday yielded no progress. Italy, Cyprus, France, Bulgaria, Spain, Slovenia, Portugal, Poland, Greece, Malta, Romania and Croatia all expressed support for mandatory labeling, while the U.K., Germany, Austria, Belgium, Slovakia, the Netherlands, Ireland, the Czech Republic, Finland, Hungary, Lithuania, Denmark, Luxembourg, Sweden and Estonia all rejected the notion.
The lack of progress has left Italian industry leaders fuming.
“It’s disheartening that from February 2013 to today, that part of Europe led by Germany remains unconvinced of the fact that ‘Made In’ represents a momentous turning point for the entire European economy, not just the Italian economy,” said Claudio Marenzi, president of Sistema Moda Italia, the Italian fashion and textile trade association.
Chinese Tanneries Saw Moderate Growth
Data recently released has shown tanning sector revenue saw a moderate growth of 10.3% to 47.35 billion yuan, and profits improved by 0.6 percent in the first four months of this year, but for the production of light leather it posted a slight drop of 0.75% to 172 million square meters. The slowdown in leather production led a slight decline in the import of hides and wet blue, which is thought to be in the normal range. The reason behind the slowdown in light leather is weak demand for leather products at home and abroad, which inevitably reduces sales volume of leather, and is not related to the cases of pollution and smuggling that have happened in the cities of Xinji and Wuji. For the same period, imports of finished leather declined 8.5% in volume, but had a 10.2% increase in value.
CLIA’s president Su Chaoying said although there is a slowdown in the growthrate of leather product exports, foreign trade growth remains steady and is more diversified. Opportunities to invest in foreign countries are increasing, and furthermore, China’s complete industry chain and manufacturing capability make China remain competitive in the world leather market.
2015 IULTCS Merit Award Winner Announced
The Executive Committee of the IULTCS takes great pleasure in announcing the 2015 winner of the “IULTCS Merit Award for Excellence in the Leather Industry”: World-renowned leather scientist Professor Bi Shi. He is Director of the National Engineering Laboratory for Clean Technology of Leather Manufacture of Sichuan University, in Chengdu. He also serves as an Academician of the Chinese Academy of Engineering. He will be honored at the 33rd IULTCS Global Congress in Brazil in November.
Audit Shows JBS Commitment to Reduce Amazon Deforestation
JBS publishes the annual independent audit regarding its public commitment not to acquire raw materials from farms cleared since October 2009 within the Amazon Biome, using labor analogous to slave labor, or are located in indigenous or environmental conservation areas land. In the verification process, 12,221 cattle purchasing operations were analyzed by JBS in 2014. Of this total, only 4 cattle purchase operations were considered non-compliant.
“We are very pleased with the outcome of the audit. It proves that the degree of assertiveness of our monitoring system suppliers was 99.97% last year, within a very large universe of purchase transactions. This level ensures the security level that civil society, customers and investors expect JBS. This number also represents a step forward
compared to the previous year, as the audit of livestock purchases made in 2013 showed a degree of 99.75% efficiency,” said Marcio Nappo, head of sustainability at JBS.
Click here to view the full text of the audit report.
CLIA Meets Ethiopian Leather Delegates in Beijing
Mr. Ahmed, special adviser to the Ethiopian Industry Ministry, headed an Ethiopian leather and textile delegation of nine members which visited CLIA May 27 to seek ways of boosting bilateral cooperation and development in leather and textile industries. CLIA president Su Chaoying and Vice Secretary-general Chen Zhanguang held talks with the delegation. Su said the exchanges between twoleather industry have been continuing for many years and bilateral leather industries always keep in close contact for developing more cooperation.
The talk focused on the development model, industrial policies, challenges and the function of the leather association in management and trade, as well as cooperation on communication of leather trade fairs.
Su said CLIA will not only play a more important role but also should special adviser do more work in driving cooperation in leather industry. Su made commitments to hold further talks with the delegation on the specific plans for carrying out the above discussion during the Shanghai leather trade fair.
46 Lose Jobs at Timaru Tannery New Zealand Light Leathers
At least 46 workers at Timaru Tannery New Zealand Light Leathers will lose their jobs, its managing director says.
David Cassidy said he told workers 46 positions in the company’s fellmongery and dry finished leather operations would be ended. Cassidy said it was possible more workers in support roles would lose their jobs. The company’s original proposal, which Cassidy announced on May 22, suggested about 60 workers from the company’s fulltime workforce of 120 would lose their jobs.
The changes meant the luxury leather company’s output would reduce by 60 percent after years of falling deer leather sales. Cassidy said other companies would process or partially process hides the company no longer used. Cassidy expected demand for the tannery’s products was unlikely to rebound in 2015. He said the job cuts gave the company “the best chance” of surviving the leather market’s unfavorable conditions.
We Want to Hear from You!
