As buyers reduce purchasing and default to readily available products at specialty running and mainstream sneaker stores, distribution will rear its head as the de facto cause of collapse for brands without the brand recognition to move fans into the purchase funnel.
In Olympic years advertising spend increases and as bigger brands vie to keep attention on their products and athletes, smaller brands will experience decreased margins although they may grow. This will place pressure on them leading to either layoffs or investors being unwilling to fund the next round. This is especially the case as premium products from every sneaker brand in the country keep showing up in off- price retail.
As bigger brands clear inventory making it easier for consumers to get shoes they would have never purchases at SRP, sluggish sales will filter into retail outlets extending the promotional environment making consumers question if it is wise to spend full price on any new release at all.
Expect layoffs from smaller brands and potentially the death or acquisition of some of your favorite small sneaker companies this year.
