A Lasting Challenge : O.C. Shoe Companies Take Foreign Competition in Stride
Shoemaker Ohannes Topchian pulls red leather onto the shoe sole with precision. Using a small hammer, he taps as he stretches the leather onto the last, a plastic form shaped like a foot.
Lasting shoes by hand is nearly a lost art in America--and Cypress Footwear Inc. in Buena Park, a manufacturer and retailer of women’s shoes, is carving out a market niche as one of the few companies that still does it the old-fashioned way.
“That’s a talent. You have to pull it the right way or it won’t fit,” said Tony Adams, 35, treasurer and partner in the family-run business.
“This is what makes or breaks your shoes,” Adams said during a recent tour of Lucky Lady Shoes in San Fernando, one of the company’s three shoe manufacturing plants. “It’s a dying breed to do it by hand.”
Competing in the leather footwear industry has become more difficult in the United States, Adams said, because a growing number of shoes are imported from China, Taiwan, Italy and South America. There are not many American shoe manufacturers left.
The number of non-rubber shoes produced in the United States has decreased steadily in the past decade. In 1980, for example, the U.S. industry produced more than 386 million pairs of shoes. By 1991, the latest year for which figures are available, the number had fallen to 172 million pairs, according to Footwear Industries of America, a trade group based in Washington.
At the same time, imports have soared. In 1980, the United States imported fewer shoes than it made: 366 million pairs. By 1991, however, imports totaled more than 937 million pairs and accounted for nearly 86% of the domestic market in non-rubber shoes.
Shoe manufacturing has left the country primarily because of cheaper materials and other lower costs abroad, manufacturers say.
“The main reason is lower wages overseas,” Adams said. In China, “you can pay a worker 14 cents an hour, versus $6.50 an hour here.”
Winston E. Hickman, executive vice president and chief financial officer of Vans Inc., a manufacturer of casual footwear in Orange County since 1966, also said more shoes are made abroad because American companies are “running away from labor costs.”
“It’s pure and simple,” Hickman said. Companies “are chasing cheap labor.”
Adams noted that domestic manufacturers who choose to stay in California face rising costs for labor, workers’ compensation and other insurance, as well as tough environmental regulations.
But for Cypress Footwear, the goal is to produce a high-quality shoe. Every pair is handmade, Adams said, which sets his company’s shoes apart from the imports, most of which are made on automated assembly lines. On an assembly line, the only hands that touch them are those that put them into boxes before they are shipped to market.
Cypress Footwear does use machines, he said, but only to cut the leather for insoles and uppers, and to glue and stitch some components.
A lasting mark--a tiny pinhole that consumers rarely notice on the strap of a sandal or the heel of a shoe--is the sign of the hand-lasted shoe, Adams said.
“Your cheap shoes out of China, you won’t see lasting marks. That’s how you can tell good quality--because they’re hand-lasted.”
At Cypress Footwear’s three Los Angeles-area factories, about 100,000 pairs of shoes are made a year, said Tony Adams Sr., 57, who founded the company in 1986 and is president and chief executive officer.
Cypress Footwear manufactures the In Touch and Attitudes brands and has more than 1,000 accounts that include major department-store chains, independent retail shoe stores, catalogue companies and the U.S. military.
“One of our biggest accounts is the Navy in Guam,” the younger Adams said. “We’ve shipped $60,000 worth of shoes to one military base. That’s an awful lot of footwear.”
The company employs 10 people at its headquarters in Buena Park and has about 100 workers at its three factories. The company is privately held and does not reveal its annual sales.
The Adamses said Cypress Footwear has found a niche by making its shoes with only U.S. leathers and by offering hard-to-find sizes and widths. It makes women’s shoes in sizes 2 to 13 and in narrow, medium, wide and double wide.
“We buy our supplies locally, and we are able to make a product that is all-American,” the elder Adams said. “It costs more to buy American components, but you can maintain the quality.”
“We fill the void,” the younger Adams said, noting that most imported shoes come in only standard sizes: 5 to 10, medium width.
“For us, it gives us a uniqueness; we stand out,” he said. “One reason we do it and others don’t is the higher cost in the lasts and the dyes.”
The younger Adams said there will continue to be a demand for American-made footwear because U.S. manufacturers can make shoes and deliver orders faster than importers can, and because customers can reorder in season.
“I stock my No. 1 sellers, and if an account calls up I can ship it out the day I get the order,” he said, noting that the company stocks about 20 styles.
If a customer wants a special style, however, making the shoes can take three to four weeks, he said.
