Lithuanian Footwear Manufacturing Industry Analysis According to Porter‘S Five Forces
Lithuanian Footwear Manufacturing Industry Analysis
According to Porter‘s Five Forces
Introduction
For all times footwear has been a basic necessity and just recently it has become a matter of fashion and prestige, thus making huge changes in footwear industry: it expanded and became well differentiated. Therefore, in order to perform and compete effectively, companies have to analyze their external environment. This paper will concentrate on Porter’s five forces that shape competition in Lithuanian footwear manufacturing industry.
Rivalry
A decade ago there were much more footwear manufacturers in Lithuania. However, right after Lithuania joined the European Union, footwear imports from China to the European Union increased eight times. It caused huge profit losses for Lithuania’s footwear manufacturers and many of them withdrew from the market. Today there are two main footwear manufacturers UAB “Sabalin” and UAB “Lituanica”, a few smaller manufacturers such as UAB “Paliūtis” and UAB “Evenida” and there are also some individual businesses which do not mass-produce but manufacture shoes just for individual orders. As we can see there are not many Lithuanian companies but their competition creates the rivalry a positive sum. The largest companies UAB “Sabalin” and UAB “Lituanica” produce leather shoes for the whole family and export most of their production to other European countries, especially to Great Britain, Latvia and Finland (http://www.lituanica.info/m93-1.html, http://www.visalietuva.lt/imones/info/sabalin-uab). Smaller manufacturers concentrate on specific footwear production such as boots and working shoes or take orders from Lithuania’s companies and produce big quantities of specific safety shoes or shoes which are part of employees’ uniform. Footwear manufacturing usually is not their only scope so when they have hard times in shoes manufacturing, they concentrate on other fields. For example UAB “Paliūtis” produces not only boots but also
According to Porter‘s Five Forces
Introduction
For all times footwear has been a basic necessity and just recently it has become a matter of fashion and prestige, thus making huge changes in footwear industry: it expanded and became well differentiated. Therefore, in order to perform and compete effectively, companies have to analyze their external environment. This paper will concentrate on Porter’s five forces that shape competition in Lithuanian footwear manufacturing industry.
Rivalry
A decade ago there were much more footwear manufacturers in Lithuania. However, right after Lithuania joined the European Union, footwear imports from China to the European Union increased eight times. It caused huge profit losses for Lithuania’s footwear manufacturers and many of them withdrew from the market. Today there are two main footwear manufacturers UAB “Sabalin” and UAB “Lituanica”, a few smaller manufacturers such as UAB “Paliūtis” and UAB “Evenida” and there are also some individual businesses which do not mass-produce but manufacture shoes just for individual orders. As we can see there are not many Lithuanian companies but their competition creates the rivalry a positive sum. The largest companies UAB “Sabalin” and UAB “Lituanica” produce leather shoes for the whole family and export most of their production to other European countries, especially to Great Britain, Latvia and Finland (http://www.lituanica.info/m93-1.html, http://www.visalietuva.lt/imones/info/sabalin-uab). Smaller manufacturers concentrate on specific footwear production such as boots and working shoes or take orders from Lithuania’s companies and produce big quantities of specific safety shoes or shoes which are part of employees’ uniform. Footwear manufacturing usually is not their only scope so when they have hard times in shoes manufacturing, they concentrate on other fields. For example UAB “Paliūtis” produces not only boots but also
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