Corina Pons and Siddharth Cavale

(Reuters) – Major shoe and clothing companies have begun moving production to European and U.S. markets. This is in response to a resurgence of cases of Delta coronavirus, which was found in Vietnam and China.

These disclosures are made amid an enormous shipping jam that has driven up prices and forced companies to reconsider their global supply chains as well as low-cost manufacturing hubs throughout Asia.

Spanish fashion retailer Mango has revealed to Reuters that it has “accelerated” its efforts in increasing production locally in countries like Portugal, Morocco, Turkey and Turkey. It mainly sourced products from China, Vietnam and Vietnam in 2019, according to the company. Mango stated to Reuters it will “considerably” increase the amount of European units in Europe by 2022.

Similar to this, U.S. footwear retailer Steve Madden announced Wednesday that it has pulled back Vietnam production and had moved 50% of its footwear production from China to Brazil and Mexico. Rubber clogs manufacturer Crocs (NASDAQ: ) announced last month that it is moving production to Indonesia, Bosnia and other countries.

The countries that were most in demand from shoe and clothing producers included Turkey, Bulgaria, Ukraine and Romania. However, China still produces a significant amount of apparel for European and American clothing chains.

Barry Conlon (chief executive at Overhaul), a management company that manages supply chain risks, stated, “We’re seeing significant growth in trucking and freight activity in former Soviet Republics…a large rise in Hungary, and Romania.”

In Turkey, apparel exports are expected to reach $20 billion this year, an all-time high, driven by a spike in orders from the European Union, Turkey’s Union of Chambers Clothing and Garment Council data showed. Exports reached $17 billion in 2020.

In Bosnia & Herzegovina, exports of textiles, leather and footwear amounted to 739.56 million marka ($436.65 million) in the first half of 2021, which was higher than for all of 2020.

“Many companies from the European Union, which is our most important trading partner, are looking for new suppliers and new supply chains in the Balkan market,” said Professor Muris Pozderac, secretary of the association of textile, clothing, leather and footwear in Bosnia & Herzegovina.

Nordstrom (NYSE 🙂 has made significant changes in the volume of its private-label production in Guatemala. In 2020, Guatemalan clothing exports surpassed $1 billion. That’s up by 34.2% from 2020 but 8.8% more than 2019.

Many companies still depend heavily on Vietnam, despite recent production interruptions that have led to significant disruptions. Vietnam’s government said in October that it will fall short of its garment exports target this year, by $5 billion in a worst-case scenario, due to the impacts of coronavirus restrictions and a shortage of workers.

The third quarter saw a 40% drop in factory inspections in Vietnam, which is a proxy of orders from retailers manufacturing. During those three months, production quickly moved to India, Bangladesh and Cambodia. The fourth quarter inspection rates in Vietnam remained at lower levels, though there was a slight uptick in October. Mathieu Labasse is vice president of QIMA. QIMA represents over 15,000 brands and provides supply-chain quality control auditing services.

Apparel maker VF Corp (NYSE:) and outdoor gear maker Columbia Sportswear (NASDAQ:) Companies warned of delays in spring and fall collections, and sometimes insufficient sizes.

Capri Holdings (NYSE 🙂 stated on Wednesday that Michael Kors handbags manufacturer Capri Holdings would not have sufficient inventory to meet holiday demand. Under Armour, a maker of athletic gear (NYSE :), said last Tuesday that it cancelled orders for Vietnam from “the factories get up and caught up.”

($1 = 1.6937 marksa