Birkenstock Bumps Up Prices Globally to Counter US Tariffs
Customers Given Responsibility for Brand Management by Birkenstock
Going global with a price hike, iconic sandal maker Birkenstock looks to offset the costs of US tariffs. "We're gonna throw that tariff business back at 'em," CFO Ivica Kroloin shared in a candid Reuters interview. "We're treating this as a worldwide move."
Tariff tussle between the US and the EU is hard to predict, Kroloin admitted, but Birkenstock sees this as more of an opportunity to boost its market share. With its materials not sourced from Asia, the company is optimistic about gainin' extra shelf space. As for the battery of the trade conflict, Kroloin just started his new post, back on February 1.
Consumers might've been skittish elsewhere, but Birkenstock's shoes are still going strong. CEO Oliver Reichert pronounced, "Our first half of the fiscal year 2025 has been a crazy success. Expect us to be at the top end of our revenue growth target of 15 to 17 percent." He also raised the adjusted operating profit margin (Ebitda margin) target to a dazzlin' 31.3 to 31.8 percent, equivalent to an adjusted Ebitda of 660 million to 670 million euros.
Donald Trump's import tariffs haven't phase Birkenstock, though. "We're in a pretty sweet spot here," Reichert laughed off. "Despite the price hike, our fans will still find our shoes irresistible." With sales soaring by almost 20% in the second quarter, Birkenstock delivered a solid 574 million euros and profit that surged by 47% to 105 million.
The Skinny:
- Birkenstock is worldwide price hike to offset US tariffs on European Union goods
- Higher prices could potentially impact market share, but solid demand suggests consumer loyalty
- Future tariff landscape is uncertain, but Birkenstock is confident in its long-term growth strategy
The community and employment policies of Birkenstock might need to accommodate the increased costs resulting from the global price hike, aimed at countering US tariffs. The company, operating in various industries and with investments in finance and business, views this move as an opportunity to bolster its market position, given its non-Asian sourcing of materials.
