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SURVIVAL STRATEGY
SEPTEMBER/OCTOBER 2012 | www.footwearbiz.com
had by far the smallest share of the total research spend
(16.7% of the total at
€
14 million), but at least the message
that R&D can lead to future success still resonated with
footwear manufacturers and tanners in 2010.
Left behind
Two years on, Rafael Calvo feels that the benefits footwear
companies have derived from continuing to invest in new
ideas and new technology while so many others were pulling
back are clear. “As an industry we have had to take some
important decisions,” the FICE president says. “And we have
ended up smaller, but I would suggest we are the size we are
now is the size we have to be. It’s a pity, but some
companies, the ones who didn’t opt for a focus on exports,
on design and on branding, have been left behind.”
He says the footwear manufacturers who have survived
realised the way things were going in the Spanish economy
before other sectors did and started work on a new, outward-
looking strategy. “There is no segment of the Spanish
economy that is more internationally focused than footwear,”
he continues. “The whole world is our stage.” Spain exported
120 million pairs of shoes in 2011, an increase in volume
compared to the previous year, but Mr Calvo points out that
growth outside the European Union was 30%.
China pays a good price
As for 2012, he quotes figures that show a 16.5% increase
in export volumes of shoes from Spain (up to April), even
though value is slightly down. Growth of exports to China is
a particularly pleasing aspect for the FICE president. “We
prefer to sell shoes to China these days rather than try to
defend our domestic market from imports from China,” Mr
Calvo says. “Now China is the market in which our shoes sell
for the best price, better than the US. Our average price per
pair has gone up by 60% in recent years and the
relationships we have with retailers and distributors in China
are good. So that’s our aim: to export more Spanish shoes to
China rather than try to work out ways to defend the Spanish
market from Chinese imports. I’m not a supporter of taking
[trade] defence to extremes.”
Something else Mr Calvo says he’s proud of is that Spain’s
footwear sector has been able to reform its relations with
workers without provoking widespread strikes. He insists:
“We’ve never had a major strike here and we now have a
new generation of younger, well trained people who are
committed to bringing quality to this industry and that’s why
Spanish companies are currently exporting shoes to 150
different countries.”
Labour reform
In June this year, employers’ organisations and trade union
representatives of employees in the Spanish footwear
industry agreed a collective pay deal for 2012, 2013 and
2014. With high levels of unemployment across the country,
workers have agreed to small pay rises, 0.5% this year, and
0.6% in the following two years. The deal will affect around
22,000 workers at 1,400 footwear manufacturing firms.
Workers are also in line to receive a bonus payment of
€
160
each before the end of 2012 to compensate for rises in the
cost of living.
A spokesman for the UGT union, Juan Antonio Maciá, told
local media at the end of negotiations: “It’s a strange deal,
just like the times we are all living in at the moment.” Rafael
Calvo views the matter in a different light, saying the deal is
very much in keeping with the spirit of long-standing
agreements between companies and unions and says labour
reform ideas of the new Spanish government, which are
aimed at making contracts more flexible and to make it
easier for companies to hire and fire people, are secondary.
“But we do have a problem with becoming competitive,”
he says. “If we can’t be competitive we can’t go out into the
external market, unless it’s to make fools of ourselves. We
have to make competitive products and everything that helps
us make our products more competitive is vital.
Nevertheless, it wouldn’t be fair for company owners just to
sack people because it’s easier for them to do so. True
business people want to create employment, make a profit
and invest it back in the business to generate greater wealth
and create more jobs.”
Boots from the famous Carmen’s Shoes exhibition, in which
high-end Spanish shoe designers created footwear that
Carmen, from Bizet’s opera, might have worn. The exhibition
has won admirers in many parts of the world.
CREDIT: GDS