What Does it Cost to Make a Shoe?
It’s true of almost everything you buy. Someone, somewhere, will say that you got taken advantage of because they claim the materials only cost a few cents, and everything else was just pure profit for the company. Of course, if that were true, everyone and their mother would be a shoemaker. So, if doesn’t cost pennies, what does it cost to make a shoe or boot?
In an effort to keep from boiling the ocean, here I’ll focus on stitched footwear. Keep an eye out for a follow up on sneakers later – the differences are actually pretty interesting.
It makes sense to start with the materials that go into making the shoe, as this is what is normally quoted by the friend who knows everything. Let’s take a look at each part of the shoe, and see how it stacks up. One note: while it’s true that the bigger brands are able to get discounts on these materials by buying in bulk, it isn’t as much as you would think.
On average, a pair of stitched shoes or loafers will take around 3 or 4 square feet of leather. If you’re looking to make a boot, add on another 2 feet. Much of this will remain as scrap. You might be able to get some coasters or a watch strap out of it, but if your intention is shoe making, that is just waste.
This is one area where there is a huge range, almost more than any other part of the shoe. If you just want a material that used breath and to sit in a field and you don’t care what split you get, leather can be as cheap as around $4 per foot. Of course, that leather isn’t worth attaching a stitched sole to. Let’s look at probably the most famous leather maker in footwear: Horween.
The prices here are a bit more stable. While the exact price per foot will depend on the size of the side and the weight of the leather. It’s safe to assume Chromexcel will run you about $13.05 a foot. Essex and Dublin are both about $14.73 a foot. Normal Shell Cordovan is around $41.25 a square foot. If you want something in a unique color, costs go up from there.
Feel free to check out other costs here: https://www.thetanneryrow.com/shop-leather
Going with suede or a less-well-known-but-still-reputable brand will bring the cost down to around $9 dollars. Then again, how many pairs of shoes have you bought simply because you saw that Horween logo?
The leather on an upper doesn’t stop there. For most high-end boots or shoes, they are going to be fully lined. This can result in another 3 feet of leather for a pair of shoes. 4 for a pair of boots. This leather is generally much thinner, and the price will reflect that. You’ll generally see something like 2/3 oz kipskin calf, at around $7.50 a square foot, or deerskin, which is just slightly less at around $7.25 per square foot.
To recap, just for the leather on the upper, a mid-tier lined shoe will run around $75 dollars. For a shell cordovan boot, this could balloon all the way to just over $300 or more.
Here things can change quite a bit based on shoe construction. For the sake of simplicity, I’ll look at a normal goodyear welted shoes, but know that this price could go up or down a bit based on construction. For more information on how different styles are made, check out our series on shoe construction here.
Starting from the upper, the first thing you’ll need is a midsole layer. In general, this is going to be either cork, leather, or both. For leather, it’s fairly easy to make the calculation. A leather midsole runs around $15 for a quality pair, and around $30 for a double thick pair. There are more affordable alternatives, ranging from Alibaba “leather” to Vibram rubber, but it’s rare that a stitched shoe would come with these.
Cork is much harder to price. The cork itself is cheap, less than a dollar per pair. However, the machines used to cut up at heat the cork are thousands of dollars. For a large brand such as Allen Edmonds or Alden this will result in significant savings over years, however even mid-sized brands often avoid using this material due to these costs. To split the difference, I’ll call the cost even with the leather midsole.
A shank is another cost that needs to be considered. It is true that some of the major footwear brands do not include one, however in most the comfort of a shoe and it’s durability are significantly increased with the inclusion of a shank. Metal shanks cost approximately $5 for a pair, with wooden shanks running around half that.
All in all, for a goodyear welted pair of shoes, expect to add $15 for the midsole, ticking up to $30 for a thicker boot.
This is one area where it’s really easy to opt for an affordable option, and we’ve seen some really well known and otherwise well-respected brands use cheaper leather here. For these, the welt generally costs around $10 per shoe.
Again, you can go even cheaper using Alibaba – some even use plastic or canvas welts – but $10 is the “cheap” side of what you’d actually want to use. Alternatively, some higher end storm welts can run more than $30 or 40 dollars per shoe, but you’re unlikely to find this on an average pair.
This one is pretty easy, $10 dollars for a shoe or boot.
Having looked at the upper and midsole, the last major part of the shoe is the outsole. Here, there are a lot of options, and many of them could be the “right” one based on what you’re looking to accomplish with the shoe. Knowing that, rather than pointing out the higher and lower ends, I’ll include a few options.
The most classic, the leather outsole, typically uses a generic brand. These run around $20 dollars per sole. If you’re looking to get something higher end, Joh Redenbach was well known, but would have more than doubled your price to around $50 to 60 per sole.
