Sports Business/03/24/2020

La Sportiva: We Also Have to Stop Supplying the Online Trade

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Now in Italy, companies are also at a standstill. The new tightening of measures to contain the coronavirus in Italy presents the sports industry with new challenges. Lorenzo Delladio, CEO of La Sportiva, explains what the forced closure means.

Lorenzo Delladio has been CEO of La Sportiva since 2015. His grandfather Narciso Delladio founded the company in the 1920s.
Lorenzo Delladio ist seit 2015 CEO von La Sportiva. Sein Großvater Narciso Delladio gründete das Unternehmen in den 1920er Jahren.

The situation in Italy is not easing. For about a week and a half now, the shops in Italy have been closed, but the coronavirus continues to spread rapidly. Last weekend, the Italian government therefore decided to extend the measures. As of now, all 'non-essential' companies and factories in the country are closed. This also affects the footwear specialist La Sportiva. The family-owned company from Ziano di Fiemme in Trento, where a large part of the production takes place, has had to adapt to new conditions in the past few days several times. Lorenzo Delladio, CEO and grandson of the company's founder, describes the situation. Mr Delladio, what is the current situation at La Sportiva in Italy?
Lorenzo Delladio: Up to now the company has had about 60 people working in shifts in the warehouse, sales and customer service departments, but from today, according to the decree of the Prime Minister, the company has suspended all deliveries, so the company is closed. Sales, marketing, administration and a small part of customer service - two people - work from home. Production is at a standstill.

But how do you keep the business running at a reasonable level?
We work with video conferences for daily meetings in the departments. There are many WhatsApp-groups for quick coordination. The IT department had to make all company servers accessible from the outside within two days and provide laptops for employees who can work from home - some 100 percent and some 50 percent.

Closure of Online Trading

How many of your global retailers are currently affected by the crisis and have already had to close?
In Italy, 100 percent of shops are affected, in the rest of Europe there are countries where 50 percent of shops have already closed, and others a little less. But the border blockade has forced us to stop all deliveries, except to Japan and the United States, where business is still normal.

The decree of Saturday evening has imposed the closure of the entire industry, including online shops. So from Wednesday 25 March, we will also stop deliveries to e-commerce.

How are you reacting to the situation in the retail sector? Have you taken measures to help commerce?
We offer a range of options: Deferral of payments, cancellation of orders already placed, stockpiling of goods for retailers waiting to reopen. We are trying to counter the trade with all the means at our disposal.

Deliveries from China Delayed

Let's talk about the production: how badly is your supply chain affected by the crisis?

Yes, the impact on production was the first effect of the crisis: spring/summer 21 samples came too late and also some spring/summer 20 products manufactured in factories in China. Unfortunately, even with the reopening of the factories in Fujan, some fabric and component suppliers did not open at the same time and delayed deliveries, resulting in reduced efficiency. This is currently a widespread problem in the fashion industry.

What kind of aid does the government offer to industry and commerce in Italy? There are a number of measures, but we are concerned that they are not sufficient.

The Italian Government's Package of Measures

These measures have so far been put in place by the Italian Government:

For retailers, the decree provides for a tax credit of 60 percent of the shop rent for the month of March, but only for the days when the shop was closed. The payment is to be made in May at the latest. For employees with an income of up to 40,000 euros who continue to work during the forced closure, the employer must pay an additional bonus of 100 euros. Parents who have to look after their children at home because of the school closures are entitled to a total of 15 days of vacation, for which a bonus of 50 percent of salary will be paid. Alternatively, a tax-free bonus of 600 euros can be claimed for care services. Freelancers without social insurance are entitled to a compensation for the month of March in the amount of 600 euros.

Further assistance payments are on the way. Italy has passed a financial package totalling 300 million euros to compensate employees for loss of wages. However, the modalities have not yet been determined.