IBISWorld report reflects low mood in US footwear sector
Despite signs of economic recovery, US footwear wholesalers have little to look forward to, according to IBISWorld’s Footwear Wholesaling report.
Its research shows that revenue has dropped at an average annual rate of 1.5% to $29.1 billion over the five years to 2012.
Although IBISWorld believes demand for shoes will improve in line with the economic recovery, retailers' increasing price-setting powers are pushing footwear wholesalers out of the game and that an increase in cheap imports has cut into domestic sales.
Revenue grew 0.5% in 2011 and is expected to rise by 1% in 2012, but the mood is still low.
"As the economy begins to show signs of a solid recovery, consumers will purchase more shoes. This trend will resonate through the shoe stores industry and trickle back to wholesalers in the form of stronger demand," says IBISWorld industry analyst Nikoleta Panteva.
"The highly
competitive nature of this industry will continue to place pressure on
participants to close operations or merge to maintain profitability. For
example, Adidas AG purchased Reebok International Inc in 2006," continues
Panteva. According to the report, adidas continues to be the largest player.
