Why is Vietnam a great country to develop and produce footwear?
Since the beginning of Innolux Footwear, our factories have been located in Vietnam. Some might wonder why we are based in Vietnam? Well, to us, the question should actually be, why would we not be?
In the early 2010s, manufacturers started broadening their views beyond China as labour costs were rising. Relocation to Asian state Bangladesh was preferred at first. However, Vietnam gained popularity thanks to the more convenient shipping logistics, superior infrastructure, eye for sustainability and craftmanship and the availability of good quality raw materials and leathers.
Nowadays, Vietnam is the third-largest footwear manufacturer in the world. On average around 920 million pairs of sneakers, sandals, heels and boots combined are produced every year. Annually, more than 800 million pairs are exported to a multitude of countries.
Vietnam more attractive than China
Despite being much smaller than neighbouring state China, Vietnam has proved to be a more attractive country to produce footwear. In fact, some of the biggest shoe brands have located their factories in Vietnam. Think of sneaker multinationals such as Nike, Adidas and Puma!
One of the main reasons Vietnam is such an attractive to produce footwear, is based on the fact that there are little to no duty restrictions when exporting from Vietnam. As of the first of August 2020, the EVFTA (European Vietnam Free Trade Agreement) has been implemented, allowing for 99% of exporting produce to be shipped into Europe without import duties.
Logically, the already large production increased even further, allowing for more diverse and even better-quality shoemaking as money shifted from duties to quality investments. The EVFTA has given an impulse to the already existing European clientele of Innolux. Partners can now easily start their shoe production in our factories and afterwards sell their products in European stores without having to keep up with high duties!
Besides of this, during and since Covid-19, lots of companies want to spread risks and other known facts, and move a big part of production from China to Vietnam and other Asian countries.
Sustainability in Vietnam
Another reason Vietnam has been very on trend is thanks to the growing sustainability movement. Manufacturers, designers and tanners based in Vietnam are picking up on the recycled and ecofriendly materials, moving from original leather to light products or vegan alternatives. Good to know that Vietnamese don’t like to fake or greenwash business, you can be sure they follow instructions and supply genuine, 100% correct required certifications.
Concepts such as ‘biodegradable’ as well as the idea of eco-consciousness are gaining popularity among shoe producers. Although, the price point is rather high for these materials and products, consumers are increasingly willing to pay more for a better quality, better service and a sustainable pair of shoes.
For most manufacturers these developments are stressing the importance of quality of materials, craftmanship, certifications (GRS, GOTS, FSC, Fair Trade etc.) and good design. As the bar is set higher, Vietnam is truly set apart from other Asian countries where low wages and synthetic materials are still the standard.
We are constantly evolving and looking for more sustainable production initiatives and usage of materials. Increasing knowledge about environmental pollution and decreasing emissions are at the top of the list for Innolux. Therefore, we offer a great variety of vegan alternatives, but also works with Lite leather from tannery Isa Tantec (Low Impact To the Environment), which saves gallons of water in the production of the material.
During Linea Pelle and Simac in Milano in september 2021 new materials and innovative machinery has been sourced to make sure to supply latest updates and innovations to our partnering brands.
Supply Chain in Vietnam
Similarly, thanks to the growing view on sustainable and high-quality production, tanners located in Vietnam are evolving their materials too.
At Innolux, we prefer to work with amazing tanneries located in Vietnam, Leather Working Group gold members, which ensures the quality of the leather is great and tanned in a sustainable way. Our productions meet the standards our partners are looking for. At least 60% of the materials used in Innolux come from Vietnam.
Workforce in Vietnam
Lastly, and probably most importantly, one of the main reasons we are located in Vietnam is simply because we love Vietnam! The Vietnamese culture with its beautiful architecture and nature, delicious food and incredibly friendly people make that we do not want to work elsewhere. Our employees hold a variety of nationalities reaching from Vietnamese, Filipino, Indians to Scottish, English, South African, Israeli and Dutch. Though, the Vietnamese culture is very welcoming and all or our staff are part of a big Vietnamese community!
We are happy to mention that since mid september, the moment it’s possible to work again in the green zones, lots of new colleagues joined in our MU-1 (Dongnai)) and MU-2 (Binh Tuan) factory. Innolux is based on the green country side 2 hours west of Ho Chi Minh. A lot of people left Ho Chi Minh City and returned to their homedowns on the countryside, looking for jobs near their homes.
We hope to welome you in Vietnam!