Birkenstock, the luxury sandal manufacturer based in Linz am Rhein, Rhineland-Palatinate, has recently made a significant announcement regarding its future expansion plans. The company, which was acquired by investment fund L Catterton and Financière Agache four months ago for approximately 4 billion euros, intends to invest a staggering 100 million euros in its industrial growth.
One of the major investments that Birkenstock plans to make is the modernization of its largest factory in Görlitz, east Saxony. This factory, known for producing high-quality cork latex sandals, currently employs 1,900 individuals. With an investment of 50 million euros, the aim is to upgrade the facility and enhance production capabilities.
In addition, Birkenstock is also looking to construct a new factory dedicated to the manufacturing of synthetic sandals. The company has allocated another 50 million euros for this project. The decision to expand into synthetic sandals aligns with the growth plans mentioned by Bernard Arnault, the head of Financière Agache and linked to L Catterton through LVMH, during the acquisition. Arnault expressed his intent to help Birkenstock tap into its significant growth potential.
The search for a suitable location for the new factory is underway, with three or four potential sites in eastern Germany and north Bavaria being considered. Once operational, the facility is expected to initially generate 400 job opportunities, with future plans to expand the workforce to 1,000 employees. The final decision on the location is set to be made in the autumn of 2021, and production at the new factory is anticipated to commence in 2023.
Birkenstock’s presence is not limited to its existing facilities in Sankt Katharinen and Vettelschoß. The company already employs around 5,500 individuals globally, and this number is consistently growing. Despite facing two months of factory closures in 2020, Birkenstock managed to generate a similar level of revenue as the previous year, amounting to around 720 million euros, with a net income of 130 million euros.
This significant investment in industrial expansion reflects Birkenstock’s commitment to strengthening its global presence and meeting the increasing demand for its premium sandals. By upgrading their existing factory and constructing a new one, the company aims to enhance production capacity and create more employment opportunities. With the backing of L Catterton and Financière Agache, Birkenstock is well-positioned to achieve significant growth in the future.
As consumers around the world continue to prioritize comfort and sustainability in their footwear choices, Birkenstock’s iconic sandals remain a staple in the global fashion industry. The company’s dedication to investing in its manufacturing capabilities showcases its determination to cater to this demand and solidify its position as a leader in the market.
Useful Links:
– [Birkenstock Official Website](https://www.birkenstock.com/)
– [Birkenstock News and Updates](https://www.birkenstock-group.com/en/newsroom/)
