BTR News – The Sneaker Game: Black Dollars, White Profits

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by Scotty Reid

The research company Statista reported recently that the 2020 revenue for the global athletic shoe market or sneaker market was valued at around 70 billion U.S. dollars annually, and it reports that the market is forecast to reach a value of 102 billion U.S. dollars in four years.

Sneakers as they’re popularly known in the United States became a fashion staple in the Black community around the late 1970s and 1980s owing to their growing popularity in part to the early interactions of hip-hop culture. Not only did break dancers, an athletic form of dancing that included elements of gymnastics, need comfortable shoes to perform but matching the shoes to an outfit, a fashion statement was just as important to the performers.

Then in the mid-80s came along one Michael Jeffrey Jordan, who had one of the best NBA careers of his era, and became arguably the first global influencer long before the age of social media. Nike’s media campaigns really leaned into a proud Black Identity without overtly showing their hand, by telling everyone to Just Be Like Mike, a Black man in a white-dominated society!

It helped that Jordan the man was not one to wade into the social-political sphere once quipping that “republicans buy shoes too” when asked to endorse the Black Democrat Harvey Gannt, the former mayor of Charlotte, North Carolina, who hope to defeat the lifelong white supremacist, Senator Jesse Helms. Another bonus for Nike was that Jordan the man would likely not be raising any issues with Nike’s labor practices let alone concern himself about where the Jordans sneakers were manufactured.

Nike’s iconic commercials, one starring, directed, and produced by famed Black film director Spike Lee at the peak of his popularity, somewhat of a Black cultural icon and a basketball fan in his own right, the media campaigns made Nike’s Jordans brand its signature shoe driving the majority of its sales and thus profits.

Sneakers are still a foundation of Black fashion trends, so it’s logical that Black consumers are still the foundation of sneaker purchases thus driving the profits for the top global corporate brands like Adidas, Converse, Nike, and Rebook. However, most if not all manufacturing is done in countries like Indonesia, Vietnam, and China.

The dollars the Black consumer market spends on these products often do not turn into employment opportunities for the communities where these Black consumers are geographically located. Corporations have long since outsourced manufacturing jobs where the corporations contract with factories in foreign countries where employers pay workers what would be considered slave wages in the US, wages well below the ridiculously low US Federal minimum wage.

Enter the Covid 19 Pandemic!

The coronavirus pandemic is having an impact despite the 2020 sales, COVID 19 did not arrive in the United States until the last two months of the calendar year. CNBC reports the sneaker giant Nike, the main supplier to Dick’s Sporting Goods, a national retailer, is having supply chain issues. The same issues are also affecting other industries that rely on outsourced manufacturing.

Despite the upward global trend in the demand for sneakers, with projected sales crossing the 100 Billion per year mark, Nike lowered its internal fiscal 2022 outlook due to the disruption in the global supply chain. Longer transit times, labor shortages abroad with prolonged production shutdowns in Vietnam, a major player in the manufacturing of Nike brand shoes.

CNBC also reported that “In a recent conference call, Nike chief financial officer Matt Friend said the company anticipates its entire business will see short-term inventory shortages over the next few quarters.”

It stands to reason that if the majority of the sneakers were manufactured in the United States, it stands likely that it would alleviate the pressure on the not being able to meet demand because of a disrupted global supply chain.

Focusing specifically on Black Americans, there doesn’t seem to be many opportunities in retail ownership for them in the retail sector which is dominated by a few national retail chains.

NBC News in a report about the $70B generated by sneakers last year, says that Black retailers saw little of that. They write “Black culture and influence made ‘athleisure’ a phenomenon, but only a handful of Black retail owners are benefitting from the trend.”

Only 5 percent of sneaker retailers in the United States are Black US Citizens.
“It’s a white boys’ club, like most things,” said James Whitner in referring to the lack of Black retail ownership James Whitner, a Black man who has carved out a successful niche with boutique apparel and sneakers stores in several cities. “There are people aware of it, but their privilege doesn’t force them to have to change it.”

When it comes to sneakers, the industry shows that black so-called dollars spent do not translate into much by way of ownership and employment opportunities. Whenever a new Black-owned sneaker company does come along like the Big Baller brand launched by US entrepreneur LaVar Ball, the business is, like the big corporate brands, reliant on the same exploitive supply chain.

Black Americans are the number one consumers of a 70 Billion Dollar sneaker industry, and not one shoe is being manufactured in any US city or rural town for that matter and if they had the inclination, the consumer base could boycott the industry until the sneakers are made not just in the USA but providing the new employment opportunities to urban working-class communities.

One bright spot towards that end, back in 2017, Fortune magazine reported that the number two U.S based sports apparel brand Under Armor, “debuted an initial line of apparel that was manufactured at the company’s new innovation center in Baltimore. And that, “Under Armour and other athletic brands, are beginning to experiment with U.S. manufacturing, often by tinkering with limited-run collections to test both the process and the prices that customers are willing to pay for domestic goods”.

Perhaps due to the supply issues brought on by the global coronavirus pandemic, big brands will be pushed to speed up their plans for domestic manufacturing in the US, often the number one consumers of their products.