Vietnam Footwear Market: Promoting Domestic Product Development and Solutions for Difficult Problems in Businesses
Eminent brands such as Adidas, Puma, and Nike currently dominate the Vietnamese shoe market, prompting vigorous competition between foreign and domestic footwear brands. Even some well-known companies, such as Biti's and Thuong Dinh, struggled in the race for market share. In this context, Vietnamese enterprises have been continually developing and applying technologies in order to produce innovative products.
Vietnam's footwear industry has numerous opportunities to grow in the context of globalization and the introduction of trade agreements. However, we face numerous obstacles that push organizations in the industry to adapt in order to overcome these challenges and compete in the global market. Particularly in the last two years, when imported goods made up 60% of the market share, the domestic footwear market was left untapped. This figure demonstrates the low level of local product demand in our nation and the inadequacy of domestic consumer support to ensure the dominance of Vietnamese-branded footwear products.
Imported brands dominate the Vietnamese footwear market.
Vietnamese shoes have not achieved significant advances in product quality and design, which is one of the key reasons why it is challenging to compete with foreign products.The decline of Thuong Dinh Shoes serves as evidence. Thuong Dinh Shoes were formerly a well-known brand both domestically and abroad, but they are too sluggish to develop and can't keep up with the times, which causes diminishing business results. Thuong Dinh Shoes are significantly “older” than other shoe companies in Vietnam, both in terms of age and style, with a lifespan of more than 60 years. Thuong Dinh Shoes, on the other hand, are essentially at a standstill and are falling even further behind while other enterprises are continually changing to keep up with the integration phase. Thuong Dinh Shoes experienced a significant drop in revenue to VND 104 billion, a loss of VND 114 billion, according to the financial report for 2020. The brand improved in 2021 as the loss decreased by about 17.7 times, but liabilities remained high at VND 64.78 billion.
Thuong Dinh Shoes, a 60-year-old brand, is dwindling.
After many years of success, Biti's, a shoe brand, is also facing pressure. Biti's, which was established in the early 1980s, immediately gained popularity for its sturdy sandals and sports shoes. However, recently, Biti's brand has been under great pressure because it is slow to launch new product lines. Therefore, popular product lines like Adidas, Puma, Nike, etc. rapidly eclipse Biti's in popularity. The brand's growth is constantly disrupted and progressively slowed down in 2020 and 2021. Compared to 2019, Biti's revenue in 2021 fell by over 40% to more than VND 1.200 billion. The net profit on the financial statement of the parent company of Biti’s (Binh Tien Consumer Goods Production Company Limited) decreased to less than VND 10 billion, a decrease of more than 90%., v.v. Trong hai năm 2020 và 2021, chuỗi tăng trưởng của thương hiệu liên tục bị gián đoạn và giảm dần. So với năm 2019, doanh thu năm 2021 của Biti’s giảm gần 40%, còn hơn 1.200 tỷ đồng. Lãi ròng trên báo cáo tài chính riêng lẻ của Biti’s (Công ty TNHH Sản xuất Hàng tiêu dùng Bình Tiên) xuống dưới 10 tỷ đồng, giảm hơn 90%.
With innumerable international brands entering Vietnam, including Adidas, Puma, Nike, etc., Biti's is under a lot of pressure.
In order to promote the production, development and consumption of product lines while ensuring quality and catching up with fashion trends, we must quickly find solutions to these problems, change, and adapt timely. Several companies have bravely modified their mindset and introduced new product lines that use cutting-edge technology. It should be noted that Run Together was the pioneer in Vietnam introducing the first NFC-enabled running shoes. This is an affordable product line, using EVA foam combined with the Meta-Rocker design, providing elasticity to the feet while keeping the weight light. Run Together, in particular, employs technology and incorporates an NFC chip into the shoe sole to connect with the application in order to track and evaluate training results. Connecting to the Run Together application, users can monitor their step data, running distance as well as track their journey on the routes. Additionally, understanding the aesthetic preferences of customers, the team thoughtfully provided a variety of color options, allowing users to effortlessly combine a variety of outfits for all activities. Although recently launched, Run Together sneakers received positive feedback from the press, media and the runner community. Run Together has met all of its goals, even having a growth rate of 100% per month, according to the latest revenue reports. This figure demonstrates Run Together's ability to confidently compete with other brands.
Run Together technology sneakers have a stunning design and outstanding features.
Domestic product lines must develop and implement 4.0 technologies to increase production and product quality in order to compete with international products. It is believed that, with the new wind from Run Together, the footwear market in our nation will be more inspired to create and introduce more prominent product lines, increasing competitiveness with international products.
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