The Vietnam Footwear Industry (2004 – 2007)
VIETNAM LEATHER AND FOOTWEAR ASSOCIAITON
LEFASO Vietnam Leather and Footwear Association Head Office: 160 Hoang Hoa Tham. Tay Ho District, Ha Noi, Vietnam Tel +844 7281562 - Fax +844 7281561. E-mail:
[email protected] Southern Office: No.5A, Xuyen A Highway, An Binh Town, Di An District, Binh Duong Province, Vietnam. Tel +848 7241499 - Fax +848 7241500. E-Mail:
[email protected] Total enterprises: over 500 companies operating in the sector. Labour force: Over 600.000 people
Footwear Industry in Vietnam • The footwear industry is the third The North
91 Factories
•70 km from Hai Phong Port •140 km from Noi Bai Airport •70 km from Cat Bi Airport
10 Factories
biggest contributor to Vietnam’s GDP and export turnover. • The industry locates in all North, Centre and South Vietnam, employs approximately half a million people and another one million people work in its supportive-industries. • The largest part of the industry is in the South of Vietnam (HCM. Binh Duong, and Dong Nai province).
The South •10 km from Saigon port
• In the North of Vietnam has cheaper labors and it may hold 25-30% of capacity of the whole industry in future.
•12 km from Tan Son Nhat Airport •12 km from HCM City
400 Factories
Enterprises by economic sector Footwear, Handbag companies
Total
Tanneries Total
Rate (%)
459
43
502
100.0
State-owned companies
01
-
01
0.2
Private local companies
239
34
273
54.3
14
0
14
2.7
206
9
215
42.8
Joint Venture companies Foreign owned companies
Production Capacity Product
Unit
2005
2006
2007
Footwear
1000 prs
499,000
627,507
715,000
- Sport shoes
1000 prs
288,155
401,732
457,300
- Canvas shoes
1000 prs
44,370
50,714
58,830
- Lady fashion shoes
1000 prs
94,590
91,677
104,550
- Others
1000 prs
71,885
83,384
95,320
Handbags
1000 pcs
51,700
70,000
70,000
Finished Leathers
1000 sqf
47,000
80,000
87,000
Export Products
Industry exports over 90% of its total annual production. Various kinds of products including: sport shoes, lady shoes, canvas shoes, sandals and slippers boots, hiking shoes…. Sport shoes contribute 50 - 55% of the total capacity and export turnover of the industry. Huge foreign - owned companies specialize in sport shoes and leather shoes for world - famous brands (Nike, Adidas, Reebok, Timberland, Clarks, Puma…). Medium and small size companies have large product range.
Most of export shoes are OEM products.
Difference kinds of Sport shoes as under:
Export value (2004 – 2007) 2004 Leather & Footwear Industry
2005
2006
2007
2,640.26
3,039.58
3,591.56
3,994.00
Country
26,503.00
32,000.00
39,605.00
48,380.00
% Ratio
10.00%
9.50%
9.07%
8.3%
Unit: Million US Dollars
Export value by main markets (2004 - 2007) 2004 Main Market
Value
2005 %
2006
2007
Value
%
Value
%
Value
%
1,966. 5
54.7
2,176. 8
54.5
EU From this ITALY
1,794. 68.0 6 (7.4)
1,789.3
58.9
162.1
(9.0)
America
134.3 423.1 16.0
611.1
20.1
193.0 802.8
22.4
216.9 885.1
22.2
Japan Other countries Total
(9.8)
(9.9)
73.0
2.8
93.7
3.1
113.1
3.2
114.7
2.9
348.5
13.2
545.5
17.9
709.1
19.7
817.5
20.4
2,639. 100. 2 0
3,039.6
100. 0
3,591. 100.0 6
3,994. 100.0 2
Export markets by value 2007 20.4%
Europe 2.9%
America Japan Others
22.2% 54.5%
Dealing with the EU anti-dumping measures, the industry is trying to increase export to US market.
Top 20 import countries 2007 No.
Countries
Ex Value (USD)
1 United States
885,116,016.3
2 United Kingdom
526,433,882.4
3 Germany
357,937,682.6
4 Netherlands
279,196,457.6
5 Belgium
278,944,193.4
6 Italy
216,898,018.1
7 France
200,948,001.8
8 Mexico
136,957,878.3
9 Spain
128,012.906.1
10 Japan
114,750,420.3
Top 20 import countries 2007 No.
Countries
Ex Value (USD)
11 Canada
78,680,931.2
12 China
66,021,899.7
13 Sweden
54,500,559.8
14 Panama
54,253,416.5
15 Hong Kong
50,529,242.3
16 Korea (Republic)
50,514,340.8
17 Austria
48,894,812.2
18 Australia
39,576,716.4
19 South Africa
37,847,689.4
20 Taiwan
36,719,869.4
Top 20 import countries 2007 Value: Million USD
900 800 700 600 500 400 300 200 100 0
ni
a a n ric iw A f T a th a o u li S tr a us a A tr i us A ea ng o or K K g on a H am an n P de e w S na hi a C ad an C an p J a in pa o S x ic e M ce an Fr ly m I ta g i u n d e l la B her y om et n gd N m a in s er K e G te d ta t ni S U te d U
Top 20 export footwear companies No.
