The L-Fashion Group has agreed to stop distributing the Chinese sports brand in the 11 European countries covered by a contract from the end of this year, says Vesa Luhtanen, chief executive of the Finnish-based company, confirming in part a report in sport-guide.com. The agreement with Li Ning Company, which was first signed in 2011, covers Finland, Germany, Austria, Switzerland, France, Italy, the Benelux countries, Russia, Slovenia and Croatia.
To replace the business, it has decided to introduce its higher-priced Rukka brand in these markets, adding a line of specific clothing for e-bike riding from the autumn/winter 2019/20 season, in addition to clothing for regular cycling, motorcycling, skiwear, running, fitness and golf.
L-Fashion has also immediately started distributing the high-end line of outdoor shoes of Dachstein, the well-known Austrian brand, in the countries where it has its own subsidiaries: Germany, Switzerland, France, Benelux, Italy, Spain and Russia. The move follows an agreement to take over the 51 percent stake that it still didn't have in the Austrian company, after acquiring an initial stake of 49 percent last June. More on this in our Outdoor Industry Compass.
Previously owned by Austro Holding, Dachstein has been growing nicely in the last fiv e years under the management of a new chief executive, Oliver Wieser, and a new sales manager, Christian Wolsegger, who will remain in their current positions. It has been developing stylish new products with an Austrian flavor as well as more technical products that use strong ingredient brands like Gore-Tex and Vibram.
Strong growth in Austria helped Dachstein to raise its total turnover by about 15 percent last year to around €10 million. The first international sales synergies with the L-Fashion Group should start to appear with the spring/summer 2020 season.
The Finnish group has been growing strongly in the last few years with its Icepeak brand, adding footwear from the autumn/winter 2016/17 season. Icepeak now offers a very complete range of clothing and footwear in a relatively low price range, comparable to that of Li-Ning. Its range of shoes and that of Dachstein were shown side by side in the group's stand at the recent Ispo Munich show, with a clearly distinct price positioning.
L-Fashion also owns other brands including Luhta and Torstai. Since signing the initial deal with Li Ning in 2011, L-Fashion has been trying to reposition its Li-Ning brand in various ways in the European market, most recently by slashing prices on many of its products, but the results have remained below expectations.
We could not determine by press time whether Li Ning had set up or is planning to establish a new sales structure for its products in Europe.