Consolidation on the cards for 2015
06/02/2015
Last month adidas announced it was selling Rockport and Coach bought footwear brand Stuart Weitzman.
Opportunistic buyers, especially those with large global platforms, will expand growth in footwear, while apparel companies will seek to broaden into luxury wear, footwear and accessories, said Moody’s.
"We believe strategic and financial buyers are focusing on this space for a number of reasons, in particular for the attractive growth opportunities that are becoming more pronounced. While apparel companies have found few growth opportunities outside the lucrative athletic wear segment, footwear and accessories have had more success expanding their brand as they have moved into 'lifestyle' brands," said Moody's vice-president Scott Tuhy.
Moody's says owning a larger portfolio of brands is a key tactic to leverage costs in their supply chain while increasing the company's importance to significant retail partners. These firms also have the flexibility to invest significantly in direct-to-consumer sales, which helps bolster their credit profile.
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