Supply problems from Asia are holding back VF Corp and Dr. Martens. The first group is suffering from problems in China that sound like a warning to the entire fashion world. This latter is struggling with closures in Vietnam.
The Chinese issue
As for the problems holding back VF Corp and Dr. Martens, let’s start with the former. They are dealing with the Chinese issue on two fronts. On the one hand, supply chains and sales, slowed down by the pandemic, and on the other, tax policy towards digital companies. As WWD reports, it is the brand Vans that has been most affected by the Chinese disruption, growing less than other brands: +8%.
On the other hand, The North Face had the best quarter in its history: up 27% on pre-pandemic levels, and sales of over 1.2 billion dollars. Timberland‘s revenue grew 11%. Overall, VF Corp. ended the third quarter on December 31, 2021, with higher-than-expected sales and revenues up 22% to 3.6 billion dollars. Excluding acquisitions, revenues increased 15%. VF Corp expects to end fiscal year 2022 with 11.8 billion dollars (down slightly from the previous forecast), including 600 million dollars from sales of Supreme products.
And Dr Martens’ problems
Dr. Martens is facing similar problems. In Vietnam, where the brand produces a third of its shoes, shoe factories were closed for three months last year. In addition, shipping delays have further reduced available stock. As a result, the business suffered. In the third quarter ended December 31, 2021, Dr Martens’ revenue grew 11% to 307 million pounds, slowing from first-half growth of 16%.
The title lost a quarter of its value since going public in January 2021. The company remains confident in achieving its targets for its first full year as a listed company. Meanwhile, supply chain tensions have forced the brand to tweak its price list. The price of its 1460 boots will increase from 149 pounds to 159 pounds, reports The Times.