The 2022 NeverWet State of the Industry Report
No matter your industry, the past few years have been challenging. In addition to unfathomable human loss, COVID brought with it layoffs, supply scarcities, and business closures. Even during times of COVID ebb, international tensions remain elevated.
Other than healthcare and cleaning supplies, few industries remained untouched by the pandemic and consequential world events. The athletic shoe industry, like countless others, certainly experienced its knocks.
In 2022, NeverWet launched a study designed to explore business concerns specific to the athletic shoe industry. Researchers surveyed thousands of professionals within the athletic shoe industry, with a key goal being taking a temperature reading on key economic factors. Researchers hoped to learn how much concern remained about COVID, inflation, international tensions, etc. At this point, what does – and does not – concern athletic shoe manufacturers?
COVID itself placed low among the list of concerns. In fact, only 28% of respondents were substantially or somewhat concerned about the virus itself. Rather, the survey results suggest that the focus has shifted from the pandemic itself to some of its negative repercussions.
While COVID loomed as the largest concern for most throughout 2021, the downstream effects in the wake of the pandemic were more tangible to those surveyed. Accordingly, respondents’ concerns escalated as they wrestled with questions related to the supply chain. Currently, respondents indicated that they feel less optimistic about raw material acquisition than they do about their health. Less than 18% of respondents are confident that the 2022 holiday season will see no shortages in raw materials. Just under half feel that such shortages will continue, and a full third remain noncommittal. This information is interesting in its own right, though these results become far more curious when taken within the context of demand. Read more about raw material shortages’ effects on athletic shoe development within the context of consumer demand here.
Rising costs and inflation are always key concerns for consumers and manufacturers alike. As of this writing, inflation is higher than it’s been in recent history. In such a dynamic environment, few agree about whether we are in the early stages of a long-term phenomenon, or are simply in a transitory period. Likewise, the survey respondents had less agreement about how much inflation will continue to impact behavior. Sixty-two percent of respondents have “some” or “substantial” concerns about inflation and its effects, yet more than 46% of respondents feel “consumer demand will continue to be strong throughout the year.”
When synthesizing survey responses about inflation and the supply chain, one may discover the following:
- A minority of respondents feel that supply chain issues are ending.
- A majority of respondents are concerned about inflation.
- A majority of respondents feel demand will remain strong.
One thing that survey respondents were heavily in agreement about was their concerns about shipping delays and shipping costs. A whopping 67.1% of survey respondents expressed “some” level of concern about shipping costs. More telling, greater than 40% expressed “substantial” concern. Though increased shipping costs will impact revenues and profits, the “good” news for manufacturers is that all industries are being impacted. Moreover, shipping costs are so directly tied to fuel prices that they are extremely volatile. Those that can survive the short-term profit implications of inflated shipping costs will find themselves on a virtually equal playing field as their competitors – once the crisis has passed.
In today’s economy, challenges are plentiful and sure-solutions are few. A key component in navigating economic ups and downs is understanding industry concerns and the impact they have on your ability to create, manufacture, and deliver products.
To learn more about NeverWet’s survey findings, along with the impact of economic challenges on the athletic shoe industry as a whole, click here.