Pro Content

German Market Insight: Inflation’s Impact on Retail. Skateboarding and Streetwear on the Rise

Let’s start again with some hard figures. Overall, inflation has stabilized slightly in recent months, but remains an issue due to price increases in certain sectors, with the inflation rate in Germany in July 2024 at 2.3%. Prices for services rose particularly sharply, while the price trend for goods remained below average. The price increases for services such as insurance and catering are particularly striking. These developments are of course particularly noticeable in the retail sector. Sentences such as “There’s less money for leisure” or “Oh come on, the old one will still do” are being heard more and more often.

The lack of summer at the beginning of the year also had a negative impact on the mood. A very rainy June and the first half of July left board shorts and bikinis hanging on the shelves for longer. However, business picked up again in the second half of the German summer, which noticeably improved the mood among retailers. From a pre-order perspective, however, a certain degree of caution is evident overall. The number of orders have been reduced and their value is also decreasing. There are certainly exceptions, but overall retailers are ordering more cautiously as stocks are still available.

The Olympic Games were very positive for extreme sports. In addition to the surfing competition, which was held on the legendary Teahupo’o wave, skating in particular caused a stir. High viewing figures were achieved at prime time, which was noticed by smaller skate stores. Interest in the sport of skateboarding is growing again for the first time since the peak times during the COVID-19 pandemic. Sales of complete skateboards and protective equipment are particularly on the rise.  Armin from A-Man Boardingstore has a similar view of the situation. He has been actively involved in the skate scene for years and celebrated the 25th anniversary of his skate park tour this year under the motto “STILL ALIVE”. When I asked him how he assesses the current situation in skateboarding, he replied: “Skating is obviously a lot of passion and heart and soul, but it gets kids involved in sport and you simply have to encourage that.” How are sales going in the store? “Skate hardware is actually quite stable, even growing slightly at the moment, but the prices on the internet are of course also pretty crazy! We’re noticing that. However, the sale of streetwear is positive. Baggy pants have really picked up.”

This brings me straight to the next topic: streetwear fashion. We board sports enthusiasts have always been pioneers when it comes to trends. In this context, I spoke to Philipp Lange from the retail agency of the same name. He is the new representative of Home Boy in southern Germany and is very happy with this decision. “Home Boy is working very well at the moment, we’ve actually been sold out in the key styles for weeks. The prebook order is going really well. It’s simply fun to have a category that is currently being well received.”

Another highlight in the board sports industry was the opening of o2 Surftown Munich Wave park. I was able to be part of this event and it was simply incredible. With almost 15,000 spectators, surfers and lots of pros from the German surf scene. The waves created by the Endless Surf technology are incredibly diverse and good. Everyone really gets their money’s worth here – whether you’re a beginner surfer in white water or a pro with two air sections.

I had a chat with Michi Mohr and it was clear that the opening and the vibe exceeded all expectations. When asked how he felt, Michi replied: “It’s still a bit surreal, But this beats everything. From the first moment I saw the first wave, to the problems with the overheated construction site. this day makes you forget everything. Everyone has a smile on their face. We have international surf pros get in touch wanting to surf the wave.” I had exactly the same feeling: just good vibes. Surftown will make the sport of surfing even better known in Germany. The well thought-out store system and its partners also offer the opportunity to test and then buy high-end surfboards. Different fins can be tried out and also purchased, something that is not normally possible. “The retail concept has already been very well received in the first few weeks and we will continue to improve it,” says Michi.

We shouldn’t forget the Outdoor ISPO, which has also taken place in Munich since my last Market Inside. It has to be said quite clearly that outdoor was the focus. Although the small surf area was always well attended, some brands that were there in winter were now missing. It was interesting and impressive how many camping, outdoor and water bottle products were presented. Large stands took up almost half the hall, consisting of backpacks and water bottles. It seems like these are categories that are growing.

I now come to one category: sneakers and skate shoes. Of course, a lot has happened here too. Nidecker has taken over the core skate shoe brands Etnies, Emerica and ES with the purchase of the Soletech Group. The brothers are totally happy with this and want to continue investing in skateboarding. I spoke to Franck Goulard, German Sales Rep South, and wanted to know what he thought of the changeover: “For me, it’s a great thing, we’re getting more support again, especially when it comes to marketing.” The processes have been simplified. How are things going otherwise? “Quite stable, and Etnies is even showing a slight increase.” That’s some good news.

I read recently 88% of sales take place in-store! This statement surprised me at first, but after a few conversations with retailers, it’s true. In-store sales are growing again and are more important than ever for retailers. That’s my feeling too. Service, experience and expertise cannot be replicated online. This enables retailers to grow sales again. We will be reporting on the first winter business in the next issue. The brands are in the starting blocks and deliveries of winter products have already begun. Let’s hope for a good start with early snow and sales.

By Tobi Hammer