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Birkenstock Footprint Sandals, Inc.

Birkenstock Footprint Sandals, Inc.

8171 Redwood Boulevard
Novato, California 94945
U.S.A.
Telephone: (415) 892-4200
Toll Free: (800) 487-9255
Fax: (415) 899-1324
Web site: http://www.birkenstock.com

Private Company
Incorporated:
1972
Employees: 230
Sales: $95 million (2000 est.)
NAIC: 42234 Footwear Wholesalers; 44821 Shoe Stores (Retail)

Birkenstock Footprint Sandals, Inc. is the primary U.S. distributor for Birkenstock Original Contoured Footbed products made by Germanys Birkenstock Orthopädie GmbH. The Birkenstock family of Germany has a long history in the shoe-making trade. Throughout the first half of the 20th century, the company marketed orthopedic shoe inserts. In the 1960s, Birkenstock used the principles behind these products to create a homey-looking sandal, designed with comfort foremost in mind. After these shoes were introduced to the United States in the late 1960s, they gained popularity with hippies and academics and were sold mainly in health food stores before reaching a mass market in the late 1980s. In 2001 Birkenstock was selling sandals, clogs, shoes, and boots in over 400 styles, colors, or materials to men, women, and children. Top fashion designers in the United States and Europe use Birkenstocks in their shows emphasizing the latest trends. Specialized Birkenstocks are sold to podiatrists, other health professionals, sports enthusiasts, computer workers, and others in niche markets. Birkenstock Footprint Sandals, also known as Birkenstock USA, sells its products in company-owned stores in San Francisco and Berkeley, California; company-owned mall outlet stores in Gilroy, California, Wrentham, Massachusetts, and Orlando, Florida; over 160 licensed stores; and over 3,500 retail shoe stores and department stores, including Nordstrom, REI, Parisian, and Macys.

German Roots of Birkenstock Products

Birkenstock traces its roots to the late 18th century, when a German cobbler named Johann Adam Birkenstock, who was born in 1754, was first registered as a subject and shoemaker in the church archives of Langenbergheim, a town in the duchy of Hesse, Germany. By the end of the 19th century, Konrad Birkenstock, a descendant, owned two shoe stores in Frankfort, the capital of Hesse. These stores would become the foundation of the modern Birkenstock businesses.

Konrad Birkenstock had the inspiration that would form the basis for his familys business for the next hundred years. At the time, shoes were made with flat soles, despite the fact that the bottom of the human foot is curved. Birkenstock realized that a sole curved to complement the shape of the foot would be more comfortable than a flat surface. In 1897, he designed the first Birkenstock contoured shoe last, a tool used in shoe-making, to help his cobblers make customized footwear for patrons.

On the strength of this innovation, Konrad Birkenstock began to spread the word of his new kind of shoe. He gave frequent talks to other leading members of the shoemakers guild, explaining his fully contoured footbed. Birkenstock traveled throughout Germany promoting his new idea, and licensed other cobblers to produce shoes made with his technique. By the start of the 20th century, he had moved beyond the borders of his native country, traveling to Austria and Switzerland as well.

By 1902, however, the popularity of custom-made shoes had begun to wane, as factory-manufactured footwear began to be more widely distributed. Adapting the essence of his idea for this new and growing market, Konrad Birkenstock developed flexible, contoured arch supports, which could be inserted into mass-produced shoes to make them more comfortable. Birkenstocks arch supports, which bent to accommodate the foot, differed from the other supports on the market, which were made of unyielding metal. With the rise of mass-produced shoes, the Birkenstock family business moved away from the crafting of custom-designed shoes to concentrate on the production of shoe inserts.

In 1908, Birkenstock pushed forward with the foot support when he developed his own substance and built molding presses to manufacture the flexible orthopedic insert. Four years later, the firm continued its technological innovation when it created a new method for using rubber, a material just beginning to be developed, in shoe inserts. In 1913, Konrad Birkenstocks son Carl joined the family firm, insuring that continuity in the companys activities would be possible. In the wake of Carls arrival, Konrad Birkenstock committed the bulk of his familys considerable assets to the research and development of rubber as a material for foot supports.

In the same year that Birkenstock undertook these efforts, Germany entered World War I. The companys contribution to the war was the design and manufacture of orthopedic shoes to be worn by wounded soldiers in a large military hospital in Frankfort. As a result of these activities, Birkenstocks products came to the attention of the doctor in charge of the hospital, who praised his efforts and encouraged him to market his orthopedic inserts more widely. In 1915, Carl Birkenstock began to travel throughout Germany, introducing the familys products to new buyers.

Two years after the end of World War I, a second Birkenstock brother, Heinrich, entered the family business. Though Germanys economy suffered following the war, the Birkenstock business thrived. The family opened a branch in Vienna, the capital of Austria, in 1923, and soon expanded its distribution to countries across Europe, selling orthopedic inserts in Austria, Switzerland, France, Italy, Belgium, Czechoslovakia, Holland, Luxembourg, Denmark, Sweden, and Norway. To accommodate this expanded customer base, Birkenstock opened a larger factory in the town of Friedberg, in Hesse. When demand for the Birkenstock product necessitated even greater manufacturing capacity, the company added night shifts at the factory.

The late 1920s and early 1930s saw the company make many changes and additions to its product line. In 1926 and again in 1935, Birkenstock expanded its line of footbeds, adding different widths to better fit the foot and to accommodate fashionable shoes. In 1937, Birkenstock further altered the footbed, adding a ring, which it patented, that allowed the insert to be easily adjusted to fit each foot. By 1928, Birkenstocks success had attracted the notice of its competitors, and other companies began to market non-metallic arch supports. For the first time, the company had competition for its products.

