Sports in the United States cost significantly more than in China, Vietnam or Indonesia. This difference in costs is due to higher salaries, stricter rules and US production lack. According to Shoemakers Academy, the average Asia sneakers cost $ 15 and US $ 35 to $ 45.
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Asian countries are dominated by sneakers due to cheaper labor and simplified supply chains. Below we will break down the heavy numbers, the cost of retail and factory, explaining why “US” sneakers are priced at the premium.
Labor costs are the biggest reason for US sneakers costs much more than abroad. According to Talentine.com, US factory employees earn an average of $ 12 to $ 16 per hour. By comparison, Chinese employees earn around $ 3-4 per hour, and Vietnam and Indonesia pay closer to $ 1.50 to $ 3. These differences in labor costs have a direct impact on the production of each sneakers.
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Compared to us, sneakers, production in China, Vietnam or Indonesia usually cost between $ 11 and $ 20 per pair. As a result, US brands need to prosecute many American sneakers to stay profitable. This work gap alone can double the basic costs before delivery, marketing or mark -up.
The US also sets out stricter rules of safety and labor compliance by increasing the general production costs. Asian factories operate in larger volumes, making each pair cheaper due to scale. According to WSJ, even automation efforts in the US have not yet met the economic efficiency of Southeast Asian manual work. All of these factors contribute to the high production cost gap.
Comparing retail prices, sneakers made in the US often cost double or even triple their colleagues made in China. For example, the Iconic New Balance 990V5, manufactured in American factories, is usually sold about $ 199, according to the official New Balance website. On the contrary, Nike popular Air Monarch IV, manufactured in China, costs around $ 80 as stated at the official Nike.
This significant price difference is largely determined by the economy of labor and the scale. In China, large factories effectively produce large quantities of sneakers, which significantly reduces the price of units. On the other hand, American factories usually produce smaller parties, which increase production costs for one couple. New Balance justifies its higher prices through branding strategies that emphasize quality craftsmanship and domestic supply.