Name
Tel
Fax
1
Pou Yuen VN Holding Co. Ltd. +848 8760213
+848 8751611
2
Taekwang Vina Ind. Co. Ltd.
+8461 836421
+8461 836435
3
Pou Chen VN Joint Stock Co.
+8461 828010
+8461 821201
4
Freetrend Ind. Co. Ltd.
+848 8975025
+848 8975024
5
Golden Star Co. Ltd.
+8431 763880
+8431 763887
6
Chang Shin VN Co. Ltd.
+8461 865204
+8461 865145
7
Sam Yang VN Co. Ltd.
+848 7956852
+848 7956838
8
Hwa Seung Vina Co. Ltd.
+8461 549743
+8461 549804
9
Dona Pacific VN Co. Ltd.
10
King Maker VN Co. Ltd.
+8461 882797 +84650 782248 +84650 757235
Top 20 export footwear companies (cont) No
Name
Tel
Fax
11 Chi Hung Joint Venture Co.
+84650 625022 +84650 658241
12 Hai Phong footwear Co.
+8431 940914
+8431 940716
13 Dong Nai Viet Vinh Shoes Co.
+8461 882791
+8461 884745
14 Hoang Gia Cat Tuong Co., Ltd.
+84650 824115 +84650 823966
15 Hue Phong Shoes Co., Ltd.
+848 8959739
+848 8958533
16 Khai Hoan Shoe Making Co. Ltd. +848 8754428
+848 8753928
17 VietNam Right Rich Co., Ltd. 18 Lac Ty Joint Venture Co., Ltd.
+848 8750410
+848 8754204
19 Phu Lam Footwear JV Co.
+848 8750098
+848 8754299
20 Thai Binh Holding & Shoes Co.
+848 7241241
+848 8960223
Import Machinery and Raw materials in 2007 Unit: Million USD
No
Contents
1. Machinery and spare parts 2. Finishing Leather
Totals
From ITALY
68.88
7.06
932.03
53.19
Labor force used by the industry
(2004 – 2007)
Unit: Person
2004
Total
500,000
2005
540,000
2006
560,000
2007
601,000
Note: The mention data not including labor force operating in the small workshops and family production
Opportunities and challenges Challenges
Opportunities ¾
¾ ¾ ¾
¾
¾
Affirm quality and prestige in international footwear markets. Business with brand name clients. Increasing demand of North American markets. Sufficient, still have advantage in cheap & skilled labor. Good security, stable economy & politics in the country. Adequate supportive industries for development.
¾ ¾
¾ ¾ ¾
¾
Competition from other Asian countries. Training system weakness for footwear industry, especially in R & D sector. EU anti-dumping & GSP. Dependence on Partners and difference markets. Weakness in forecast & update information about the markets. Dependence on foreign countries for high quality materials.
Main objectives to the year of 2015
Speed up resources for the design and marketing areas. To develop relating industries such as: footwear material production, to increase the ratio of domestic materials. Increase value added to products Calling and encourage investment in high quality leather products (Fashion leather shoes & goods), Trade promotion for new markets and maintaining the annual growth of 10 - 15%. Creating more jobs and improving the quality of life for the labors operating in the industry.
Trade cooperation between Vietnam and Italy (Leather & Footwear Sector) ¾
¾
¾
¾
Vietnam export to Italy footwear (mainly sport footwear), achieved 216,9 USD in 2007 Import Leather, Machinery and spare parts
(In 2007 achieved 60.25 USD)
To acquire know – how transfers (from Italy) for tanning and footwear productions Exchange information, training technicians and designing staffs and so on…
Projects calling investment ¾
¾
¾
Setting up Technical, Training and Service Center for tanning, footwear and leather goods products Projects focus on fashion leather shoes and leather goods with high quality Projects focus on improve quality of finishing leather, applying clean technology and reduce polutions for tanning process
Projects calling investment ¾
¾
¾
Projects relating supplying and production of footwear & leathergood component and accessories Project on recycle hard wastes and water treatment system for tannery enterprises…. Other projects for sustainable development of the industry
Samples for sustainable development of the industry
Footwear factories
Material factories
Footwear Product Development Center
CAD/CAM & Rapid Prototype (RP) have made great changes
Footwear Product Development Center Sample stitching line
Sample materials
Design section with 3D-CAD patterning unit Sample lasting line
Laboratory for testing of materials and products
Outsole production
Rubber batching & mixing
Outsole press
Rubber sheeting
Outsole trimming
Out sole production
Outsole buffing
Stockfiting lines
EVA-Phylon production
EVA pressing MC
EVA skiving MC
EVA-Phylon production
Phylon Injection Line (PVN)
Material production
Footwear production
Warehouse
Health & Safety
Automat Fire Alarm
Fire system
Hydrant system
CSR-Health & Safety
Canteen
CSR-Health & Safety
MSDS - Machine safety
First Aid First Aid site
No PPE no working site
Professional Training
No PPE no working site
Schools for local community
Thank you! VIETNAM FOOTWEAR AND LEATHER ASSOCIATION
