S&V Weekly Newsletter Vol.8 No.09, February 28 2022

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Apeco update

Pinetown, KZN, SA – Apeco is NOT in liquidation as was incorrectly reported last week but has been taken over by the bank who have the debtors and stock as security.
      A decision was taken in consultation with the bank that they perfect their security by collecting the debtors and selling off the stock. Once they have perfected their security , surplus funds will then be distributed to creditors.
      Apeco’s office has been closed down and all office contents have been auctioned.
      Mark Gibbings and Brett Van Rooyen have revived Pearson Trading to continue most of the agency businesses reverting to the original grassroots of Alfred Pearson & Co as commission agents.

Wage Negotiations
 

Dates settled

Durban, KZN, SA – The dates for wage negotiations in the 3 sectors of the National Bargaining Council of the Leather Industry of SA have been decided.
      The first round of the General Goods & Handbags sector will take place in Cape Town on 07 and 08 April, with the second round scheduled for 04 and 05 May.
      The first round of the Tanning sector will take place in Port Elizabeth on 12 and 13 April, with the second scheduled for 10 and 11 May.
      The first round of the Footwear sector will take place in Durban on 20 and 21 April, with the second round on 18 and 19 May.

Direct-to-Consumer


The folly of retailers expecting loyalty from brands which have made it clear their intended strategy is direct-to-consumer (DTC) was highlighted by reports in US trade media on Friday and Saturday of the hit Foot Locker has taken from Nike. Size is no protection: Foot Locker had sales of US$7.5 billion in 2020, with 3 000 stores in 28 countries and over 30 000 employees. Below are extracts from 3 reports.

Foot Locker Feels the Sting of Nike's DTC Push

26 February - Even Foot Locker isn’t immune to the sting of the direct-to-consumer push. The footwear retailer on Friday posted a bleak outlook for 2022, largely due to the impact of one of the company’s vendors making an “accelerated strategic shift to DTC.” Foot Locker said as a result, no single vendor will represent more than 55% of total supplier spend, down from 65% last year.
      As part of this vendor shift, Foot Locker posted a bleak outlook for 2022, which anticipates sales falling between 4% and 6% and same-store sales falling by 8% to 10%.
      Foot Locker’s shares sunk Friday morning in pre-market trading after the news was announced.
      Analysts have noted in recent quarters that Foot Locker appears to be losing market share to other vendors like Dick’s Sporting Goods and Hibbett Sports, especially compared to 2021. Last quarter, Williams Trading analyst Sam Poser noted that these sporting goods chains appear to be “getting more love” than Foot Locker from the major vendors, many of which are leaning into their own DTC strategies.
      For Nike, an aggressive DTC strategy has led the brand to terminated wholesale accounts with retailers like Zappos, Dillard’s, DSW, Urban Outfitters, Shoe Show and more, leaving many retailers without the ability to sell one of the most popular brands in stores. Nike has also cut back on the amount of product it is offering in existing vendors, like Foot Locker, in order consolidate distribution...
      In light of the changes, Foot Locker is focusing on diversifying its vendor mix and product assortment. Most recently, the company inked a deal with Authentic Brands Group (ABG) to exclusively carry certain Reebok shoes in U.S. Foot Locker stores and websites. - Footwear News (full report https://footwearnews.com/2022/business/earnings/foot-locker-stock-price-q4-nike-dtc)

Nike Pullback Hits Foot Locker Stock Hard

26 February - Nike products made up 75 percent of Foot Locker’s mix in 2020. By the fourth quarter of this year, it expects this to fall to 55 percent. Foot Locker shares plummeted Friday morning as Nike’s plans to pull back on shipments prompted the retailer to forecast declining sales for 2022. The company expects revenue will fall 4 percent to 6 percent in full-year 2022. Comparable sales are forecasted to drop 8 percent to 10 percent. - Sourcing Journal (full report https://sourcingjournal.com/footwear/footwear-retail/foot-locker-forecasts-sales-decline-nike-direct-to-consumer-dtc-off-mall)

Foot Locker Burned by Nike Dependence

26 February - Nike’s push to concentrate more on its DTC business played out in a dramatic fashion Friday when large retailer Foot Locker announced Nike was providing smaller allocations of “high heat” styles to the global footwear retailer. - Shop-Eat-Surf (full report https://shop-eat-surf.com/2022/02/foot-locker-burned-by-nike-dependence/)

They Said It

"Time certainly flies! No feature, but thanks for the offer.  We are shy, even at 100!" - Gregg Daniel, Mendelson & Frost, Durban, KZN, SA, who, after a mention last week of which I thought were the three oldest suppliers to the footwear and leather goods industries in SA, informed me that M&F turns 100 this year - 2 years older than Apeco. 

Got anything you'd like to share?

