Dow builds partnership with China's Xtep

Xiamen, Fujian – Dow Polyurethanes signed a co-branding agreement in May with China’s leading sports shoe maker Xtep for its Softpad insoles adopting Dow Comfort Science’s Voralast PU memory foam.

Joint hangtags will be launched on such shoes, representing Dow Polyurethanes’ first co-branding program with a Chinese brand. “This is a special occasion for Dow Polyurethanes’ business as we celebrate our first use of our Comfort Science brand on a consumer product,” said Glenn Wright, business president of Dow Polyurethanes.

“A big part of our business strategy is to bring our science closer to customers, so we can help each other grow by bringing innovation to high-demand markets,” Wright added.

The two parties initiated the corporation in 2014, and the product took shape in mid-2015 and was rolled out in early 2016. Today 10% of Xtep’s shoes employ Softpad insoles, and the company plans to apply the technology to all of its women's shoes and join forces with Dow on a range of new products such as high resilience midsole and environment-friendly PU adhesives.

Dow’s Asia Pacific polyurethanes unit marketing director, Gu Wei said: “We are looking to launch solvent-free PU leather material in 2017 and I’m sure it will apply to shoes.”

Produced at Dow’s Guangzhou site and targeting both sports and casual shoes, the Voralast material enables the shoe pad to closely conform to the shape of the foot with resilience rate below 10% and evenly distribute weight over its entire surface.

The technology also lowers the product’s density to 80± 5kg/m³, down by 20% compared to conventional PU or EVA materials, and makes the insole more durable with a compression set below 5%, compared 7% or better for conventional PU foam and up to 50% for EVA.

“The core of the innovation is to introduce new technologies into the products,” said Stanley Chan, vice president of Footwear at Xtep International Holdings. “A lot of manufacturers used to be speed- and price-oriented, but today’s consumers have changed and we need to bring them better-quality, more innovative products.”

With dual headquarters in Hong Kong and Xiamen, Fujian, Xtep, which makes sports shoes, apparel and accessories, has a network of around 7,000 stores nationwide. In 2015 the company’s net profit jumped a third to CNY 623m ($95m) on an 11% rise in revenue to CNY 5.3bn. Its sports shoe business, accounting for an 11% share in the Chinese market, brought in CNY 3.3bn revenue, up by 7% from 2014.

According to Xtep, Nike has a 20% market share in china, Adidas has 15%. It is not clear if Xtep is either the largest or the second largest domestic chinese footwear brand; its major chinese competitors are Anta and LiNning.

Dow Polyurethanes saw its fastest growth last year in the Asia Pacific region – or China for single country markets – with a double-digit rate, and expects such growth to continue over the next three to five years. The company has 16 manufacturing facilities in China along with its Asia Pacific innovation center situated in Shanghai.

“And we continue to invest both in China and in Southeast Asia,” said Wright. “We are much more focused on being located in the end-use markets. We believe that our manufacturing footprint also needs to be in the area, in the countries where we participate.”