It comes from a new consumer world where borrowing to spend is prioritised over saving. It comes from a world where societies are increasingly urban and do not recognise nature and natural things as clearly and obviously good in the way previous generations have done for thousands of years. It comes from a society increasingly defined by image, by short term thinking, by oversimplification, by lobbying, misleading claims in an increasingly fragmented world, and fragmenting society.

For everyone to receive a decent wage, the final consumer must recognise the value of what they consume. They must understand that rampant consumerism, fed by low price goods is doing great harm to both people and the planet. It has led to long, complex and fragile supply chains. It has led to margins so tight that workers are sometimes not properly paid, and their safety is not secure. It has led companies that talk a story of partnership to walk away from receiving or paying for goods they ordered; and others to pay only when they realised an angry public would punish them.

This largely comes from the way retail and branding has developed since the late eighties. Those were the years when you could get mugged in Rome for a pair of Timberland 3-eye Classic Lugs, with their yellow leather linings, handsewn construction and thick high traction outsoles. Brands moved onto the balance sheet and companies realised that with clever communications, they could transform the world of retail. Mature economies depend heavily on consumption, so since that time governments have kept interest rates low and encouraged borrowing. Rising property valuations and then new ways of consuming goods via subscriptions, rentals or personal contract purchasing – phones, computers, motor cars, education – has kept that consumption going. Western societies shifted to borrowing and spending and saving to buy things started to be viewed as a threat to the economy. Most items still being made in the west shifted to the developing world, and, usually after a couple of moves, ended in China.

Consumers spent the same but bought more items
Historically, that meant a dive in quality, but the Chinese invested in modern plants and good training. The products were good, the logistics soon well established, and as they grew market share, the huge volumes allowed prices to drop without loss of quality. Some goods even had more consistent high quality, although vigilant auditing was required. Consumers spent the same share of their disposable income on clothing and footwear each year, but with it bought more and more items, filling wardrobes and landfills with items designed for only a few washes and many used only once or twice. Some items never got worn.

The new brands started opening their own stores, fragmenting the retail store scene, new malls were opened around the world and luxury brands became available in every major city and airport. Luxury was no longer exclusive, it only needed cash; items like scarves, card holders and wallets offered entry level access, as did that new retail tool, the factory outlet mall. How fragmented could retail get?


Amazon was never about books alone
Then came the Internet and another channel opened up. Amazon arrived and the world thought “books”; but the Amazon plan was never books alone, it was retail domination. And it was not about creaming off the most popular items the way supermarkets do. Rather, it was about anticipating and serving the highly specific needs of each one of us as individuals. Year after year, shareholders kept faith with the reinvestment of cash in doing this better, in more product categories, in more regions of the world. We said clothing and footwear would not sell this way, and then Zappos turned up; in 2009 Amazon paid a $1 billion for it. Traditional retailers looked on, but seemed unwilling to challenge or compete.

Internet retailers can play games to avoid sales tax and other business taxes. They were allowed a head start and the old retailers, already too fragmented and with too many malls and stores, were slow to move. Multichannel retail was discussed, but rarely seriously attempted. During this, to everyone’s astonishment, private equity bought many high street stores and ignored the problems of 2008, which demonstrated the need to keep a strong balance sheet. Perhaps their early dividends and refinancing methods retrieved their costs early. When COVID-19 turned up and the economy closed, we have too many retailers with no reserves who do not pay suppliers and will not reopen, ever.

Regardless, consumers will start buying again; we need them to be considered consumers. To reject this sort of consumerism. They will be younger, more Asian and more African. Europe and the U.S. are more damaged, will recover more slowly; many consumers will be more cautious. They have been leaving the cities that have been exciting social places of culture and innovation. They have become death traps. Globally connected, densely populated, dangerous.

Do we know this new consumer? Value for them is not about price. Connoisseurship, individuality, self-reward become more important than status. People buy products that they think say something about who they are. Can we persuade them of the value of leather in this scenario? The value of the artisan, of longevity, of products with character, that come from nature and display its beauty, its functionality.

Much retail will now remain online. Yet, new retail will emerge. It is a chance to renew suburban and smaller high streets, and liveable communities within cities. Amongst the cafes and the bars to be, let us have some tannery stores or pop-ups, explaining leather and educating consumers with hands on experiences and some real facts about our raw material, process and material qualities.

The post Covid-19 consumer world will be different. The past is not attractive. The boomers have fouled it up. It is time to move on. If leather is to fit in, we have to adapt and evolve; quickly.

Only if we do can every craft worker, engineer and employee in the chain be sure to receive that decent wage – and a decent wage for everyone is an essential pillar of sustainability.

Mike Redwood

Mike Redwood
May 20, 2020

Follow Dr 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.