Fox fashion owner: Small Israeli fashion chains doomed
Comment comes week after one of Israel's oldest textile and clothing companies, Srigamish, closed down.
"In four years there will be four large Israeli fashion chains that will have a 20% to 30% share of the market, and the rest will be controlled by foreign chains," said Harel Wizel, controlling owner of the Fox fashion group, speaking to investors on Wednesday in Tel Aviv.
"What we have seen happen all over the world will happen here too. In Poland, Thailand and Singapore, 90% of the fashion stores are international chains and the rest are strong local [brands]. Anyone who thinks it will be different here is simply wrong," Wizel added.
In what seemed proof of his argument, though not directly connected to Wednesday's conference, one of Israel's oldest textile and clothing companies, Srigamish, closed down its business last week and fired its workers. Srigamish was founded in 1957 and is known for its Mishmish brand of children's clothes, and has over 45 stores in Israel that are owned by franchisees. The stores will continue to operate, though it is not clear what goods they will sell and who they will buy them from. Haim Halivni, owner of Srigamish, confirmed the report. "We have not yet decided what we will do," he said. The company fired 15 employees and closed the factory, he said.
Last week, another fashion chain, Grip, asked the court for protection from creditors - whom it owes NIS 31 million. Another chain, Bonita, is also in serious financial trouble and has cash flow problems after its bankers refused to give it any additional credit. Other chains are also complaining because of the economic slowdown.
Wizel put his money where his mouth is last year when he brought the American Eagle brand to Israel, and last month Fox said it is negotiating to represent the New York fashion brand.
Fox released its second quarter financial results on Tuesday, poting a large rise in sales and net profit, but a drop in operating profit.