The March 2015 Hidenet Hong Kong Forum, “The Future of Leather,” covered some critical topics, including leather’s loss of market share, industry standards for tanners, and green technology for tanners in developing countries. We want all professionals working in the leather supply chain to participate through this online platform, so we want to hear from you! Logical Media Consultants has created a video survey around some of the most pressing topics in the leather and hide industry. The survey is short, and they’ve included the video clips if you’d like to watch the relevant comments from the Hong Kong Forum.
Your answers are strictly confidential and will help guide the content for future Hidenet Forums.
You can access the survey here.
We look forward to your input. Thank you.
South Korea, China Formally Sign Free Trade Pact
China and South Korea formally signed a free trade agreement (FTA) that would remove most tariffs between Asia’s largest and fourth-largest economies, whose trade is already worth more than $200 billion.
The pact — largely agreed in November and signed by the two nations’ trade ministers on Monday — aims to gradually remove tariffs on more than 90 percent of traded goods within 20 years.
China is the South’s top trading partner as well as the biggest export market, and two-way trade stood at around $235.3 billion in 2014, according to state data in Seoul.
South Korea is also one of the biggest foreign investors in China, pumping in some $1.6 billion in the first quarter of this year.
Pending mandatory parliamentary approval, the FTA will allow small and medium-sized South Korean firms greater access to China’s vast consumer market and help create more than 50,000 jobs in the South, Seoul’s trade ministry said.
The agreement will remove tariffs on 71 percent of South Korean exports to China in 10 years and 91 percent in 20 years.
Seoul will in return remove tariffs on 79 percent of Chinese imports in 10 years and 92 percent in 20 years.
China to Top US as Largest Retail Market by 2018
Retailers aren’t worried that China’s economic growth slowed to a six-year low of 7 percent in the first quarter of 2015. According to a new report by strategy and management consulting firm A.T. Kearney, the country will surpass the United States as the world’s largest retail market within three years as global brands clamor to cater to an increasingly wealthy consumer class.
The 2015 Global Retail Development Index ranks the top 30 developing countries for retail investment taking into account such variables as market size, how saturated it already is and overall riskiness.
Uruguay, Chile, Quatar and Mongolia all figured among the best locations, but China claimed the top spot for the first time in five years because, despite its cooling economy, retail growth was 11.6 percent in 2014 and sales hit $2.83 trillion.
The report calls China “the leader of the pack” and says retailers are “adapting to an environment of slower economic growth” by “pruning and optimizing store portfolios.”
Plus, China’s e-commerce sales swelled 50 percent to nearly $450 billion last year—that included $150 million in mobile transactions—and is projected to reach $1 trillion by 2019 as Alibaba and JD.com work to better serve smaller cities and rural areas. Alibaba teamed with China Post last year to boost its last-mile delivery capabilities, while JD.com launched same-day delivery in more than 100 counties and districts and next-day delivery in another 600.
Among the least desirable places in the developing world for retailers: Mexico and Angola, the latter because “local production facilities are limited and infrastructure is underdeveloped,” the report said.
Portugal’s Footwear Industry Grows
Portugal’s shoe exports reached EUR1.8bn (US$2.06bn) last year.
After a difficult few years brought about by a global economic recession, Portugal’s footwear and clothing industries are growing and underpinning the country’s business recovery.
Last year  the country’s shoe exports hit a record high of around 89m pairs, bringing in EUR1.8bn (US$2.06bn) in receipts according to the Portuguese Association of Industrial Footwear, Accessories, Leather Goods and Substitutes (APICCAPS).
According to a spokesperson from APICCAPS, overseas sales growth of 7.7% was registered in 2014, making it the fifth consecutive year of growth. Figures from APPICAPS show growth was registered in “practically all” overseas markets, particularly in Europe, but also in (former Portugal colony and oil rich) Angola, US, Canada and Australia.
“Since 2009, Portuguese footwear sales in foreign markets have increased by more than 50%. Portugal is consolidating its presence in European markets and has doubled its presence in overseas markets,” the association said.
Indonesia to Provide Incentives to Boost Textile, Footwear Sectors
The Indonesian Ministry of Industry on Tuesday unveiled a new plan aimed at boosting textile and footwear exports and growing the country’s revenue.
The plan will provide incentives to domestic textile and footwear manufacturers to step up production by easing government requirements concerning raw material procurement and financing, and stockpiling cotton and leather to ensure steady supplies.
In addition, the director general of chemical, textile and miscellaneous industries, Harjanto, said the government wants to expand its circle of trading partners by forming more free-trade agreements (FTAs) with countries to which it can export its garments and footwear.
In recent months, around 200 footwear manufacturers laid off about 40,000 workers, according to the Indonesian Footwear Association, while the Indonesian Textile Association (API) said at least 6,300 workers were let go from 120 textile factories and production hours have been cut back to just three days as a result of weak sales.