Susan Friedman, Vans’ national marketing manager, cited the same advantages in being a domestic shoemaker.
“We have the ability to provide quick turnaround time to serve customers,” Friedman said.
Vans, which is based in Orange and manufactures 3.75 million pairs of shoes annually, can fill orders within 19 working days, she said. For competitors who import, she said, filling an order can take four to six months.
“Since we’re manufacturing locally, we’re able to process the orders, handcraft the products and ship out of our local factory--all within a much shorter time frame,” she said.
Vans’ shoes are distributed through 76 company-owned retail stores in Southern California and through a nationwide network of more than 6,100 independent shoe, sporting goods and apparel stores. Vans also sells internationally in 35 countries through independent distributors. Locally, the company’s shoes are available at Miller’s Outpost, Foot Locker and Nordstrom.
Friedman said Vans is aiming for a 24-hour turnaround and is piloting techniques at its recently built factory in Vista, in northern San Diego County. The company eventually plans to have the same capacity at its Orange plant.
The program is called MAST--Make and Ship Today. The goal is that an order placed by 4 p.m. on a given day will be shipped by 4 p.m. the next day, Friedman said.
“It enables our retailers to have no risk in carrying their inventory because they’ll be able to buy smaller orders but more frequently,” she said.
Hickman said Vans’ annual sales for its latest fiscal year were $92 million, an increase of about 30% over the previous 12-month period.
The publicly held company employs about 2,200 workers in Orange County and anticipates continued growth this year.
Turning around a product quickly enables a shoemaker to follow the current fashions as well as to be a trendsetter by introducing new styles, both manufacturers said.
Vans’ collection for men, women, children and infants includes 24 styles in 145 colors and prints that range from its classic deck shoes and slip-ons to high tops.
Cypress Footwear, which makes more than 130 styles of sandals, boots and dressy sling-backs, prides itself on not producing ordinary-looking women’s shoes, the younger Adams said.
Rather than follow fads, he said, the company listens to customers’ needs and wants.
“Instead of going with the masses, I fill the niches,” said Adams, who designs the company’s footwear. “When you design shoes, you have to be open-minded. It’s not what you like, it’s what the customer wants.”
The company’s signature style is the sandal, in designs ranging from flats to high heels, from glitzy to conservative, from casual to evening wear. One popular style has clear vinyl uppers adorned with rhinestones and other ornaments. The “Vegas” style has clear vinyl uppers and soles.
“I sell to everybody in Las Vegas,” the younger Adams said. “Every cocktail waitress wears them.”
In November, Cypress Footwear opened its first outlet store, De Mars Factory Outlet, in a retail center at Lincoln and Knott avenues in Buena Park.
“It’s a true outlet--from an American factory to the consumer,” the younger Adams said.
Customers can find shoes priced as much as 60% less than retail and can choose among discontinued styles, stock overruns and irregulars.
The company plans to open other factory outlets in Orange County in the next two to three years.
For Cypress Footwear and for Vans, company officials said, the future is in keeping the domestic edge.
“You have to make a quality product that can be competitively priced--and we strongly believe that we can do that,” Vans’ Hickman said.
Said the senior Adams at Cypress Footwear: “We make American shoes for American feet, and that to me is the name of the game. If you make something that’s comfortable, people come back and come back for it.”
U.S. Shoe-Making Down, Imports Up
Imports accounted for nearly 86% of non-rubber U.S. shoe sales in 1991. That contrasted with less than half in 1978. Over the same period, U.S. production decreased steadily except for a small increase in 1988.
U.S. production, pairs of shoes in millions: 1978: 418.9 1991: 172.0
Imports’ share of U.S. market 1978: 47.6% 1991: 85.9%
U.S. Imports Outnumber Exports
Imported shoes, in millions of pairs: 1978: 373.5 1991: 937.2
Exported shoes, in millions of pairs: 1978: 6.9% 1991: 17.9%
Fewer Work for U.S. Shoemakers
Domestic employment in the industry has declined steadily. Number of jobs, in thousands: 1977: 156.9 1991: 67.1
Where Imports Come From
Asia produced and shipped most of the non-rubber shoes imported into the United States in 1991, the latest year for which figures are available. China alone accounted for 424.5 million pairs--more than 45% of the total. Pairs of shoes, in millions, from top shoe-exporting countries: China: 424.5 Taiwan: 117.9 Korea: 113.7 Brazil: 93.6 Indonesia: 51.0 Italy: 33.1 Thailand: 24.5 Spain: 17.5 Hong Kong: 12.7 Philippines: 8.4
Source: Footwear Industries of America
