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Footwear in Asia-Pacific
Industry Profile
Reference Code: 0200-0619
Publication date: September 2009
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EXECUTIVE SUMMARY
EXECUTIVE SUMMARY
Market Value
The Asia-Pacific footwear market grew by 3.9% in 2008 to reach a value of $34.3 billion.
Market Value Forecast
In 2013, the Asia-Pacific footwear market is forecast to have a value of $42.7 billion, an increase of 24.3% since 2008.
Market Segmentation I
Clothing, footwear, sportswear and accessories retailers dominated the Asia-Pacific footwear market in 2008, generating 65.9% of the market's overall revenues.
Market Segmentation II
Japan accounts for 35.8% of the Asia-Pacific footwear market's value.
TABLE OF CONTENTS
EXECUTIVE SUMMARY 3 CHAPTER 1Market Overview 6 1.1Market Definition 6 1.2Research Highlights 6 1.3Market Analysis 7 CHAPTER 2Market Value 8 CHAPTER 3Market Segmentation I 9 CHAPTER 4Market Segmentation II 10 CHAPTER 5Competitive Landscape 11 CHAPTER 6Leading Companies 13 6.1Shamior Co Ltd 13 6.2The Asics Corporation 14 6.3NIKE, Inc. 16 CHAPTER 7Market Forecasts 20 7.1Market Value Forecast 20 CHAPTER 8Appendix 21 8.1Methodology 21 8.2Industry Associations 22 8.3Related Datamonitor Research 22
LIST OF TABLES
Table 1:Asia-Pacific Footwear Market Value: $ billion, 2004-2008 (8)
Table 2:Asia-Pacific Footwear Market Segmentation I: % Share, by Value, 2008 (9)
Table 3:Asia-Pacific Footwear Market Segmentation II: % Share, by Value, 2008 (10)
Table 4:Key Facts: Shamior Co Ltd (13)
Table 5:Key Facts: The Asics Corporation (14)
Table 6:Key Financials: The Asics Corporation (15)
Table 7:Key Facts: NIKE, Inc (16)
Table 8:Key Financials: NIKE, Inc (19)
Table 9:Asia-Pacific Footwear Market Value Forecast: $ billion, 2008-2013 (20)
CHAPTER 1 MARKET OVERVIEW
1.1 Market Definition
The footwear market consists of the total revenues generated through the sale of all types of men's, women's and children's shoes. The market is valued at retail selling price with any currency conversions calculated using constant annual average 2008 exchange rates.
For the purpose of this report the global figure is deemed to comprise of the Americas, Asia-Pacific and Europe.
The Americas comprises Argentina, Brazil, Canada, Chile, Colombia, Mexico, Venezuela, and the US.
Europe comprises Belgium, the Czech Republic, Denmark, France, Germany, Hungary, Italy, Netherlands, Norway, Poland, Romania, Russia, Spain, Sweden, the Ukraine and the United Kingdom.
Asia-Pacific comprises Australia, China, Japan, India, Singapore, South Korea and Taiwan.
1.2 Research Highlights
The Asia-Pacific footwear market generated total revenues of $34,321.4 million in 2008, representing a compound annual growth rate (CAGR) of 4.3% for the period spanning 2004-2008.
Clothing, footwear, sportswear and accessories retailers proved the most lucrative distributors for the Asia-Pacific footwear market in 2008, generating total revenues of $22,623.9 million, equivalent to 65.9% of the market's overall value.
The performance of the market is forecast to accelerate, with an anticipated CAGR of
4.5% for the five-year period 2008-2013, which is expected to drive the market to a
value of $42,670.3 million by the end of 2013.
1.3 Market Analysis
The Asia-Pacific footwear market is enjoyed sustained growth which is expected to continue over the next 5 years.
The Asia-Pacific footwear market generated total revenues of $34,321.4 million in 2008, representing a compound annual growth rate (CAGR) of 4.3% for the period spanning 2004-2008. In comparison, the Chinese and South Korean markets grew with CAGRs of 10.7% and 4% respectively, over the same period, to reach respective values of $11,683.1 million and $1,868.4 million in 2008.
