Safety shoes industry is one of traditional safety products industries. Most foreign old brands got started with it’s own production and finally was transformed to be a importer. Up until now there is still a small part of safety shoes brands that got their own production facility, but the majority of them rely on imports from China or other countries. Those relying on imports do not change their suppliers as frequent as the other safety products importers. This might be because of a couple of reasons. Those reasons make it difficult for them to change to new suppliers.
First, safety shoes have a pretty complex construction which needs a lot of skill to make, and every tiny detail has to be made perfect. The quality of safety shoes depends not only on the materials used but to a large degree, on how you make it. To make a quality shoes, the factory must slow down their production speed and pay attention to each tiny detail on shoes, but not all factories are created for making high quality shoes. Many importers have cooperated with a few of fixed suppliers for so many years and they know their suppliers’ quality. For them, changing suppliers means a high risk. Even though you can get everything well prepared, the process of changing suppliers is not necessarily smooth. Sticking to your original suppliers makes a peaceful mind.
Second, each type of PU injected shoes has the corresponding sole and tread that also adds to the difficulty of making change. The tread is made using molds which is a costly investment. A set of sole molds usually costs more than 70,000 US dollars to make. If as an importer, you do not want to take this cost, then you have to use factory’s sole molds that have a fixed tread, otherwise place a very big order to your supplier to offset this cost. Most importers have a variety of shoes in their range with different sole and tread that makes changing suppliers very difficult.
Third, the cost of making CE certificates for safety shoes is pretty high. It usually takes more than USD 6000 to get one in China if both the upper and sole of the shoes are new. If you are a European importer, CE certificate is a must-to-have. You either need to make your own certificates or get your suppliers’ certificates. Big importers might have most of their own CE certificates, but not all importers can afford to make such many certificates. Smaller European importers have to reply on their suppliers’ certificates. Finding a new supplier that has the exact CE certificate is not that easy and the new supplier usually do not want to make the CE certificate for the sake of getting your orders, unless you have a big volume of order to them. So this can also make importers stick to one single supplier.
Fourth, traders dominate the safety shoes exportation in China. At the very beginning of when China first opened the door to outside world, every exportation was done by traders. Even up till now, most part of safety shoes exported are still being done by them. Safety shoes factories have a low share of exportation. Most traders call themselves factory in front of foreign importers and many importers know the truth, but they still choose to buy from them instead of factory. Why is it so? Excluding above factors, the role traders play is also a big consideration. The traders in the middle between factory and importer not only mark up based on factory price but also check the goods quality. Some big Chinese traders have inspector working in factories and checking shoe quality on a day to day basis. Some importers might doubt on factory quality, so cooperation with traders can give them moments of peaceful mind.
Mos of the time, importers only want to stick to their current safety shoes suppliers, sometimes they have to do it even though it could pose risk to them. But under what circumstances would they change suppliers? This is a question that can not be answered easily and only importers themselves know it. But in general, the following might be some of the reasons from perspective of shoe suppliers:
- The current suppliers can not meet their quantity demand any more. Current suppliers have capacity problem.
- The quality of current suppliers are getting worse or unstable. Importers have to find a new supplier that has a more stable quality.
- Better prices are found from others suppliers. For the matter of profit margin, it is benefiting to buy from other suppliers.
- Importers’ customers want lower prices. To meet their want and keep competitiveness, importers have to find cheaper suppliers.
- Importers’ quantity is getting bigger and in order to lower risk of buying from only one supplier, they have to diversify the sources they buy from.