U.S. shoe imports declined a steep 15.7% last month, marking the lowest import figures for January in a decade, according to new data from the Footwear Distributors and Retailers of America. Considering that more than 70% of the nation’s shoe imports come from China, where the spread of COVID-19 shut down entire cities and forced the quarantine of more than 50 million people, it’s a telling sign of how great an impact the new virus is having on the manufacturing industry.
Still, FDRA president and CEO Matt Priest said there are strong indications that things are getting back to normal in China, where spread of the disease has now largely been stemmed. “In some of the key production centers in China — provinces like Guangdong, Fujian, and Zhejiang — we’re hearing of 80% to 90% operating capacity, with slow improvements happening every day. For those production facilities that don’t rely as heavily on migrant workers, that number is even higher.”
However, delays from materials and components makers, many of which are located in Chinese provinces that are farther inland, are slowing down the supply chain. “Operational capacity numbers for these suppliers ranges from 40% to 70%. These delays have impacted not only Chinese production but also production in Vietnam, Indonesia, Cambodia and other countries [that rely heavily on raw materials from China],” Priest said.
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But despite ongoing challenges, Priest noted, “The perception many have is a marketplace trying to recover and get back up to speed.” However, now that the coronavirus is spreading rapidly in other regions, including the United States and Europe, the situation continues to evolve and create uncertainty. “You couple the [more positive] narrative emerging from the East with the onset of the virus here at home — and the disruptions it is having on travel, gatherings and, potentially, retail — and it brings a whole different set of challenges. It’s like passing through the eye of a hurricane and heading back into the storm,” Priest said.
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