Nike and Adidas recently announced they will both be taking their manufacturing away from China and into Vietnam.
According to GQ, at a shareholder meeting, Adidas’ CEO Kasper Rorsted reported that 44% of his company’s shoes were made in Vietnam last year. He compared this to 31% made in Vietnam only five years ago. Only 19% of Nike shoes were made in China in 2017 compared to 32% in 2012.
China was responsible for the manufacturing of most Nike and Adidas’ shoes just 10 years ago. But since wages have gone up in Chinese factories, the shoe companies have decided to move to a area with cheaper labor such as Vietnam. So the shoes you see at your local Payless or Foot Locker are likely going to be made in Vietnam. Higher-end brands like Burberry and Balenciaga will still be made in China, though.
According to Quartz, Vietnam is now responsible for producing more than twice as many Adidas sneakers as China. This switch isn’t just happening with U.S. brands. Japan’s largest fashion chain Uniqlo has increased Vietnam suppliers by around 40% over the last year or so. They’ve been on the hunt for options other than China.
Vietnam isn’t the only part of Asia seeing an increase in manufacturing production. Indonesia, Thailand, and Malaysia are all taking part in the manufacturing world. In fact, for Adidas Indonesia is actually the second biggest source of production. It’s followed by Vietnam and leads China, which sits in spot number three.
This isn’t saying that China has fully lost its manufacturing mojo, yet. All-in-all, China still leads the world in clothing and footwear manufacturing. Adidas and Nike still produce their clothing options in China while moving their footwear production elsewhere. But even though they still currently dominate, the country needs to be aware of what might happen in the future. Eventually, it’s likely that all clothing and sneaker production jobs will move outside of China.
The landscape of sneaker production has changed a lot over the past few years. And while manufacturers contribute $2.17 trillion to the U.S. economy, we can expect even more changes in the years to come.
