EsFashion designer Steve Madden reported second quarter revenues that increased by 5.8% on a year earlier,beating analysts’ estimates by 1.3% on a year earlier according to S&P Global Market Intelligence figures. Volume growth may have been stronger – the company referred to a shift to private label businesses – with U.S. seaborne imports having risen by 13.0% on a year earlier in the second quarter, Panjiva data shows.
Source: Panjiva
The challenge ahead for the firm may come from the – currently low – possibility of tariffs to be applied on Chinese exports of leather goods. As outlined in Panjiva research of the Trump administration’s proposed list of $200 billion of products to be targeted with 10% duties includes handbags as well as textiles and leather used in manufacturing such products.
Nonetheless Steve Madden management is confident those should not be insurmountable stating both that tariffs “are going to result in price increase on handbags” and that “everybody in our space is in the same boat”.
The former is a common strategy across industries facing duties. The latter is a reference to sourcing strategies. Steve Madden sourced 58.4% of its U.S. imports from mainland China in the past 12 months, accounting for 58.3% of shoes (which were 92.2% of all shipments) and 58.0% of handbags.
By comparison on an industry-wide basis China accounted for 50.3% of shoe imports and 55.8% of luggage imports. It’s worth noting that shoes are not yet included in the list of products targeted.
Source: Panjiva
