Footwear Supply Chain Strategies for a More Resilient Future

Last updated: November 17, 2025

In late 2024, fashion giant Shein revealed disturbing findings in its own supply chain: two instances of child labor and multiple factories failing to pay minimum wage. These discoveries, disclosed in its 2023 sustainability report, raised serious questions about transparency, oversight, and the true cost of scale.

Fast forward to mid‑2025, and no one’s asking for pledges anymore. Regulators want data, consumers want proof, and the brands making progress are the ones who’ve moved on from good looking ESG reports to actual changes in their supply chain practices. And consumer trust is fragile. As environmental laws like the EU’s Ecodesign for Sustainable Products Regulation (ESPR) gain enforcement teeth, and as Digital Product Passports become mandatory in more markets, footwear brands must evolve supply chain strategies or risk losing legal access, reputation, and revenue.

What’s New in the Footwear Arena: Laws, Innovation, and Risk

Regulatory shifts: The EU’s Corporate Sustainability Due Diligence Directive (CSDDD) is now being enforced in many sectors. Alongside ESPR, brands must prepare to deliver detailed product lifecycle data, including material origin, environmental impacts, and end‑of‑life treatment.
Innovative product launches: Vital examples such as Solk’s Fade 101, a trainer that is compost‑capable, and Vivobarefoot’s 51% bio‑based compostable shoe, show what’s possible. They’re early bets, but they’re shaping what sustainability looks like when it’s built into the product.
Transparency gaps remain: KnowTheChain’s leather supply chain case study shows many global footwear and luxury brands still lack public disclosure or effective mitigation for forced labour risks beyond the first tier.

The Most Critical Blind Spots Even Advanced Footwear Brands Face

Footwear brands today are facing significant challenges:

The Challenge	What it means
Complexity and fragmentation	The footwear supply chain involves multiple stages like design, material sourcing, manufacturing, and distribution. Complexity further increases due to the industry's reliance on a global network of suppliers and manufacturers, often leading to fragmented operations and communication challenges.
Supply chain visibility and traceability	Many footwear companies struggle with limited visibility into their supply chains, making tracking products from origin to consumer difficult. This lack of transparency can hinder compliance with regulations and consumer expectations for ethical sourcing.
Sustainability and environmental impact	The footwear industry faces increasing pressure to adopt sustainable practices. Challenges include sourcing eco-friendly materials, reducing carbon footprints, and managing waste. Companies are exploring innovations like biodegradable alternatives and circular economy models to address these concerns.
Labor and ethical concerns	Ensuring fair labor practices throughout the supply chain remains a significant challenge. Issues such as inadequate wages, poor working conditions, and a lack of labor rights enforcement can lead to reputational damage and legal repercussions.
Consumer demand and customization	Modern consumers demand personalized products and rapid delivery times. Meeting these expectations necessitates agile manufacturing processes and responsive supply chains, which can be challenging to implement.
Regulatory compliance	Navigating the complex landscape of international trade regulations, tariffs, and environmental laws requires diligent compliance efforts. Non-compliance can result in fines, shipment delays, and loss of market access.

6 Recommendations for Building Intelligent, Adaptive Footwear Supply Chains in 2025

Below are six strategies, drawn from what’s working in the field. Each recommendation includes concrete steps and examples.

1. Start Piloting Digital Product Passports & Design Transparency

The ESPR rollout means brands need to start thinking seriously about how they’ll build product passports into their operations. Begin with one or two product lines.

Collect material breakdowns (source country, supplier identity, chemicals used).
Use platforms that support dynamic updates (e.g. labeling changes, repair instructions).
Share public snapshots of these passports to build trust.

2. Embrace Circular Design & Compostable/Recycle‑Friendly Materials

Reduce adhesives, prioritize modular components, select materials with known end‑of‑life pathways.

Integrate take‑back programs or reverse logistics.
Monitor durability and functional performance to avoid trade‑offs that hurt user experience or lifespan.

3. Push Visibility Further Upstream

Many forced labor risks and environmental harm begin in raw material production. Mixing social due diligence with material sourcing is critical.

Map suppliers of hides, rubber, synthetics beyond the direct contractors.
Use third‑party verification, site visits, and training (e.g. what Adidas does with tanneries in Taiwan, China, Brazil, Paraguay).
Use risk models to identify geographic, material, or regulatory hot spots. Several laws increase risk for materials originating in regions with human rights concerns.

4. Use Tools & Collaboration to Scale Circular and ESG Innovation

Plenty of consortiums and NGOs are already doing the groundwork – brands don’t have to build the whole thing from scratch.

Leverage mapping and traceability tools (the Retraced platform is one example) to gain full chain visibility.
Share learning and best practices with industry peers to avoid reinventing the wheel.

5. Embed ESG & Risk Management into Procurement Decisions

Risk needs to show up in contracts, in how suppliers are evaluated, and in the way sourcing teams make decisions.

Include ESG, labor rights, environmental impact as scoring criteria in vendor selection.
Provide capacity building for suppliers (e.g. training up tanneries, supporting smaller factories) to help them meet new expectations.
Use predictive tools, data feeds, and early warning systems for disruptions (conflict zones, climate risk, regulatory changes).

6. Public Reporting & Regulatory Alignment

Everyone, from regulators to investors, wants to see what’s being tracked, and how brands are actually measuring progress.

Align with frameworks such as GRI, CSRD, SASB.
Publicly report on traceability metrics (e.g. % of product lines with material origin traceable, % compostable/recycled content).
Call out what’s working and what still needs work. That’s what builds trust.

Smart Traceability Systems are Changing the Game — Are You Keeping Pace?

As we've seen, many of today’s pain points stem from legacy systems and fragmented supplier relationships. But forward-looking brands are advancing through the five stages of supply chain maturity, using digital tools and collaborative strategies to turn transparency into an operational advantage. Smart traceability systems accelerate that shift.

Unlike static audits or manual reporting, modern traceability platforms offer dynamic, end-to-end visibility across materials, factories, and logistics. They allow ESG managers to integrate compliance into the design and sourcing process. A leading example in sustainability built into the entire process comes from Veja. The French show brand collaborates with waste‑picker co‑ops (Catadores) to convert PET bottles into shoe linings. The work is fully traceable from collection through to fabric production, helping both environmental and social goals.

The future of footwear supply chains lies in connected and intelligent infrastructure. And the sooner brands embrace it, the more resilient, transparent, and customer-aligned they’ll become.