Bags / Shoes & Accessories

Pouyuen Vietnam, one of the world's largest sports shoe manufacturers, had as many as 6% of its employees resigned during the worst period of the domestic epidemic, making it difficult to meet orders now, and the exports of major brands including Adidas may be affected.

According to a report by Bloomberg, Baoyuan is a shoe factory in Vietnam of Taiwanese-funded enterprise Baocheng (9904), which produces shoes for major brands such as Adidas, Reebok and Converse. Recently, due to labor shortages, production has been delayed. Further affect exports. The representative of Vietnam Bao Yuan subsequently confirmed the report.

u3000u3000 Epidemics are repeated and shipping costs are rising

u3000u3000 These well-known footwear brands began to withdraw from Asia

u3000u3000 November 9, according to Reuters:

u3000u3000 Major garment and shoe manufacturers are moving their production locations to close to retail locations in the United States and Europe. As the Asian Delta variant virus epidemic is heating up again, production activities earlier this year have slowed down or even been suspended for several weeks.

u3000u3000At the same time, the congestion of shipping has led to higher costs and forced companies to rethink their global supply chains and their strategy of establishing low-cost manufacturing centers in Asia.

u3000u3000 The latest case is Spanish fashion retailer Mango, which told Reuters on Friday that it has "accelerated" the production process in Turkey, Morocco, and Portugal. In 2019, a large part of the company's products were purchased from China and Vietnam. Mango told Reuters that in 2022, it will "significantly" expand the number of local production in Europe.

Similarly, American shoe retailer Steve Madden said on Wednesday that it has reduced production in Vietnam and transferred 50% of its shoemaking activities from China to Brazil and Mexico. Another shoe manufacturer Crocs said last month that production Activities are moving to Indonesia and Bosnia.

u3000u3000 Bulgaria, Ukraine, Romania, the Czech Republic, Morocco, and Turkey are some of the countries that attract apparel and shoe manufacturers to set up factories, but most of the products in the apparel sales chain in the United States and Europe are still produced in China.

u3000u3000 To be sure, many companies still rely heavily on Vietnam, and Vietnam’s recent shutdown has caused serious disruption. The Vietnamese government said in October that due to the new crown epidemic restrictions and worker shortages, clothing exports this year will be difficult to meet the standard. In the worst case, it will be US$5 billion less than the target.