Supply Chain Challenges in the Footwear Market

At a recent Footwear Workshop organized by the American Apparel & Footwear Association (AAFA), industry leaders and experts discussed key themes and supply chain challenges in the footwear market. At this event, industry leaders highlighted the need for brands to address multiple challenges like supply chain visibility, traceability, compliance, and sustainability. Here were some other key themes:

Ensuring Supply Chain Integrity and Compliance

One of the prominent topics discussed was the need to guarantee supply chain integrity and prevent counterfeit or infringing goods. This is not surprising given that the counterfeit goods market is estimated around  $1.7 trillion to $4.5 trillion each year¹. Large footwear brands shared their experience and emphasized the importance of due diligence, supply chain mapping, traceability, and visibility. Visibility, in this context, pertains to the possession of documentary evidence that unequivocally verifies the legality and absence of infringement associated with the footwear products. It was noted that brands understand the complexity and that they cannot rely on a single solution to tackle all these aspects simultaneously. 

Empowering Suppliers for Transparent Supply Chains

Brands expressed the challenges they face in motivating suppliers to identify n-tier suppliers that exist beyond your tier 1 suppliers and gain a complete understanding of their supply chains. Incentivizing suppliers to conduct necessary research and fostering collaboration emerged as crucial steps. 

Mitigating Risks and Ensuring Compliance

Brands often find themselves reacting to supply chain issues rather than proactively establishing robust systems and processes. This reactive approach not only consumes time and resources but also leads to inefficiencies. Consequently, brands are actively seeking a comprehensive, all-encompassing solution that can effectively address the evolving environmental, social, and governance (ESG) requirements of the present era.

Streamlining Documentation and Supporting Sustainability Claims

The importance of proper documentation in customs clearance and the impact of misleading sustainability claims, otherwise known as greenwashing, were highlighted by multiple leaders and brands. This coincides with the increase in greenwashing lawsuits against organizations over the past few years. Brands emphasized the need for streamlined processes to gather and manage documentation effectively that support their sustainability efforts truthfully. 

Navigating Evolving Regulations and Leveraging Incentives

With the U.S. government considering lowering duty rates for goods made from recycled, organic, or sustainable materials, brands face the challenge of operationalizing such incentives while staying compliant with evolving regulations. There is a market opportunity, as consumers are asking for more sustainable products. In fact, consumers across all generations are now willing to spend more for sustainable products². 

Summary

This Footwear Workshop organized by AAFA highlighted the critical challenges and opportunities within the footwear industry. The challenges discussed are closely aligned with the areas where  Infor Nexus™ offers capabilities to effectively address and resolve them. Infor Nexus is a world leading multi-enterprise supply chain business network that address the industry's pressing needs, such as supply chain transparency, traceability, compliance, and sustainable practices. By leveraging Infor Nexus, brands can enhance their supply chain visibility, streamline compliance efforts, and foster sustainability initiatives, ultimately leading to greater efficiency, resilience, and competitiveness in the footwear market. More specifically, Infor Nexus, and its Transportation Management System, is a global, multimodal transportation visibility and planning platform – offering control tower orchestration with network benefits. It enables businesses to combine international logistics with advanced domestic transport functionality. Interested in speaking with an Infor Nexus specialist to learn more? Fill out the form below.