With the start of the 1930s, Birkenstock expanded its education and promotion efforts beyond people who made shoes to the public itself. The company published 70,000 copies of The Foot and its Treatment, a heavily illustrated pamphlet of 50 pages, in an effort to inform customers about the companys theories of orthopedics. Two years later, in 1932, Birkenstock stepped up its education efforts when it began to offer training seminars and lectures to orthotic appliance sellers in most European countries. These sessions lasted a week, and included more than 5,000 people in the mid-1930s.

Germanys defeat in World War II changed but did not seriously disrupt Birkenstocks development. With the coming of peace in 1945, the company transferred its operations from the Frankfort area in Hesse, to the town of Bad Honnef on the Rhine. Innovation and education continued apace; in 1946 the company introduced a toe-free insert and in 1947 it began to distribute a pamphlet for shoe sellers titled Footorthotics System Birkenstock, with 112 pages and 55 illustrations. In 1950, Konrad Birkenstock, the creator of the flexible footbed and the companys driving force for half a century, died at the age of 77.

The decade following Konrad Birkenstocks death saw a number of changes in the venerable company. In 1956, Birkenstock introduced an insole made of shaped foam that was created through thermoplastic compression. Two years earlier, in 1954, a new generation of Birkenstocks had joined the family firm, when Karl Birkenstock, Carl Birkenstocks son, came aboard. Although his father envisioned the companys future exclusively in terms of orthopedic shoe inserts, the younger Birkenstock had more ambitious plans. He hoped to create a shoe that provided all of the benefits of walking barefoot. To do this, he experimented, combining his grandfather Konrads techniques of flexible, contoured arch support, with his own understanding of how the foot works and moves.

Within a decade of Karl Birkenstocks arrival at the family firm, the company had re-entered the shoe business. In 1964, it began to manufacture a shoe whose design was based on the shape and function of the human foot. The new Birkenstock shoe was built from the inside out, starting with an orthopedically-based footbed, which gave firm support to the bottom of the foot. The companys goal was to make the wearer feel that he or she was walking on a surface that would yield, such as wet sand. In order to accomplish this, Birkenstock designed a footbed made of cork, latex, and jute, which absorbed shocks to the foot. The company also added a raised toe bar, to facilitate the instinctive gripping motion of the toes, and a heel cup, to cradle the heel and better distribute the bodys weight. In 1965, Karl Birkenstock attached this sole to two simple leather straps to create a clunky, but comfortable, orthopedic sandal.

Company Perspectives:

Our purpose is to share our heartfelt belief that comfortable, healthy footwear contributes to happiness and well-being. Through our distribution of high quality footwear, we strive to create positive, harmonious relationships with employees, customers, vendors and the environment, emphasizing honesty and integrity in all we do. Within our company, our goals are to provide an atmosphere that stimulates growth and creativity among employees and to reward and encourage contributions .

Margot Fraser and the Origins of Birkenstock Footprint Sandals

One year after Birkenstock began to market its new sandals, the shoes came to the attention of Margot Fraser, a German-born dress designer who had immigrated to the United States. While she was vacationing at a spa in Bavaria, workers suggested that she try Birkenstock sandals to ease her chronic foot problems. Several months later, her foot pain greatly improved. Fraser was hooked, and she believed that other American women would also want an alternative to the uncomfortable high-fashion shoes typically marketed to women. She spread the word about Birkenstock sandals to her friends, bringing them shoes from Germany. Finally, along with her husband, a cookware importer, Fraser arranged with Karl Birkenstock to market his sandals in the United States.

When Fraser approached the owners of shoe stores about selling Birkenstock sandals in their stores, she was universally rebuffed. Repeatedly, shoe sellers assured her that no American woman would ever wear shoes that ugly, regardless of how comfortable they might be. Seeking alternate marketing channels, Fraser turned to the health food industry. We had to sell to people with a different vision, Fraser later recounted to People magazine. It was very tough at first, she told the New York Times. But it was when I went to a health fair, and people there wanted them that I got a start. They were interested in fitness. At a trade show, Fraser sold her first pair of sandals to a woman who was limping among the booths, holding her high-heeled shoes in her hands. After trying the Birkenstock sandals, this woman began wearing them constantly and also bought several pairs to sell in her health food store.

Fraser set up business in her home in Santa Cruz, California, using her garage as a warehouse. Sales of the sandals through health food stores increased, and the shoes gained a reputation for their comfort. In addition, Fraser sold the shoes through the mail. She bought shoes directly from the factory, often in lots of 20 pairs, and had them shipped parcel post to her house.

In 1971, Fraser moved her business out of her house, leasing a small office on top of a San Rafael, California, health food store for $25 a month. In 1972 she incorporated her company under the name Birkenstock Footprint Sandals, Inc., and formally became the sole U.S. distributor of Birkenstock products. Fraser hired a part-time bookkeeper and packer. We made enough money to survive, she later told the Sacramento Bee. We were pinching our pennies, but we managed. By the end of that year, the company had sold 10,000 pairs of shoes to the U.S. market, promoting the product through homemade fliers, small ads in health food publications, and booths at trade fairs and shoe shows. Often, the shoes were first bought by the owners of health food stores, who had to stand behind a cash register all day. With their recommendation, the popularity of the shoes spread through word of mouth.

While Fraser was working to sell Birkenstock products in the United States, the German parent firm was furthering its efforts to develop its line. In 1966, the company introduced a special paper, on which a customers footprint could be marked, for a better fitting shoe. In the following year, Birkenstock developed and began to use Birko-Cork, a natural thermopliable product for use in footbeds. Two years later, the company also began to sell insoles that massaged the feet in its noppy-fit sandals.

During the 1970s the popularity of Birkenstock footwear exploded, as the shoes became associated with the Bohemian lifestyle popular with young people. In the United States, sales of Birkenstock sandals grew dramatically, and the company introduced a number of new styles. In 1970, a sandal called Roma, with a strap that encircled the heel, was sent to stores. In the following year, Arizona, designed with two classic wide straps, was introduced. Overall, there were 12 different varieties of the basic Birkenstock shoe, all sold in natural earth tones.