When it comes to rubber soles, two classics stand out: the Dainite studded sole, that the Itshide Commando sole. Both of these can be found for around $25 to 30 dollars. That being said, it’s worth noting that it’s actually pretty difficult to source these without a business account. Neither brand will sell directly to a consumer, and if you’re looking to pick up an individual pair prices could easily double.
No matter which sole you buy, you’ll need to add on a heel. These are fairly cheap overall, with the final cost depending on how closely you want to match the rest of the sole. Generally they run around $5 to $10.
For the outsole, the costs for materials alone range from around $20 dollars to $70 or more.
A shoe is more than just the leather and rubber that goes into it. A shoe can have yards of specialized thread, eyelets, hooks, nails, canvas, and more. Further, shoes will typically have stiffeners at the toe box and heel counter. Finally, shoes are often given a once over with polish or conditioner before they leave the factory.
All of these extras are fairly inexpensive, but combined add up to another $5 to $10 dollars in costs.
The materials above don’t magically come together on their own. While the claim that shoemakers make that each shoe takes weeks of labor is laughable (check out shoegazing’s article about it here), each shoe does require about an hour of labor once the parts above are assembled. Give another 30 minutes of prep time for the above, a few minutes of quality control at the end, and a bit of dead time built in, 2 hours of labor per shoe is likely a good approximation.
But what does 2 hours actually mean when it comes to cost? Well, it means different things depending on where the shoe is made. In the U.S., the average cost of skilled labor in a factory worked was around $38 dollars an hour. This is including benefits and payroll taxes. In Spain, another hotbed of shoe manufacturing, wages are closer to $22 dollars an hour, including benefits and payroll taxes. China is a bit harder to find data on, but after a significant increase in wages over the last decade it seems like $5.51 is a good approximation.
The two hours to put together a shoe can therefore mean a lot of different things, with an expectation of around $76 dollars in labor for a U.S.-made shoe, down to around $11.02 for a Chinese-made shoe.
To make a shoe today, a factory worker is unable to do much without their tools. These range from the fairly simple wooden or plastic lasts, which are fairly affordable overall, to a goodyear welting or blake stitching machine, that can cost tens of thousands of dollars. It’s hard to place a cost per shoe on these machines, but for an individual these costs are nearly insurmountable.
Finally, these machines all need a place to live. A shoe factory can run from small to fairly large, but any location will cost thousands a month in rent/upkeep.
It would be impossible to figure out how much each of these adds to the cost of the shoe that you buy. We will leave them off the final cost for that reason, however keep in mind any total will likely end up much higher due to these costs.
Having a shoe sitting on your factory floor does your new potential shoe empire no good. You need to actually sell the shoes to a person, and then give them the product. For this article, I’ll focus on online-only locations, but brick and mortar stores will increase the costs exponentially.
First you need to have a website where people can actually buy something. Websites themselves are fairly cheap to buy but this will still work out to well over $300 a year in hosting for a mid-sized company. You’ll also want someone to built the website itself. Like the machines, it would be impossible to figure out each possibility on how this impacts costs, but these are expenditures these companies make.
Next, you need to get people to your website. Hopefully you’ll be doing that through word of mouth, but in reality you’ll need to advertise. This will change based on strategy, but to give an idea, the cost-per-click on Instagram is around $3.00 for apparel. A good click-to-conversion rate for Instagram is around 15%. In other words, if you rely on Instagram advertising, you can expect to pay around $20 on ads for every shoe you sell.
There are other options such as google ads, sponsorships, or giving pairs to people for review (see my email on the side bar if you’re interested…), but in general the prices are about the same.
Finally, the shoes need to get to the buyer. Shipping rates will change based on the buyer, but after clicking around on a UPS.com business account, $15 is around average. Of course, a small percentage of your buyers will return their shoes. When that happens businesses typically need to eat shipping both ways, but that is hard to count on a single pair of shoes.
Let’s recap the costs from the sections above:
Materials: $120 to 415
- Upper: $75 to 300
- Midsole: $15 to 30
- Welt: $10
- Outsole: $20 to 70
- Extras: $5 to 10
Assembly: $11 to $76
- Labor: $11 to $76
- Factory/Machinery: Uncounted
Consumer Experience: $35
- Advertising: $20
- Shipping: $15
Add these up, and you get a grand total of an average stitched shoe falling between $166 and $526, just to make the shoe and sell it to the customer. As a reminder, this does not cover any of the machinery, website or physical store front, returns, or profit for the company.
What does this all mean? It’s pretty easy to see where the pricing of shoes come from. While I obviously don’t have access to Alden’s books, I did some back of the napkin math on the Chromexcel Alden Indy’s I own and found that the costs above add up to around $300 dollars. Counting in all the costs not mentioned here, the 25-50% cut retailers usually take out, and the ability to find them on sale or as seconds for less than $500 shipped, that seems like a pretty good deal overall.
I’d be interested to hear what you think. Which shoe brands offer great value? Which ones don’t? Let me know in the comments below.