Price of Brazilian footwear pleases importers

28 de junho de 2016

São Paulo – Importers attending the footwear and accessories fair Francal approve of the current price of Brazilian footwear. That’s what they stated to ANBA this Monday (27), the fair’s second day, at Parque Anhembi, São Paulo. “It’s a good price”, said Piyush Shah, purchase chief of shoexpress, brand of the footwear chain owned by the Landmark Group, from the United Arab Emirates, one of the largest footwear retailers in the Middle East.

Francal started this Sunday. This Monday it was possible to see a great number of importers roaming the fair’s halls, a sight celebrated by exhibitors. The sector is making an extra effort to export in a period of lower sales to the domestic market. If it’s up to Manuel Ortiz, owner of Tu Calzado chain stores, the companies will sell more. “I will buy a little more”, he said.

Ortiz believes the price of Brazilian footwear is a little higher than earlier in the year, but still he considers it in a good level. In the store, the Brazilian product represents 95% of the total. “The price is good”, he said, also emphasizing the quality of the product.

That’s also the opinion of Julio Barrios, owner of Martina Shoes, from Paraguay, that praises the finishing of Brazilian footwear. The importer will not increase purchases in comparison to the previous year only because the economic situation in his country is not good. “We depend a lot on Brazil and Argentina”, he explains.

Another importer, Shah, says that the company to which he works also plans to increase purchases of Brazilian footwear this year. This Monday he was visiting the stands and planned to close deals with companies Beira Rio, Suzana Santos and Itapuã, among others. The company imports between 200,000 to 300,000 pairs of shoes from Brazil per year.

Landmark Group operates in several sectors and have as its brands, among many, Shoe Mart and shoexpress, footwear chain stores placed in different price segments, and Max, department store that also sells footwear.

The average export price of a pair of shoes from Brazil from January through May of this year was USD 7.56. The amount is down 6.3% from a year ago. The US dollar is strong relative to the Brazilian currency right now, a scenario that is beneficial to exports, but these types of sale are yet to take off. In the first five months of the year, export revenue was down 4.7% to USD 367.4 million, but export volume climbed 1.7% to 48.6 million pairs. 

Abdala Jamil Abdala, the president of the event’s organizer Francal Feiras, stresses the 1.7% growth in volume early on in the year, which he terms a tenuous recovery. He believes it’s only a matter of time before exports are back to past levels, which is what it takes for international clients to start buying again. 

The Brazilian footwear industry has once exported over 200 million pairs of shoes per year. In 2015, 124 million pairs were shipped abroad, grossing USD 960 million. The Francal Feiras president claims the Brazilian footwear industry has exportation in its DNA, and that the USD 960 million in revenue came as a result of the quality, design and comfort of the Brazilian product. 

The chairman of the Brazilian Footwear Industry Association (Abicalçados), Heitor Klein, also believes the medium-to-long-term export outlook is good. “This year we’ve already seen a modest recovery,” he says regarding the numbers seen through May. 

According to Klein, the factors preventing exports from increasing further, in spite of the weak domestic currency, include exchange rate volatility, which leads to foreign trade operators being uncertain when setting their prices. But the Abicalçados chairman is optimistic about the beginning of the Spring/Summer season in the Northern Hemisphere, and he believes the season could help speed up the recovery of Brazilian exports. 

Francal is also working to help the industry leverage foreign sales. For this edition, the organizers placed special emphasis on inviting foreign buyers and paid their lodging costs. According to Abdala, exhibitors reported doing business with importers during the first days of the event. The Arab buyers attending Francal have been invited in collaboration with the Arab Brazilian Chamber of Commerce.

 *Translated by Sérgio Kakitani & Gabriel Pomerancblum