The demise of the Swiss shoe industry was only a matter of time. Death in instalments was surely due to wrong management decisions, as the latest victim shows.
After about 120 years of existence, Swiss shoe manufacturer Fretz Men has made the decision to give up. Shoe production for the upcoming season would still be delivered and then business operations would cease around the end of June 2023, the “NZZ” newspaper reported Wednesday.
Stocks would still be sold off and that would be it for the last major Swiss shoe producer, whose roots date back to 1903.
The main reason for the closure decision was the fact that production in Switzerland could no longer cover costs, the report continued. The CEO of the traditional company, Vinzenz Lauterburg, told the paper that a double-digit million amount had already been lost in the past ten years.
Rescue measures, such as discontinuing the women’s collection, concentrating on the development of new models in a small atelier at the Aargau headquarters in Fahrwangen and completely relocating production to India and Italy in 2020, had all failed to bear fruit.
Ultimately, the coronavirus pandemic with the many closed shoe specialty stores, Fretz Men’s most important sales channel, dealt the death blow to the family business.
A sale or licensing of the Fretz brand failed from a lack of interested parties, the Zurich paper continued.
The strategy of occupying a niche in the highly-competitive shoe market in the price segment between 120 and 190 Swiss francs with solid quality has thus ultimately failed. The cost structure with manufacturing in Switzerland was apparently much too high.
Delay of measures
The management and the family owners probably did not want to admit this for far too long and apparently took necessary adjustments far too late. During the coronavirus pandemic, they then failed to get their act together.
As a counterexample, the Swiss sports shoe brand ‘On’ can be listed, which clearly stands up to big brands like Adidas, Nike & Co. but only manufactures their designs in Switzerland.
The Swiss shoe industry in decline has now simply found another victim in Fretz. Recently, another owner family already sold the traditional brand Kandahar from the Bernese Oberland because of profit problems.
Only luxury works
In 2021, the Thurgau entrepreneurial family Karl Müller had taken over the activities around Kandahar and tried to continue to focus on Swiss shoe production with the two existing shoe brands Kybun and Joya in Sennwald in the St. Gallen Rhine Valley.
This will probably only succeed in a luxury segment. However, Kybun’s prices of over 300 Swiss francs per pair are almost twice as high as those of Fretz.
1,600 pairs per day
For the masses, the train of Swiss shoe production seems to have finally left the station.
Fretz Men produced – in the best of times – up to 1,600 pairs of shoes per day and for this output the manufacturer needs to find enough buyers at a price that yields profit and thus secures their existence.