Clothing, footwear, sportswear and accessories retailers proved the most lucrative distributors for the Asia-Pacific footwear market in 2008, generating total revenues of $22,623.9 million, equivalent to 65.9% of the market's overall value. In comparison, sales made in department stores generated revenues of $7,207.5 million in 2008, equating to 21% of the market's aggregate revenues.
The performance of the market is forecast to accelerate, with an anticipated CAGR of
4.5% for the five-year period 2008-2013, which is expected to drive the market to a
value of $42,670.3 million by the end of 2013. Comparatively, the Chinese and South Korean markets will grow with CAGRs of 8.3% and 4.4% respectively, over the same period, to reach respective values of $17,386.6 million and $2,320.3 million in 2013.
MARKET VALUE
CHAPTER 2 MARKET VALUE
The Asia-Pacific footwear market grew by 3.9% in 2008 to reach a value of $34.3
billion.
The compound annual growth rate of the market in the period 2004-2008 was 4.3%.
Table 1: Asia-Pacific Footwear Market Value: $ billion, 2004-2008
Growth
billion% Year $
2004 29.0
2005 30.2 4.20%
2006 31.7 4.90%
2007 33.0 4.10%
2008 34.3 3.90%
CAGR, 2004-2008: 4.3%
Source: Datamonitor D A T A M O N I T O R
CHAPTER 3 MARKET SEGMENTATION I
Clothing, footwear, sportswear and accessories retailers dominated the Asia-Pacific
footwear market in 2008, generating 65.9% of the market's overall revenues.
Sales made in department stores generated 21% of the market's aggregate
revenues.
Table 2: Asia-Pacific Footwear Market Segmentation I: % Share, by
Value, 2008
Share Category %
Clothing, Footwear, Sportswear and Accessories Retailers 65.90%
Department Stores 21.00%
Hypermarket, Supermarket, and Discounters 5.40%
Discount, Variety Store, and General Merchandise Retailers 4.20%
Cash and Carries and Warehouse Clubs 0.10%
Other 3.40% Total 100.0% Source: Datamonitor D A T A M O N I T O R
CHAPTER 4 MARKET SEGMENTATION II
Japan accounts for 35.8% of the Asia-Pacific footwear market's value.
In comparison, China accounts for a further 34% of the regional market's value.
Table 3: Asia-Pacific Footwear Market Segmentation II: % Share, by
Value, 2008
Share
Geography % Japan 35.80%
China 34.00%
Rest of Asia-Pacific 14.40%
India 10.40%
South Korea 5.40%
Total 100.0%
Source: Datamonitor
D A T A M O N I T O R
CHAPTER 5 COMPETITIVE LANDSCAPE
The footwear market will be analyzed taking footwear retailers as players. The key buyers will be taken as consumers, and footwear manufacturers as the key suppliers.
As footwear is a basic necessity, and thus involves high sales volumes, buyer power for individual consumers is reduced considerably. Many countries in Asia-Pacific provide a cheap manufacturing environment suitable to meet the demands of western retailers for cheaply manufactured goods. This region, therefore, has a high number of footwear manufacturers with a relative lack of differentiation, which weakens supplier power.
Fixed costs are relatively low for retail operations and new entrants are common.
However, owing to the existence of large established retail groups that wield significant economies of scale, it is difficult for such new entrants to increase in size considerably. Although footwear retailing is fairly fragmented, the market is dominated by large retail groups between whom there is a high degree of rivalry.
Buyers with respect to the footwear market are defined as end-user consumers and market players as footwear retailers. The necessity, and therefore high sales volumes, of footwear reduces the buyer power of individual consumers considerably.
As a consequence of fashions and the variety of different functional footwear categories, there is a great deal of differentiation within the footwear market, which, despite increasing choice for consumers, often limits the availability of suitable products and therefore reduces buyer power. Overall, buyer power with respect to the footwear market is moderate.
