Adidas could burn $500 million in unsold Yeezy sneakers

75050011 (2).jpg

After breaking up with Kanye West, the famous brand apparently does not know what to do with almost half a billion dollars’ worth of unsold merchandise.

For a while, Kanye West's YeezY sneakers were one of the most coveted pairs in the entire world, but that has changed these days - and the brand's parent company, Adidas, is in trouble.

The German sneaker giant has an estimated $300 million to $500 million worth of unsold Yeezy sneakers in its warehouses after cutting ties with West following his public turn on anti-Semitism, the Washington Post reported. The final decision on what the company will do with the sneaker is still undecided, but options range from selling off the Yeezy brand to literally burning it.

At the end of October, Adidas finally parted ways with West, as one of the last companies associated with the rapper to do so, also causing him to lose his billionaire status. At first, brand officials thought they could rebrand Yeezy sneakers and sell them at a discount, but that strategy appears to be unsustainable, with brand officials recently saying it could lead to excessive losses.

This month, the company announced that it could lose as much as $1.3 billion in revenue and $530 million in operating profit if it doesn't find a new use for the Yeezy sneakers. "What makes this so dramatic is the scale of the whole situation," analyst Tom Nikic told the Post. "It's a really big, significant part of Adidas' business."

At this point, Adidas has a few options for what to do with the unsold footwear, but none of them are all that appealing. He could sell them at a discount and without a label, as "zombie Yeezy", as Nikic called them, which many members of the general public would still interpret as profiting from anti-Semites and beyond. Other avenues include liquidating the shoes through discount stores or selling them by the kilo.

A more unpleasant choice would be to completely destroy the shoes, by burning them. The practice is not uncommon in the fashion industry, and brands including Burberry and Louis Vuitton have deliberately destroyed products in the past. However, that too comes with a ton of negative attention, given the ethical and environmental issues involved in setting millions of dollars’ worth of goods on fire for no real reason.

Perhaps, as Professor Elizabeth Napier suggested to the Washington Post, Adidas will donate the Yeezy to disaster relief efforts, such as efforts to help those affected by the recent earthquakes in Turkey and Syria. While that would certainly give the company goodwill in the public eye, it still wouldn't help financially, meaning even that is a lost prospect for Adidas.

Follow us on instagram