Domestic brands walk tall in VN market

Monday, Jul 15, 2013 08:00

Shoes being produced at Huu Nghi Da Nang Joint Stock Company. Made-in-Viet Nam footwear is the first choice for a majority of Vietnamese customers. — VNA/VNS Photo Ha Thai
HCM CITY — Made-in-Viet Nam footwear is the first choice for a majority of Vietnamese customers, according to the Viet Nam Leather and Footwear Association (LAFASO).

The association says the finding comes from a recent survey that studied consumer behaviour patterns in five major cities and provinces – Ha Noi, HCM City, Hai Phong, Thanh Hoa and Binh Duong.

The survey was an attempt to help enterprises keep abreast of market demand and develop strategies for product design, pricing and distribution.

The survey showed that almost two-thirds, or over 70 per cent, of the respondents would purchase local shoes and sandals as their first choice.

The association said the survey also highlighted the growth potential of the domestic footwear market.

It found that about 65.9 per cent of the respondents spend less than an average of VND200,000 (approximately US$10) per month on footwear.

Twenty per cent of the respondents said they were ready to spend VND500,000 (US$24) and the remaining said they would pay even higher sums on their footwear per month on average.

Industry insiders said these figures indicate great growth potential since consumers appear willing to spend significant sums on their footwear, and this expense would only increase when incomes go up in the future.

Three well-known Vietnamese shoe brands most favoured by respondents are Biti's, Thuong Dinh and Vinagiay, the survey found.

Nguyen Thi Thanh Xuan, deputy general secretary of LEFASO, said the survey results would help domestic producers understand Vietnamese consumers better and develop suitable production and marketing strategies.

Local firms can also adjust their product designs to better meet consumer preferences, she said.

The survey showed, for instance, Vietnamese consumers bought their footwear at retail shops (40.8 per cent), footwear centres (28.3 per cent) and enterprises'own stores (18 per cent). Consumers make their choices based on reasonable prices, quality assurance and convenience, Xuan said.

The survey findings indicate that despite their limitations in production capacity, design and distribution, domestic footwear makers have opportunities to expand their market share in the coming years, she said.

Deputy general director of the Binh Tien Consumer Goods Company Limited (Biti's), Nguyen Duy Thanh, said footwear is a fashion product, so it is very important to keep creating new products and designs, especially considering the fierce competition from Chinese imports.

Each month, Biti's needs to introduce at least 50 new shoe designs if the company is to survive, Thanh said.

In addition to improving product quality and designs, Biti's has also increased investment in developing distribution networks and after-sales services, he said.

The company's factory has an annual production capacity of 20 million pairs, 55 per cent of which are sold in the domestic market via 60 major direct distribution centres and 3,500 agents.

As a result, the company has been able to increase its turnover by between 20 and 30 per cent every year, Thanh said.

Xuan said fashionable design was the Vietnamese footwear industry's weakest point.

This could be seen in the fact that 59 per cent of those preferring to buy foreign shoes said their choice was influenced by their design, she said.

To further expand their market share, domestic shoemakers should pay more attention to improving product designs and come up with effective sales strategies, Xuan said. — VNS

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