VIETNAM LEATHER AND FOOTWEAR INDUSTRY

The global’s tanning industry is characterized by small or medium-sized family businesses. Countries with the fastest growing in tanning industry such as South Korea, Taiwan, China, and Indonesia, have difficulty in supplying raw materials and have to import large quantities of raw materials. Currently, many tanneries have been built in these countries to meet the growing demand for leather, while most of the tanneries in Europe, Japan, and the United States have been shut down. Over the years, the global’s leather consumption growth has been negligible for cow leather and decreased by 2% per year for sheep and goat leather. In contrast, skin consumption in developing countries has tended to increase sharply.

The Far East continues to be the largest net importer of cow leather. This is due to the development of leather products and footwear production in China, Vietnam … Export of cow leather from Africa has grown at a rapid pace due to the important supply of some countries such as Kenya, Ethiopia, Somalia, and Zimbabwe. While exports of sheep and goat leather are likely to decline due to the reduction of domestic demand.

Total global footwear production maintained 23 billion pairs in the past two years after an average growth rate of 15% from 2010 to 2014. China, India, and Vietnam are the global’s largest footwear producers with 70% of world output.

Leather and footwear manufacturing is a key industry of Vietnam. However, the production of leather and footwear is still mainly in the form of export processing, with the source of input materials specified by importing customers. Therefore, the value added to the product is low and highly dependent on the supply from abroad. Each year, Vietnam consumes billions of dollars to import. The localization rate of leather and footwear industry at 50% is not enough to meet the export requirements of Trade Agreements (almost 55%) signed and being negotiated. For leather footwear products, the localization rate is even lower due to the dependence on the imported leather source.

Vietnam leather and footwear industry continues to benefit from China’s fluctuations. Such as the devaluation of the Chinese yuan and the high increase in labor costs. In addition, many investors in the leather and footwear industry are turning to invest and expand production in Vietnam (utilizing cheap labor) and to reduce investment risks in China. Along with the participation of foreign invested enterprises, the export turnover of footwear in 2017 reached xx.xxx billion, up 12.7% compared to the same period in 2016. Meanwhile, in China, due to production costs tend to increase, FDI leather and footwear enterprises tend to shift investment from China to Vietnam. The footwear industry is forecast to continue to grow sharply from 8-15% in the period 2018 to 2020.

Abbreviations
Report summary
1. Business environment
1.1. Macroeconomic situation
1.2. Legal framework
1.3. Free trade agreements
2. Overview of Global Leather and Footwear Industry
2.1. Value chain of Leather and Footwear Industry
2.2. Production Methods
2.3. Leather industry
2.3.1. Raw materials
2.3.2. Production
2.3.3. Consumption
2.3.4. Import export
2.3.5. Price movements
2.3.6. Some typical countries
2.4. Footwear industry
2.4.1. Raw materials
2.4.2. Production
2.4.3. Consumption
2.4.4. Import export
2.4.5. Footwear prices
2.4.6. Some typical countries
2.4.7. Some famous brandnames
3. Overview of Vietnam Leather- Footwear  industry
3.1. History of Establishment and Development
3.2. Industry Scale and Features
3.3. Leather industry
3.3.1. Raw materials
3.3.2. Production – Consumption
3.3.3. Export
3.3.4. Import
3.3.5. Inventory
3.4. Foodwear industry
3.4.1. Raw materials
3.4.2. Production
3.4.3. Consumption
3.4.4. Export
3.4.5. Import
3.4.6. Footwear prices
3.4.7. Inventory
3.4.8. Distribution channels
3.5. Some other leather products
3.6. Machinery/Technology
3.7. Risks and Threats
3.8. Industry Planning
3.9. Driving Forces and Forecasts
4. Enterprise Analysis
   Appendix

 

Pou Yuen Vietnam Co., Ltd (HCMC)
TaeKwang Vina Industrial JSC (Dong Nai)
Chang Shin Vietnam Co., Ltd (Dong Nai)
Hwa Seung Vina Co., Ltd (Dong Nai)
Pou Sung Vietnam Co., Ltd (Dong Nai)
Pou Chen Vietnam Co., Ltd (Dong Nai)
Thai Binh Footwear Investment and Production JSC (Binh Duong)
Dona Standard Vietnam Footwear Co., Ltd (Dong Nai)
Ty Xuan Co., Ltd
Samho Footwear Co., Ltd

