How German shoe firms  competing with peers from Asia

Admin I Monday, September 02, 2024

 

BERLIN – Germany’s shoe retailers and manufacturers are struggling with increasing competition from Asian shopping portals, a trade association said on Monday.

“Temu and Shein are flooding Germany with cheap shoes, most of which are of poor quality, and some of the goods are even harmful to health,” said Rolf Pangels, Managing Director of the German Textile, Footwear and Leather Goods Retail Association (BTE), at the Shoes trade fair in Düsseldorf.

Singapore-based Shein and China-based Temu are very popular in Germany. Consumers bought around 1 billion fashion items and shoes from the online retailers in 2023, according to a BTE estimate.

The companies reject criticism of their products and insist they demand strict controls and safety standards from their suppliers.

The association is calling for effective controls and fair competition. “If the activities of such platforms are not stopped, there will be more insolvencies in the shoe trade,” Pangels warned.

The number of shoe shops in Germany has fallen by around 800 to around 8,750 since the beginning of the year, BTE says.

In the first half of the year, retailers made 2% less turnover than in the same period last year, despite a rise in prices.

Adjusted for prices, the decline is likely to be even higher due to weak consumer sentiment and the poor weather in May and June, said Pangels.

After a good start to the year, shops suffered a “painful double-digit slump in sales” in these months.

The outlook for the future is pessimistic, with more than half of Germany’s shoe retailers expecting lower sales than in 2023, and  only 30% expecting an increase, according to an association survey. Some 41% rate their business situation as poor and only 16% as good.