“We are really shocked by this situation. Our warehouses are full but we cannot sell,” API chairman Ade Sudrajat told the Jakarta Post.
Cleto Sagripanti New CEC President
Cleto Sagripanti, President of the Italian Footwear Association (Assocalzaturifici), was unanimously voted as the European Confederation of Footwear (CEC) next President and takes over the residency headed by the French Jean-Pierre Renaudin.
“When I became CEC’s president two-years ago, I was conscious that the new challenges that our footwear industry were facing could not only be solved at European level. We needed to continue going global and reinforcing multilateral dialogues,” explained. Renaudin, adding: “I am confident that the International Footwear Forum will become a new channel of dialogue between all our associations of around the world,” Renaudin said.
The recently elected President Cleto Sagripanti plans to leave the Presidency of Assocalzaturifici in mid-June to fully dedicate his time to the Presidency of the European Confederation. Mr. Sagripanti already commented on the new position: “As CEC President I will indeed continue the international initiatives undertaken by Jean-Pierre, trying to reinforce the strength and unity of our European industries. In this relation, I will work for the EU support to re-shoring strategies, to promote market access on a level playing field, and to fight for a better regulatory environment for our SMEs”.
CEC was created more than 30 years ago as the voice of the European footwear industry in Brussels. It gathers footwear national associations and federations of the European Union, representing approximately 87% of footwear production.
Spring Trend: Woven Leather Shoes
Woven leathers have been reinterpreted for spring ’15, with high-end labels using the traditional huarache style in a new, modern fashion.
Balmain, Sophia Webster and Charlotte Olympia wove multicolored leathers together for an unexpected, eye-catching look. The lively hues certainly capture the spirit of the woven silhouette’scolorful history, which originally developed as a Mexican sandal.
Contemporary brands like Robert Clergerie and Ancient Greek have stayed true to thesandal style, with Clergerie using the technique on its flatform sole.
In the men’s market, the pattern was used as a more subtle touch. Bottega Veneta, which has made woven footwear its signature, used woven suede on the toe caps of sneakers. Brands like Christian Louboutin and Y-3 continued the sneaker message, using a black-and-white color combo for a street-smart aesthetic.
If you’re looking to get your hands on the crafty style, be prepared to pay the price. Woven leatherwork is often handcrafted, which means the cost of production can be a tad higher than usual. But judging by this season, it’s worth the investment.
Deckers Has Record Q4 and Annual Results
Deckers Brands reported net sales increased 15.6 percent to a record $340.6 million in the fiscal fourth quarter ended March 31, capping off a record year despite strong currency headwinds.
The owner of Ugg, Teva and Sanuk footwear brands reported sales grew 19.1 percent during the period in currency-neutral terms. Gross margins, however, plunged to 44.7 percent compared to 48.9 percent for the same period last year.
For the fiscal year ended March 31, net sales increased 14.5 percent to a record $1.817 billion compared to $1.588 billion last year. On a currency-neutral basis, net sales increased 15.6 percent.
“Looking ahead,” Martinez continued, “we believe the shift in the Ugg brand’s fall order book towards more non-core collections such as specialty classics, weather, and casual boots better aligns with current trends and positions us for a successful fall/holiday season.”
Ugg Brand net sales for the fourth quarter increased 9.7 percent to $216.8 million compared to $197.6 million for the same period last year. For fiscal 2015, Ugg brand sales increased 12.6 percent to $1.49 billion.
Teva Brand net sales for the fourth quarter increased 13.4 percent to $53.1 million compared to $46.8 million for the same period last year. For fiscal 2015, Teva brand sales increased 13.5 percent to $126.7 million.
Sanuk Brand net sales for the fourth quarter increased 27.9 percent to $39.2 million compared to $30.7 million for the same period last year. For fiscal 2015, Sanuk brand sales increased 13.1 percent to $114.7 million.
Other brands Combined net sales increased 60.9 percent to $31.5 million compared to $19.6 million for the same period last year. For fiscal 2015, combined net sales of the company’s other brands increased 69.5percent to $82.4 million.
Deckers Aquires Koolaburra
Deckers has acquired the women’s footwear brand Koolaburra. Based in Santa Barbara, Koolaburra offers sheep wool-lined boots similar to those offered by Ugg (owned by Deckers). The brand’s range also includes sandals and leather goods.
“We plan to quickly reposition Koolaburra over the next 12 months to enter the mid-tier market. This is a highly strategic acquisition for us that will allow us to compete in this market while maintaining the premium positioning of our UGG bran,” said Deckers President Dave Powers.
Koolaburra, whose sheep-lined boots are slightly cheaper than Uggs (about 140 euros, as compared to 160 euros for a lower end Ugg model), could therefore see its prices fall and its range altered.
