Economy posing major challenge for fur retailers

SANDY PARKER REPORT, VOL. 33, ISSUE 25, AUGUST 24, 2009
The following extract is reproduced with permission from Sandy Parker Reports, Weekly International Fur News. Sandy Parker has been covering the fur industry for more than four decades. For most of that time he has published a weekly newsletter, detailing results of international pelt auctions, wholesale price trends, business developments and movements in the trade, as well as economic and political activities that may impact on it.

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International Fur News
with Sandy Parker

Economy posing major challenge for fur retailers

FUR RETAILERS, FACED WITH A CHALLENGING SEASON AHEAD, are searching for new marketing strategies that might loosen consumers’ purse strings without undermining their own image. Unlike the automobile industry, which has benefitted from the U.S. government-sponsored “cash-for-clunkers” program, the fur trade does not rank among the top contributors to the country’s economy and therefore must rely on its own creativity to stimulate business in a difficult economy.

Big discounts, say retailers, are not the answer, particularly for those looking to preserve their prestige image as well as their margins. What can loosen purse strings, some believe, are fashion pieces at lower price points. These might include well-made pieced mink and other section furs, but also the better grades of lower-priced species. Furriers are also stocking more smaller items, including boleros, accessories and accent pieces.

Furriers are also planning more special events to zero in on specific target groups. Among these are charity benefits and trunk shows held in private customers’ homes as a way of drumming up extra revenue. In addition, fur specialists have been trying to dispel their strictly furrier image by diversifying into related products that consumers ordinarily would look for in department stores.

WHILE DIFFICULT ECONOMIC CONDITIONS HAVE CAST A CLOUD OVER RETAIL FUR PROSPECTS in much of the Western world, it appears that the huge Chinese market could still move forward, thus propping skin prices. Although that country also was initially hit by the financial crisis that enveloped the world, mainly because its big export business suffered when other countries canceled orders, it has been showing signs of a turnaround that indicate a faster recovery than elsewhere. According to government figures, China’s industrial output in July rose 10.8% over last year and retail sales increased 15.2%.

IN THIS ISSUE:
Economy Posing Major Challenge
Stores Seeking Fresh Solutions
Bigger Discounts Seen as Wrong Way
Special Events Being Weighed
China Expected to Prop Skin Prices

For extracts from back issues of Sandy Parker Reports see News Archive. Subscribers can access an archive of complete issues at www.sandyparker.com.