Entrepreneur shares Chinese outsourcing horror story behind liquidation

The founder of Bennetts Boots has cited outsourcing to China as a reason why the company failed.

According to an interview last year Start Up Smart, Bennetts was launched in 2007 by Amanda Bennett at the Melbourne Shoe Fair. She came up with the idea of boots with an extra-wide calf the year before while on a working holiday in China.

Bennetts achieved initial success and deals with major retailers.

However, the company was put into liquidation on May 15. Bennett has spoken out about the reasons the business collapsed. Contract manufacturers in China cut corners, with a shipment of poor-quality boots of shabby construction and low-grade leather being received.

“Success to the Chinese is being able to do things behind your back and get away with it,” she told BRW.

“I don’t mean that in a derogatory way; it’s a cultural thing… I’m not saying they [the manufacturers] are bad people; they’ve got families to feed.” 

The boots made at Wenzhou, China, were initially as ordered, but a following shipment showed evidence of cut corners, after the Chinese factory manager noticed low-grade leather offcuts on the factory floor.

“It wasn’t just all our money; it was money we had borrowed from the bank,” said Bennett.

“We’d just opened a store in Sydney with a six-month lease, and lost $100,000 because we didn’t have any stock. Then there was the million dollars in lost sales.

Image: http://www.femail.com.au/