As sourcing costs rise along with trade tensions, the appeal of affordable labor costs and relatively tension-free trade relations has footwear companies increasingly turning their attention to Vietnam.
\nPulling from the data compiled for its World Footwear Yearbook, World Footwear said Vietnam produced 1.18 billion pairs of shoes in 2017, giving it a 5.2% share of the world market and making it the third largest producing country in the world. Vietnam was also the second largest exporter of footwear, shipping 1.02 billion pairs around the world and commanding a 7.4% share of the market.
\nWhen it comes to U.S. footwear imports in particular, Vietnam is the second largest supplier of shoes after China. In the year to March, the U.S. took in 109.4 million pairs of shoes from Vietnam, a 14 percent increase over the 95.8 million pairs it had imported from the country at the same time in 2017.
\nPart of the growth has to do with more shift away from China as labor costs there continue to climb.
\nLast month Adidas indicated a shift in its own footwear sourcing from China to Vietnam, and alluded to the trend continuing.
\nForty-four percent of Adidas\u2019 footwear was made in factories in Vietnam last year, up from 31 percent in 2012, World Footwear reported. By contrast, its Chinese suppliers only produced 19 percent of its footwear volume, and that number is down from 30 percent over the same period. By 2019, Adidas expects more than half of its footwear will be produced in Vietnam.
\nThe shrink from China may prove beneficial amid the ongoing Sino-U.S. trade battle being waged with tariffs.
\nAccording to World Footwear, Puma, which makes close to one-third of its goods in China, recently noted efforts to move some production out of China and into other Asian markets as a result of new tariff impositions. Nike has also spent big money in Vietnam, benefiting from a favorable trade environment and reasonable labor costs.
\nThe threat of higher duties\u2014no matter how harsh they seem\u2014still won\u2019t unseat China as the leader in footwear production, however.
\n\u201cChina is still an important procurement market, irrespective of trade duties,\u201d Adidas CEO Kasper Rorsted told shareholders at an annual meeting.
\nFor Di\u1ec7p Th\u00e0nh Ki\u1ec7t, deputy chairman of Lefaso, Vietnam\u2019s leather, footwear and handbag association, there\u2019s confidence that Vietnam\u2019s current performance will continue as the country looks to enhance its development.
\nSpeaking at the two-day Vietnam Footwear Summit in Ho Chi Minh City in March, Ki\u1ec7t pointed to the country\u2019s trade agreements with Japan, ASEAN and the TPP-11, now known as the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP), plus its ample workforce.
\n\u201cWe have a golden demographic ratio with 66.9% of the population being working age, providing an abundant supply of cheap and skilled workers,\u201d Vietnam News reported Ki\u1ec7t as saying. \u201cVietnam can supply materials for the footwear industry and becomes a destination for large producers.\u201d
\nThe key for the country, Ki\u1ec7t added, has been its ability to produce and export high value-added products.
\nContinuing, he said, \u201cThis is a big opportunity for the industry. If we continue to promote the export of high-value products, the industry will develop strongly.\u201d
\nPlease visit for Reference: https:\/\/sourcingjournal.com\/footwear\/footwear-supply-chain\/footwear-manufacturing-vietnam-107903\/<\/p>\n","protected":false},"excerpt":{"rendered":"
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