The last two pandemic years were crazy – in general, but also for the skateboard goods market. While at first everybody thought lockdowns would hurt especially skateshops, it was kind of the other way round: most skateshops sold even more than in the years before. While gyms and sports facilities were closed, parents sent their kids to play in the streets with the wooden toy and many in the 30+ age group rediscovered the love they had for it when they were young. But while the demand went to new heights, the production was decreasing (for obvious reasons). That’s why there were a lot of skateshops that had empty boardwalls at some point. Now the stuff is back at the shops again. Basically they are overflowing with products – but now with increased prices. Jan Faeser from Sprouters Distribution in Würzburg explained to us how it came to this situation and what happened during the last two years.
In March 2020 it was of course a totally new, difficult situation and we didn’t know at the beginning how it will develop. The first lockdown was a completely new challenge. You were facing spring delivery for most brands and you couldn’t foresee at that point, that there will be a hardgoods boom. So people cancelled orders or put them on hold – but then the progression to summer was just crazy! The warehouse was empty while all summer preorders were on delay. The volume for summer deliveries multiplied and most manufacturers couldn’t keep up with production for different reasons. Because of Covid you were only able to have less workers in the factory, one woodshop was running out of glue at some point, and another one had the production ready, but it didn’t get pick up cause the factory was in an area where the truck drivers would’ve had to go to quarantine after they entered. For sure health is more important. As a result of different problems, what was ordered by distributors was cut down by the manufacturers. If things went well at that time, you got 50% of your order quantity – with 2-3 months delay. It was impossible to meet the demand.
"One woodshop was running out of glue at some point, and another one had the production ready, but it didn’t get pick up cause the factory was in an area where the truck drivers would’ve had to go to quarantine after they entered"
Definitely. As a shop you had to make sure that you had boards, but all distributors had empty warehouses. The stocks, regardless of which brand, were then also sold out very quickly. So we were able to supply new shops with our brands and in this way also grew with our portfolio.
Of course, every shop noticed that hardgoods were selling really well, but they couldn't get hold of new stuff. As a result, they had to suspend a complete season. If you looked into a skate store back then, the board wall was no longer available, as were the other components like trucks, wheels, etc.
When hardgoods sold like crazy, the shops also ordered a lot more than usual. The productions were more stable again, so distributions received the complete orders – sometimes at the same time than the delayed orders…
points you mentioned are definitely a massive factor and affect
everybody indivudal in the chain from manufacturer to brand to
distribution and then retail. In addition, the costs for each brand in
the production have increased. Woodshops have increased in size to keep
up with demand. More workers, more machines – more costs then also for
brands. On average, you can expect each board to be about 15-20 euros
This is a difficult question. You have to know that certain production quantities are pre-booked. But if the situation changes and brands want to give less into production, that’s of course also a dificult situation for the woodshop. It was already noticeable in the middle of 2021 that sales of hardgoods were declining, possibly even collapsing somewhat, but the booked goods were already planned. Personally, I thought that it would flatten out a bit, but I never imagined that it would happen so rapidly. Fortunately, we were able to postpone the booked production for many companies and were thus able to prevent winter decks from coming right after the fall delivery. I think we have to make it clear to the brands that we have to slow down the business a bit, to hopefully get to a healthy level with hardgoods in Spring/Summer 22.
"On average, you can expect each board to be about 15-20 euros more expensive."
You’re right, textile is getting more expensive, too. The reasons are pretty much the same.
They will unfortunately have to put the old stuff on sale. This will of course make it more difficult to sell the new, more expensive, hardgoods. You can’t blame the customer for getting the deck on sale instead of the new board for more cash. But to not order new Spring/Summer stuff is also no solution since shops need to have the fresh stuff. But I think it will unfortunately take a lot of patience at retail until the over ordered stuff clears up.
Personally, I had the impression that big brands were somewhat favored because of their larger order volume, which of course made it not easy for smaller brands, to wait for their ordered stuff. This also meant that the bigger brands were able to get their stuff to the market faster, which meant that smaller brands couldn’t sell as much. Without putting stuff on sale it will be very difficult to keep your small brand alive in the long run.
I’d like to say that prices will come down again, but honestly I don’t think it will get cheaper anytime soon. I don’t hope that prices will continue to rise, but we are just at the beginning of the whole situation that we have already mentioned. I rather hope we can keep the current prices. You really have to see how everything develops.
To run out of stuff and hope that the production can match your orders was crazy. As a distributor you want to go through such times together with the shops, but you can’t do much more than wait and hope that you can divide the pre-orders fairly – which wasn’t always the case. When stuff was available again, we capped the orders per shop – so that every shop had a chance to get some boards. Now we have a good inventory in stock and the shops are equipped for the time being, so you have to be patient as a distributor. For 2022, we will also take less risk with stock in distribution. It’s a paradoxical situation that new stuff is now arriving that costs more than the stuff still in shops.
The pre-orders for the brands are of course smaller than in 2020/21, but it’s still moving to a healthy level and many have already seen that it will now be different times and you will see which brands will do good. We were also able to talk very well with the respective woodshops, so that we also get planned quantities delivered a little better and more targeted for the next seasons. With one manufacturer, for example, you had to place your order over a year in advance – fortunately that could be changed, so that we can react more promptly to the respective market situation. It is simply very difficult to order now if you have to place a pre-order for Fall 22. It’s a tough time for shops as way too much stuff has added up and Spring 22 stuff is already slowly making its way.