The Czech owner of Alpina, the Slovenian-based sports footwear maker, will close down part of production in Žiri in the west of the country and move it to a factory in Bosnia-Herzegovina as a result of which 60 jobs in Slovenia will be lost by the end of the year. One of the plants in Bosnia has been shut down recently.

K&H, a company that is part of the Franco de Poisd'eau & CIE group, bought Alpina in 2022 from Bank Assets Management Company, Slovenia's bad bank, which has since been dissolved.

Founded in 1947, Alpina has been facing a drop in sales and an increase in inventories, with the situation deteriorating further this year due to the poor winter season, which slashed demand for items such as ski boots.

The company has told the Slovenian Press Agency that part of the production lines, including the assembly lines for skiing, cross-country skiing and hiking boots, will be moved to a production unit in Bosnia-Herzegovina.

The tool and machine facility and plastic injection moulding unit will remain at the company's headquarters in Žiri, as will all the jobs in the development, marketing and sales departments.

One of plants in Bosnia shut down

The plan to lay off 60 out of the 228 workers in Žiri is part of a broader reorganisation and optimisation plan. The management has pledged to use soft workforce reduction measures as much as possible.

The Alpina group employed 1,012 people at the end of 2023. By the end of June, the number had been reduced to 948 and further still at the end of July as the company shut down one of its two production units in Bosnia-Herzegovina, which employed 90 people.

After the lay-offs in Žiri, the group's headcount will have been reduced to roughly 800 by the end of 2024.

Last year, Alpina posted a loss of €1.7 million on €38.8 million in sales revenue. The management projects for sales to drop to €28-29 million this year, 25% below the original plan, and the loss to increase to €3 million.

The company is looking for financing options in the form of loans from various financial institutions as well as from the Economy Ministry. It has concluded no agreements yet.

Director Amadea Kavčič Jesenovec said the planned workforce reduction plan was necessary to keep the company alive.

Decrease in demand, high costs

The reasons are a decrease in demand, the high costs of energy, transport and maintenance, the increase in the minimum wage and the immense pressure from the competition in terms of low production prices.

The output has been declining since 2017, when Alpina produced 642,000 pairs of shoes and boots. The number dropped to 403,000 in 2019 and to 141,000 in 2023. This year, the company is to put out only 46,000 pairs.

Since last year, Alpina has thus focused entirely on developing and producing sports footwear, with the group's long-term strategy being to remain a leading manufacturer of cross-country ski boots and to again grow on the Alpine ski boot market.

The company has been outfitting some of the world's leading cross-country and biathlon athletes. In the past Alpine skiers too were winning medals at the biggest sporting events in its ski boots. Alpina is also known for its sturdy hiking boots.

Despite the financial problems and redundancies in production, the company said there was no shortage of innovative ideas. "The management and owners are aware that different and innovative products are the only true way to increase sales."

The management also noted that further development would not have been possible without the financial support of the owners in the past year and a half, which provided the required funds for the development of a new ski boot.