SHARE
COPY LINK

OUTDOORS

Outdoors clothes companies making major inroads

A paradise for outdoor clothing and accessories, Germany is drawing the attention of the sector's major players.

Outdoors clothes companies making major inroads
Photo: DPA

Sales of the sector, which has constantly evolving contours, is estimated at €1.8 billion ($2.6 billion) in Germany, about 30 percent of the European market according to an estimation by the distributor Intersport.

Global growth has been “substantial” in past years and now boasts sales of around €10 billion, added the European Outdoor Group (EOG).

The success of Jack Wolfskin, a German brand that has risen to the top spot in Europe, gives an idea of the boom.

Its sales have gained an average of 25 percent per year for the past seven years and amounted to more than €300 million in 2010.

In July, the US investment fund Blackstone bought Wolfskin, which uses a paw print as its logo, for almost €700 million, or more than seven times what it was worth in 2005.

Wolfskin caught on early to the potential created by outdoor lifestyles.

“Ten years ago we opened stores in German shopping malls, no one dared to do that at the time. And it worked very well,” sales director Markus Bötsch said. “Up till then the outdoor sector was a niche market of sports equipment but consumers progressively recognized the quality and practicality of these products for everyday use,” he added.

In Germany, where consumers give a higher priority to clothing’s practical side over style, windbreakers and jackets that breathe are seen more and more often in cities.

They also sometimes serve to signal a certain “passion” and “philosophy” for outdoor activities and environmental issues, “irrespective of whether it’s true or not,” EOG secretary general Mark Held said.

From its discrete headquarters in Idstein, a cozy town north of Frankfurt, Wolfskin wants to expand in France, Britain, eastern Europe, and in China which is already its second biggest market after Germany.

Other German outdoor companies are often older family firms, like the hiking boot maker Meindl, clothing company Schöffel, or backpack manufacturer Deuter, and they mostly sell their products in German-speaking countries.

Wolfskin must nonetheless deal with competition from compatriot Adidas, which also wants a share of the leisure sports market.

Outdoor products already represent “around 20 percent of the entire sport market” and “attracts more and more young people,” said Rolf Reinschmidt, head of Adidas’ outdoor division.

With sales of outdoor products at €200 million last year, it has only a modest global market share but the group aims to reach €500 million in sales by 2015.

The group’s outdoor unit sales gained 21 percent in 2010 and rose “by almost 40 percent in the first half of 2011 on an annualised basis,” Reinschmidt said.

The brand with three stripes is backed by a global distribution network, and plans to introduce a line of hiking shoes and other products in the United States this year.

Another German company, Puma, is aiming for the upscale markets for safari and sailing wear. The French group PPR, which owns Puma, has also bought the US company Volcom, which markets clothing for several types of gliding sports.

AFP/mdm

Member comments

Log in here to leave a comment.
Become a Member to leave a comment.
For members

ECONOMY

How is Denmark’s economy handling inflation and rate rises?

Denmark's economy is now expected to avoid a recession in the coming years, with fewer people losing their jobs than expected, despite high levels of inflation and rising interest rates, The Danish Economic Council has said in a new report.

How is Denmark's economy handling inflation and rate rises?

The council, led by four university economics professors commonly referred to as “the wise men” or vismænd in Denmark, gave a much rosier picture of Denmark’s economy in its spring report, published on Tuesday, than it did in its autumn report last year. 

“We, like many others, are surprised by how employment continues to rise despite inflation and higher interest rates,” the chair or ‘chief wise man’,  Carl-Johan Dalgaard, said in a press release.

“A significant drop in energy prices and a very positive development in exports mean that things have gone better than feared, and as it looks now, the slowdown will therefore be more subdued than we estimated in the autumn.”

In the English summary of its report, the council noted that in the autumn, market expectations were that energy prices would remain at a high level, with “a real concern for energy supply shortages in the winter of 2022/23”.

That the slowdown has been more subdued, it continued was largely due to a significant drop in energy prices compared to the levels seen in late summer 2022, and compared to the market expectations for 2023.  

The council now expects Denmark’s GDP growth to slow to 1 percent in 2023 rather than for the economy to shrink by 0.2 percent, as it predicted in the autumn. 

In 2024, it expects the growth rate to remain the same as in 2003, with another year of 1 percent GDP growth. In its autumn report it expected weaker growth of 0.6 percent in 2024.

What is the outlook for employment? 

In the autumn, the expert group estimated that employment in Denmark would decrease by 100,000 people towards the end of the 2023, with employment in 2024  about 1 percent below the estimated structural level. 

Now, instead, it expects employment will fall by just 50,000 people by 2025.

What does the expert group’s outlook mean for interest rates and government spending? 

Denmark’s finance minister Nikolai Wammen came in for some gentle criticism, with the experts judging that “the 2023 Finance Act, which was adopted in May, should have been tighter”.  The current government’s fiscal policy, it concludes “has not contributed to countering domestic inflationary pressures”. 

The experts expect inflation to stay above 2 percent in 2023 and 2024 and not to fall below 2 percent until 2025. 

If the government decides to follow the council’s advice, the budget in 2024 will have to be at least as tight, if not tighter than that of 2023. 

“Fiscal policy in 2024 should not contribute to increasing demand pressure, rather the opposite,” they write. 

The council also questioned the evidence justifying abolishing the Great Prayer Day holiday, which Denmark’s government has claimed will permanently increase the labour supply by 8,500 full time workers. 

“The council assumes that the abolition of Great Prayer Day will have a short-term positive effect on the labour supply, while there is no evidence of a long-term effect.” 

SHOW COMMENTS