08-05-2013, 02:28 PM
Footwear Industry Capability Map
Footwear Industry.doc (Size: 1.09 MB / Downloads: 33)
Nature of the Industry
Footwear manufacturing is the process of designing, engineering, cutting, stitching and making leathers and man-made materials into an upper, insole, outsole and heel around a wood, plastic or metal last. The last determines the fit and feel of shoes as well as their performance. The units of measurement for shoes sizes differ across countries.
Industry Structure
The Australian footwear manufacturing industry consists of approximately 360 establishments employing approximately 1,880 people (2010-11 figures) and is primarily concentrated in New South Wales and Victoria, together employing 74% of industry workers and contributing 71.3% of industry revenue. Other main Australian states engaged in the industry are South Australia, Tasmania and Western Australia.
The industry has severely shrunk over the last five years. By the end of 2010-11 only 2.85 million pairs were estimated to have been made in Australia, down from 4.82 million in 2005-06. Manufacturers are now producing lower volumes with higher values with the decrease in volume occurring mostly for low-cost products, which are now largely manufactured offshore. The majority of remaining output is for medium to high-value footwear products.
In the five years to 2010-11, industry exports are estimated to have decreased at an annualised rate of 3.0% to an estimated $43 million. Growth in China’s footwear manufacturing activity continues to challenge Australian footwear producers, with export declines in each year, except for 2008-09. New Zealand has been Australia’s most significant export destination, receiving over 45% of Australia’s footwear exports in 2009-10.
Local manufacturers only produce a small portion of footwear purchased in Australia, with competing imports increasing their share of the domestic market. Imports are estimated to account for 76.9% of domestic demand in 2010-11, up from 73.9% in 2006-07 .
The continued growth of Australia’s resources sector represents a possible key market for the expansion of domestic supply of work footwear.
Industry Capabilities and Production Methods
Australian manufacturers have the capability to design, fit and assemble footwear for a range of purposes – including men and women’s casual shoes, men and women’s fashion shoes, children’s shoes and industrial footwear.
Critical Processes
Manufacturers are reliant upon a solitary Australian manufacturer, Shoe Lasts Australia, for their supply of lasts. In the event that supply was interrupted or discontinued, it is unlikely that an alternative Australian supplier could readily be obtained by the majority of manufacturers at a similar cost. It appears that J Robins Manufacturing Pty Ltd remains the only Australian manufacturer with the capability to manufacture lasts in house.
Supply of footwear components (such as insoles, outsoles, reinforcements and heels) from Australian manufacturers is trending towards critical levels. As is the case with the supply of lasts, J Robins Manufacturing remains the only sufficiently vertically integrated manufacturer to produce their required components internally. A limited number of manufacturers are reliant upon J Robins Manufacturing for their supply of footwear components with the remainder sourcing them from offshore.
Supply of footwear materials, whether it be synthetic imports or domestic & global leather supply, are relatively secure for Australia’s footwear industries and Australian manufacturers have been successful in establishing diverse and robust international supply chains.
Australia’s footwear manufacturers do however face significant challenges in preventing the decline in their domestic and export market share. An inability to compete on price with imports has necessitated the move towards innovative, higher value add production to meet customer demand for customised and medium to high value products.
Last Production
General Footwear Manufacturing
With one exception, Australian footwear manufacturers are reliant upon a single domestic company, Shoes Lasts Australia, for their supply of lasts. Manufacturers would need to look offshore to meet their demand for lasts if Shoe Lasts Australia ceased to exist.
It appears that J Robins Manufacturing Pty Ltd is the only domestic manufacturer sufficiently vertically integrated as to be able to internally manufacture lasts should the need arise.
Industrial/Work Boot Manufacturing
As is the case with general footwear manufacturing, industrial/work boot manufacturers are reliant upon Shoe Lasts Australia for their supply of lasts. In the case of injection moulds, manufacturers look to purchase from Germany, Italy or China.
Production Engineering (including tooling, press knives, moulds and dies)
General Footwear & Industrial/Work Boot Manufacturing
Australian footwear manufacturers are currently able to obtain the necessary implements for the majority of the manufacturing process (such as press knives for cutting leather and other materials) domestically. There are concerns however in regards to the steady decrease in the availability of Australian produced press knives. Manufacturers will be forced to source press knives off shore when supply reaches critical levels. This is already the case in regards to mould & die producers with domestic production almost non-existent, with the exception of J Robins Manufacturing.
Mass Customisation
General Footwear Manufacturing
The majority of Australia’s footwear manufacturers produce a range of footwear in various shapes and sizes to accommodate most customers. Most lack the technological capacity to deliver individually customised products without increased costs.
J Robins Manufacturing Pty Ltd and R.M. Williams, along with Shoe Lasts Australia and the Footwear Manufacturers Association of Australia are currently undertaking a project aimed at further developing the technological means for mass customisation of their footwear to meet their customer’s demands.