New Opportunities for Investing in Iran’s Footwear Industry

Iran’s footwear industry is undergoing a transformative phase, presenting exciting opportunities for investors looking to tap into a growing market. With a projected revenue of $2.367 billion in 2025 and an annual growth rate of 3.29% from 2025-20291, the sector offers significant potential for both domestic and international stakeholders.

Why Invest in Iran’s Footwear Industry?

1. Expanding Market: Iran produces approximately 270 million pairs of shoes annually, with plans to increase this figure to 400 million pairs, potentially becoming the 9th largest shoe producer globally13. The domestic market is robust, as Iran is the largest consumer of footwear in the Middle East and the 18th largest globally, with annual per capita consumption of 2-2.5 pairs4.

2. Strategic Export Opportunities: Iran exports footwear to key markets such as Iraq, Afghanistan, Azerbaijan, and Turkey, with Iraq alone accounting for 50% of exports3. Neighboring countries and regions like Central Asia and members of the Shanghai Cooperation Organization represent untapped markets demanding billions of pairs annually3.

3. Cost Advantages: The local production of polyurethane (PU) and other raw materials has significantly reduced reliance on imports, saving up to $300 million annually1. This positions Iran as a cost-effective producer capable of competing in global markets.

4. Government Support: Policies such as import bans on foreign footwear have bolstered domestic production, encouraging local manufacturers to improve quality and align with international standards34.

Key Investment Areas

1. Manufacturing Expansion: With production capacity standing at nearly 500 million pairs per year3, investing in modern factories equipped with advanced technologies can help meet growing domestic and export demands.

2. Raw Material Production: The surge in local PU production has not only reduced costs but also created opportunities for exporting raw materials to other countries1. Investors can explore partnerships in chemical industries supporting footwear production.

3. Brand Development: Iran’s footwear industry lacks globally recognized brands4. Investments in branding, marketing, and design innovation can establish strong domestic and international identities for Iranian footwear.

4. Technology Integration: Upgrading manufacturing processes with automation and digital tools can enhance efficiency and product quality, making Iranian footwear more competitive globally.

Market Insights

• Export Trends: In 2024, exports surged to record highs, with Azerbaijan, Iraq, and Afghanistan as primary destinations23. The average export price remains competitive compared to global standards.

• Import Challenges: While imports have declined due to government restrictions, this creates opportunities for local producers to fill gaps in high-quality footwear demand3.

• Consumer Behavior: Despite economic challenges, Iranian consumers are increasingly favoring locally produced shoes that meet international standards3.

Conclusion

Iran’s footwear industry offers a unique combination of growth potential, cost advantages, and strategic market access. By investing in manufacturing capacity, raw material production, branding initiatives, and technological upgrades, stakeholders can capitalize on the expanding domestic market and lucrative export opportunities. With government support and increasing global interest in Iranian-made products, now is the ideal time to invest in this dynamic sector.