According to statistics, in 2005, Vietnam reached US$2.9 billion from footwear export, up 13.6 per cent on-year. In 2005, the fact that EU has been reconsidering the Generalised System of Preferences and the anti-dumping lawsuit against Vietnamese leather shoes had a great impact on local footwear production. Until now, it has been very difficult for Vietnamese footwear enterprises to sign new contracts, expand market and set plan for 2006’s exportation. Most of partners remain waiting for European Council’s last decision on the lawsuit.
Mr. Nguyen Gia Thao, Chairman of Vietnam Footwear Association said that footwear enterprises have carried out activities to promote exports to new markets since the last months of 2005. In addition, the footwear industry has worked out an overall strategy towards reaching an export turnover of US$ 3.7 billion in 2006. In the short term, solutions proposed are: focusing on human resource development, infrastructure improvements, investing in producing materials to reduce prices. In particular, enterprises should carry out both export and various activities to advertise their products and trademarks, thus improving their image on new markets.
In 2006, Japan will still be considered the largest Asian market for Vietnamese footwear. Last year saw a rather high growth of exports to this market, increasing 75 per cent at times. However, Vietnamese footwear enterprises still have to overcome many barriers to continue achieving successes on this market. Japanese consumers have strict requirements for quality. They are ready to pay a rather higher price for products with high quality and durability. These requirements include after-sales services such as timely distribution in case of damage caused by transportation such as small scratches or left pieces of thread. One of principles that helps Vietnamese firms gain success in their integration into Japanese market comes from the ancient idiom, “When in Rome, do as the Romans do”, following market information, diversifying products, strengthening popularisation, actively participating in fairs, exhibitions and asking Japanese consultants for advice…
According to the forecast, in 2006, sneakers will be back and trendy, especially high-grade and leather-capped sneakers. Therefore, firms which still keep the production line of sneakers will have favourable conditions to develop and increase orders, especially ones in large quantities. Next year, sneakers will be exported mainly to two key markets with large consumption namely Japan and the US. Foreign-owned enterprises and joint-ventures still gain advantages over others. Currently, catching this demand, many firms are preparing to launch products considered to be best-sellers next year such as sneakers, sports shoe, rubber sandals and slipper. In comparison with Japanese, the US consumers are not very fastidious, however, American sanctions are common trade barriers used by producers to protect domestic production. Therefore, integrating into the American market, Vietnamese footwear enterprises should launch a suitable market development strategy, to avoid possible anti-dumping lawsuits.
According to Ms. Dinh Thi My Loan, Head of Competition Administration Department, Ministry of Trade, Vietnamese footwear enterprises will face many challenges in 2006. Eighty per cent of Vietnamese footwear enterprises are outsourcing ones, not direct producers and exporters. In addition, local firms are short of inputs; Vietnamese economic conditions and service infrastructure have not kept up with other foreign footwear exporters. Therefore, to successfully obtain the set target for 2006 will require strong efforts on behalf of Vietnamese footwear enterprises in which seeking new markets is a vital task.
Kim Phuong
Vietnamese
