The triumph of the German shoe manufacturer Birkenstock is one of the most unlikely success stories in the fashion industry, even though it has been clear for decades: the “New York Times” was surprised to discover that the rather clumsy-looking Birkenstock model “Boston ” was the “shoe of the hour”, was also more than 30 years ago. Since then, the company has made significant progress towards becoming a manufacturer of trendy lifestyle products.
On Tuesday, the sandal maker from the city of Linz am Rhein with a population of 6,000, which now also produces sneakers, beds and cosmetics, filed for an IPO in the US. The debut on Wall Street in New York is scheduled for the second week of October. The company wants to sell 10 to 15 percent of the shares and raise at least $8 billion. Analysts also believe that a turnover of 11 billion is realistic: Birkenstock is a luxury brand and therefore particularly valuable.
In a boat with Louis Vuitton and Dior
In 2021, heirs Christian and Alexander Birkenstock sold 65 percent of the shares to the private equity firm L Catterton for $4.9 billion. The fact that the company went public less than two years later may have to do with the fact that the value of the company has almost doubled since then. Especially in America and Asia, a growing number of customers are shuffling through life on silent cork soles: in 2022, adjusted profits amounted to 400 million euros; in the first half of 2023 there were already 225 million.
The entry of L Catterton into Birkenstock illustrates the change in image of the latschenschmiede: the investment house is a merger of an American investment company with the private equity division of the French luxury goods group LVMH, which owns brands such as Louis Vuitton and Dior. While L Catterton now wants to sell some of his Birkenstock shares, LVMH majority shareholder Bernard Arnault plans to increase his stake: the company fits well in his portfolio, says France’s richest man.
Birkenstock is, if you like, a shoe from the spirit of utopia: in the mid-19th century, the so-called life reform movement emerged in Germany, which opposed industrialization by turning to nature. In Frankfurt, a group of progressively oriented Schumacher gathered around the anatomy professor Hermann von Meyer, including the young Konrad Birkenstock.
Meyer called for a shoe reform: Until the mid-19th century there was no difference between a left and a right shoe, reports the author Nike Ulrike Breyer in an essay on the history of Birkenstock. In addition, most shoes were pointed, forcing the toes out of their natural position.
The concept of the footbed that Konrad Birkenstock developed must have been liberating for many people at the time. However, the breakthrough only came under Konrad’s son Carl: many veterans of the First World War suffered from foot pain and demanded healthy footwear. In 1925, Carl Birkenstock opened his first factory. Another 38 years passed before the company produced its first sandal: in 1963, Birkenstock launched the “Madrid” model.
America remains the most important growth market
Today the company employs 6,200 people at six locations. Production takes place exclusively in Germany and nothing is expected to change in the near future. Birkenstock also relies on continuity at management level: CEO Oliver Reichert, who has been at the helm for eleven years, will stay on. Reichert is the first company boss not from the Birkenstock family; His appointment was preceded by disagreements between the heirs.
America is currently the most important growth market. Birkenstock has been there since the late 1960s. At that time, hippies and other dropouts discovered German footwear for themselves: anyone who wore Birkenstocks rejected consumer society and its fashion dictates.
It’s hard to say when sandals became mainstream. The fact that British supermodel Kate Moss was photographed in Birkenstocks in 1990 was certainly a turning point. Since then, the spirit of the times has played into Birkenstock’s hands: sustainability and health consciousness are in fashion. The days when fashion journalists wiped their Chelsea boots with their chunky sandals seem to be over for now. (aargauerzeitung.ch)
Soource :Watson
I am Amelia James, a passionate journalist with a deep-rooted interest in current affairs. I have more than five years of experience in the media industry, working both as an author and editor for 24 Instant News. My main focus lies in international news, particularly regional conflicts and political issues around the world.
