While upgrading its collection, New Balance is working more closely with some European retailers and appointing new country managers as part of its corporate goal to double sales by 2012. After the recently announced nomination of a new manager for its French subsidiary, Olivier Motteau, it’s now the turn of a new manager for the German-speaking countries, Rainer Graeber. They both report to Jonathan Ram, managing director of New Balance EMEA.
Graeber has worked mainly in larger food companies such as Unilever, Tchibo, Johnson & Johnson and most recently Mars. He replaces Christian Scheffold, who switched to Skins, the maker of compression apparel.
Meanwhile, the company’s improved merchandising efforts have led among other things to the opening of a second New Balance store in Italy by one of its best retail partners. Located in the modern EUR district of Rome, the store is run by Claudio Panei, a running enthusiast whose family runs a chain of shoe shops in the Italian capital, Dorian Calzature.
Another retailer in Southern Italy who had been handling the American brand for more than 30 years opened the first European New Balance store in Lecce two years ago alongside its own multi-sport store, Ticchioni Sport, and a variety of single-brand shops for Fila, Lacoste, Sergio Tacchini and Mandarina Duck.
The two Italian stores are serviced by Gartner Sport, the 12-year-old distributor of New Balance in the country which became a joint venture with the brand about five years ago. The store concept has been developed by Gartner in collaboration with an Italian studio, A&A Design. In contrast with all other customers, the two stores work on a consignment basis, with Gartner determining the most appropriate product range to show the full breath of the brand’s offerings and replacing sizes and widths all the time from its own stock.
Gartner has also installed shop-in-shops in the stores of a dozen other loyal retail clients in Italy such as KM Sport in Verona. It has a special stock replenishment scheme with a few major retailers of performance running footwear. It also has a special program to supply a limited series of 1,008 pairs of classical New Balance shoes, made in England, to a selected group of 84 fashion-oriented retailers all over the country.
Other distributors have several single-brand New Balance stores in operation in some less developed European markets – 5 in Greece, 2 in the Ukraine and 4 each in Poland, Russia and Turkey – and they all are seemingly profitable. There are more than 300 New Balance shops also in China. While New Balance has just under 300 mono-brand stores in the USA and Canada, partly designed to offer a multitude of widths to the final customer, there are no plans to add any others in Italy or in any of the other developed countries of Western Europe, at least for the time being.
Instead, New Balance EMEA has been developing since last year a series of partnerships with retailers in the U.K., France and Germany, where the company controls the distribution, that allow them to improve inventory turns by re-ordering missing widths and sizes of certain styles when they run out of them. Using field merchandisers in the three countries, this never-out-of stock (NOS) “ambassador program” will be boosted in the next couple of years.
The company’s new merchandising efforts will be simplified through its just announced adoption of CenterStone Technologies’ iVendix B2B e-commerce platform for its European operations. It will provide New Balance’s sales force and its 4,000-plus dealers throughout the continent with a non-stop product ordering and order tracking facility, using an electronic catalog.
The more specific NOS service of its “ambassador program” capitalizes in part on the fact that the brand continues to run a 26-year-old manufacturing and assembly facility in the Cumbria region of the U.K.. As a tribute to its continued presence there, New Balance, which has been making even football boots there, recently became official supplier of footwear to the local Carlisle United Football Club.
At New Balance’s head office in Boston, meanwhile, Tom Carleo has been recruited as general manager of the company’s running and outdoor business units, and Mark Cavanaugh as strategic business unit manager for sport and outdoor. They both report to Ray Hilvert, general manager of New Balance for footwear. Carleo was a product manager and Nike and served lately as senior vice president of product for Saucony. Cavanaugh ran Nike’s cleated footwear business for 13 years before acting as global director of sports marketing at Nike Bauer Hockey.
