Visitors to the two Westfield shopping centers in London and to others in Poland, Hungary and Bulgaria will see special kiosks in their alleys with attractive displays of Grendene's Grendha, Ipanema and Rider ranges of shoes. Inspiring a sensation of joy, combined with low price ranges of €15 to €30 a pair for the displayed styles, they are intended to trigger impulse buying decisions.
Manned by a salesperson and supervised by Grendene's national distributors in the respective countries, these kiosks are the adapted replicas of a concept successfully launched three years ago by Carvel, a longtime distributor of Grendene in the Balkan countries. Based in Belgrade, it has already set up about 20 such kiosks in a growing number of shopping centers throughout the former Yugoslavia and in Albania.
The rollout of the kiosk concept is part of a program to stimulate best practices among the 90 independent distributors of Grendene's products around the world supervised by Alexandre Turra Gastaldello, who recently took over Ida Ferro's former responsibilities as export manager of the Brazilian group.
Like some other Brazilian companies, Grendene's exports were affected last year by the appreciation of the Brazilian real and difficult economic conditions in the mature markets. Its exports declined by 22.2 percent in volume to 42.5 million pairs, but their average price went up by 21.9 percent in U.S. dollars to $5.01 per pair.
As a result, the company's exports declined in value by only 9.6 percent in reais and by 5.0 percent in dollars, down to a level of $213.0 million for the year. In terms of volume, Grendene's share of Brazil's total footwear exports increased to 16.4 percent in 2011 from 15.1 percent the year before.
In the domestic market, the company's gross revenues fell by 7.1 percent to 1,489 million reais (€617.7m-$818.0m). The management blamed the softening of the Brazilian economy, which began to affect Grendene last March.
The group's total gross revenues thus declined by 7.6 percent to R$1,846.7 million (€766.1m-$1,014.5m), but the gross margin improved by 2.7 percentage points to 43.3 percent. The operating margin fell slightly by 0.7 percent to 12.5 percent, and it would have improved without an increase in advertising and marketing expenses and without the default of a big unnamed customer.
Higher financial income and other factors allowed the company to post a net profit of R$305.4 million (€126.7m-$167.8m) for the year. It was only 2.2 percent lower than the record level achieved in 2010, but as a percentage of sales, the net income margin improved by 1.1 percentage points to the higher level of 20.6 percent.
The management says it will continue to increase its communication efforts, strengthening its brands with aggressive marketing through multiple media, in order to recover market shares. It wants to strengthen relations with clients to meet their needs in a more focused manner.