Canton Fair To Inspire Shoe Enterprises To Accelerate The Pace Of Transformation

In May 5th, the 107th Canton Fair came to a close. The statistics of Quanzhou foreign economic cooperation and Trade Bureau showed that the number of orders gained by spring enterprises increased year by year. As a direction of export, the performance of spring enterprises in the Canton Fair has made Quanzhou's foreign trade base which has only begun in August. But behind the continuous rebound, because of the soaring cost of raw materials and labor and the uncertainty of RMB appreciation, the attitude of spring enterprises to take orders is becoming more cautious. It was hoped that the economic recovery would bring more abundant orders, but the cost pressure that could not be transferred would make many springs enterprises want to fail and let enterprises have to consider accelerating the transformation.

Continuous rebound

The official statistics show that overseas buyers increased by 8.4% compared with last autumn's fair, and the turnover volume was $34 billion 300 million, an increase of 12.6% over the same period last year. According to the statistics from Quanzhou's foreign trade and Economic Cooperation Bureau, the turnover of spring enterprises has increased by two digit year-on-year, according to the statistics of Quanzhou foreign trade and Economic Cooperation Bureau.

Whether it is the overall environment of the Canton fair or the situation of Quanzhou enterprises, a larger increase in turnover means that the export of foreign trade may have been rid of the gloom of the international financial crisis. Last year, Quanzhou's foreign trade exports had a negative growth until August last year. When Quanzhou's foreign trade and Economic Cooperation Bureau official analyzed the phenomenon, Quanzhou's exports rebounded in the second half of the year, mainly due to the pull of the Christmas order factor and the need for replenishment by international buyers after inventory depletion. "The foundation of the rebound is not strong enough."

As time went on in 2010, Quanzhou's foreign trade exports began to show a substantial positive growth compared to the same period last year. Data show that in the first quarter of this year, Quanzhou's foreign exports amounted to US $1 billion 651 million, compared with the first quarter of 2008 last year and the first quarter of the crisis, the export growth rate exceeded 43 percentage points.

From the actual situation of many export enterprises contacted by reporters, since the end of last year, many Quanzhou export enterprises' production lines are basically at full load. According to the analysis of Quanzhou foreign trade and Economic Cooperation Bureau, after the financial crisis, the demand for high-end products decreased, and the demand for high-end products increased correspondingly. The middle and low end products were the advantages of Quanzhou's export commodities. However, we must pay attention to the fact that in the first quarter, the export growth of Quanzhou's exports increased, and the export base was lower than that of the same period last year. The export rebound in the first quarter came from the inventory replenishment in Europe and the United States after the holidays such as Christmas and New Year holidays, which made buyers increase imports in a short time. But whether the real consumption of the European and American markets is really improving is still to be seen.

It is in this sense that the weathervane of this Canton Fair is more meaningful. According to the rule of past years, the peak period of export in Quanzhou appears after July. Generally speaking, the order situation in July can appear on the Canton Fair. However, judging from the information returned by this Canton Fair, the situation of Quanzhou export enterprises is still complex. Judging from the situation of the Canton Fair, although the year-on-year growth has seen a substantial increase, the turnover is still down 10.3% compared with the 2008 Spring Fair before the outbreak of the crisis, which is also less than that of last autumn's fair.

As for the exhibitors in Quanzhou, the reporters have contacted many exhibitors such as TAM Sen, Su Peng, Chao Wei, Ming Jian and so on. These enterprises are mainly in the two industries of shoes and clothing, which occupy Quanzhou's total export volume of half wall river. Prior to that, Huang Rongqin, chairman of Jinjiang de Rong Clothing Co., Ltd., once conducted a survey of European and American countries. According to his findings, the consumption market in Europe and the United States is not really restored. "In the case of the consumer market has not really recovered, the rebound must be a difficult process."

　　 A long list with no bottom

The uncertain prospect of recovery has disturbed many springs enterprises, and the cost of soaring prices has led to worries among many enterprises. A number of exhibitors in Quanzhou said that the current production capacity of the relative cooperative factory is still ample, and the order is scheduled to run until around July and August. But it must be noted that the abundance of orders is only relative. Ding Youyi, chairman of WorldCom footwear industry, told reporters that many factories now have plenty of orders, mostly due to difficulties in recruiting workers, resulting in the failure to release their capacity. "Compared with the lack of production capacity of many enterprises, the order is certainly ample."

