Some of Italy’s 4,000-plus footwear manufacturers are small and, at times, a little fragile, but Milan-based economist Enrica Baccini insists that the Italian shoe industry as a whole is “anti-fragile”.

Italy’s footwear sector reported a 16% rise in revenues during the first nine months of 2021 compared with the same period the year before. This was still between 10% and 15% less than the figure for the same months in 2019. Export revenues for the nine-month period in 2021 were in excess of €7.5 billion and Italy’s shoe manufacturers shipped just under 150 million pairs over that time. Leather footwear accounted for 61.7% of total export value, while leather shoes’ share of the total export volume was 44%.

In terms of the domestic Italian market, including imported shoes, consumers spent almost €3.7 billion on footwear in January-September 2021, buying just over 100 million pairs. These figures show an increase of 10.5% in value and of 8.8% in volume compared to the same months in 2020. But in making these comparisons, Assocalzaturifici refers to some distortion owing to “the shock of 2020” and the devastating impact of the first waves of covid-19. Compared to 2019 figures, last year’s show decreases in domestic footwear consumption of 14.8% in value and of 10.6% in volume.

Speaking about the market situation in general rather than about these figures specifically, Enrica Baccini, an economist who works for Fondazione Fiera Milano, the company that runs the Rho exhibition venue in Milan, says optimism is growing in Italy and has already returned to pre-covid levels. Consumer sentiment aside, she says that something else that gives her hope is the enduring ability of manufacturers in Italy to create products that satisfy the desires of consumers.

She believes domestic consumers pay too little attention to the importance that manufacturers still have in the Italian economy, focusing more on fashion and luxury trends, for example. “But we know that manufacturing matters,” she says. “Luckily, that ability to realise products that consumers want still exists in Italy. Despite the crisis of the pandemic and other crises, such as the terrorist attacks in the US in 2001, the global financial crisis in 2008, we still have more than 4,000 companies producing beautiful shoes.”

Regional picture

Exact figures she goes on to give show that there are 4,151 companies in Italy making footwear at the moment, employing a total of more 72,000 workers, people Ms Baccini describes as having “extraordinary know-how that we have to continue to value highly”. Famous shoe-producing region Le Marche has the most, with 1,315 manufacturers and 17,500 employees, followed by Tuscany with 952 companies and 14,000 workers, Veneto with 655 companies and 15,400 employees, Campania with 371 manufacturers employing 6,115 people and Lombardy with 343 manufacturers and 6,687 workers.

No monopoly for big luxury

To confirm the importance to the wider luxury sector of at least the top performers in this group, the Fondazione Fiera Milano economist cites a 2021 study by financial services group Intesa Sanpaolo. It found that the 11 biggest French and Italian luxury groups use a total of 1,867 manufacturers in Italy as suppliers, across the whole of their product ranges. Within that, 246 suppliers were footwear manufacturers with a combined annual turnover of €5.4 billion. Only ten of those manufacturers are companies owned by the luxury groups themselves, Ms Baccini explains, while 53 are strategic enough to be classified as tier-one suppliers and 42 are tier-two. This leaves 141 footwear companies that, while they enjoy enough prominence to be part of the value chains of these important luxury groups, are still non-strategic.

“This means that the luxury groups are snapping up some footwear manufacturers,” Enrica Baccini says, “but they are not monopolising the footwear market.” This is not what she terms “a worrying phenomenon” and there is still plenty of shoe manufacturing expertise to go round. She quotes a separate source, Italy’s national statistics institute, ISTAT, to suggest that of 1,700 footwear manufacturers in Italy, more than 40% of the total, bring their own shoes to market under their own brand names. “They are independent companies, expressing their creativity and entrepreneurship,” she insists. “We still have a great number of companies that want to be in charge of their own destinies. This is positive.”

More than just resilient

Surveys of its own that Fondazione Fiera Milano carries out among exhibitors at Micam and other industry events suggest that 40% of the Italian companies that take part make shoes only for their own brands. A further 53% make own-brand footwear at the same time as producing for third parties.

Clearly, some of these companies in the shoe manufacturing sector in Italy are quite small and some are fragile, but, according to Ms Baccini, more and more analysts of the wider economy are coming to see the shoe sector as “anti-fragile”. She explains that this means the industry is “more than resilient”, because companies that are resilient will withstand a shock or a crisis, surviving them but staying the same. Anti-fragile companies, on the other hand, do not just survive the shocks, but emerge from them in better shape than before.

The concept is one that Lebanese-born writer Nassim Nicholas Taleb came up with in a 2012 book called ‘Antifragile’. A part of the basic idea that Enrica Baccini particularly likes is that having some fragile companies in the eco-system makes the eco-system itself anti-fragile. She explains this by saying that exposure to fragility, not least during the lockdowns imposed by the first waves of covid-19 in 2020 and early 2021, helped inspire innovation among Italian footwear manufacturers.

In Fondazione Fiera Milano surveys, it is in times of trouble that the highest numbers of footwear companies claim to be investing in innovation. Only 27% claimed to be innovating in the stable years around 2005, for example. This rose to 67% following the government-imposed austerity and double-dip recession years of 2012 and 2013. “This is exactly what is happening again in our footwear sector now,” Ms Baccini points out. “The level of innovation among our exhibitors is always high, but it grows in periods of crisis. This is what we really can call anti-fragility, even if it is not the mainstream view of what is happening in the economy.”