Scotch & Soda: Expert sees more than just logistics problems at the brand

On June 12, the Northern European branch of Scotch & Soda was declared bankrupt due to logistical problems. In addition, it failed to become profitable. Scotch & Soda’s Northern European operations collapsed one year after the restart under Bluestar Alliance. According to business expert Cor Molenaar, the bankruptcy is not only due to logistical problems.

“The fashion industry is going through a difficult time,” Molenaar said by phone. Consumer demand has been declining for some time and is changing rapidly. Companies must be able to anticipate this. “Scotch & Soda doesn’t seem to have adjusted its strategy after the restart, and that seems to be the core problem.”

Molenaar refers to fast fashion giants such as Zara and Shein. “They have a nice system that works with small inventories, allowing them to respond quickly to consumer demand. Those who do not have such a system will find it difficult to compete.”

The appointed administrators report that they are again working on a restart. Molenaar indicates that a potential acquirer must adjust Scotch & Soda’s strategy if the company is to succeed again. “First, a clean sweep must be made, for example by selling off remaining stock. Then, as it were, you can start again with a new approach,” concludes the business expert.