CEOs on Coronavirus: Titan’s Joe Ouaknine Says ‘A Lot of Companies Are Going to Go Under — Maybe I’m One of Them’
In a new series, top leaders from across the footwear industry discuss the deep impact of the coronavirus and the challenging road ahead.
For Joe Ouaknine, founder and chairman of California footwear firm Titan Industries, business was completely halted last week when California put coronavirus lockdowns in place across the state.
The company, which owns Badgley Mischka and holds the license for Splendid, has closed its headquarters and warehouse — and can’t ship orders to customers. Ouaknine is hopeful that government aid will help his business and others get back on track. If not, he is prepping to make difficult decisions that could include layoffs.
Here, Ouaknine discussed the state of his business and the impact on the industry as a whole.
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Since the outbreak and California lock down, how have you been impacted?
Joe Ouaknine: “We had to close [our office] last week. They forced us to shut down our warehouse. We aren’t essential. We cannot ship open orders that we have. We cannot [operate] our direct-to-consumer business.”
If you can’t ship, what is the state of your e-commerce business?
JO: “I specialize in special-occasion shoes and thought ‘Who is going to buy shoes for a wedding or prom?’ But I’m getting 500 to 600 orders a day. So I’m wrong. It’s a good sign, but I cannot ship so they will cancel. And with the stores closing, it’s a ripple effect. It’s very frustrating.”
What are you doing to try and keep business moving?
JO: “We have to be patient and wait for orders from the government. What we did as a company was decide to pay everybody for two pay periods then evaluate. But there’s no money coming in, just money coming out. It is what it is and we will go from there. There’s nothing we can do.”
How have you been impacted specifically in China?
JO: “Our office in China is open and operating. They are going ahead with sample making for the next show [but] we don’t know if it will happen or not. Our factories are receiving orders, which we don’t know if we will be able to receive.”
Where do you think the industry will be long-term following this pandemic?
JO: “A lot of companies are going to go under and maybe I’m one of them. In my opinion, I can’t see the light at the end of the tunnel. I wish I knew when this was going to end. This is going to peak by the end of April, so we won’t see any relief until June at the earliest. But if the government does what they say they are going to do and help workers and help small businesses with loans and so on, everyone will be saved. But if they don’t react quick enough, everyone is going to stop paying.”
What profound changes will we see as a result?
JO: “The government is giving us no other choice. They are putting us out of business. In three weeks from now, if things have not improved, I have to make cuts. I will have to lay off everyone since I won’t be operating — and then rehire when we reopen. I’m paying people by courtesy. After that, we will see. Right now, I’m leaning towards just shutting down. This is in every industry.”
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