Do you have any suggestions, comments or experiences about the industry that you'd like to share with the industry? - tony@svmag.co.za

28/02/1945: Basil da Silva, Mendelson & Frost, Cape Town, W. Cape, SA.
28/02/1969: Dilesh Dajee, agent, Johannesburg, Gauteng, SA.
01/03/1945: Chris Schutte, retired, former agent, Pretoria, Gauteng, SA.
02/03/1945: Sakkie van der Vyver, retired, formerly Adidas, Cape Town, W. Cape, SA.
02/03/1953: Garth Ewing, retired, formerly Garth Ewing Agencies, East London, E. Cape, SA.
04/03/1946: John Commins, retired, formerly Wayne Plastics, Johannesburg, Gauteng, SA.
04/03/1977: Regan Govender, Paragon Footwear, Pietermaritzburg, KZN, SA.
05/03/1937: Arnold Buckby, agent, Cape Town, W. Cape, SA.
05/03/1949: Tony Carnecky, retired, formerly Futura Footwear, Pinetown, KZN, SA.
05/03/1983: David Novos, Economic Shoes, Paarl, W. Cape, SA.
05/03/1986: Muhammed Omar, Fashion Square, Durban, KZN, SA.
06/03/1971: Sunil Bhagwandas, Ginger Bhagwandas, Durban, KZN, SA.
06/03/1976: Kevin Pillay, Alateens Bopsi Footwear, Durban, KZN, SA.
06/03/19xx: Sunil Jethwa, The African Boot Co., Nairobi, Kenya.

In Memoriam this week

28/02/2016: Johnny Parboo (b. 21/10/1945), Labora Shoes, Durban, KZN, SA.
01/03/2004: Sandra Faye Campbell (b. 09/06/1971), Dunn’s Stores, Johannesburg, Gauteng, SA.
02/03/1991: Edward Powell (b. 12/02/1967), agent, Johannesburg, Gauteng, SA.
03/03/2003: Gerry Elder (b. 03/08/1928), agent, Cape Town, W. Cape, SA.
03/03/2010: Ernest Alfred ‘Basie’ Heunis (b. 17/05/1923), Silverton Tannery [closed], Pretoria, Gauteng, SA.
06/03/1993: Brian Murphy, agent.
06/03/2011: Livio Sirilli (b. 06/04/1921), Sirilli Shoes, Pietermaritzburg, KZN, SA.

Have you let us know about your birthday, or the birthdays of your colleagues? Our readers love this section, so please become part of it. This also applies to the In Memoriam section. Help us remember former colleagues.

Classified Adverts

Operations / Factory / Production Manager position required.

20+ years experience in the footwear industry. Based in KZN. CV available on request.
Please contact on 068 053 3245.

Directory entries updated last week

Bolton Footwear, Cape Town, W. Cape, SA.
Global Tanners, Harare, Zimbabwe.

New subscribers last week

Molapo Clement Dikgale, shoe and accessories buyer, John Craig, Johannesburg, Gauteng, SA.
Edgar Gutierrez, 7 Leagues Leather, Vancouver, Canada.
Conrad, Owner, Eden & Co, Leather goods and Jewellery manufacturing, Northern Cape, SA.
Fatima Capelinha, Operations, Servesa, Gauteng, SA.
John Francis, Ownder, JFA, footwear, Bryanston, Gauteng, SA.
Daniela Marzoppi, Internal Sales, Royal Adhesive Industries, Cape Town, W. Cape, SA.
Steven Pillay, PMC Group, Durban, KZN, SA.
Murray, PMC Group, SA.

3. Malawian Kwacha (MWK)

Source: https://www.xe.com/currencyconverter/

4. Zambian Kwacha (ZMW)

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5. Zimbabwean Dollar (ZWL$)

Source: https://www.xe.com/currencyconverter/

ABSA Agri Trends: Hides & skins prices

Johannesburg, Gauteng, SA (24 February 2022) - The current average hide price increased by 8.3% to R6.63/kg from R6.12kg a week ago. The current price is 18.3% higher than the average price a month ago and is 20.5% higher than the average price a year ago. The range of prices reported was as follows: Minimum price: R5.68 Maximum price: R7.00. Please note: Our methodology weighs the prices we collect according to the number of hides they sell in a month. This is done to make it more representative of the prevailing market price. NB* Hide prices are determined by the average of the RMAA (Red Meat Abattoir Association) and independent companies. - Marlene Louw, senior agricultural economist, and Nkhensani Mashimbyi, agricultural economist, Absa group.

Note: For previous prices, see HERE

Have a look at these links

We invite businesses to send us links to websites, Facebook pages and the like which they feel would be of interest to others. The links below are from our database:
Groblersdal Workwear, Groblersdal, Limpopo, SA. PPE distributor.
Groundcover Leather Co., Curry's Post, KZN, SA. Footwear and leather goods manufacturer.

Contact us

News & Classifieds: Tony Dickson, +27 (0)31 209 7505, tony@svmag.co.za

Next newsletter: March 7, 2022.

SAFLIA enquiries: Tel 0800SAFLIA * Email info@saflia.co.za * Website http://www.saflia.co.za

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