Warnings over a sharp decline in demand across Europe have put the auxiliary footwear industry under heavy stress. The company that manufactures shoe components argues that the situation is more severe because its fortunes hinge directly on final product sales. The sector faced cuts of 25% and 30% in production last year, and many firms reduced staff to weather the storm, according to Manuel Román, president of the Spanish Footwear Components Association (AEC).
Difficult conditions persist, with more than 2,500 facilities spread across the region trying to prevent closures amid sustained personnel reductions. The goal is to keep operations afloat rather than shutter the plants entirely.
In a prior edition of the Futurmoda shoe components fair, this reality was underscored by observers and industry insiders. The sector is largely composed of micro SMEs, often employing fewer than ten to fifteen workers, covering equipment, screen printing, sole production, and the various components of a shoe. The ongoing crisis has led to production patterns being cut by between 15% and 20%, with some workers being rehired only in a minority of cases (as explained by Román).
The 2023 AEC sector report, released recently, notes that some companies have already reduced production cycles, consolidating into a single shift per day, and mirrors concerns about layoffs and potential bankruptcies in exceptional circumstances. The feedback points to a continuing chain of challenges dating back to the Covid period, followed by geopolitical tensions that pushed up prices for materials and energy—price pressures that have not subsided and continue to restrain the sector.
Price adjustments and cost pressures
Along with shrinking output and a leaner workforce, the sub-industry has had to adjust prices to move merchandise and clear stock that cannot be absorbed in a weak market. Raw materials, energy, and transportation costs have all restrained operational capacity, driving production costs up by more than 80% from 2020 to today (according to the AEC report).
The industry also faced narrowing trade margins as competition intensified due to lower consumer demand and rising import inflows, notably cheaper products from Asia. Meanwhile, the shoe components associations continue to push for domestic production in Spain, with Román acknowledging that exporters want to access international markets because other regions face the same set of problems.
Exports are concentrated in Portugal, Morocco, Romania, Germany, France, and Italy, where much of the sub-industry’s output is ultimately produced. This geographic focus reflects the broader regional supply chain that underpins the sector.
Key events and outlook
The Lineapelle shoe fair in Milan, scheduled for late February, is viewed as a critical moment for suppliers to gauge future sector needs. Manufacturers are already signaling higher expectations as Europe’s second-largest sub-industry fair approaches, with a view toward aligning production with anticipated demand shifts. The fashion outlook for the near term remains cautious, but events in the European market will influence strategic decisions across the value chain.
Another major industry gathering is planned in Fira Alacant (IFA) in mid-March, framed as a barometer for the sector’s resilience and a test of capacity to rebound from current headwinds.
The Futurmoda fair continues to bring together more than 300 exhibitors focused on footwear and machinery components, offering a snapshot of ongoing innovation and the quality standards that define the sector. Early indicators showed strong participation, suggesting a degree of confidence amid prevailing uncertainty and the economic and trade challenges highlighted in the AEC’s latest annual report.
Labor challenges and productivity
Among the most pressing issues for the footwear components industry are absenteeism and the scarcity of skilled labor. The AEC notes that absenteeism sits around 10% in the sector and that hiring unskilled workers without proper training arrangements, as laid out in collective agreements, adds to operating costs. These factors complicate efforts to scale production or maintain consistent quality across suppliers, particularly in a time of reduced demand and tighter margins.
In addition, the industry continues to grapple with the broader labor landscape, where adapting workforces to match evolving production needs remains a persistent challenge. The combination of demand weakness and rising costs underscores the need for strategic decisions that balance efficiency with capable, well-trained teams.
Overall, the sub-industry’s path forward hinges on a mix of price discipline, targeted investments in automation where feasible, and renewed access to international markets that can absorb excess capacity while maintaining competitive production costs.
These dynamics illustrate why the sector remains closely aligned with policy shifts, energy pricing trends, and currency movements that affect import costs and export competitiveness. Stakeholders emphasize the importance of maintaining supply chain integrity and continuing to advocate for measures that support domestic manufacturers against a backdrop of global competition. sector report and industry forecasts.