Shoe maker Crocs plans to move beyond supply chain issues; stocks jump, Retail News, ET Retail

Crocs Inc has raised the lower end of its annual revenue forecast, as it prepares to counter supply constraints by moving some of its production out of Vietnam, where plant closures have pinched shipments, raising its shares by 12%.

The company, known for its rubber clogs, announced Thursday that it would move production to China, Indonesia and Bosnia, from Vietnam which had become a manufacturing hub for many companies around the world, in especially clothing.

Crocs had forecast that 70% of its production would come from Vietnam in 2021, before deciding to withdraw some of its production, chief executive Andre Rees said in a conference call with an analyst. The company did not specify how much production it was moving out of the country.

Many factories in Vietnam’s manufacturing hubs have been closed or are operating with far fewer workers in the field since mid-July due to an increase in cases of Delta variants, affecting supplies from major clothing companies, including Nike Inc, Abercrombie & Fitch and Adidas AG.

Nike has warned of delays during the crucial holiday shopping period due to supply issues and said it would take several months to resume full production in Vietnam, where about half of its shoes are produced.

Crocs, meanwhile, said he would be able to jumpstart production quickly due to the simplicity of his shoes. The company added that it is also avoiding port delays on the west coast of the United States by moving to the docks on the east coast.

He expects revenue for fiscal 2021 to grow 62% to 65%, up from his previous forecast of a 60% to 65% increase.

Revenue for the third quarter ended Sept. 30 jumped 73 percent to $ 625.9 million, beating analysts’ average estimate of $ 610 million, according to Refinitiv IBES, as the company benefited from more pricing. higher and lower discounts.

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Virginia C. Taylor

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