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How much do you think it costs to make a pair of Nike shoes in Asia?

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Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#661

Post by freddie_mercury »

ForOldHack wrote: post #425

"I encourage you to note assume that every Asian worker is a slave." I do NOTE, that I was on Korea for 18 months, and saw over 20 factories, and knew a few people that worked there. They were making 1/10 of the minimum wage in America at the time, $0.75 vs $7.50, Today they are making $6.94, so I would assume that They are making few shoes in Korea. "While it's difficult to pinpoint exactly which country pays the ab…

Vietnam does not pay $68/month. Where did you get your made up numbers?

Source: brother works in a Nike factory in Vietnam; am acquaintances with the manager of an Adidas factory in Vietnam; and know that the legal minimum wage in Vietnam -- which is definitely enforced on foreign factories -- is far above $68/month.

My brother at the Nike factory makes almost 10x that assembling women's shoes.

Someone working part time at a convience store makes 3-4x your claimed number.

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#662

Post by anomaly_ »

phkahler wrote: post #314

I've always wondered why the supply chain has exponential price increase at each step. The example given (guessed at) is the factory produces the shoe for $12.5 and sells it to Nike for $25. Nike then sells it to Footlocker for $50 and they then sell to a customer for $100. Everyone expects to mark up their costs by about 100 percent. Why is that the case? Even if we say the markup isn't 100 percent, why is it a perc…

because businesses have overheads? and customers have brand preferences that stop (or limit the success of) Footlocker just selling generic models without Nike's involvement?

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#663

Post by yen223 »

Aaronstotle wrote: post #317
rayiner wrote: post #42

Americans need to get over their view of “Asia” as being about making shoes. When I was working in engineering in the early aughts, we mocked the Chinese as being able only to copy American technology. Today, China is competitive with or ahead of America in key technology areas, including nuclear power, AI, EVs, and batteries. We need to anticipate a future where China is equal to America on a per capita basis, but f…

Maybe it will come full circle and the US will commit IP theft to catch up to the dominant Chinese companies.

See e.g. Youtube Shorts and Instagram Reels

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#664

Post by marenkay »

This makes a good argument against centralized production and knowledge. It would economically be much more reasonable if any good could be produced anywhere at any time. Smaller production facilities for localized sourcing. Would IMHO also be much more in line with a free market. Everyone would be free to source goods in any country or location of their choice. Coupled with open knowledge this could be a truly free market.

But will never happen because currently free market means one business is free to dominate and control a market.

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#665

Post by Jensson »

stackedinserter wrote: post #438
Ancalagon wrote: post #405

Earlier quoted context omitted.

And that wont happen to the US?

What is "that" that "won't happen"? US, Canada, Europe are demographically cooked too, but they (partially) solve this problem with immigration, that is not an option for China and the rest of Asia.

You think there will be zero policy changes in China over the next 125 years?

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#666

Post by anomaly_ »

hyperpape wrote: post #506
dcow wrote: post #498

I wish the discussion included the margins the fashion industry makes. In the labor sector, 10%-20% margin is respectable. But in the fashion and consumer goods sector at least 30% margins are expected. 80% margins are normal for “luxury” goods, which I’m sure is the bracket Nike falls into. I wish margins were included in the thread. It’s only true that everything increases in cost if you also have to keep the same…

There are profit margins in the thread. They’re a lot lower than what you described.

OP will be talking about gross profit not net, and also totally ignoring the substantial overhead investments in brand marketing, customer service, stores, etc, that luxury goods brands have to make.

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#667

Post by wkat4242 »

smadge wrote: post #393
gmueckl wrote: post #389

Earlier quoted context omitted.

This is either a joke that flies over my head or there are a few zeroes missing. Which is it?

The joke is that Warhammer sets are expensive.

I'm kinda surprised people aren't just buying a 3D printer. I print stuff all the time. I'm not into this kind of game but if I were I wouldn't pay that much for a piece of plastic I can print at home for 3 bucks.

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#668

Post by tirant »

mclau156 wrote: post #234
hx8 wrote: post #83

> But if we bump the cost of freight, insurance, and customs from $5 to, say, $28, then they wholesale the shoes to Footlocker for about $75. And if Footlocker purchases Nike shoes for $75, then they retail them for $150. Everyone needs to fixed percentages to avoid losses. I don't understand this paragraph. If Footlocker was okay with $50 profit/shoe, why do they need to claim $75 profit/shoe in their costs per shoe…

Every single person in the supply chain has a lever they can pull to change price, except the end consumer

That’s actually the opposite. The consumer is the one dictating prices and preferences.

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#669

Post by anomaly_ »

AtlasBarfed wrote: post #348

"Everyone needs a fixed percentage to make money" I get they WANT to, and it's what a shoe retail strives for, but this isn't accurate. Cars for example aren't 100% marked up. That would be insanity.

Because cars are a high $ item vs. shoes. A business's overheads don't scale linearly with item price, so it's possible for a car mfg to achieve a similar net profit margin to a shoe mfg but with substantially lower gross profit margins.

Re: How much do you think it costs to make a pair of Nike shoes in Asia?

#670

Post by jldl805 »

dmoy wrote: post #570
stevage wrote: post #473

Earlier quoted context omitted.

I don't find Lego especially expensive. And Lego is way more difficult to manufacture, has very exacting functional requirements and extremely good QA.

Lego is pure IP (both from LEGO itself, and then e.g. Disney or whoever is behind the theme of a given set). If you get sets designed in China and made at the same factories that make Lego bricks, they're like 1/3 the cost. If you get sets designed in not-China but obviously ripped off ("Star World" sets that are 1:1 copies of Star Wars legos), also in the same factories, it's like 1/10 the cost. The manufacturing is…

False. Lego is some of the most precise injection molding in the world. The tolerances are insane and they nail them every time. Compare with offbrand building blocks and you'll feel the difference.

Micromolding is very hard, and Lego is the best at it.

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