In Germany, the Birkenstock company expanded its production facilities in order to meet the new demand. The company leased a factory in the town of St. Katharinen that housed punching presses to cut out the leather pieces for its shoes in 1974. Two years later, Birkenstock introduced Birko Foam, yet another new material for use in its shoes, and in 1978, the company began to use superelastic light material to make new specially contoured soles.

At the start of the 1980s, Birkenstock modernized its production processes further, installing computerized last-making machinery to make the molds for shoes. Two years later, Birkenstock introduced its first significant variation on the basic sandal, the thong-sandal, which it began to sell in five different styles. In the next two years, the company received nearly 40 different design protection rights from the German Patent Office for its products, including two developed for the thong sandal. In 1984 Birkenstock opened a larger warehouse for its products.

Despite the innovation of the thong sandal, sales of Birkenstock shoes began to wane in the early 1980s, as fashions shifted away from the functional and down-to-earth. We were struggling with the image that we were a hippie shoe, Fraser later told Forbes. We wanted to change that. In 1989, her company ditched its old, chunky logo, replacing it with something sleeker. In addition, the company joined with Birkenstocks German designers to increase the number of styles and colors offered to customers. Gradually, the number of Birkenstock sandal styles available grew to 125, with colors such as mango, moss, fuchsia, and cognac. In addition, Birkenstock sandals for children were introduced under the name Birkikids.

Key Dates:

1774:
Johann Adam Birkenstock is listed as a shoemaker in church archives in Germany.
1897:
Konrad Birkenstock designs the first Birkenstock contoured shoe last to enable the manufacture of customized footwear.
1966:
Margot Fraser first brings Birkenstock products to the United States.
1972:
Birkenstock Footprint Sandals, Inc. is incorporated.
1995:
Company opens outlet store in Gilroy, California.
1996:
Birkenstock opens its company store in Berkeley, California; Orlando outlet store is opened.
1997:
Birkenstock opens its San Francisco retail store.
2000:
Company opens outlet store in Wrentham, Massachusetts.

Developments in the 1990s and Beyond

In 1990, Birkenstock began to sell its shoes through a glossy mail-order catalogue, which it updated every six months. Soon other catalog merchants, such as L.L. Bean and the Sharper Image, were marketing the companys wares. By the early 1990s, popularity of Birkenstock sandals was once again soaring, as baby boomers aged and comfort became chic. In 1992, Birkenstock purchased a large warehouse to distribute its products, which were shipped from Germany to Houston in containers, and then moved by rail to Novato, California. This facility used a mile of conveyor belts and a computerized barcode inventory system to control stock after a $1 million renovation. From this warehouse, shoes were sent to more than 90 Birkenstock specialty stores, large department stores, and other vendors.

Meanwhile, Birkenstock Footprint Sandals financial performance kept improving. Sales increased 30 percent annually from 1988 to 1990, then jumped another 44 percent from 1990 to 1991, aided by an increased selection of footwear and celebrities including Madonna and Harrison Ford buying Birkenstocks.

In 1992 Mary Scott and Howard Rothman wrote a chapter about Birkenstock in their book Companies with a Conscience. They emphasized that founder Margot Frasers open communication style and caring about her employees, vendors, and customers had been the key from the beginning. For example, Melanie Grimes, Birkenstock Footprints first licensed retailer, said, I started selling Birkenstocks from the closet of my college dorm in 1972. When I eventually opened a store of my own the shipment arrived with a letter from Margot saying If the shoes are not for you and your customers, please send them back for a full refund. Keeping the letter as a reminder of how Fraser had built their business relationship, Grimes in 1992 had three Birkenstock licensed stores in or near Seattle.

Birkenstock worked with M.J. Feet, the name of Melanie Grimes retail stores, when the store decided in 1996 to use the Internet to sell Birkenstocks. The retailer made sure corporate headquarters approved the items sold online and how they would be marketed.

In the late 1990s, Birkenstock Footprint Sandals received several awards or honors. Footwear News in 1997 inducted founder Margot Fraser into the Footwear Hall of Fame. Working Woman Magazine in May 1998 rated the company by revenue as number 140 in its list of the Top 500 Women-Owned Businesses. Margaret and Phyllis A. Katz in their 1997 book The Feminist Dollar: The Wise Womans Buying Guide included Birkenstock as the sixth most female friendly company out of 386 total companies. The Business Journal published for Sonoma, Marin, and Napa counties concluded that Birkenstock was the largest minority or women-owned business in that area.

Unlike their earlier history of rejection, Birkenstock products, especially the Boston clog, were quite popular with many international clothes designers. For example, Stephen DiGeronimo used Birkenstock products in his November 4, 1997 fashion show. After Narciso Rodriguez used cashmere flannel-covered Bostons in his fashion show in Milan, Italy, several other clothing designers followed his lead. For example, Charles Chang-Lima, Perry Ellis, John Scher, Paco Rabanne, Gene Meyer, and Ron Chereskin also featured Birkenstocks in their fashion shows.

Trish Donnally, fashion editor for the San Francisco Chronicle said on August 20, 1998 that the crunchy granola of shoe styles is in and that they indeed were trendy. Although some said the companys clogs were ugly, they enjoyed the footwear comfort. Everything in a Birkenstock is reparable, pointed out Laurie Davenport, the Birkenstock San Francisco store manager. You can replace foot beds, hammer out the cork edge to cradle bunions, and you can remove the toe bar [in sandals] if people find them uncomfortable.

