There is always an audible rolling of eyes when a packaged box arrives for me at reception. It is standard form that I track down chunky creditors reports in electronic form, so the box could only contain one thing. A thing that all of my colleagues assure me I have enough of, but a thing I could not bear to receive less than at least once a month.
As my signature rages across the parcel slip acknowledging receipt of said thing, I fail to make it to my desk without tearing at its skin. A flash of cardboard. A name gleams across the box. Christian. Louboutin. The box is opened. There is a five inch heel winking at me in acknowledgment. We have done well today.
Unfortunately, the same can not be said for the broader retail sector which produces such marvelous creatures. We have seen some significant collapses in the Australian footwear industry in recent times, ranging from the Figgins Group in 2010 to the more current Colorado Group, with its staple of Mathers, Williams and Diana Ferrari brands. As part of our special report into the sector (page 18), we look into this state of affairs and whether there is any hope on the horizon.
The footwear retailing industry accounts for 55 per cent of total shoe sales in Australia, not including department stores and other clothing retailers. Unfortunately, non-essential spending on footwear drives stronger revenue growth and is often viewed as uneccessary during vulnerable economic times (the gall).
Or so says business information firm IBISWorld, which attributes the flow-on effect from the global financial crisis for poor performance in the sector.
Revenue fell by 2.9 per cent in 2008/09, and another 1.4 per cent in 2009/10 as the situation worsened. In fact, the 2008/09 financial year saw the sector experience its steepest decline in over a decade, with Federal Government stimulus incentives not enough to stimulate growth over the year. As consumer sentiment plunged 14.3 per cent, households chose to use extra money to pay debt, bump up savings or buy a great big whopping plasma TV.
From this came the first major sign of trouble, with Figgins-owned Shoo Bix announcing plans to close 43 stores due to tough times and growing competition.
So what’s the deal? As you’ll read, IBISWorld predicts brighter times for the sector over the next five years and, coincidentally, I also spoke with Sarah Figgins for this edition, who too has a new lease on life.
I certainly pledge my allegiance to a higher, er brighter, future.
