PHILIPPINE FOOTWEAR INDUSTRY :
The Footwear Industry covers a range of products that includes sports shoes, dress or casual shoes, slippers and sandals. Materials range from leather, rubber and plastic to textile and other components. The sector targets buyers of all ages and offers products for men, women and children.
Leather footwear is normally used as dress shoes. Non-leather footwear with outer soles of rubber or other materials such as plastic, wood, textile is commonly used as casual footwear. Sandals and slippers are mostly made of textile or plastic material and are used both indoors and outdoors. Sports footwear entails high standards of production and most sport shoes facilities in the Philippines involve some direct
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Shoes produced for this market are normally of good quality , and prices range from US$20 to US$50 a pair for ladies’ and men’s leather shoes. This group normally purchase from locally famous boutique shops that have carved themselves a niche in the market.
At the low end of the footwear market, products basically cater to the mass market made up of a relatively large low to middle income groups, who may opt to forego quality for price. Taking price into account, this group usually invests in a few pairs of dress, formal shoes. The price points of these products would be around US$10 to US$15 a pair. The majority of the shoes would be of the casual and simple kind.
Production of Footwear/Raw Materials :
The local footwear industry is a labor-intensive operation, with most of the firms small and micro in size. Production is seasonal work, with peak periods before Christmas season and school opening. Workers are hired on a piece-rate basis, as most manufacturers cannot afford to employ workers the whole year.
A major area of concern for the footwear is the sourcing of raw materials. The country does not have a competitive tanning infrastructure that processes semi-finished or finished leather hides. Therefore, procurement of leather and shoe-related components such as shoe lasts, heels,
This paper introduces the basic situation and feathers of current athletic and casual footwear industry and raises that active management of
If a company decides to help differentiate its branded footwear by offering buyers 500 models/styles to choose from, then company managers should evaluate the merits of trying to reduce the $14 million annual costs for production run setup costs associated with producing 500 models/styles at each plant by
Athletic footwear cannot be designed to cater to a large group as in general. It has to produceits products with a distinct difference keeping in mind the age groups or usage groups it isintending to target.
The objective of these establishments, apart from achieving labor cost savings, was to spread risk. Initially, the various production sites were capable of producing the same types of shoes, indicating an insignificant degree of specialization in the production units. However, in recent years ECCO had strived to narrow each unit and capitalize on its core competencies.
sale of Nike’s high-margin products to high-end customers. Regardless of the low cost of the World Shoes, they
Solely Shoe Industry has an annual revenue of about $360.1 billion. Europe is the largest market of shoes all over the
Footwear International is a multinational manufacturer and marketer of footwear that has 83 companies in 70 different countries. One of these locations is
Supplier is moderately concentrated. There are many suppliers in China who were coping the product and styles and selling poor versions of the shoe. Low – Medium.
By the use of Porter’s Five Forces model to analysis the athletic footwear market around the world; our strategy is to cut the price of footwear in the Year 11 and 12, and to increase budget of advertisement and to bid celebrity endorsements in order to boost the sales volume in a competitive industry .
Nike subcontracts the production process of its footwear to 900 contract factories located worldwide with Asian developing countries such as China, Indonesia and Vietnam accounting for the bulk of total world production. Production of the footwear is based on a vertically integrated model. In the primary stage, raw materials such as rubber, leather and plastic are extracted from places located in close proximity from the factories. In the secondary stage, the extracted resources are sent to the factories or “Sweatshops” for manufacturing. It should be noted that the whole production process of Nike footwear are being carried out by independent private contractors.
The shoe market is completely governed by competition. There are no monopolies or any other rules defining the pricing here.
The athletic shoe industry will be first analyzed by the Porter’s Five Forces framework. The well-known Porter’s Five Forces is a model that analyzes an industry and helps firms develop a business strategy. The five forces model focuses on six forces that will determine the attractiveness of this industry: (1) the risk of entry by potential competitors, (2) the intensity of rivalry among established companies within an industry, (3) the bargaining power of buyers, (4) the bargaining power of suppliers, (5) the closeness of substitutes to an industry 's products, and (6) the power of complement providers (Hill, Jones, & Schilling, 2015).
High demand for quality and reduced lead times led the company to a self-sufficiency approach on streamlining its entire value chain from raw hides to finished shoes unlike its major competitors who only designed and marketed their products without in house manufacturing.
REFERENCESBBC WEB SITEwww.bbc.co.ukCLARKS WEB SITEwww.clarks.co.ukKEY NOTEMARKET REVIEW 2006 CLOTHING AND FOOTWEAR INDUSTRYMINTEL MARKET REPORThttp://academic.mintel.com/sinatra/oxygen_academic/search_results/show&/display/id=220168THE TIMESONLINEhttp://business.timesonline.co.uk/tol/business/economics/article732688.eceVERDICT MARKETING WEB SITEwww.verdict.co.uk/marketing
The athletic footwear industry consists of shoes for a variety of uses. Running, walking, aerobic, hiking, biking, gym, and shoes for various sports are considered athletic footwear. The athletic footwear forecasted to grow at a CAGR of 2.1% between 2016 and 2022. The demand for athletic footwear will continue to increase over the next seven years. This demand is fueled by the change in populations around the world. The increase in urbanization will continue to increase the demand for athletic footwear.