The consumer must recognise the value

Redwood Comment
Published:  20 May, 2020

The relation the leather industry has with the consumer has become far more complex in recent times. That complexity has come from the power of brands and the tools they use to communicate with consumers to make the consumer not bother to understand the material but acknowledge only the logo. 

It comes from a new consumer world where borrowing to spend is prioritised over saving. It comes from a world where societies are increasingly urban and do not recognise nature and natural things as clearly and obviously good in the way previous generations have done for thousands of years. It comes from a society increasingly defined by image, by short term thinking, by oversimplification, by lobbying, misleading claims in an increasingly fragmented world, and fragmenting society.

For everyone to receive a decent wage, the final consumer must recognise the value of what they consume. They must understand that rampant consumerism, fed by low price goods is doing great harm to both people and the planet. It has led to long, complex and fragile supply chains. It has led to margins so tight that workers are sometimes not properly paid, and their safety is not secure. It has led companies that talk a story of partnership to walk away from receiving or paying for goods they ordered; and others to pay only when they realised an angry public would punish them.

This largely comes from the way retail and branding has developed since the late eighties. Those were the years when you could get mugged in Rome for a pair of Timberland 3-eye Classic Lugs, with their yellow leather linings, handsewn construction and thick high traction outsoles. Brands moved onto the balance sheet and companies realised that with clever communications, they could transform the world of retail. Mature economies depend heavily on consumption, so since that time governments have kept interest rates low and encouraged borrowing. Rising property valuations and then new ways of consuming goods via subscriptions, rentals or personal contract purchasing – phones, computers, motor cars, education – has kept that consumption going. Western societies shifted to borrowing and spending and saving to buy things started to be viewed as a threat to the economy. Most items still being made in the west shifted to the developing world, and, usually after a couple of moves, ended in China.

Consumers spent the same but bought more items
Historically, that meant a dive in quality, but the Chinese invested in modern plants and good training. The products were good, the logistics soon well established, and as they grew market share, the huge volumes allowed prices to drop without loss of quality. Some goods even had more consistent high quality, although vigilant auditing was required. Consumers spent the same share of their disposable income on clothing and footwear each year, but with it bought more and more items, filling wardrobes and landfills with items designed for only a few washes and many used only once or twice. Some items never got worn.

The new brands started opening their own stores, fragmenting the retail store scene, new malls were opened around the world and luxury brands became available in every major city and airport. Luxury was no longer exclusive, it only needed cash; items like scarves, card holders and wallets offered entry level access, as did that new retail tool, the factory outlet mall. How fragmented could retail get?