Vietnam’s Imports of Textiles, Leather & Shoes More Than 1.5 Billion
Import turnover of textiles, leather and shoes 4/2015 of Vietnam in March reached $450 million, up 4.2% over the month and increased 6.95% 3/2015 compared to the same month of 2014. As for the first 4 months of 2015, imports of raw materials in textiles and garments, leather and footwear reached more than $1.5 billion, up 10.2% over the same period in 2014.
In the first 4 months of 2015, Vietnam imported commodities mainly from China with $531 million, accounting for 34.5% of total imports in this group, an increase of 13.91% compared to same period a year earlier. This is followed by South Korea with $229 million, accounting for 14.9% of total turnover, down 7.43% over the same period the previous year; Taiwan with almost $156 million, representing 10.1% of total turnover, up 7.15% over the same period the previous year; the United States with $90 million, representing 5.9% of total turnover, up 17.31% over the same period the previous year.
Most imports of textiles and leather shoes in Vietnam in the first 4 months of 2015 increased sharply over the same period of 2014. In particular, a number of strong import markets such as Canada (increased 174.81%, to nearly $2 million), Singapore (up 101.05%, to $896,000), Brazil (up by 74.72%, to $76 million), Australia (up 50.95%, to $12 million). In contrast, imports dropped sharply from markets such as Austria, Poland, Spain, Malaysia and Hong Kong, with respective decreases 25.43%, 25.33%, 21.12%, 15.27% and 10.2% over the same period last year.
K-Swiss Acquires KR3W Denim and Supra Footwear
K-Swiss Global Brands (KSGB), also known as K-Swiss Inc., a division of E.Land Group, announced its acquisition of One-Distribution, a leading skate-inspired apparel and footwear manufacturer and parent company of KR3W Denim Co. (KR3W) and Supra Footwear (Supra).
This acquisition brings the KSGB portfolio to a total of six globally distributed brands, including K-Swiss, Palladium, PLDM, OTZ Shoes, KR3W and Supra Footwear. KSGB is a division of E-Land Group, a $10 billion group of companies with over 200 brands, 10,000 retail stores and business across apparel, footwear, retail, hotels, leisure and entertainment.
Founded in 2006, Supra quickly became one of the largest and most successful independent sneaker brands in the skate industry. It is famous for its game-changing Skytop shoe.
KR3W, an apparel brand with a foundation in skate culture, began in 2003. The brand made its name in denim, and changed the young men’s denim paradigm with the introduction of its K Slim Denim Jean using an innovative stretch fabric and a narrow profile. KR3W has since expanded its apparel range, successfully blurring the lines between skate and fashion, while maintaining its “Dark Americana” aesthetic.
Mexico’s Guanajuato Yields 82 % of Exports
Chamber of the Footwear Industry of the State of Guanjuato (CICEG) has reported that the 20 million pairs of shoes it exported accounted for 82% of Mexico’s exports. The figure respresents a value of $469 million. The association also said the average price per pair rose to $23.36, indicating the output is high-quality shoes.
New Adjustable Female Shoe Based on Smart Materials
A new adjustable female shoe based on a new memory shape composite of leather and Nitinol material, is now available. The new material allows fitting the shoe to the foot shape, after obtaining anthropometric measurements through the Shopintantshoe portable scanner and modifying it with the “Shoptool,” a machine that completes the process directly in the shop. The consortium of EU-funded project Demo ShopInstantShoe presented the results in Villena, Spain, at Calzamedi’s installations.
The new InstantShop tool is compact, lightweight and attractive, and is easily set up in the shoe store for on-the-spot personalization. InstantShoe is made up of the shaping system, an original designed machine with three different lasts to cover all the size range, the intuitive configuration software and the foot scanner DOME, developed by the Biomechanics Institute of Valencia.
Six European partners have taken part in Demo ShopInstantShoe: two from Spain, Biomechanics Institute of Valencia (IBV) and Calzamedi, two from France, Texinov (Lyon) and Nimesis (Strasbourg) one from Switzerland, Technoboots, and one from Portugal Ortopedias Twins.
As Juan Carlos González, Innovation Director of Footwear and Clothing Area at IBV, explained: “The service consists of an innovative customisation process that takes place directly in the retail store and allows scanning clients’ feet in order to obtain basic anthropometric measures and adjusting the chosen shoes immediately through the Shoptool. This is possible thanks to the new memory shape composite material made of leather and Nitinol.” Mr. González adds, “Anyone will be able to get the best fit, and if finally the client does not wish to buy the product, the shoe will recover the original shape by warming it up during few seconds.”
The new memory shape material provides fashionable female shoes that are fully ergonomic, comfortable, innovative and custom-fit.
Trends in aesthetics and the fashion of female footwear demand a more accurate fitting to guarantee footwear functionality and comfort. However, the variability in the foot size and shape among persons makes achieving an adequate fitting for each individual consumer very difficult, and the result is, especially in the case of women, uncomfortable and unhealthy footwear.