Many countries within the Asia-Pacific region provide cheap manufacturing environments suitable to meet the demands of western retailers for cheaply manufactured goods. This region, therefore, has a high number of footwear manufacturers with a relative lack of differentiation, which weakens supplier power.
Overall, supplier power with respect to the Asia-Pacific footwear market is moderate.
Fixed costs for retail operations are relatively low and new entrants are common.
However, there exists in this market a number of large established retail groups that wield significant economies of scale through bulk purchasing and pooling certain back office operations. As a consequence of this, it is difficult for such new entrants to increase in size considerably.
Given the large number of low cost manufacturers supplying the market, it is relatively easy for new players to establish the required supply chain. With the exception of certain specialist types of footwear, such as sportswear and designer products, brand recognition of footwear retailers is relatively low, further facilitating the entrance of new players. Overall, the threat of new entrants with respect to the footwear retail market is strong.
As footwear is a basic necessity, the threat of substitutes to the market is limited. However, there is a significant degree of substitution between segments of the market. For example, sportswear is often a substitute for other more traditional footwear types. Overall, the threat of substitutes is moderate.
Although footwear retailing is highly fragmented, the market is dominated by large retail groups, between whom there is a high degree of rivalry. However, fixed costs for retail operations are not prohibitively high and, therefore, smaller companies easily co-exist within the market.
Furthermore, this allows relatively easy expansion of output capacity, which enhances rivalry. There is a high degree of diversity between retailers, with dedicated shoe retailers competing with apparel retailers and large supermarket chains. Overall, rivalry between footwear retailers is assessed as strong.
CHAPTER 6 LEADING COMPANIES
6.1 Shamior Co Ltd
Table 4: Key Facts: Shamior Co Ltd
Address: 1-19-6, Higashi Asakusa, Taito-ku, Tokyo, 111-0025 Japan
Telephone: 81 3387 49602
Fax: 81 3384 9820
Website: www.shamior.co.jp/eng.html
Financial Year-End: March
Source: Company Website D A T A M O N I T O R
Shamior is a Japanese women’s shoe manufacturer which has the capacity to produce 5000 pairs of shoes a day under the brand names of Shamior Golf, Something and Edwin. Company is active in producing, selling and trading shoes.
The company is headquartered in Tokyo, Japan and has an estimated 170 employees and is divided into four major divisions. First division owns domestically run factories and facilities based in Japan, than Tosmat Co., Ltd, Caron Shouse co., Ltd and real Estate Solution.
Key Metrics
There is no detailed financial information available for the company.
6.2 The Asics Corporation
Table 5: Key Facts: The Asics Corporation
Address: 7-1-1, Minatojima-Nakamachi, Chuo-ku, Kobe, 650-8555,
Japan
Telephone: 81783032231
Fax: 81783032241
Website: https://www.doczj.com/doc/a18016407.html,
Financial Year-End: March
Source: Company Website D A T A M O N I T O R
The Asics Corporation is one of the leading sports footwear and clothing manufacturers in Japan. The company makes footwear, sportswear, and uniforms for
a number of sports, including basketball, volleyball, track and field, wrestling, and
running. Footwear accounts for about 50% of sales.
Asics also makes accessories such as socks, sports bags, and protective gear. The company operates subsidiaries in Australia, China, Europe, Korea, and the US.
Japan accounts for about 60% of the company's sales. Asics has around 4,894 employees and is headquartered in Kobe, Japan.
Key Metrics
Asics generated revenues of $2,186 million in the financial year ended March 2008, an increase of 16.3% compared to the previous year. The company's net income totaled $126.6 million in fiscal 2008, a decrease of 5.6%% compared with 2007.
Table 6: Key Financials: The Asics Corporation
20042005200620072008 Revenues1,357.91,417.71,653.11,880.02,186.0 Net Income44.767.7133.4134.1126.6 Profit Margin 3.3% 4.8%8.1%7.1% 5.8% Total Assets1,143.71,184.81,359.01,497.71,798.3 Total Liabilities661.3619.9635.1597.2733.8 Employees4,1613,7083,8364,4624,894 All in $ millions, except for employee numbers and margins
Source: Company Filings D A T A M O N I T O R
6.3 NIKE, Inc.
Table 7: Key Facts: NIKE, Inc.
