An asset reshuffle involving three of Brazil’s leading footwear manufacturers will result in Grendene boosting its women’s collection, Vulcabras Azaleia focusing on sportswear and Alpargatas concentrating on its key brands, including Havaianas.
Grendene has signed a license agreement for the Azaleia brand owned by Vulcabras. The three-year agreement, which can be renewed for an additional three years, covers the production and sale of women’s shoes in Brazil and worldwide, except in Peru, Chile and Colombia, where the Azaleia brand has a network of more than 70 stores, according to Vulcabras’ website.
The label is present in more than 20 countries. In Brazil, it can be bought through the brand’s online store and in over 12,000 physical shops.
Gendene and Vulcabras stressed that there is no solidarity between them regarding their respective activities and obligations towards any third parties for the brand.
The compensation for the use of the brand will be based on a percentage of the monthly net operating revenues of the products, in accordance with the standards currently practiced by Grendene with other licensors.
The license agreement is in line with Vulcabras’ decision to focus on manufacturing and marketing sports shoes, while continuing to sell women’s shoes only in the South American countries excluded from the exclusivity contract with Grendene. Meanwhile, Grendene, which is known for brands such as Melissa and Ipanema, reinforces its women’s portfolio.
Vulcabras produces sports shoes under the brands Under Armour and Olympikus and recently bought for 32.5 million reais (€5.0m-$5.8m) Alpargatas’ rights to manufacture and market the Mizuno brand. The license covers Brazil and Argentina. In turn, Alpargatas is concentrating on the Havaianas and Osklen brands as well as its internationalization and the digitalization of its business.
According to the Brazilian press, the switch will boost Vulcabras Azaleia’s revenues as the Azaleia brand generates annual sales of BRL 100 million (€15.5m-$18.0m) per year against BRL 444 million (€68.6m-$79.8m) for Mizuno. The company’s production lines dedicated to women’s shoes will be converted to the manufacturing of sports shoes.
Vulcabras has been reorganizing its activities recently, reducing the number of factories to two from three after selling a plant located in Sergipe to Dok. The company is concentrating manufacturing at enlarged plants in Ceará and Bahia, which now measure 70,000 and 50,000 square meters, respectively.
Vulcabras is also scheduled to discontinue the girl brand Dijean, which could be sold if a buyer is found.