The European footwear industry needs to innovate to remain competitive. For that, the shoe industry must identify, assimilate and exploit new technologies as well as develop new concepts, targeting higher added value applications in high tech areas such as materials and composites. In this context, thanks to InstantShoe the European shoe manufacturers and distributors can offer their clients a differentiation in terms of individual fitting and personalisation, both immediate and cost-effective.
Focus on the Shape Memory Composite
At the heart of the recovery process are the Shape Memory properties of the shoes’ upper which is the ability to keep a form given by mechanical action and to return to its initial shape when heated.
The new designed textile is placed between shoe’s outer leather and inside lining during gluing process, and provides the shape memory effect to the composite structure. The key component to get this memory effect is a textile including wires made of shape memory material called Nitinol, an alloy of Nickel and Titanium, which are inserted in the textile structure with a particular patented pattern.
Metallic filaments differ from textile yarns by their very high stiffness which makes them not compatible with a traditional knitting process. As a consequence, machinery adaptation was necessary before being able to run the loom with these wires.
Chinese Company Launches First 3D Foot Scanner and 3D Printed Shoes
When it comes to 3D printing, the technology offers incredible customization options whether it be for tools, home decor, or even fashion. While the idea of 3D printing dresses, evening gowns and blouses may not seem all that appealing just yet, several companies are diving into the realm of 3D printing footwear. Most notably, in the United States, Feetz has been the company which has made the most headlines thus far, but abroad there are companies in other countries trying their best to innovate upon the idea of 3D printing footwear as well.
For one Chinese startup, Jiaodu Technology, they have taken the idea of customization a step further by creating what they claim to be the first ever 3D foot scanner, aimed at making the customization process of footwear even more reliable.
Jiaodu has just unleashed a new 3D footwear fabrication process which they refer to as “Foot of the Cloud” (rough translation) at a startup competition in China.
“Many people, especially a lot of girls, worry about their shoes,” explained chief adviser of foot science and technology for Jiaodu Technology, Xu Chaoyi. “Wearing very beautiful shoes, usually means that they are very uncomfortable, or even can lead to bone disease, toe deformation, etc. This is because the development of the footwear industry, for so many years, has been based on standard shoe design, and are not customized for each person. Of course this leads to more or less inappropriate sizes. It is our goal to use the internet and 3D technology to change the industry so that everyone can wear a pair of properly fitting shoes.”
In line with this goal, Jiaodu has created a small foot scanner which can be installed in shoe stores, and is operated over the cloud, sending foot scan data directly to the company, allowing them to fabricate a 3D printed shoe that is sized perfectly for the customer.
In just 3 seconds, the scanner can analyze a user’s foot, creating all the data necessary for the fabrication of a pair of shoes. The user then selects a style, and the shoes are 3D printed and shipped directly to their door.
Traditionally, completely custom shoes like this were only made available for wealthy individuals, but now, thanks to Jiaodu and this new 3D foot scanner, a pair of shoes can be purchased for just a few hundred dollars. Currently there are 10 shoe models available to purchase using this technology, but the company plans to partner with more shoe manufacturers in order to unveil even more models in the near future.
US Soccer Footwear, Apparel Sales Grow
Though not as popular a spectator sport as baseball or football in the U.S. , soccer is becoming increasingly important to U.S. apparel and footwear retailers, who are seeing sales of soccer cleats and clothing outperform those of other sports, according to global information companyThe NPD Group.
Retail sales of soccer footwear grew by 14 percent in the 12 months ending March 31 this year, compared to 2 percent growth in the prior year period. By segment, men’s grew the most, at 20 percent, while women’s and children’s each rose by 8 percent.
The soccer cleatbusiness in the U.S. is largely confined to children’s and young adult sizes, and are worn for participation in the sport, while the growth in apparel is more about fan wear.
JBS Couros Opens US Distribution Center
JBS Couros, the world’s largest supplier of leather hides, has opened its first North American distribution center here as it eyes an expanded presence in the U.S. furniture market.
The Brazilian company said the new facility will stock a wide range of leather articles from its tanneries in South America, Europe and Asia, providing improved shipping and faster delivery to furniture industry customers in North America. The company also said the distribution center will allow it to respond more quickly to changing trends in the marketplace.
In addition to the distribution center, JBS is raising its U.S. profile with the opening of a permanent showroom at Showtime, the fabric and leather trade fair that begins Sunday in High Point. The company said it has been studying the U.S. market for more than two years and believes the latest moves will enable it to grow market share here.
JBS is based in Sao Paulo, Brazil, and has 26 tanneries and finishing operations in Brazil, Argentina, China, Germany, Italy, Mexico, South Africa, Vietnam and Uruguay. The company said its leather business generated revenues of more than $1.5 billion in 2014.
Fabelli Group to Launch European-Made Bedroom Line
Fabelli Group, a sister company of Italy-based contemporary furniture resource Domus Arredi, has recently begun operations in the U.S. and plans to launch a line of European-made contemporary bedrooms for the U.S. market.
