Philippine Footwear Industry :

Topics: Shoe, Athletic shoe, Footwear Pages: 25 (3684 words) Published: September 11, 2012

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 foreign investments.

Production of footwear in the country is concentrated in Metro Manila, where about 43% of all shoe manufacturers are situated. Within the area, City of Marikina is the center of the footwear business wherein almost three fourths of all shoe producers. Moreover, most of manufacturers in the industry are micro to small in size. Firms usually have their own shop facilities, although a small number rely on subcontractors for production work.

Market Distribution :

The Footwear companies market and distribute their products thru own boutique stores while other rent space in large department stores and malls. The specific market segments for the sector are defined according to the price and quality of the product. These range from cheap, low-end footwear made from synthetic materials to high-end and well-crafted leather shoes based on European or American designs or brands.

The majority of shoe producers utilize manual and semi-automated processes in their manufacturing operations. The United States is the largest market for footwear products, while China is the world’s largest suppliers.

Local shoe producers face still competition in the market mainly from low-priced products coming from China and other Asian countries. The industry also has difficulties regarding raw materials supply. Local leather, as well as other shoe components, are not desired quality and price. Producers generally have to rely on imports for their materials and suppliers.

Channels of Distribution of Footwear :

The Footwear industry production is absorbed by the domestic market. Though manufacturers have various distribution channels, department stores are still the best market. Big manufacturers are capable of having their own domestic retail stores and direct concessionaires in big department stores. Traders can go from low end retail markets to high end national and provincial department stores. Some manufacturers who are also traders also concentrate on foreign markets by contacting retail outlets by direct selling to Overseas Filipino Workers and foreign buyers.

Market Segmentations :

Footwear product lines vary according to fashion and cater to specific market segment, the market segmentation for this sub-sector follows the same pattern as that of garments in that it is based on the income levels and the lifestyle of the end consumer. There are basically three distinct market segments for footwear based on quality and price.

The high end market represents the upper echelon of the market segment. Buyers in this category can afford luxury items and indulge in extravagant lifestyles. This group normally buys imported shoes ranging from US$100 a pair to US$500 a pair in the local retail market. Preference leans towards Italian, French and American branded shoes. While customers from this sector purchase mostly imported branded ones, they occasionally also purchase the locally made, branded footwear of select local boutiques. Normally, local boutiques brands are made from imported materials. The average price point of the locally manufactured high-end...
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