Address: Nike, Inc., One Bowerman Drive, Beaverton, Oregon 97005
6453, USA
Telephone: 1 503 671 6453
Fax: 1 503 671 6300
Website: https://www.doczj.com/doc/a18016407.html,
Financial Year-End: May
Ticker: NKE
Stock Exchange: New York
Source: Company Website D A T A M O N I T O R
Nike is primarily engaged in the design, development and worldwide marketing of footwear, apparel, equipment and accessory products. The company sells its products primarily through its retail stores and various distributors and licensees, in over 180 countries across Americas, Europe, the Middle East, Africa, and Asia Pacific.
Nike's operations are supported by manufacturing, sourcing and distribution facilities.
The company procures raw materials including natural and synthetic rubber, plastic compounds, foam cushioning materials, nylon, leather, canvas and polyurethane films to make Air-Sole cushioning components used in footwear from Nike IHM, Nike (Suzhou) Sports Company, wholly owned subsidiaries of Nike and independent contractors located in China and Taiwan.
Nike and its contractors and suppliers purchase raw materials for apparel products in the country where they manufacture apparel products for Nike and its subsidiaries.
The key raw materials used in apparel are natural and synthetic fabrics, thread, plastic and metal hardware and specialized performance fabrics designed to repel rain and retain heat.
The company operates one footwear factory which accounts for around 6% of the company's total footwear production. In addition to manufacturing, the company procures footwear from contract suppliers located in China, Vietnam, Indonesia and Thailand.
Of the total Nike branded footwear the company procured 36% from manufacturers located in China, 33% from Vietnam, 21% from Indonesia and 9% from Thailand. The company has manufacturing agreements with independent factories in Argentina, Brazil, India, Italy and South Africa which manufacture footwear for the company to be sold in those countries.
Nike procures apparel for sale from the US and other international markets from independent contract manufacturers located in 34 countries such as China, Thailand, Indonesia, Malaysia, Vietnam, Turkey, Sri Lanka, Honduras, Mexico, Taiwan, Israel, Cambodia, India and Bangladesh. Its largest single apparel factory accounted for approximately 8% of total 2008 apparel production.
Through a futures ordering program the company offers its merchandise to retailers in the US and other international locations.
In the US, the company distributes footwear through its distribution centers located in Wilsonville, Oregon and Memphis. Nike distributes apparel and equipment from centers located in Memphis, Tennessee, Tigard, Oregon, and Foothill ranch, California.
Nike operates 11 distribution centers in Europe, Asia, Australia, Africa and Canada from which it distributes to its stores in international locations.
Nike's operations can be divided into four product lines: footwear, apparel, equipment and other.
The company manufactures and sells footwear for specific athletic use such as running, training, basketball and soccer. It also manufactures and sells sports-inspired urban shoes and children's shoes. In addition, the footwear product line comprises shoes for casual and leisure use.
The company also sells shoes designed for tennis, golf, baseball, football, bicycling, volleyball, wrestling, cheerleading, aquatic activities, hiking, outdoor activities and other athletic and recreational activities. The company offers these products for men, women and children.
Nike offers sports apparel and accessories for athletic activities such as running, training, basketball, soccer, golf, baseball, football and bicycling.
Nike sells sports apparel and accessories for most of the activities for which it offers footwear. Nike's apparel product line comprises sports-inspired lifestyle apparel, athletic bags and other accessory items. The company offers apparel and accessories to complement its athletic footwear products. It also offers footwear, apparel and accessories in collections designed in a similar fashion or for a specific purpose. The company also markets apparel with licensed college and professional team and league logos.
Nike sells performance equipment under the Nike brand name, including bags, socks, sport balls, eyewear, timepieces, electronic devices, bats, gloves, protective equipment and other sports equipment
The company also licenses the production and selling of Nike branded swimwear, cycling apparel, children's clothing, school supplies, eyewear, golf accessories and belts. In addition, Nike sells a wide range of plastic products to other manufacturers through its subsidiary, Nike IHM.