List of figures
Figure 1: GDP growth, 2010 – 3M/2018
Figure 2: Monthly CPI fluctuations 2014 – 3/2018
Figure 3: Total disposable income and household expenditure, 2010 – 2017f
Figure 4: Average population and population growth, 2006 -2017
Figure 5: Import export, Q1/2015 – Q1/2018
Figure 6: Export structure by commodity category, 3M/2018
Figure 7: USD/VND exchange rate, 2016 – 3/2018
Figure 8: FDI attraction by sector, 3M/2018
Figure 9: Retail sales of goods in Vietnam, 2010 – 3M/2018
Figure 10: The market share of modern retail in total retail revenue 2014
Figure 11: Consumer confidence index – CCI
Figure 12: Leather production, 2010 – 2015
Figure 13: Leather consumption, 2010 – 2014
Figure 14: Leather consumption structure by products, 2013
Figure 15: Footwear production structure by region, 2016
Figure 16: Global footwear output, 2011 – 2016
Figure 17: Market share of consumption by region, 2016
Figure 18: Global footwear consumption, 2010 – 2016
Figure 19: Footwear consumption by type, 2015 – 2017e
Figure 20: Footwear consumption value, 2012 – 2017e
Figure 21: Localization ratio by enterprises and sectors (%)
Figure 22: Total output of some tanned leather products, 2012 – 3M/2018e
Figure 23: Tanned leather imports, 2010 – 2017e
Figure 24: Tanned leather import structure by country, 2017e
Figure 25: Leather exports, 2012 – 2017e
Figure 26: Leather export structure by country, 2016e
Figure 27: Number of enterprises by region, 2015
Figure 28: Total output of main products, 2012 – 3M/2018e
Figure 29: Domestic footwear consumption, 2010 – 2016e
Figure 30: Retail sales of footwear, 2012 – 2017e
Figure 31: Sport shoes retail sales, 2012 – 2017e
Figure 32: Sales of some major sport shoes types, 2017e
Figure 33: Consumption struction by value, 2017e
Figure 34: Consumer structure by shoe spending per month, 2013
Figure 35: Footwear consumption structure, 2014
Figure 36: Footwear consumption segments in Vietnam
Figure 37: Footwear exports, 2012 – 3M/2018e
Figure 38: Footwear exports by country, 3M/2017 – 3M/2018e
Figure 39: Contribution structure of enterprises in leather – footwear export, 2012 – 3M/2018e
Figure 40: Footwear imports, 2010 – 2016e
Figure 41: Footwear import structure by country, 2016e
Figure 42: Average footwear export price, 2014
Figure 43: Export of bags, suitcases, wallets, etc, 2012 – 3M/2018e
Figure 44: Export structure by enterprise, 2013 – 3M/2018e
Figure 45: Growth rate of product output (%/year)
Figure 46: Total investment capital in planning period (VND billion)
Figure 47: Net revenue, 2015 – 2016
Figure 48: Gross Profit, 2015 – 2016
Figure 49: Corporate Income Taxes, 2015 – 2016
Figure 50: Pou Yuen’s profits
Figure 51: Selling expenses, 2015 – 2016
Figure 52: General & Administrative expenses, 2015 – 2016
Figure 53: Self-financing rate, 2015 – 2016
Figure 54: Liabilities,, 2015 – 2016
Figure 55: Profit margin, 2015 – 2016
Figure 56: Solvency, 2015 – 2016

List of tables
Table 1: Legal documents related to leather quarantine
Table 2: Top 10 footwear producers 2016
Table 3: Top 10 footwear consuming countries, 2014 – 2016 (Million pairs)
Table 4: Sport shoes consumption value, 2015 – 2017e (USD million)
Table 5: General information about the leather and footwear industry of Vietnam
Table 6: Competitive comparison between Vietnamese and Chinese products
Table 7: Market share of shoes brands in Vietnam, 2014 – 2017
Table 8: Typical footwear exporting enterprises, 2017
Table 9: Top major importing markets of EU-28, 2012 – 2017
Table 10: Top major importing markets of the US, 2012 – 2017
Table 11: Export value by HS code
Table 12: Export price by HS code in some countries
Table 13: Price of some major footwear types in Vietnam, 2012
Table 14: Production volume
Table 15: 10 enterprises having the highest revenue in the leather and footwear industry
Table 16: Other indexes, 2016