Footwear industry accelerates green transition, strengthens supply chains

Footwear industry accelerates green transition, strengthens supply chains

Lefaso has called for faster development of the domestic supporting industry to reduce reliance on imported materials. It also proposed establishing strategic raw material reserves and trading platforms to improve supply security.

A shoes production line at Viễn Thịnh Shoes Company in Long Hậu Industrial Zone in southern province of Tây Ninh. Việt Nam is currently the world's third-largest footwear producer, after China and India, and the second-largest exporter.— VNA/VNS Photo

Việt Nam's footwear industry is stepping up efforts to build greener production and strengthen domestic supply chains as it seeks to maintain export growth amid global uncertainties.

The sector earned nearly US$12 billion from exports in the first half of 2026. During the period, Việt Nam also overtook China to become the largest footwear supplier to the US market for the first time.

Footwear exports reached $11.95 billion during the first six months of the year, up 0.5 per cent from a year earlier. Although shipments to markets such as China, Japan, the UK and Mexico declined, exports recovered strongly toward the end of the second quarter.

In June alone, overseas shipments rose to $ 2.16 billion, more than $200 million higher than in May, supported by strong demand from the US and the EU, statistics show.

The US remained Việt Nam's largest export market, accounting for nearly 39 per cent of the industry's total export value with shipments worth an estimated $4.55 billion during the year's first half, up more than 6 per cent year-on-year.

Việt Nam is currently the world's third-largest footwear producer, after China and India, and the second-largest exporter. Around 90 per cent of its footwear production is sold overseas.

However, the industry's heavy dependence on exports also makes it vulnerable to external shocks. Experts say geopolitical tensions, rising logistics costs and increasingly strict trade policies in major markets are putting pressure on manufacturers.

Dr Võ Trí Thành, President of the Institute for Brand and Competitiveness Strategy, pointed out that businesses are facing both supply chain disruptions caused by geopolitical conflicts in the Middle East and growing trade protection measures in the US.

Raw materials account for 60–65% of the cost of producing a pair of shoes. Facts in the second quarter showed that companies with sufficient inventories were better able to cope with higher logistics costs to deliver orders on time, while many smaller firms had to reject export orders because they lacked materials.

To strengthen competitiveness, the Vietnam Leather, Footwear and Handbag Association (Lefaso) has called for faster development of the domestic supporting industry to reduce reliance on imported materials. It also proposed establishing strategic raw material reserves and trading platforms to improve supply security.

The industry is also accelerating its green transition to meet stricter sustainability requirements, particularly in the EU, including carbon reduction, product traceability and Digital Product Passport regulations, according to Lefaso Vice Chairwoman and General Secretary Phan Thi Thanh Xuan.

Since the second quarter, many large manufacturers have increased investment in clean technologies, automation, digital transformation and environmentally friendly materials. At the same time, companies are shifting from contract manufacturing to original design and brand development while leveraging the 17 free trade agreements Vietnam has signed to expand into new markets such as India, the Middle East and Africa.

Lefaso said maintaining a skilled workforce also remains essential, adding that stronger supply chain resilience will be key to helping Vietnam preserve its position in the global footwear market. 

Bizhub