How Much Does It Cost To Make A Shoe In China?
The apparel and shoe industries are booming 2021. Rather, statistics show an exponential growth in shoe companies in coming years.
Surprisingly, even inexperienced entrepreneurs can initiate a local or nation-wide shoe business. Moreover, when online businesses are in full swing, you can start a small online shoe business startup keeping your budget in mind.
Are you wondering how much does it cost to make a shoe in China? Or how much investment you’d need for your startup? This guide is to help you clear the clouds!
As a rough estimate, you’ll need to pay around $15,000 up front to stock the initial supply. Now if you choose to set the shoe startup online, you can skip on the location fee, rent costs, etc. All the investment you’ll require is on online website, SEO, and online marketing.
Should I Source Wholesale Shoes From China?
Now, whenever you talk about setting up a shoe business, China shoe companies come top of the list. Not only did they backed up US brands like Nike, Adidas, but have a popular and reliable shoe brand Anta as well.
Moreover, they are renowned for cheap shoe manufacturing and wholesale shoe production. Rather, China is still the largest producer of plastic and silicone sandal manufacturer.
The trending jelly shoes and crocs are primarily sourced by China. In China, there are wholesale flip flop manufacturers, sandal manufacturers, and there’s a huge scope for startups due to minimal competition.
At sandalmanufacturer, we have a small MOQ to support startups who wish to set up their online or local wholesale, private label, or custom ladies shoes business.
How Much Does Shoe Making Cost In China?
Although shoe manufacturing cost has become competitive in China compared to India and Vietnam, yet the quality has improved tremendously. China shoe factories are great at duplicating and have excellent shoe manufacturing machinery. So, roughly your initial shoe company setup can demand $15,000 to $25,000 investment. While a large scale brand would demand up to $80,000 or more.
The shoe manufacturing cost depends largely on custom design, custom raw material quality, bulk quality manufacturing, and various other factors. The fact is ‘Made in China’ doesn’t mean bad quality rather it depends upon the manufacturing cost of goods and products.
What’s the Cost of Making a Sneaker?
If you come a pair of sneakers that retail for $70, the wholesale buying price would be around $35 per pair. If the shoe retailer has a huge shoe business, he may get further 3-5% discount or zero shipping costs, etc.
Although a retail store owner earns around 50% of the profit, but the cost of employees, rent, electricity bills, advertisement needs to be managed from the profit margin.
However, for an online shoe company, tons of costs can be cut-short. Yet, establishing reliability factor and managing sizing issues can be doubly challenging.
If we break down the shoe making cost down to the China shoe manufacturers, that $70 may original cost around $15 to $20 only. Usually, the china shoe companies have bought raw material in bulk which gives them a lot less manufacturing cost on average with a good profit margin.
Because of cheap labor and easy availability of raw materials in Guangzhou, China (the shoe manufacturers hub), the shoe making cost is a lot reasonable.
However, the shipping costs is a whole different story. To give you a quick breakdown, here it is:
Usually freight costs for USA are $.50/pair. So, if you are shipping 5000 pairs, it will cost you $2500 shipping costs.
That’s not it, leather sneakers are far more expensive in the shoe shop due to the additional shipping costs. For exotic skin leather shoes, custom and insurance charges would make up for additional $1.64.
What Are the Costs of Shoe Parts?
How much a shoe costs greatly depends on how much its parts cost. Let’s break it down:
- Shoe Upper Part—34%: It includes the foam, private labeling, laces, etc.
- Shoe Outlook—16%: It includes leather, fabric, rubber, etc.
- Shoe Outsole—14%: The bottom part of the shoe.
- Labor and Profit Cost—27%
- Shoe Casing—6%: Private labeled box, packaging, tags etc.
What’s the Profit Margin for New Shoe Businesses?
The profit margin of shoe businesses depends largely on how huge the shoe business is. What monopoly shoe business has achieved against its competitors.
An on-ground shoe business will have better chance to achieve monopoly compared to its online competitors. The euphoria and satisfaction associated with wearing the comfortable shoes and confirming the size is a different story. Moreover, there are lesser chances of complaints from the customers as they have tried on the shoes before buying.
However, if you are planning to set up a shoe business, start up online with prototypes on display. Chinese sandal manufacturers are very welcoming and accommodating for small businesses compared to local shoe manufacturers. Once the business gains trust and starts to add value to customer’s life, setting up an on ground shoe business gets easier. The shoe manufacturing quality can be enhanced with the profit earned from sales.
Tips and Tricks for Wholesale Shoe Startup Businesses
If you have the designs and shoe business idea with you, you need to select a reliable China shoe manufacturer very carefully.
- We recommend you to contact different shoe manufacturers and compare the pricing.
- If you are contacting the shoe making factory via Alibaba, make sure they are the original shoe manufacturers not the wholesale suppliers.
- Start your business with wholesale shoes bulk buying and selling to understand the dynamics of the industry.
- If you want custom shoe designed, look for shoe making experts with minimum MOQ to keep the business risk to a minimum.
For further insights, you can read the linked article: A Complete Guide to Selecting China Shoe Manufacturer and Importing Footwear
We at Sandal Manufacturers Design Private Label, Custom Ladies and Kids Shoes Offering Minimum MOQ to Support New Shoe Startups. We Were Established in 90s and Are Competitive Wholesale Shoe Suppliers and Manufacturers for Global Small Scale and Medium Scale Businesses. Get in Touch for Further Queries.