Birkenstock in the 1990s set a good example of combining the profit motive with environmental protection. In 1991 a group of employees organized themselves as the Green Team to promote environmentally sound practices by both employees and the corporation. It attempted to reduce paper consumption and trim office waste, and it offered several commuting options. In 2001 Birkenstock continued to decrease its energy consumption through facility improvements and new technology.

With strict vegetarians or vegans unwilling to eat or use any animal products, Birkenstock found alternatives to its leather products. Its catalog listed footwear made from wool, polyure-thane, and acrylic. It said these nonleather products used breathable, durable materials which hold theirnew look longer than most real leathers. People for the Ethical Treatment of Animals (PETA) included Birkenstocks in its free Shopping Guide to Nonleather Products.

In 2001 Birkenstock Footprint Sandals remained under the leadership of its founder and President Margot Fraser, while Mary Jones, the firms first employee, was its vice-president and manager of human resources. However, employees owned about 40 percent of the company. Based in Novato, California, in Marin County, Birkenstock Footprints headquarters included 157,000 square feet for its offices and warehouses. It annually sold about two million pairs of its footwear to men, women, and children and looked forward to serving others in the future.

Principal Competitors

NIKE, Inc.; Ecco; The Timberland Company; SAS; Mephisto; Naot.

Further Reading

Chan, Gilbert, Step By Step, Sacramento Bee, May 2, 1994, p. C1. Deja Vu Shoe, People, August 26, 1991.

Donnally, Trish, Dont Smirk at Birks, San Francisco Chronicle, August 20, 1998, pp. E6-E7.

Magiera, Marcy, Woodstocks Kids Slip into Birkenstocks, Advertising Age, August 24, 1992, p. 12.

Mikutel, Sarah, Live and Let Live: For Vegans, Respect for Others Includes Animals, and the Things They Eat, Wear and Buy Reflect That, Morning Star (Wilmington, N.C.), August 22, 2000, pp. 1D, 5D.

Montalbano, Elizabeth, A Seattle Shoe Seller Who Got It, Computer Reseller News, August 21, 2000, p. 74.

Patterson, Cecily, From Woodstock to Wall Street, Forbes, November 11, 1991, p. 214.

PETA Offers Alternative Shopping Guide, Houston Chronicle, October 26, 2000, p. 3.

Scott, Mary, and Howard Rothman, One Step Ahead, in Companies with a Conscience: Intimate Portraits of Twelve Firms That Make a Difference, New York: Carol Publishing Group, 1992, pp. 3545.

Stengel, Richard, Be It Ever So Birkenstock, New York Times, August 30, 1992.

Elizabeth Rourke
update: David M. Walden

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Birkenstock Footprint Sandals, Inc.

Birkenstock Footprint Sandals, Inc.

8171 Redwood Boulevard
Novato, California 94945
U.S.A.
(415) 892-4400
Fax: (415) 899-1324

Private Company
Founded:
1967
Employees: 135
Sales: $60 million
SICs: 3149 Footwear Except Rubber Not Elsewhere
Classified; 3100 Leather & Leather Products

Birkenstock Footprint Sandals, Inc. is a shoe distributor best known for its clunky, comfortable orthopedic sandals. The Birkenstock family of Germany has a long history in the shoe-making trade. Throughout the first half of the twentieth century, the company marketed orthopedic shoe inserts. In the 1960s, Birkenstock used the principles behind these appliances to create a homey-looking sandal, designed with comfort foremost in mind. After these shoes were introduced to the United States they gained popularity with hippies and academics before reaching a mass market in the 1990s.

Birkenstock traces its roots to the late 18th century, when a German cobbler named Johann Adam Birkenstock, who was born in 1754, was first registered as a subject and shoemaker in the church archives of Langenbergheim, a town in the duchy of Hesse, Germany. By the end of the 19th century, Konrad Birkenstock, a descendant, owned two shoe stores in Frankfort, the capital of Hesse. These stores would become the foundation of the modern Birkenstock businesses.

Konrad Birkenstock had the inspiration that would form the basis for his familys business for the next hundred years. At the time, shoes were made with flat soles, despite the fact that the bottom of the human foot is curved. Birkenstock realized that a sole curved to complement the shape of the foot would be more comfortable than a flat surface. In 1897, he designed the first contoured shoe last, a tool used in shoe-making, to help his cobblers make customized footwear for patrons.

On the strength of this innovation, Konrad Birkenstock began to spread the word of his new kind of shoe. He gave frequent talks to other leading members of the shoemakers guild, explaining his fully contoured shoe. Birkenstock traveled throughout Germany promoting his new idea, and licensed other cobblers to produce shoes made with his technique. By the start of the twentieth century, he had moved beyond the borders of his native country, traveling to Austria and Switzerland as well.

By 1902, however, the popularity of custom-made shoes had begun to wane, as factory-manufactured footwear began to be more widely distributed. Adapting the essence of his idea for this new and growing market, Konrad Birkenstock developed flexible, contoured arch supports, which could be inserted into mass-produced shoes to make them more comfortable. Birkenstocks arch supports, which bent to accommodate the foot, differed from the other supports on the market, which were made of unyielding metal. With the rise of mass-produced shoes, the Birkenstock family business moved away from the crafting of custom-designed shoes to concentrate on the production of shoe inserts.

In 1908, Birkenstock pushed forward with the foot support when he developed his own substance, and built molding presses to manufacture the flexible orthopedic insert. Four years later, the firm continued its technological innovation when it created a new method for using rubber, a material just beginning to be developed, in shoe inserts. In 1913, Konrad Birkenstocks son Carl joined the family firm, insuring that continuity in the companys activities would be possible. In the wake of Carls arrival, Konrad Birkenstock committed the bulk of his familys considerable assets to research and the development of rubber as a material for foot supports.

