International talk dominated Sunday’s speaker series at FN Platform.
From retail and wholesale expansion to sourcing, industry players debated the reasons for entering overseas markets, and the best ways to do so.
“Our business faces the same challenges in the U.S. as everybody else,” said Rick Darling, president of Li & Fung USA. “It’s now a market share game. There’s slow growth opportunity here. I don’t see that changing a whole lot over the next five to 10 years. And because of that, there is a lot of pressure on how you’re going to grow your business. For the brands you own or license, the idea of putting them in other regions of the world is very attractive from a growth standpoint, but it also is very challenging.”
At an afternoon discussion sponsored by FN Platform and the United Shoe Retailers Association, Darling and other panelists warned young brands about expanding too fast. Speakers described the international terrain as tough to navigate, thanks to local legal rules, language barriers and difficulty in keeping distribution in check.
“As you expand, do it one step at a time. It’s not an overnight process,” Darling said. “Sometimes it’s OK to take the path of least resistance. The world markets are going to grow over the next 20 years. Take your time and determine where and how to position the brand, and make sure you can deliver on time there. Brands are meaningless if you can’t deliver on time.”
No wonder, then, sourcing concerns crept into conversations at a later panel.
“What keeps me up at night?” Rick Paterno, president of The Jones Group Inc., rhetorically asked. “Costs, labor, materials, production — those are the things big companies are worrying about. We’ve been chasing cheap labor around the world for decades. We’ve run out of places. China is the place. The industry and suppliers are there. We have to make it work. We’re exploring some other options such as Ethiopia, but China is our No. 1 country and we’re making investments there.”