The company has established a sales and product development headquarters in Miami and has developed 14 new leather and fabric upholstered beds and six corresponding case groups that include dressers, mirrors, nightstands and chests.
With fully upholstered beds targeted to retail around $999, the company will offer styles that are available in different finishes and grades of leathers and fabrics.
Garments & Accessories
Michael Kors Suffers First-Ever Drop in Comp Sales
Global aspirational luxury brand owner Michael Kors Holdings Ltd(KORS) announced financial results for its fourth quarter and fiscal year that were decimated by the strong dollar but still managed to beat Wall Street estimates on the top and bottom lines.
However, a drop in comparable store sales, a first for the company since going public in 2011, sent investors into a panic, reigniting worries that the company might be expanding too aggressively, making its brands overexposed and ultimately less desirable.
Also worrying Wall Street was the company’s tempered guidance for the current quarter and fiscal year. KORS shares plummeted 24 percent on the first day of post-announcement trading, its largest single-day decline since going public, resulting in an almost $3 billion drop in market value.
Total revenue for the three months ended on March 28 increased 17.8% to$1.1 billionfrom$917.5 millionin the prior year quarter, slightly ahead of analyst consensus estimates. Correcting for currency fluctuations, the increase was 23.3%.
Retail net sales increased 14.9% (21.1% on a constant currency basis) to$469.4 million,driven by 121 net new store openings in the past year, and from a significant increase in e-commerce sales from the recently launched company-owned U.S. e-commerce site.
Wholesale net sales increased 20.4% to$570.4 million, 25.8% in constant currency. Licensing revenue increased 16.5% to$41.3 million.
North American revenue increased 13.7% to$840.5 million. European revenue grew 33.5% to$219.8 million. On a constant currency basis, revenue inEuropegrew by 59.5%. Revenue inJapanincreased 42.7% to$19.2 million.
Comparable store sales fell by a staggering 5.8% (1.7% on a constant currency basis), well below management’s prior guidance of a mid-single-digit increase. North American comps down 6.7% and European down 5.6% (up 11 percent in constant currency). Last year, first quarter comps rose by 26.2%.
North American comps were slammed by a slowdown in spending by tourists because of the strong dollar, and by a sharp decline in watch sales. In addition, there was a negative impact from delays in shipments of footwear, womenswear and small leather goods due to the West Coast port slowdown. European sales were impacted by a slowdown in tourist traffic from Russia and Eastern Europe.
For fiscal 2016, the Kors expects total revenue of approximately$4.7 billion to $4.8 billion, below analyst expectations of more than $5 billion, and flat comparable store sales.
Hermès CEO Pledges to Limit Price Increases
Hermès International is keeping a lid on prices despite currency swings that have created a sharp differential between the cost of luxury goods in Asia and Europe, csaid hief executive officer Axel Dumas.
Speaking at the company’s annual general meeting, Dumas reiterated that Hermès has an annual currency hedging policy that mitigates the impact of the weak euro on revenues. In addition, he said the company believes its prices should reflect production costs, in particular in France, where the brand’s famed Birkin bags are made.
“That is the reason why we don’t apply the solution consisting of saying, ‘I lower the prices somewhere and I raise them in France,’ because it would artificially increase prices for our French customers,” he said.
“Faced with [the weakness of the euro] we will probably make some adjustments, but I would say they are in line with our price policy, since we will have a price increase of around 4 percent in 2015, namely in Switzerland,” Dumas said, adding that the luxury goods firm was mulling more widespread price increases in 2016.
He was optimistic about the company’s capacity to ride out a second rise in consumption tax in Japan, once it is implemented. “We will obviously adjust our prices accordingly,” Dumas said. “We hope the momentum we saw in the wake of the first increase in VAT [in April 2014] will continue.”
The group plans to open a new store in Miami in November that will cater to a local and Latin American clientele. Business in Brazil, where Hermès is staging its Festival des Métiers showcase for workmanship to coincide with the reopening of its renovated flagship in São Paulo, remains hampered by high import duties, the ceo said.
“As long as these import duties exist, it will be difficult to have a more sustained business, but we still plan to open other stores in Brazil in the next year or two to drive brand awareness and seduce our Brazilian clientele. I am not sure they will necessarily purchase in Brazil,” Dumas said.
Swedish Institute Expands Clean Textile, Leather Project
One of Sweden’s largest public-private partnerships, Sweden textile water initiative will expand to new countries in Asia and Africa after a successful pilot project in India.
Through the initiative, 28 Swedish textile and leather companies have cooperated with Stockholm International Water Institute (SIWI) to catalyze a shift towards sustainable production globally, SIWI said on its website.
To achieve this, the initiative has educated suppliers and sub-contractors to help minimize the use of water, energy and chemicals throughout the whole supply chain.
