Buddy Tan of Marikina-based custom shoemaker Black Wing Shoes has penned an insightful piece on the decline of Philippine shoemaking and how imported footwear became favoured over local brands. For those who aren’t familiar, Black Wing Shoes along with Sapatero are a few of the brands breathing new life into local shoemaking.
On the struggle of small and micro manufacturers:
The limited capacity to produce coupled with the inability to keep up with more advanced styles created an environment where the small and micro scale manufacturers continued to limp on while opportunities to modernize became even more limited due to the high risk of investment. Some small scale manufacturers with enough revolving capital though still supply to some major department stores and have continued to survive throughout the years but styling has become limited due to the available materials and cost prohibitions.
On the change in the market environment:
The local manufacturing industry also has to cut on labor costs and scrimp on materials just to be able to compete with imported items in terms of pricing on the entry level market. This diminishes the product both on the value side and price side because even with the cost cutting, the product still cannot match imported ones in terms of style and appeal (build quality is different though). This is where I think local can still shine though, the build quality of our entry level products are better but often undermined by the low cost materials used in order to compete still.
Buddy didn’t mention that the cost to produce shoes here in the Philippines (in terms of labor, electricity, materials) is much higher compared to countries such as China and Vietnam. Trying to compete with shoes made in these countries is very difficult that the margins no longer make sense, as Buddy also pointed out.
I believe the way forward for Philippine shoemakers is for larger manufacturers such as Bristol Shoes to move away from the mass market and into the higher end of the spectrum. Sapatero has proven that people are willing to pay more for locally made shoes that use better materials. The margins are better and it’s easier to sell to a market with more purchasing power.