In the first quarter of 2020 footwear companies saw an average drop in sales of -38.4%, with total losses estimated at 1.7 billion euro.
The figure emerges from a study of the impact of Covid-19 on the footwear industry conducted by Confindustria Moda with the participation of 88 Assocalzaturifici member companies, who replied to the survey during the lockdown.
60% of the footwear companies sampled reported a -20% to -50% drop in sales in the first quarter of 2020 as compared to the first quarter of 2019, while an additional 20% of those surveyed saw their sales shrink by more than -50%. There was a steep drop in orders: 46% of the companies interviewed reported receiving -20% to -50% less orders in the first quarter of this year, while 37% saw their order portfolio cut by more than -50%. The average decrease in orders was -46.2%.
According to Assocalzaturifici Chairman Siro Badon: “The lockdown has had a significant impact on the sector. Unlike the textiles industry, we are unable to convert our production lines, and so we have registered a steeper drop in sales and orders than other companies in the fashion industry. We need bold structural measures by the government regulating credit, taxation and support for exports. These are the strategic resources required by companies in one of Italy’s most crucial industries”.
93% of footwear industries resorted to social security or plan to do so in the near future. More than 3/4 of the respondents stated that 80% of their workforce resorted to wage support or other social security measures, such as those available to craftspeople. On the whole, the percentage of employees who may take advantage of social security is 88.6% of the total workforce of the footwear companies contacted in the survey. The way we work has also changed: 61% of the companies allowed professionals who could do so to work from home, representing 11% of the total workforce of the companies sampled.
The survey noted the biggest problems companies have had to deal with during the emergency and their feelings about the future, asking entrepreneurs what measures they would like to see from the government to promote recovery. In the first case, it emerged that key difficulties include relations with customers, cash shortages and cancellation of trade fairs. The survey respondents saw the strategic priorities for government intervention as policies aimed at guaranteeing liquidity, social security measures, appropriate fiscal policy and trade fairs.
Source: Assocalzaturifici Italiani