Tampere-based Palmroth shoe manufacturers file for debt restructuring

Workers hope losses will turn into profits

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The last Tampere-based shoe factory Hamken Oy has filed for debt restructuring and protection from its creditors.
      At EUR eight million the liabilities of the company, also known as the boot & shoe manufacturers Palmroth, are one and a half times greater than the firm’s turnover, which currently stands at EUR 5.4 million.
      The Hamken Oy managing director Pauli Suutarinen, who was only appointed last summer, filed the company’s debt restructuring application with the Tampere District Court on Tuesday.
      Based on statements from creditors, the court will decide within a week whether to accept the application.
     
The debt restructuring only concerns Hamken Oy, which has around 120 employees.
      The company’s workers at both the Tampere and Virrat factories were informed of the measure the day the application was filed.
      "This did not come as a surprise. For some time now we have not had enough work", shoe coverings cutter Auli Kaivanto said.
      Second-generation factory owner, Pertti Palmrooth, 75, says he is retired, but still visits the factory every day.
      When in the 1930s the city of Tampere boasted with around 20 shoe factories, Hamken has for years been the only one left.
      There is light at the end of the tunnel, however. According to marketing director Petrina Palmroth, this year's number of orders shows an increase of 15 per cent compared with last year.
      "Lay-offs have been called off and full employment will continue at least until the end of the year", managing director Suutarinen promises.
      Half of the production is sold abroad.
      According to Suutarinen, the quality of Palmroth products is second to none. "As a brand we are as strong as Marimekko", he says.
      "At the moment we are seeking ways to cut costs to bring our prices below the EUR 100 mark. But we will never lower ourselves to the level of low-cost imports from countries like China."


Links:
  ShoeInfoNet Finland
  Pertti Palmroth

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