More than 40 factories participated in the pilot project, which contributed to saving 284 million liters of water and 402 tonnes of chemicals annually.
“It is all about spreading knowledge and changing attitudes,” says Rami Abdelrahman, programme manager at SIWI. “Within just two years, we have educated more than 14,000 factory managers and employees. This has paved the way for long-term gains for both the environment, the companies, the suppliers and the local population.”
Inspired by the success of the pilot, the initiative will now expand to include new factories in Bangladesh, China, Ethiopia, India and Turkey. The Swedish international development cooperation agency (Sida) will, through a unique business model, match the companies’ and factories’ investments in better water management.
SIWI will continue the learning process with suppliers and sub-contractors in the new countries. The initiative also works with national public authorities to increase the institutional capacity to govern water sustainably.
”Unfortunately, the textile industry often has a negative impact on the environment and we therefore want to take the lead in minimizing water and chemical usage in Asia and Africa. We will jointly contribute to sustainable development and an improved local environment,” said Charlotte Petri Gornitzka, director-general, Sida.
Leather Chemicals Market Set to Grow
Increasing leather application in footwear, furniture, automotive upholstery and garments is expected to positively impact the global leather chemicals market. The leather production process begins with beamhouse operations, followed by tanning and finishing, with each process requiring a different set of chemicals. Growing premium leather demand coupled with abundant raw material availability is presumed to augment global market growth over the next six years. Stringent regulations and guidelines from agencies such as REACH and EPA are expected to pose challenges to the global market. Chemicals, such as chromium, which are used iin the leather production process, have several derogatory health effects. Dependence on such harmful chemicals and the lack of potential substitute chemicals in the market are other issues challenging the market growth. Increasing leather substitute acceptance across various industries, coupled with rising raw material prices, is projected to negatively influence the global market over the forecast period. R&D regarding eco-friendly solutions and less harmful leather chemicals promise ample opportunities to industry participants.
Full research report on Global Leather ChemicalsMarket with detailed figures and charts available.
Emerging economies in Asia Pacific are expected to witness brisk market growth owing to increasing premium leather applications in garments, footwear, automotive upholstery and furniture. Rapid industrialization and rising disposable income levels in the region are slated to further augment regional market growth. Economies such as Mexico and Brazil are expected to witness high leather products demand, which in turn is presumed to bolster the Latin American leather chemicals market. The European market has been dominated by Italy for the last several years and is expected to continue to grow at a steady pace over the forecast period.
New York Firm Grows Leather in Lab Using Skin Cells
n a bid to take reduce the amount of genuine leather used in fashion and textile manufacturing, lab-grown hides are being developed in New York as a workable, more efficient alternative to natural animal skin.
For animal lovers, the idea of leather doesn’t sit well, both in conversation or in the wardrobe, cut and sewn into a biker jacket or Chelsea boot. However, leather goods and leather coats are heavily sought after for their weather protection properties, insulation and most of all, their soft, luxurious touch. Meanwhile leather, in the guise of suede, was a huge runway trend for Fall 2015 and looks to play a leading role in fashion collections and the home as top labels and brands set their lines into production mode.
Environmentally friendly leather alternatives, such as leather made from mushrooms, have already been explored. Now, a New York-based firm is dishing out leather alternatives within a laboratory—without the need for animals to be slaughtered or the use of common tanneries.
Based in Brooklyn, Modern Meadow is making lab-grown leather, using recent advances in cell engineering technologies. Taking the opportunity to explain the meat-less process at a recent TEDTalk, Andras Forgacs from Modern Meadow, discussed biofabricating genuine leather.
The first step involves scraping skin cells from the animal—be it cow, lamb or goat—just as in a regular human biopsy. These cells are then extracted, without harming the animal, before isolating the cells and multiplying them in a cell culture medium. From the millions of cells, each one is encouraged to naturally produce collagen, a connective tissue between cells.
Both, the cells and collagen are then spread out to form sheets. Then, sheets are layered to form thicker sheets and left to mature. The multilayered skin is put through a short, chemically reduced tanning process. And then the leather is created, as a result.
Because it uses animal cells at the source, the lab-leather has the same characteristics as genuine leather, without the waste and killing the animal.
As it stands, the company grows 6 sq. cm. pieces of leather only, but plans to launch a limited collection later this year, with large production scheduled in five years’ time. No pricing indicators have been released.
Aside from the bio-benefits, lab grown leather hopes to improve upon the material properties of leather, through testing and trials. This includes engineering the material to be more lightweight and durable, as well as breathe better and insulate more efficiently.
And different patterns in the leather could emerge, without sacrificing the natural graininess we’ve come to love and find in genuine animal hide.
Guangzhou International Shoe and Leather Fair Opens
First day of the Guangzhou International Shoe and Leather fair has ended. The fair’s 25th edition saw mainly Southern Chinese exhibitors of finished footwear and components for footwear, however few booths of important international tanneries. Despite quite decent attendance, it was not comparable to previous years and the first day did not meet expectations.
