Footwear companies are increasingly ordering their products from Vietnam. If you are in the industry, you might be wondering, why is this happening? How does Vietnam handle export items? What are the basics of the importation of goods into the United States?
Over the last decade, China has lost increasingly more business to Vietnam’s footwear manufacturers. Companies such as Fast Retailing Co., Ltd. have moved operations from China to other countries, as their wage costs are cut in half when manufacturing in Vietnam.
Indeed, in 2014, Nike, Adidas, and Puma increased their business with Vietnam by 25% compared to 2013. Furthermore, in 2017, factories in Vietnam produced 44 percent of Adidas footwear. Worldfootwear.com also noted that Vietnam’s footwear exports are up by 11% for the year. So, how does this translate to dollars? In the first nine months of 2018, Vietnam exported nearly 11.8 billion US dollars’ worth of footwear.
“According to the latest edition of the World Footwear Yearbook, in 2017 Vietnam produced 1.1 billion pairs of shoes (a share of 4.7% in worldwide production), taking the third position as the largest producing country. In 2017 Vietnam was the second largest exporter of footwear with a 7.1% share (1.0 billion pairs) behind China (9.7 billion pairs; 67.5%).”
Footwear companies are also choosing Vietnam manufacturers because of their import-export processes. Vietnam wants a vibrant economy, and they have few, if any, barriers to products for export.
The most common and inexpensive way to start exporting products from Vietnamese footwear manufacturers is by first establishing a trading company. In order to be permitted to export, (or import,) a foreign investor must also register with the Department of Planning and Investment (DPI). Additionally, the investor must obtain an Investment Certificate. The good news is that most goods and services being exported from Vietnam are exempt from tax.
Prior to importing a product, you may contact the U.S. Customs and Border Protection (CBP) office at the port of entry where your merchandise will enter the United States. A complete directory of the various ports of entry can be found on the CBP website. There are many rules regarding the subject of imports to the U.S.A., but footwear is not hazardous in any real way, so the barriers are low.
According to U.S. Customs and Border Protection, “CBP does not require an importer to have a license or permit, but other agencies may require a permit, license, or other certification, depending on the commodity that is being imported.”
In conclusion, Vietnam footwear manufacturers are in demand, and the demand is growing. Although importation into the U.S.A. has its regulatory hurdles, importing products from Vietnamese footwear manufacturers shows no significant barriers.…