In the same year that Birkenstock undertook these efforts, Germany entered World War I. The companys contribution to the war effort was the design and manufacture of orthopedic shoes to be worn by wounded soldiers in a large military hospital in Frankfort. As a result of these activities, Birkenstocks products came to the attention of the doctor in charge of the hospital, who praised his efforts and encouraged him to market his orthopedic inserts more widely. In 1915, Carl Birkenstock began to travel throughout Germany, introducing the familys products to new buyers.

Two years after the end of World War I, a second Birkenstock brother, Heinrich, entered the family business. Though Germanys economy suffered following the war, the Birkenstock business thrived. The family opened a branch in Vienna, the capital of Austria, in 1923, and soon expanded its distribution to countries across Europe, selling orthopedic inserts in Austria, Switzerland, France, Italy, Belgium, Czechoslovakia, Holland, Luxembourg, Denmark, Sweden, and Norway. To accommodate this expanded customer base, Birkenstock opened a larger factory in the town of Friedberg, in Hesse. When demand for the Birkenstock product necessitated even greater manufacturing capacity, the company added night-shifts at the factory.

The late 1920s and early 1930s saw the company make many changes and additions to its product line. In 1926 and again in 1935, Birkenstock expanded its line of footbeds, adding different widths to better fit the foot and to accommodate fashionable shoes. In 1937, Birkenstock further altered the footbed, adding a ring, which it patented, that allowed the insert to be easily adjusted to fit each foot. By 1928, Birkenstocks success had attracted the notice of its competitors, and other companies began to market non-metallic arch supports. For the first time, the company had competition for its products.

With the start of the 1930s, Birkenstock expanded its education and promotion efforts beyond people who made shoes to the public itself. The company published 70,000 copies of The Foot and its Treatment, a heavily-illustrated pamphlet of 50 pages, in an effort to inform customers about the companys theories of orthopedics. Two years later, in 1932, Birkenstock stepped up its education efforts when it began to offer training seminars and lectures to orthotic appliance sellers in most European countries. These sessions lasted a week, and included more than 5,000 people in the mid-1930s.

Germanys defeat in World War II changed but did not seriously disrupt Birkenstocks development. With the coming of peace in 1945, the company transferred its operations from the Frankfort area in Hesse, to the town of Bad Honnef on the Rhine. Innovation and education continued apace; in 1946 the company introduced a toe-free insert and in 1947 it began to distribute a pamphlet for shoe sellers titled Footorthotics System Birkenstock, with 112 pages and 55 illustrations. In 1950, Konrad Birkenstock, the creator of the flexible footbed and the companys driving force for half a century, died at the age of 77.

The decade following Konrad Birkenstocks death saw a number of changes in the venerable company. In 1956, Birkenstock introduced an insole made of shaped foam that was created through thermoplastic compression. Two years earlier, in 1954, a new generation of Birkenstocks had joined the family firm, when Karl Birkenstock, Carl Birkenstocks son, came aboard. Although his father envisioned the companys future exclusively in terms of orthopedic shoe inserts, the younger Birkenstock had more ambitious plans. He hoped to create a shoe that provided all of the benefits of walking barefoot. To do this, he experimented, combining his grandfathers techniques of flexible, contoured arch support, with his own understanding of how the foot works and moves.

Within a decade of Karl Birkenstocks arrival at the family firm, the company had re-entered the shoe business. In 1964, it began to manufacture a shoe whose design was based on the shape and function of the human foot. The new Birkenstock shoe was built from the inside out, starting with an orthopedically-based footbed, which gave firm support to the bottom of the foot. The companys goal was to make the wearer feel that he or she was walking on a surface that would yield, such as wet sand. In order to accomplish this, Birkenstock designed a footbed made of cork, latex, and jute, which absorbed shocks to the foot. The company also added a raised toe bar, to facilitate the instinctive gripping motion of the toes, and a heel cup, to cradle the heel and better distribute the bodys weight. In 1965, Karl Birkenstock attached this sole to two simple leather straps to create a clunky, but comfortable, orthopedic sandal.

One year after Birkenstock began to market its new sandals, the shoes came to the attention of Margot Fraser, a German-born dress designer who had emigrated to the United States. While vacationing at a German spa, workers suggested that she try Birkenstock sandals to ease her chronic foot problems. Several months later, her foot pain had greatly improved. Fraser was hooked, and she believed that other American women would also want an alternative to the uncomfortable high-fashion shoes typically marketed to women. She spread the word about Birkenstock sandals to her friends, bringing them shoes from Germany. Finally, along with her husband, a cookware importer, Fraser arranged with Karl Birkenstock to market his sandals in the United States.

When Fraser approached the owners of shoe stores about selling Birkenstock sandals in their stores, she was universally rebuffed. Repeatedly, shoe sellers assured her that no American woman would ever wear shoes that ugly, regardless of how comfortable they might be. Seeking alternate marketing channels, Fraser turned to the health food industry. We had to sell to people with a different vision, Fraser later recounted to People magazine. It was very tough at first, she told the New York Times. But it was when I went to a health fair, and people there wanted them that I got a start. They were interested in fitness. At a trade show, Fraser sold her first pair of sandals to a woman who was limping among the booths, holding her high-heeled shoes in her hands. After trying the Birkenstock sandals, this woman began wearing them constantly, and also bought several pairs to sell in her health food store.

Fraser set up business in her home in Santa Cruz, California, using her garage as a warehouse. Sales of the sandals through health food stores increased, and the shoes gained a reputation for their comfort. In addition, Fraser sold the shoes through the mail. Throughout her early years in business, Fraser was unable to convince the German Birkenstock company to make her its sole American distributor. Instead, she bought shoes directly from the factory, often in lots of 20 pairs, and had them shipped parcel post to her house.