The fair’s kick-off coincided with the imposition of new tariffs on imported footwear and boots: sport shoes and ankle boots import tariff will be down from 11-24% to 12%. This measure aims to stimulate weak consumer demand as demonstrated retail, which dropped by 11% in the first quarter of the year.
Spring ANPIC Ends
The spring edition of ANPIC ended on May 22 in Leon, Mexico. The fair, focused on leather, accessories, components, chemical products and synthetic and textile materials, included 700 booths and more than 350 brands, as well as 9,000 buyers and visitors. Synthetic material was the protagonist: it guarantees saving of around 30% thanks to its competitive price and therefore affecting purchasing choices of buyers.
Mexican leather shoemakers have to face increasing competitiveness of new alternative materials. It is a new challenge for the nation’s footwear industry that, until last year, was threatened by competitive exports of Chinese shoes that are now subject to 35% import tax.
Next COTANCE 2025 Project Seminar Set for Paris
The second meeting of “A Future for European Leather,” co-organized by COTANCE will take place in Paris on June 19.
COTANCE, the leather industry’s representative body to the European Commission and its social partner, the EU trade union IndustriAll, are hosting the conference with an agenda devoted to the social challenges the European leather industry will likely to face through 2025.
Speakers include Emmauelle Butaud of the European Economic and Social Committee and Delegate-General of the Union of Textile Industries; Xavier Royer, specialist in skills training for the leather industry; Franck Boehly, President of the Conseil National du Cuir, the French leather industry council; and Dominique Jacomet, Director General of Institut Français de la Mode, the fashion and design body.
Heavy Texas Steers down $2.00 — Relatively little movement was seen in the countries most prodigious selection. As is typical in the current market environment, buyer’s ideas were considerably below what packers were willing to accept. Regardless, producers were not exactly besieged with buyer interest. Sale prices varied from a low of $83.00 to a high of $84.00, down a dollar and two from last week. Averages were typically 60/62 lbs.
Raw Fresh Hides — Raw/fresh prices finally came down a little in reals this week, but not enough to reflect the prices at which tanners must sell their blue. Prices seen in reals were 3.40/kg fob packers door. This is about 3% below last week. However the dollar rate increased 3%. Slaughterers are not in any serious need to move their fresh hides because of lower kills. Production now forecast to be before the end of this year 20% below 2014.
Not to long ago, in a rare incident of my observation of my wife’s accessories I noticed an attractive purse she was wearing. When I asked about it, she said this was a knock off she bought during the Shanghai Fair last September.
I looked more closely. The leather was of good quality as were the trimmings, and what really got my attention was the markings on the side of the bag.
In nice gold lettering it says CELINE – Paris, and Made in Italy. My wife said she paid $25.00 for it in one of he underground shopping malls in Pudong, always busy and “knock off” heaven.
Since last fall, we understand that the Chinese Government has cracked down even more, but these kind of things, not limited to leather purses, abound. This really makes a mute point about the EU deciding about mandating a Made In rule, as per the story above.
Does it really matter what law there is when examples such as this are so widespread? The better question is how to stop it. Major brands try to monitor knock offs of their products, and now even the Chinese government, but so far, it has been an overwhelming task.
Can it ever be stopped? Perhaps, and Made In laws certainly can’t hurt, but the only pragmatic solution is to keep checking and inspecting and seeking out the multitude of counterfeit leather goods available to anyone who wants to buy at pennies on the dollar.
|Shoe Upper Leather||This Quarter||Last Quarter|
|Full Grain aniline, cowhide 2.0 mm and down||3.00-3.40||3.10-3.40|
|Full Grain aniline, cowhide 2.0/2.4 mm||3.10-3.50||3.10-3.25|
|Full Grain aniline, cowhide 2.4 mm and up||3.20-3.60||3.10-3.25|
|Corrected leather, cowhide 2.0 mm and down||2.60-2.95||2.70-3.05|
|Corrected leather, cowhide 2.0/2.4 mm||2.70-3.05||3.10-3.25|
|Corrected leather, cowhide 2.4 mm and up||2.80-3.15||3.10-3.20|
|Upholstery Leather||This Quarter||Last Quarter|
|Full Grain aniline, cowhide 1.0/1.4 mm||3.25-3.30||3.35-3.40|
|Full Grain aniline, cowhide 1.4 mm and up||3.60-3.70||3.70-3.80|
|Corrected leather, cowhide 1.0/1.4 mm||3.00-3.10||3.10-3.20|
|Corrected leather, cowhide 1.4 mm and up||3.40-3.50||3.50-3.60|
|Split Leather||This Quarter||Last Quarter|
|Embossed, smooth 1.4/1.6 mm||1.50-1.60||1.60-1.70|
|Embossed haircell 1.4/1.6 mm||1.50-1.60||1.60-1.70|