The Portuguese footwear industry is honing its strategy to conquer new markets. According to EY Parthenon, an international consultancy with offices around the world, "Portugal is now a strong alternative to Italy”. To this end, it will invest 600 million euros over the next few years.

In the study «The footwear industry’s path to luxury», EY Parthenon argues that "reducing costs or developing new market segments are two possible ways for Portugal to position itself as a relevant player in the luxury footwear sector”.

According to Miguel Cardoso Pinto of EY Parthenon, "rising costs and increased competition are threatening the footwear sector”, so the sector needs to "review its positioning”. Reducing costs is one of the ways to achieve financial sustainability in the sector. To achieve this, it will be important to "increase scale by integrating different players”. At another level, EY suggests "increasing productivity through new industrial processes” and "optimising labour costs”. Finally, companies could "reduce raw material costs through product innovation”.

From a strategic perspective, the consultancy points out that "exploring segments with greater value-added potential, entering new geographies, and optimising new stages of the supply chain are three possible paths to a more competitive future”.

EY assures that Portugal has several comparative advantages over an Italian industry "threatened by high production costs, a market dominated by intermediaries and a lack of skilled labour”.

The market study also stresses that "both Portugal and Italy are able to offer high quality and reputation, but Portugal has lower production costs”.

World footwear production is dominated by Asian countries, with China accounting for almost 55% of global production. In value terms, the footwear market is worth 398 billion US dollars, of which the luxury segment accounts for 8%.

According to EY Parthenon in the study «The footwear industry’s path to luxury», the luxury segment is expected to grow by 4.1% per year until 2028. In order to reposition itself, "Portugal will have to work on three levels: production development, commercial development and innovation”.

"Creating a reputation for luxury footwear”, "strict compliance with ESG standards”, "competitive pricing”, "high agility and flexibility”, "confidentiality”, "transparency”, "excellent customer service” and "top quality product” are some of the requirements.

The President of APICCAPS points out that "Portugal is investing 600 million euros in the future of the footwear industry”. "We want to be an important international reference”, says Luis Onofre.  "Every year, 24 billion pairs of shoes are produced, about 90% of them in Asia, which means that 9 out of 10 people wear Asian shoes. We don’t think this is sustainable, on the contrary, we think there is room in the market for players like Portugal”, argues the president of APICCAPS.

600 million euros of investment
In the new Strategic Plan for the Footwear Cluster 2030, the Portuguese industry has outlined four priorities (Qualification of People and Companies; Sustainable Products and Processes; Flexibility and Rapid Response; Active Presence in the Markets), 24 measures and 113 actions to reposition the sector in the international competitive arena. To address them, it will invest 600 million euros between now and 2030.

Two major projects (BioShoes4All and FAIST, under the PRR) are already underway and should be completed by the end of 2025, focusing on automation, digitalisation and sustainability. "Very soon, the Portuguese footwear industry will be the most modern in the world”, believes Luís Onofre.

There are currently 1,500 companies in the footwear cluster (footwear, components and leather goods) in Portugal, responsible for 40,000 jobs. The sector currently exports 90% of its production to 173 countries on five continents.