In 1971, Fraser moved her business out of her house, leasing a small office on top of a San Rafael, California, health food store for $25 a month. At that time, she incorporated her company under the name Birkenstock Footprint Sandals, Inc., and formally became the sole American distributor of Birkenstock products. Fraser hired a part-time bookkeeper and packer. We made enough money to survive, she later told the Sacramento Bee. We were pinching out pennies, but we managed. By the end of that year, the company had sold 10,000 pairs of shoes to the American market, promoting the product through homemade fliers, small ads in health food publications, and booths at trade fairs and shoe shows. Often, the shoes were first bought by the owners of health food stores, who had to stand behind a cash register all day. With their recommendation, the popularity of the shoes spread through word of mouth.

While Fraser was working to sell Birkenstock products in the United States, the German parent firm was furthering its efforts to develop its line. In 1966, the company introduced a special paper, on which a customers footprint could be marked, for a better fitting shoe. In the following year, Birkenstock developed and began to use Birko-Cork, a natural thermo-pliable product for use in footbeds. Two years later, the company also began to sell insoles that massaged the feet, called Nappy-Fit.

During the 1970s the popularity of Birkenstock footwear exploded, as the shoes became associated with the Bohemian lifestyle popular with young people. In the United States, sales of Birkenstock sandals grew dramatically, and the company introduced a number of new styles. In 1970, a sandal called Roma, with a strap that encircled the heel, was sent to stores. In the following year, Arizona, designed by Fraser with two classic wide straps, was introduced. Overall, there were 12 different varieties of the basic Birkenstock shoe, all sold in natural earth tones.

In Germany, the Birkenstock company expanded its production facilities in order to meet the new demand. The company leased a factory in the town of St. Katharinen that housed punching presses to cut out the leather pieces for its shoes in 1974. Two years later, Birkenstock introduced Birko Foam, yet another new material for use in its shoes, and in 1978, the company began to use superelastic light material to make new specially contoured soles.

At the start of the 1980s, Birkenstock modernized its production processes further, installing computerized last-making machinery to make the molds for shoes. Two years later, Birkenstock introduced its first significant variation on the basic sandal, the thong-sandal, which it began to sell in five different styles. In the next two years, the company received nearly 40 different design protection rights from the German Patent Office for its products, including two developed for the thong sandal. In 1984 Birkenstock opened a larger warehouse for its products.

Despite the innovation of the thong sandal, sales of Birkenstock shoes began to wane in the early 1980s, as fashions shifted away from the functional and down-to-earth. We were struggling with the image that we were a hippie shoe, Fraser later told Forbes. We wanted to change that. In 1989, her company ditched its old, chunky logo, replacing it with something sleeker. In addition, the company joined with Birkenstocks German designers to increase the number of styles and colors offered to customers. Gradually, the number of Birkenstock sandal styles available grew to 125, with colors such as mango, moss, fuchsia, and cognac. In addition, Birkenstock sandals for children were introduced, under the name BirkiKids.

In 1990, Birkenstocks American branch began to sell its shoes through a glossy mail-order catalogue, which it updated every six months. Soon other catalogue merchants, such as L.L. Bean and the Sharper Image, were marketing the companys wares. By the early 1990s, popularity of Birkenstock sandals was once again soaring, as the baby boomers aged and comfort became chic. In 1992, Birkenstocks American arm purchased a large warehouse to distribute its products, which were shipped from Germany to Houston in containers, and then moved by rail to Novato, California. This facility used a mile of conveyor belts and a computerized bar-code inventory system to control stock after a $1 million renovation. From this warehouse, shoes were sent to more than 100 Birkenstock specialty stores, large department stores, and other vendors. As Birkenstock moved into the mid-1990s, the companys niche in the functional shoe market appeared secure. With more than 100 years of experience in cradling feet, the enterprise run by descendants of Johann Birkenstock seemed assured of a comfortable future.

Further Reading

Chan, Gilbert, Step By Step, Sacramento Bee, May 2, 1994, p. C1.

Deja Vu Shoe, People, August 26, 1991.

Magiera, Marcy, Woodstocks Kids Slip into Birkenstocks, Advertising Age, August 24, 1992, p. 12.

Patterson, Cecily, From Woodstock to Wall Street, Forbes, November 11, 1991, p. 214.

Stengel, Richard, Be It Ever So Birkenstock, New York Times, August 30, 1992.

Elizabeth Rourke

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Birkenstock Footprint Sandals, Inc.

Birkenstock FootprintSandals, Inc.

founded: 1966

Contact Information:

headquarters: 8171 redwood blvd.
novato, ca 94945 phone: (415)892-4200 fax: (415)899-1324 toll free: (800)761-1404 url: http://www.birkenstock.com

OVERVIEW

Birkenstock Footprint Sandals, Inc. is famous for its trademark product—bulky but comfortable leather sandals, worn by "hippies" in the late 1960s and by almost everyone else in later years. The California-based company does not manufacture shoes itself; instead, it is the exclusive American importer and distributor of Birkenstock footwear, which is made in Germany by a two-century-old company. The founder of Birkenstock Footprint Sandals, Margot Fraser, discovered the sandals in Germany while on vacation in 1966. Although she had no business experience, she decided to sell the sandals in the United States when she realized how much better her feet felt after wearing them. However, traditional shoe stores had no interest in the admittedly unattractive sandals; Fraser found her original market in health-food stores.

Birkenstock grew from a one-woman company operating out of Fraser's home and selling a few pairs of shoes at a time, to a highly successful company with $82 million in sales in 1997. Almost two million pairs of "Birkenstocks" are sold in the United States every year. In addition to its original brown leather sandals for adults, Birkenstock now sells 300 styles and colors of shoes and sandals for adults and children. Some new products come in bright colors and in synthetic materials, and many celebrities and fashion models were seen wearing Birkenstocks in the 1990s. Birkenstock is noted for its community activism and its excellent employee relations.

