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Bolwear: New MD outlines strategy

1st Oct 2012 , S&V Footwear and Leather Goods

Growing brands will be a central theme

Great Brak River (SA) – Alan Fleetwood, group MD of Bolton Footwear since July, is making marketing – and specifically the growth of the group’s brands – one of his main themes.

“It’s not that I inherited anything that’s broken,” he said. “It would be an indictment of me if I had, because I’ve been here, and part of the process, since 1985. As a group, we have a dynamic, evolving 5-year plan, which rolls over with each passing year, and my role is to see that it happens.”

Another key task is growth. “We need to grow, even if it’s just organically, because of inflation. It’s very difficult to keep up with inflation if you don’t grow the pairs.

“We could be acquisitive if something comes along, but we’re not going hunting. We’d rather build on what we have.”

Marketing and brands: He said that marketing has been “the weakest link in our organisation”.

“Not the people – in Gavin Wilkins [sales & marketing manager at Watson] and Kevin van Staden [sales & marketing manager at Bagshaw], we have 2 great guys. But their functions haven’t been given sufficient importance, and we’ve been very lucky, because we have great brands which have prospered without as much effort as we should have put in. Now it’s time to look at expanding those brands.”

He said in the country’s top shopping centres, like Sandton City, “you don’t see local footwear brands, except in the chains. Our brands aren’t strong enough. It’s not just us, it’s the industry.

“How do we create brand awareness? It’s a difficult question, because we’re not experts. Finding independent advice is the immediate challenge.”

He said Watson, which has 8 men’s and 4 women’s active domestic brands, and distributes 2 international brands, “isn’t over-reliant on Grasshoppers – I think it’s more accurate to say that we just haven’t exploited the other brands enough”.

“On the Grasshopper side, we’re the ‘victims’ – if that’s the word – of the success of a handful of styles, and we need to change that without affecting those shoes. We have a very decent range across all the brands, but retailers buy only sure-fire sellers, and the other styles don’t get noticed.

“We’re supporting Kris Karpinski, one of our Cape Town customers, in opening a concept store to test and popularise the whole men’s range exclusively. It’s been a long time since we were in retail with Spitz and Shoerama – it’s something we may look at.”

He said the group expected substantial growth from Bagshaw Footwear’s Ndlovu-branded imported safety footwear to enter that market below Lemaitre, where the cheap and cheaper Chinese origin shoes play. A non-steel toecap service footwear offering under the Fuel brand, manufactured by Bagshaw, offers further opportunity. Ndlovu and Fuel belong to the group, whereas its flagship safety footwear brand, Lemaitre, is used under licence.

“As an industry, we have one external factor going for us: There’s a lot of positive sentiment among consumers to buy ‘made in SA’. We should make more use of that fact when we’re negotiating with safety distributors, for example. They have a lot of control over which brands to offer.”

Domestic manufacturing: Of South Africa’s competitiveness as a footwear manufacturing country, he said: “Bolton Footwear stays committed to being a local manufacturer, which only imports what it can’t make economically – and with the DTI’s various programmes aimed at stimulating local manufacturing, even that might change if we can reverse engineer some of the imported product.

“We don’t expect to make under international brands. Bass does well for us, and it would be nice to get more, but it would be difficult to go back to the days when we made Bally locally, because the brand owners are very possessive.”

He said the DTI’s intervention had been “rather late – but it’s good that they’ve now done it”.

“The fashion industry has been under siege for years, and we estimate that in safety footwear, which is a mainstay of local production, 50%, by pairs, is now imported.

“We need to maximise what we can get out of the DTI, and we’re aware that our competition has access to the same funds.

He said the group’s component suppliers served it well. “The component model we have is good – a whole lot of privately-owned component suppliers. But as an industry, we have a lot of systemic problems – for example, the duty on Indian buffalo leather, or having to amortise machinery over low volumes of footwear produced.

“We have to chase every little saving. I don’t think we should mess with quality, but we must investigate every avenue to make footwear more cheaply.

“I don’t blame labour for our lack of competitiveness. I think they’ve come to the party. We also have a moral obligation to the village, with which we have a symbiotic relationship, and to our workers in Port Elizabeth. Watson Shoes and 6 SMMEs have been approved by the DTI as a cluster – these are the same SMMEs we set up in 2000, although there have been changes in their shareholding dynamics. We still have to get a retailer lined up.”

He said the group has new constructions in mind – “stitchdowns, for example” – and the DTI’s funding will help, “but I doubt we would go back into welted footwear”.

It would also build its capacity to produce the Californian construction, where it is the only local factory doing so.“An advantage we have is that our shareholders, the Bolton family, are committed to the industry and to local manufacturing.”

Skills and BEE: He said the group had equity plans, “but we take the best person for the job. We have a lot of PDIs in middle management – people who grew into those positions. We know that the government has an equity plan, and by-and-large we get there. Because of its well-publcised woes, the industry doesn’t readily attract new talent, and when we grow them, we often lose them to other industries.

“A bigger problem than race and gender is age, because the industry hasn’t been sexy for a long time. People between 30 and 45 – that’s the missing generation, when the industry was in big trouble, and companies were in survival mode, with flattened management structures. It was good for the industry in some ways – no-one was allowed to build an empire – but overall it’s left a gap. Recently, we’ve made 5 very good middle management appointments of people under 30.

“Both of our management teams are top notch, and I’m very pleased we have been able to retain [former group MD] Marthus Louw’s involvement on the board of directors.” – [Tel: +27 (0)44 620 2111, email: gerda.rappard@bolwear.co.za]

 

 

 

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