DUSSELDORF — Last year was a rough one for the German women’s wear industry, and according to manufacturers and retailers at the recent CPD trade show here, 2002 isn’t going to be any better.

Rising unemployment and inflation, political uncertainty in the run-up to national elections, and what many say are psychological barriers to the Euro, have combined to dampen consumer confidence in the country.

Hubert Weidemann, president of the German women’s wear association, said inventories were “out of control,” and added that “we have to accept that order activity will be pushed aside.”

Nevertheless, the mood wasn’t all doom and gloom at the mega fair, which closed Feb. 5. As Sebastian Holzshuh, director of product, marketing and distribution for the German sportswear company Cinque, said: “The mood of the retailers is astonishingly positive, for when you read the figures, there’s no reason to celebrate. But the spirit is encouraging, though no one expects good results for spring. We all hope the insecurity relating to the euro diminishes and that things begin to get better by fall.”

A member of the beleaguered Wunsche Group, Cinque’s financial standing was secured on the eve of the show by the takeover of Wunsche by MPC Holding.

“It’s great to have [the problems] behind us,” Holzschuh said. “We can already see the difference in how suppliers react, and we’ve clearly acquired new customers at the show, which was not the case at the last fairs.”

Jurgen Richter, a member of the Escada board of management with responsibility for the Laurel business, said, “The mood at the fair is always better than it is in reality. [The retailers] all want to get out of the stores and the mess they’re in. But the situation hasn’t changed. January was horrible at retail at all levels. Yet the moment the season is over, it’s all old merchandise and the stores know they have to buy. What’s more of a problem is whether the retailer will get enough money from the bank to pay for the merchandise.”

As CPD is primarily an information-gathering rather than an order-writing event, its hard to get a handle on how the year is panning out. But so far the numbers for Laurel are good, he said.

“We had better results [in fiscal 2001] than the year before, and the year before wasn’t bad,” he said. It is nonetheless openly known that Escada is looking for a financial partner or buyer for Laurel. This has nothing to do with financing the day-to-day operations, Richter explained, but rather to fund an aggressive growth plan for the brand.

“This season, acceptance of the collection is not the reason retailers aren’t ordering,” said Monika Drechsler, marketing director for She, the German upper-moderate collection. “The problem that we all face is how much budget do the stores have and what kind of limits will they get from the factoring banks. They all have full warehouses, and it’s not that they don’t want to buy, but that they don’t have the financial possibilities.”

Expanding export activity is another strategy, but Drechsler said former boom markets like Russia were also beginning to show signs of strain.

“We’ve had continuous growth in Russia for 3 1/2 years and our agent has really built the brand, supporting it with advertising in Russian Elle and Vogue,” she said. “But he said the air is getting thinner there, too, and the days of continuous growth are over.”

Manufacturers are facing new challenges, as Germany’s retail ranks continue to thin and those remaining concentrate on fewer suppliers. A spokeswoman for Steilmann said the collection had received positive feedback at CPD, “which loosens up the atmosphere.”

“But the retailers are afraid and would rather not spend their money, even if they have to buy merchandise,” she said. “And they’re looking for commission deals so they can split the risk. But manufacturers can’t take on even more risks.”

By and large, the looks at CPD covered familiar ground, with the overall trend toward more relaxed and coordinated dressing. Last season’s return of the suit, especially tailored pantsuits, has translated into softer tailored components for fall-winter, with shorter jackets making a strong comeback. Soft neutrals dominated the palette, with a complete range of creams, beiges, bisques and make-up shades, accented with rich tints of pink and blue. Black also reasserted itself, often in combination with wine reds.

Fall looks to be a season of several must-have items in Germany. Among the key looks:

The ruffled shirt.

The thin shearling coat, jacket or skirt.

Leather in all shapes and forms.

Velvet suits and separates.

Quilted outerwear.

Wide and/or corset-like belts.

The more fashion-forward lines are experimenting with Empire waists, and asymmetric skirt hems surfaced in mainstream and contemporary lines.

Traffic at the three-day show which closed Feb. 5 was slightly down. The Igedo Co. said it registered 48,000 trade visitors compared to 50,000 last February. According to the FKM, a volunteer controlling agency of fair and exhibition visitors, CPD drew 57,600 visitors. The number of exhibitors was also down by about 200 companies, and the show featured about 1,700 firms.

This season, CPD kicked off a show-within-a-show, CPDxsite. Devoted to jeans and young, trendy fashion, xsite featured 55 companies in a more clubby atmosphere than the other CPD halls. The overall reaction to the new lifestyle segment was quite positive. Lars Bultink, sales manager of Mexx, said “The concept is successful. We talked to many people, all of whom reacted very positively to the hall. We feel we took the right step coming here with XX by Mexx.”

Mirjam Dietz, xsite project director, described the start-up as “super successful.” She said, “Many [manufacturers] came to see how it looked…and we had lots of talks with potential exhibitors, most of whom abstained from any fair participation this season.”

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