Chinese footwear dominates Vietnam market

Vietnam ranks fourth on the list of the world’s top 10 shoe exporters, with plans to export $6.2 billion worth of products in 2010 alone. Yet, the domestic shoe market is dominated by foreign-made products, especially those from China.

At a shop that distributes Vietnamese Biti’s brand products in HCM City, there are more than 150 models of footwear for children. A hundred are Chinese.

Chinese products flood shops

The Vietnamese salesperson here advised customers to buy Chinese goods. “Chinese products are diversified in design. Vietnam-made products are durable, but you do not need durable products, because children grow up every day. The shoes that fit your kids today may be outgrown tomorrow,” she reasoned.

At other Biti’s sales agents in HCM City, China-made products were also seen on display. Surprisingly, they are sales agents for a Vietnamese brand, but they mostly sell products from China.

At Giay Viet, Dong Hai, Hong Anh and Pasteur shops, which are well known among Saigonese, there are also a lot of Chinese goods targeting a wide range of customers, from children to men and women, with different price levels.

At supermarkets like Co-op Mart and Maximark, visitors can browse through many shoes on display, but they are all from China.

Staff like selling Chinese goods

When Ly, the owner of the sole distributor of Vietnamese Asia brand footwear, was asked why she sells products with different brands, she explained that retailers need to sell hundreds to thousands of models, while Vietnamese companies can only provide products with a limited number of models.

Ly added that all retail shops sell Chinese shoes, because these products can bring profits 2-3 times higher than those of Vietnam. “While we must make prompt payment to Vietnamese producers, we can defer payment for Chinese products,” she noted.

Tran Huu Thanh, the owner of Long Thanh leather footwear workshop, agreed, revealing that when he sells his company’s products, he can make a profit of 5-8 percent. When selling Chinese products, however, he can make 25-30 percent.

Ngoc Nga, a shoe shop owner at An Dong Shopping Mall, remarked: “Domestically-made products are durable, but there are only several models. The suppliers of domestic products always require deposits, while no deposit is required for Chinese products. You just need to place orders and you will get delivery in five days.”

According to Nga, most Chinese products have been imported across the border. “If you want to sell Chinese goods, you just need to contact wholesalers at Dong Xuan Market or in Lang Son province,” she observed. “Trucks will then carry the goods to you.”

Where are Vietnam’s shoes?

According to the Vietnam Association of Leather and Footwear Association Lefaso, 90 percent of products from big footwear firms are reserved for export. Foreign-invested enterprises (235) make up 70 percent of the total export revenue, while Vietnamese products make up 30 percent.

Vietnam now has 1000 enterprises operating in the footwear industry, but 70 percent are outsourcing for foreign importers.

In fact, big domestic enterprises are not really interested in selling products on the domestic market. Only a small volume of products with Thuy Khue, An Lac and Thuong Dinh brands are available.

Tags: Chinese footwear