Allbirds - A Merino success story
- By: "Farm Tender" News
- Ag Tech News
- Feb 02, 2018
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Allbirds shoe business growing as it highlights connection to NZ Merino Farmers
Imitation might be the sincerest form of flattery, but Allbirds wool shoes founder Tim Brown has had enough of the recognition from some rivals.
Late last year Allbirds filed a trade dress infringement lawsuit in the Northern District of California against shoe giant Steve Madden for allegedly copying its signature wool lace-up sneakers.
Steve Madden is not the only established company venturing into the woollen shoes business. Adidas, Nike and Puma are also using wool in sneakers and clothing, as more consumers seek out natural fibres over synthetic.
It is all good news for New Zealand's 400 merino farmers who are riding the wave of a boom in demand for the fine fibre.
Since mid-2014, prices for 17.3-17.7-micron merino have risen from just below $13 per kilogram, to $28/kg today.
Tim Brown takes Allbirds staff, who are largely American, to high country stations such as Walter Peak to see where merino is farmed.
Former All White Brown said from his office in San Francisco that wool was "having a moment", especially in the United States where Silicon Valley tastemakers enjoy padding about in his shoes.
"They want to understand how things are made, they care about sustainability and New Zealand merino farmers are well placed to take advantage of that momentum."
One of the key points of difference with rival wool shoes is the fact Allbirds uses New Zealand merino only and they highlight the connection to Kiwi farmers.
An Allbirds wool runner and a Steve Madden wool traveller sneaker. Allbirds has sued Steve Madden for allegedly copying its wool lace-up sneakers.
Christchurch-based company NZ Merino collects the fibre and sends it to Italian textile manufacturer Reda, where it is felted for the shoes.
"We're not just using any wool, we're using the best wool in the world, some of the finest micron fibre also used to make $5000 suits by Armani," Brown, 36, said.
The fact the "behemoths" of the sports shoe world are breathing down his neck did not scare him.
"The idea that those big companies are beginning to consider it [wool] is a huge compliment, we're in a competitive situation. The number of knock-offs we're seeing of our product is crazy."
There are other differences. Traditional sneaker companies operate according to a different business model, one based on "old school" seasonal ranges and bricks and mortar stores. Allbirds was designed to be only online from the beginning.
"Those businesses have been reliant on synthetics and leathers and are entrenched in a low cost method of manufacturing that supports the wholesale model," Brown said.
NZ Merino chief executive John Brakenridge said he was confident Allbirds would prevail.
"I've a huge amount of confidence in that they are the category leaders, they have substance behind their story in terms of connecting with farmers, and they're bringing in the right amount of capital to continue the momentum.
"To give an analogy, NZ Merino has been involved with Icebreaker and Smart Wool which have established new wool categories for sportswear and socks. Both those brands as category leaders have dominated their sectors," Brakenridge said.
Allbirds will continue its focus on casual footwear, and steer away from performance and fashion products. Traditionally, comfortable shoes had been ugly, said Brown, but Allbirds was turning that idea on its head.
Brown would not confirm reports his is the world's largest direct-to-consumer shoe company.
"We've been really pleased with the response, we're doing it at a scale that's up there," was as far as he was prepared to go.
He and co-founder Joey Zwillinger now employ just under 100 workers, the majority of whom are located at Allbirds San Francisco headquarters and retail store, with the balance located at the New York City retail store. A Nashville distribution centre is used, but the staff there are not Allbirds employees. The shoes are manufactured in South Korea.
Brown has given staff the opportunity to visit the South Island high country farms where the merino comes from, and watch a shearing competition in Invercargill.
But while it may be merino wool's "moment", the same cannot be said of the coarse wool sector, which by volume is 95 per cent of New Zealand's total output.
"Except for merino, the wool industry has done a horrible job of marketing itself, you've seen the rise of synthetics and polar fleece where it masquerades as natural fibre. But it feels like the tide is turning," Brown said.
Picture - Allbirds co-founder Tim Brown started his business in 2014.
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