COMPANY FINANCES

Because Birkenstock is a private company, it does not release detailed financial information to the public. Its 1997 sales were $82 million, a 26-percent increase over 1996 sales of about $65 million. However, sales for both 1995 and 1994—$55 and $50 million, respectively) were down from sales in 1993 of $60 million.


HISTORY

Although Birkenstocks have only been sold in the United States since the 1960s, in Germany the Birkenstock family has been manufacturing shoes since the 1700s. In 1774 J.A. (Johann Adam) Birkenstock was registered in the church archives of Langenbergheim, Germany, as "subject and shoemaker." Since that time, the Birkenstock family has continuously made and sold footwear. J.A. Birkenstock's grandson, Konrad Birkenstock, owned two shoe stores and was the person who shaped the family business for the next century. In the late 1800s shoes were made with flat soles and were very uncomfortable since the human foot is curved. In 1897 Konrad Birkenstock invented the first contoured insole, which allowed his cobblers to design custom footwear. However, custom footwear became less popular as cheaper factory-made shoes were more widely manufactured. So Birkenstock turned to another idea: in place of the rigid metal arch supports used in factory-made shoes, he designed a flexible arch support insert.

Around the time that World War I began, Konrad's son Carl joined the business. Soon the company concentrated on developing orthopedic shoes and inserts to be worn by wounded soldiers. By the 1920s Birkenstock orthopedic products were being sold throughout Europe. In the 1930s and 1940s, thousands of people in Europe attended Birkenstock-sponsored educational seminars about the benefits of orthopedic shoes. In 1954 a new family member, Karl Birkenstock (Carl's son) stepped into the leadership role. Karl Birkenstock moved the company back into the shoe manufacturing business, and focused on developing a shoe that was based on the shape and movement of the human foot—a shoe that would provide all of the benefits of walking barefoot. In 1964 Birkenstock presented the result of years of design work: a shoe with a footbed made of latex, cork, and jute, with a raised toe bar and a heel cup to better distribute the body's weight. The following year the sole was attached to two leather straps, and the first Birkenstock sandal was born.

At this point Margot Fraser entered the picture. She was a German-born dress designer who had moved to the United States. While on vacation at a spa in Germany in 1966, Fraser asked for advice about her chronic foot problems. Someone suggested that she try the new Birkenstock sandals; she did, and within months her foot pain had vanished. Fraser decided that she should share the sandals with other American women who experienced constant discomfort and even pain from the high-heeled, pointed-toe shoes that were in fashion. But when she approached the owners of shoe stores, they told her that American women would never wear such ugly shoes, no matter how comfortable they were. So Fraser took a different approach, and brought the sandals to a convention of health-food store owners in San Francisco. Her first customer was the manager of a health food store, whose feet were so sore that she was carrying her shoes around the auditorium. The manager bought three pairs to sell in her store, all in her own size in case nobody bought them.

FAST FACTS: About Birkenstock Footprint Sandals, Inc.


Ownership: Birkenstock is a privately owned company.

Officers: Margot Fraser, Pres. & Founder; Dennis Cutter, CFO; Mary Jones, VP & HR Manager

Employees: 195 (1997)

Principal Subsidiary Companies: Birkenstock is the exclusive importer and distributor of German-made Birkenstock Original Contoured Footbed sandals and shoes in the United States. It maintains two company-owned retail stores, two mall outlet stores, and a large distribution and marketing center at its headquarters in Novato, California.

Chief Competitors: Birkenstock has a host of competitors in the footwear business. Its top competitors include: NIKE; Deckers Outdoor Products; and Wolverine World Wide.


Sales of the shoes were slow through the early 1970s, with Fraser ordering 20 pairs at a time from Germany and using her garage as a warehouse. Fraser had no business training and no financial resources to build the business. Her marriage broke up in 1969 and she left everything behind, including her business. But the few customers she did have convinced her to start it again, which she did with the financial help of the woman who had bought the first pairs of sandals at the convention. In 1971 Fraser moved the business to a small office above a California health-food store, and incorporated it as Birkenstock Footprint Sandals, Inc. In the same year, the classic "Arizona" sandal, still a best-seller today, was introduced. The German company made Fraser its sole importer and distributor within the United States, and opened a larger factory to meet the increased demand for its products.

Sales of Birkenstocks dropped during the 1980s, as customers became more interested in athletic shoes and luxury items. In 1988 sales were a mere $8.6 million. In 1989, Birkenstock changed its logo and began to increase the number of styles and colors available, including new sandals for children. An attractive mail-order catalog was launched in 1990, and other catalog sellers, such as L.L. Bean and The Sharper Image, also began to sell Birkenstocks. Sales of Birkenstocks soared through the 1990s, as Baby Boomers who had first worn them in the 1970s returned to their comfortable favorites, along with their children who bought the new designs. In the late 1990s celebrities such as Madonna, Harrison Ford, and even the emergency room staff on the television program ER were seen wearing Birkenstocks. Photographs of models in fashion magazine ads also frequently paired high-fashion clothing with a pair of Birkenstock sandals. By 1995 annual sales had leapt to $55 million, and in 1997 they reached a record $82 million. Margot Fraser still heads the company, but has initiated a plan by which employees will take over ownership.


STRATEGY

Founder Margot Fraser has always followed a simple but incredibly successful strategy. She believes that her product contributes to health and comfort; if her company continues to produce a quality product, people will continue to buy it. Birkenstock does very little advertising, and considers its customers its best salespeople. As she told Entrepreneur magazine in 1995, "All we have to do is stay in business and perform."

While Birkenstock continues to produce the sandals that made it prosper in the early 1970s, it has expanded its product line in the 1990s to reach a new generation of customers, still insisting that every product meet a high standard of quality and be orthopedically sound. Fraser also is noted for encouraging employee participation in business decisions of all kinds. She herself had no business training, and believes that a company that treats its employees with respect will encourage creativity and be successful.


