There is hardly a day where not politicians or functionaries of organizations and other lobbyists feel the end of the general recession near or complain about the current situation.

Our position on this subject is well-known: Aside from business cycles and relative good figures in the Luxury, PremiumEconomy and Economy segment, the sale of consumer goods is negatively influenced and it does not look like this is going to change essentially in 2005.

The people are amidst a restructuring of their expenditures. Aside from saving more, a lot more people put their money under the mattress and don’t take it to the bank. And they spend more money on health care, education and training. Compelled by circumstances, more money goes to taxes, fees and private “operating expenses” such as gas, rent and energy. Last but not least, they are putting money aside for the case of becoming unemployed. The resulting partial abandonment of consumption of how it was done in the 70’s and 80’s of the past century has been crossed off as part of the change of values. He who is no longer awaiting the end of the lagging consumption, but is orienting and positioning himself anew is better off overall.

However, there is one thing which could present us with a problem: The seemingly never-ending relocation of jobs from Europe to the Far East; mainly to China.

The time is ripe where we wish for the EU or if not the EU than countries such as Germany, France, Spain and Italy peer at job losses with effective counteractive measures in the pocket. It is those international conglomerates who might be pushing Europe to the edge of financial ruin. Of course, nowadays we do need global production structures for products with a global distribution.

Production has to follow the sale, but it cannot work out well, if these conglomerates produce products for the Luxury segment of the market in low wage countries, to discharge a portion of the value added abroad and then sell those products in countries, where they first eliminated the jobs and lost a fortune through bad business decisions.

There is no reason in this world why Italian shoes of the luxury class at a price range of € 400.- to € 500.- need to be produced in China for € 35.- a pair, because the production in Europe is too expensive. If a marketer of a Swiss shirt brand orders shirts in Italy, the Italian however passes on the order to a Turkish business, which in turn is having the shirts tailored as cheaply as possible in Romania, it is going to have to come to a catastrophe, especially, since this is not an isolated case but only an example of how the textile industry functions nowadays. To prevent this catastrophe from happening in the eleventh hour is only going to be possible, if industry and retail develop new strategies and get on the right track.

Total revenue is made wherever there are corresponding revenues.