The shortage of labor force makes the enterprises have to increase their wages. The Quanzhou foreign trade and Economic Cooperation Bureau has mentioned a typical case in the survey results. After Jinjiang's rain gear company mentioned the average wage of workers from 1300 yuan to 2000 yuan per month, 500 workers were originally planned to recruit, but in the end, only 300 people were recruited. At the same time, raw material prices have also seen substantial growth. According to the data of Quanzhou foreign trade and Economic Cooperation Bureau, the export of textiles and fabrics used in Quanzhou has increased from 15% to 20%, and the price of steel has increased by about 10%. Another statistic shows that in the 20 textile materials and products, in 2009, 5 products increased by 100% over the year, and 12 products increased by more than 50%, while only 2 products increased by 10%.

The cost of labor and raw materials has been running all the way, but raising prices is a hopeless thing. At this fair, Jinjiang's umbrella enterprises generally raised more than 10% of the price, but the market purchasers seemed not to buy it. "On the one hand, foreign buyers are very familiar with the production and operation of domestic suppliers. On the other hand, the economy has just recovered, and it is difficult for buyers to accept too high prices at once. In addition, the change of exchange rate also involves the nerves of Quanzhou's export enterprises. At present, the industry generally expects that the RMB exchange rate will appreciate in the year. However, under the "three big mountains" under the shortage of labor force, rising costs and unpredictable exchange rate movements, it is more and more prudent for enterprises to take orders.

Last year, many enterprises looked forward to the emergence of long single orders. But at this fair, even if there is a long list, enterprises will not dare to take it hastily. A Quanzhou exhibitor told reporters that in the current shortage of labor, once the enterprise blindly orders, it may lead to no shipment in July and August, and then there may be compensation and breach of contract, which may be a fatal blow to the enterprise. In addition, once RMB appreciation and cost rise sharply, "the more we receive, the more we will lose."

　　 Had to accelerate the transformation

It was hoped that the economic recovery would bring more abundant orders, but the cost pressure that could not be transferred would make many springs enterprises lose hope. Many enterprises had to face the embarrassment of being embarrassed whether they were good years or bad years, which led enterprises to consider accelerating the pace of transformation.

At this Canton Fair, enterprises have begun to take substantive steps. Changing the traditional foundry mode, upgrading OEM to ODM has become the choice of many springs enterprises. According to Chen Shitian, assistant director of the plum blossom umbrella board, since last year, the plum umbrella has hired a number of foreign R & D personnel, and has designed a number of high-end products for Europe and Japan, laying the groundwork for the company's sales this year. Get rid of the pure processing role and set up distributors directly in Japan and Korea to expand the market of Japan and Korea. Japan and South Korea market is recognized as a high-end market, the integration of independent design elements, plum umbrella in Japan and South Korea market competitiveness rapidly increased, and now, plum umbrella 10% of the products exported to the two major markets.

In fact, speeding up the transformation of Quanzhou's foreign trade enterprises has also entered the official agenda. Not long ago, the Quanzhou Municipal Foreign Trade and Economic Cooperation Bureau issued a number of measures to promote the development of foreign trade and economic cooperation in Quanzhou in 2010, laying a strategic layout for Quanzhou's foreign trade in the post crisis era. In the new deal officially introduced by Quanzhou, Quanzhou's support measures for foreign trade enterprises have shifted from reducing costs in times of crisis to encouraging enterprises to seize the right to speak. It is for this reason that in the new deal, enterprises are encouraged to "go out" to build an international logistics network to an unprecedented height, and to increase support for enterprises to invest abroad and to develop processing trade.

The head of Quanzhou Municipal Foreign Trade and Economic Cooperation Bureau believes that the "sore spot" of Quanzhou's foreign trade enterprises is not having the right to speak price, and the construction of an international logistics network will be the first step for Quanzhou foreign trade enterprises to snatch international pricing power. This is also the consensus of many enterprises. The news from the foreign trade and Economic Cooperation Bureau shows that this year, the pace of spring enterprises going abroad has been significantly quickening. In the first quarter, 8 enterprises have applied for foreign investment to the foreign economic and Trade Bureau. Compared with last year, the number of enterprises invested abroad has doubled.