The company offers athletic company owned branded footwear, apparel and equipment through 254 retail stores in the US. Of these 121 are Nike factory stores which carry primarily overstock and closeout merchandise, 14 are Nike stores which also house Nike Women stores, 12 are Nike Towns which are designed to shelf Nike branded products and four Nike employee-only stores.
Nike offers its products in other countries though Nike-owned retail stores and through a mix of independent distributors and licensees. The company sells its products to over 27,000 retail accounts outside the US, excluding sales by independent distributors and licensees. Outside the US, the company offers its products through 141 Nike factory stores, 46 Nike stores, three NikeTowns and 12 Nike employee-only stores.
The company' other product line primarily includes the external sales by its subsidiaries: Cole Haan Holdings, Converse, Hurley International, Nike Golf, and Umbro.
Nike's other businesses comprise subsidiaries through which Nike sells apparel, footwear and accessories of brands other than Nike. Nike's wholly owned subsidiaries include Cole Haan Holdings, Converse, Hurley International and Nike IHM.
The company sells a line of dress and casual footwear, apparel and accessories for men, women and children under the Cole Haan and Bargano brand names through its subsidiary, Cole Haan Holdings. Converse, a subsidiary of the company, designs and distributes athletic and casual footwear, apparel and accessories under the Converse, Chuck Taylor, All Star, One Star, John Varvatos, and Jack Purcell brand names.
It also offers footwear under the Hurley brand. Hurley International, a subsidiary of the company designs and distributes a line of action sports apparel for surfing, skateboarding, snowboarding and youth lifestyle apparel and accessories under the Hurley brand. The company also provides athletic and casual footwear, apparel and equipment, primarily for the sport of soccer under the Umbro brands.
Nike Golf, a subsidiary of the company, designs and markets golf equipment, apparel, balls, footwear, bags and accessories across several geographies. Further, the company operates four Nike employee-only stores, 102 Cole Haan stores that house factory and employee stores, 35 Converse stores that house factory and employee stores and seven Hurley stores. Outside the US, the company operates 57 Cole Haan stores.
In addition to the physical retail store channel, the company also offers its products across various countries through the websites, https://www.doczj.com/doc/a18016407.html,, https://www.doczj.com/doc/a18016407.html, and https://www.doczj.com/doc/a18016407.html,.
Key Metrics
The company recorded revenues of $18,627 million during the financial year (FY) ended May 2008, an increase of 14.1% over FY2007. The operating profit of the company was $2,433.7 million during FY2008, an increase of 14.2% over FY2007. The net profit was $1,883.4 million in FY2008, an increase of 26.3% over FY2007.
Table 8: Key Financials: NIKE, Inc.
20042005200620072008 Revenues12,253.113,739.714,954.916,325.918,627.0 Net Income945.61,211.61,392.01,491.51,883.4 Profit Margin7.7%8.8%9.3%9.1%10.1% Total Assets7,891.68,793.69,869.610,688.312,442.7 Total Liabilities3,109.93,149.43,584.43,662.94,617.1 Employees24,66726,00028,00030,20030,200 All in $ millions, except for employee numbers and margins
Source: Company Filings D A T A M O N I T O R
MARKET FORECASTS
CHAPTER 7 MARKET FORECASTS
7.1 Market Value Forecast
In 2013, the Asia-Pacific footwear market is forecast to have a value of $42.7 billion,
an increase of 24.3% since 2008.
The compound annual growth rate of the market in the period 2008-2013 is predicted
to be 4.5%.
Table 9: Asia-Pacific Footwear Market Value Forecast: $ billion, 2008-
2013
Growth
Year $
billion%
2008 34.3 3.90%
2009 35.7 3.90%
2010 37.2 4.20%
2011 38.8 4.50%
2012 40.6 4.50%
2013 42.7 5.10%
CAGR, 2008-2013: 4.5%
Source: Datamonitor D A T A M O N I T O R