Georgia shoe maker lays off most of workforce after Adidas halts Yeezy production


New York
CNN

Okabashi, an Adidas manufacturing partner and family-owned footwear company in Buford, Georgia, has laid off 142 employees as a result of Adidas ending its partnership with Ye, formerly known as Kanye West.

“So far there are not enough orders to keep all employees busy at work. Unfortunately, Okabashi is announcing the immediate layoff of 142 employees,” the statement said.

That was equal to two-thirds of the company’s workforce, a company spokeswoman told CNN Friday.

Adidas ( ADDDF ) cut ties with the musician last month after the now-infamous anti-Semitic tirade. The sports club said it “does not tolerate anti-Semitism and any other form of hate speech” and called his latest comments “unacceptable, hateful and dangerous”.

The sale and production of Yeezy brand products has stopped, as have payments to Ye and his companies.

“Adidas clearly does not support hate speech and Okabashi also supports these values,” the statement said. “Unfortunately, this means Okabashi has to stop its current production for Adidas,” the company said.

Okabashi has been the US footwear contract manufacturing partner for Adidas Yeezy products since April 2020, the company said in a statement to CNN.

The company is “coordinating with local government agencies and manufacturers to provide assistance and alternative employment opportunities to affected team members,” he said.

The shoemaker said “laid-off workers will receive severance pay and comprehensive health coverage.”

As one of the remaining 1% of US footwear manufacturers, Okabashi will continue to produce its own branded products and is looking for other partnership opportunities,” the statement said.

Okabashi, which has been in business since 1984, manufactures sandals that are “made from approximately 25% recycled materials,” according to its company website.

The prospects of dealing with unsold Yeezy gear are very challenging.

There is an environmental impact to the destruction or disposal of unsold goods. The production of clothes and other clothing comes at a high environmental cost due to greenhouse gas emissions, significant water use, water pollution and textile waste. Typical methods of destroying unwanted clothing (such as using incinerators) only exacerbate the problem.

Rebranding merchandise to camouflage controversy is another common industry tactic, experts say. It involves removing or somehow disguising the distressed brand logo.

Yeezy products are very distinctive in their style and design, so rebranding may not work, according to Burt Flickinger, retail expert and managing director of retail consultancy Strategic Resource Group. f

The most likely destination for unwanted Yeezy products could be foreign markets, which are often the solution for problematic merchandise. Sending goods overseas to countries that need it and where the durability of a product is more important than brand or fashion, the industry lags behind.