30 April, 2017 - 02 May, 2017
18 May, 2017 - 20 May, 2017
22 May, 2017 -
25 May, 2017 - 26 May, 2017
31 May, 2017 - 02 June, 2017
The industry atmosphere after the Hong Kong APLF show two weeks ago has been almost euphoric, and was further buoyed along by the LVMH first quarter results showing strong growth in fashion and leather goods. It was remarkable that a quite pessimistic atmosphere the day before the show transformed in just two and a half days.
So caution is required as the fundamentals for the leather industry have not changed and the potholes ahead for leather remain. For many tanners, the fact we are processing a primary material does make us feel a long way from the final consumer, cushioned as we are by manufacturers and retailers along the supply chain. As a result, it was obvious that in some sectors like footwear leather tanners are splitting into the categories of those who understand how to react to the changes ahead and those who are trying to remain untouched.
It is interesting to look at this through the lens of companies like VF Corporation who have in the last few days made public their new business plan to 2021. It has four major strands
*Reshaping the company’s brand portfolio and enabling VF’s powerful brands;
*Transforming to a consumer and retail-centric model;
*Elevating direct-to-consumer while prioritising digital; and,
*Distorting investment toward Asia, with a heightened focus on China.
The four choices will focus on six critical capabilities, namely, design and innovation, demand creation and brand experience, insights and analytics, retail excellence, demand and supply chain agility, and talent.
Tomorrow is not going to be like today for leather.
Even a powerful company like VF Corp with five US$1 billion-worth brands (North Face, Vans, Timberland Wrangler and Lee) among their huge portfolio, have not had it easy. As the CEO said when launching their strategy to investors: “we actually did see changes coming in the marketplace. What surprised us however, was the speed and intensity of those changes and how they've come across the entire global region that we operate in”. Changes in consumer preferences related to product and to the retail landscape, with the decline of big boxes and departmental stores in the U.S., are happening much faster than they expected.
Tanners cannot be complacent
This is why tanners need to get less complacent and more alert. The market place is evolving quickly and leather is fighting for its role with these new younger consumers with non-traditional attitudes. If, when, how and what they buy and choose to own rather than merely experience: all happening while competitor materials are getting better and their marketing smarter.
Steve Rendle, President and Chief Executive Officer did not present the most outstanding strategy I have seen in this sort of arena, but he did explain how VF Corp are being touched by all the issues of the changing world right down to co-creation of content and the experience economy. What is more, I have access only because he has made it all publicly available through their website., including the slides they used and the transcripts.
So if you still think the way to prosper is carrying on doing more of the same, I urge you to read it. Then read it again, and take note. Tomorrow is not going to be like today for leather.
12th April 2017
Follow Mike Redwood on twitter: @michaelredwood
Publication and Copyright of "Redwood Comment" remains with the publishers of International Leather Maker. The articles cannot be reproduced in any way without the express permission of the publisher.comments powered by Disqus