Brazil's footwear sector boosts investment to enhance productivity

Despite the unstable global landscape, the Brazilian Footwear Association (Abicalçados) recently conducted a survey which revealed that the footwear sector intends to invest 1.7 billion reais (around 303,84 million dollars), a value seven percent higher than last year.

Executive president of Abicalçados, Haroldo Ferreira, explained that around 50 percent of the footwear industry’s investments in 2025 are expected to be allocated to machinery, equipment, and technology, aimed at improving productivity. “Brazil suffered a sharp deindustrialisation process in the 1990s, when, in addition to the so-called ‘Brazil cost,’ there was a relaxation of imports, and we began to notice an invasion of Asian products in the Brazilian market,” said Ferreira.

According to Ferreira, the industry, which represented more than 46 percent of the gross domestic product (GDP) in 1989, saw its representation fall to just over 14 percent last year. “It is no exaggeration to say that the Brazilian footwear industry resisted and continues to resist in a rather hostile environment, taking into account the high production costs and predatory competition imposed by Asian markets, now also through international e-commerce platforms,” added Ferreira, emphasising that investments focused on productivity have been essential for the national footwear industry to remain the main one in the West.

Equipment, distribution centres and factory expansion

Among the announced investments, some are aimed at purchasing a wide range of machinery and equipment. This is the case of Andacco, which is part of the Cacique Group, from Minas Gerais. The company, which produces 5,000 pairs per day, intends to acquire new equipment and moulds, totalling approximately three million reais.

Company director Benvenuto Arantes explained that this amount exceeds what was invested in 2024 by 40 percent. “Investment is a constant for Andacco, regardless of the scenario, which this year is still quite obscure,” he said. For Arantes, however, opportunities may arise in light of the tariff war between the US and China. “The US is the destination for 70 percent of our shipments. With the high tariffs imposed on Chinese footwear, we will possibly have greater demand, which could have a positive impact on our exports and, consequently, on performance for 2025,” he explained.

Tip Toey, a children’s footwear company based in Franca, São Paulo, has been making investments in structural projects totalling three million reais in recent years. The company, which exports a third of its production, will inaugurate a distribution centre in Europe this year, with an investment of approximately 100,000 euros. Co-chief executive officer of Tip Toey, Scott McInerney, explained that the expansion plan involves three main fronts: brand, export, and industry. “We want to be closer to European customers to respond quickly to demand and receive more consistent feedback on our products,” said McInerney in the press release.

The Minas Gerais-based women’s footwear and accessories brand Luiza Barcelos constantly invests in machinery and, at the end of 2023, inaugurated a production unit in Rio Grande do Sul, from where 80 percent of its production originates. “Today, exports represent two percent of turnover, a figure we want to double in 2025. For this, we are intensifying participation in international trade fairs,” said company director Luiz Barcelos.

Boaonda, a producer of injected footwear from Rio Grande do Sul, invested more than two million reais in 2024 in expanding its EVA lines and acquiring new machinery. For 2025, given a surprisingly positive first quarter with 30 percent sales growth, Boaonda was obliged to expand its headquarters, in a project that will cost more than five million reais to meet domestic and international market demands. According to brand manager Cássio Romani, the new building should be ready by the end of the year, directly employing more than 50 people. There is the possibility of tripling this number to 150 in the short term, depending on the company’s continued growth.

For the year, although optimistic, the company forecasts sales growth of around 15 percent. “Brazil has structural problems such as high taxes, unfair competition—including within our own market—and difficulty in finding labour. Despite this, Boaonda remains confident and is betting on our country,” said Romani.