CURRENT TRENDS

As Birkenstock celebrated its thirtieth anniversary in 1996, it also went off in several new directions. The company had to face competition from athletic shoes, sport sandals (such as "Teva" sandals), and cheaper imitations of its own products. Several hundred new customers were approved as Birkenstock retail outlets, bringing the national total to 3,500 by 1998. And Birkenstock itself went into the retail business for the first time, although in a limited fashion. It opened two company-owned retail stores (in San Francisco and Berkeley, California) and two mall outlet stores (in Gilroy, California, and Orlando, Florida).

Birkenstock also sought to reach new customers in addition to its loyal existing customers. New lines of more trendy Birkenstocks, featuring brighter colors and using synthetic materials, were introduced. But, along with its new and often younger customers, the company still understood the importance of loyalty to its original customers from the "hippie" days. As Margot Fraser told Entrepreneur, "Quality of life is back in. Baby boomers are aging and noticing foot problems, and that alone may be enough to give us a 20-year growth curve."


PRODUCTS

As of 1998 Birkenstock sold 300 styles and colors of shoes and sandals, for both adults and children. In addition to offering its traditional leather sandals (such as the ever-popular "Arizona"), Birkenstock was reaching out to the new generation of customers who grew up during the athletic shoe craze, as well as aging Baby Boomers who wanted more comfortable footwear once again. New product lines include the "Betula" collection, colorful sandals and clogs with lug soles; the "Footprints" collection of walking and trekking shoes; "Tatami" wedge shoes and sport sandals; and an expanded line of "Birkikids" sandals and clogs for children. Even though many of the new models come in fashionable colors and use synthetic materials instead of leather, all of them retain Birkenstock's orthopedic design.

In the late 1990s Birkenstock also began to market a line of professional footwear designed for clinical, medical, and food-service workers. These shoes are water-and grease-resistant, and can be bought in fashionable colors. The "ESD" shoe is another unique professional product—a shoe for computer technicians that prevents the buildup of static electricity.

CORPORATE CITIZENSHIP

Birkenstock is frequently listed as one of the most socially and environmentally responsible companies in the United States. It donates a portion of its annual profits to more than 100 community organizations, particularly those near its Marin County headquarters (such as the Marin Conservation League and the Marin Agricultural Trust). It also has donated generously to national organizations, such as Canine Companions for Independence, which trains assistance dogs for physically challenged people. Since 1991 Birkenstock has had a corporate "Green Team" that educates employees about environmental activities and practices in the workplace, and the company is committed to being environmentally responsible. Its home page describes this overall environmental policy: "At Birkenstock, if we had a choice, we'd leave nothing behind but our footprints."

GLOBAL PRESENCE

Birkenstock Footprint Sandals, Inc. limits its business operations to the United States, in which it is the exclusive importer and distributor of Birkenstock footwear. The shoes and sandals are made in Germany by the company founded over 200 years ago by J.A. Birkenstock. The two operations are totally independent; the German company owns no share of the U.S. operation, and vice versa.

CHRONOLOGY: Key Dates for Birkenstock Footprint Sandals, Inc.


1897:

Konrad Birkenstock develops the first shoe with a contoured insole

1902:

Birkenstock develops the first flexible arch supports

1925:

Birkenstock's arch supports are being exported all over Europe

1932:

Leading medical specialists support the Birkenstock system in international training seminars

1964:

Karl Birkenstock uses his father's arch support as the basis for a shoe and creates the Birkenstock sandal

1966:

Margot Fraser begins importing Birkenstocks into the United States

1970:

The most recognized Birkenstock, the Arizona, is introduced

1971:

Fraser incorporates her company as Birkenstock Footprint Sandals, Inc. and becomes the sole American distributor

1989:

Fraser joins with the German designers to expand the product line

1997:

Birkenstock USA is entered into the Footwear News Hall of Fame


EMPLOYMENT

Although it employs only about 200 people, Birkenstock has received numerous awards based on its innovative employee practices. Internal communication is highly emphasized and openly appreciated. As each fiscal year begins, all employees meet to discuss Birkenstock's future direction. It is not unusual for a clerical employee to rise to high levels; for example, Mary Jones (Vice President and Human Resources Manager) began as a part-time bookkeeper in the company's early years. When a company bonus is distributed, all employees, including executives, receive the same amount. Executives do not receive additional benefits such as company automobiles. Birkenstock's appreciation for its employees has been returned; even during the company's lean years between 1985 and 1990, only one manager left.

Margot Fraser, in her late 60s in 1998, started a transition plan for the time when she no longer heads the company. To assure that the company she founded continues in its present direction, she has instituted a plan through which the employees of Birkenstock will eventually buy the company. In fact, in the late 1990s employees already owned 40 percent of the company.

SOURCES OF INFORMATION

Bibliography

Baber, Bonnie. "Margot Fraser." Footwear News, 15 December 1997.

"Birkenstock Footprint Sandals, Inc." Hoover's Online, 27 July 1998. Available at http://www.hoovers.com.

Eskenazi, Joe. "Birkenstock Stands on Solid Footing." Daily Californian, 9 September 1996.

McGarvey, Robert. "Shoe In." Entrepreneur, February 1995.

Patterson, Cecily. "From Woodstock to Wall Street." Forbes, 24 August 1992.

Rourke, Elizabeth. "Birkenstock Footprint Sandals, Inc." International Directory of Company Histories, Vol. 12. Detroit: St. James Press, 1996.

Scott, Mary, and Howard Rothman. Companies With a Conscience. New York: Carol Publishing Group, 1992.

Skorupa, Susan. "Birkies at 30." Reno Gazette-Journal, 23 February 1997.

For additional industry research:

Investigate companies by their Standard Industrial Classification Codes, also known as SICs. Birkenstock's primary SICs are:

3100 Leather & Leather Products

3149 Footwear Except Rubber, NEC

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