Nike and the problem of excess inventory
The latest Leatherbiz Market Intelligence, the exclusive, fortnightly analysis of the global leather value chain, went live on sister website leatherbiz on October 4.
It suggests that the only thing that could bring a boost in demand for leather in the mass market would be an end to current geopolitical tensions and a fall in the price of energy and of food. At the moment, this seems a very faint hope indeed.
It offers Nike as an example, pointing out that in the sports footwear brand’s most report quarterly report, it revealed a 44% increase in inventories. On the one hand, drawn-out lockdowns in China led to protracted product flows in its shops there. At the same time, delays in the global supply chain meant that too many shoes arrived too late to be as attractive to consumers as they might have been at peak points in the appropriate season.
“Planning in the fourth quarter of 2021 for sales growth in the current year that has not materialised means many consumer goods manufacturers are currently plagued by significantly high inventories,” Market Intelligence says.
