Slovenian footwear producer Peko may introduce franchise program

Footwear producer Peko is considering reorganization plan which includes the introduction of a franchise system.

Slovenian leather fashion shoes producer Peko is planning to change its distribution model and is considering the introduction of a franchise model, the company’s CEO, Slavko Despotovic, said as quoted by local media in the beginning of October 2013.

The reorganization program will emphasize on the production of fashion shoes and the development of wholesale in foreign market within the company’s existing network, daily Slovenian media Dnevnik said.

The introduction of a franchise system will diminish the risks associated with retail distribution and will increase the inventory turnover.

The company has been struggling with liquidity problems. It plans to raise some 1.0 million euros from the sale of 10 to 15 of its properties in Serbia.

However, employee lay-offs are not part of the new policy. Currently, Peko employs some 200 workers mainly in development and production. It has retail network in Slovenia, Croatia, Serbia and Macedonia.

 Peko, established in 1903, is one of the oldest manufacturers and distributors in Slovenia. The company went insolvent in 2001. It is majority state-owned. It was almost bought by Croatian steel company Osimpex until it suddenly aborted its offer in May this year.