Growth Track Of Shoe Enterprises In Yangtze River Delta And Pearl River Delta

They are in the Pearl River Delta and the Yangtze River Delta shoe tycoon Guangzhou Chuangxin Shoes Co., Ltd. and Wenzhou, respectively.

Chuang Xin seeks the path of pformation

As one of the first shoe manufacturers to move the production line to mainland China, Wu Zhenchang, chairman of Guangzhou Chuangxin, came to Guangzhou in 1990 to set up a factory. He used the overseas network base he laid before and the cheap labor force of Guangdong to work for a large number of large clients such as Nike.

With the rapid development of Guangzhou factory, he simply closed the Taiwan factory and pferred all the orders to the mainland. At the peak, there were nearly 20 thousand employees in the letter, with an annual export volume of US $more than 100 million.

However, in recent years, because of the rapid increase in the labor costs of the Pearl River Delta, the appreciation of the renminbi, the macroeconomic regulation and control of the country, the international trade friction and the low consumption of the international market, Wu Zhenchang's enterprises have begun to go downhill. Especially since the outbreak of the financial crisis, the credit order of Guangzhou has dropped by three or four, and the number of workers has been reduced from 1.3 to six thousand or seven thousand.

Some time ago, Wu Zhenchang was said to have moved the factory to other places.

Wu Zhenchang denied this. He talked about the pick-up in orders this year, but the cost pressure is still very large. He dare not rush to expand the scale of production again. In the current tense situation of employment in the PRD, he will not dig in to other shoe factories with high salary. He can only abandon some cheap orders, maintain the existing scale, and consider new strategies.

But Wu Zhenchang has made a lot of difficulties in moving the brand into or out of Southeast Asia.

Because both have risks, he also needs to consider carefully, after all, this is related to the future development direction of enterprises.

Wu Zhenchang has visited Zhanjiang and Southeast Asia's Vietnam and Indonesia in recent years. The labor cost in these areas has relative advantages. Especially in Vietnam, the wage of shoemaker workers is only 1/3 of that in Guangzhou, which is very attractive to the processing trade enterprises. In addition, this year, the China ASEAN Free Trade area has been launched in an all-round way, which has created better conditions for bilateral investment and trade. This is also the case in.

However, the production facilities in Southeast Asia are far from mature in the mainland, and more importantly, after the relocation, it is likely to miss the huge market opportunity of the mainland.

If we move inland, we will also face some problems in pportation and production matching, especially for enterprises such as Chuangxin, which are mainly exported by products.

Wu Zhenchang has also tried to sell some brands to expand domestic sales, but the progress is not smooth. At present, sales still account for less than 10% of the company. Wu Zhenchang admitted that this is related to his efforts to focus on export orders, but he is still very optimistic about the prospects of the domestic market, but from the manufacturing industry to business there is a greater risk. Early market research needs to be well prepared.

{page_break}

Founded in 1988, AOKANG group is a local private enterprise in Wenzhou, Zhejiang. Like many leather shoes export enterprises, AOKANG starts from the domestic market and gradually develops its export market. At present, AOKANG shoes account for 80% of domestic sales and 20% of exports.

In recent years, both domestic and foreign sales have maintained a good growth rate.

"At present, the export market is relatively stable, mainly for some European high-end customer OEM, the growth rate is far from domestic sales so fast, AOKANG's four independent brands plus the newly acquired Italy brand Wanli Wei Greater China operation power, multi brand operation attracted different levels of consumers.

Walking on two legs, we form scale purchase and production, and develop the same set of standard and standard production processes, improve efficiency and control waste with strict management, and continuously enhance R & D and design. These measures can offset the rising cost at present.

The rapid growth of domestic sales can, to a certain extent, reduce pressure on export orders, "said Wang Hailong, spokesman for AOKANG group." in addition, AOKANG started investing in Bishan County in 2003. The cost of shoemaking here is about 20% less than that in Wenzhou. Austrian Kang is interested in increasing production in the West.

However, the shoes produced in Chongqing are mainly supplied to the western market, while the export products are mainly located in Wenzhou.

According to Zhou Shijian, executive director of the China International Trade Association, compared with PRD, enterprises in the Yangtze River Delta have more awareness of brand building and independent research and development, and many export enterprises are mainly based on general trade and have closer ties with the domestic economy.

Relying largely on local enterprises and local migrant workers, the Yangtze River Delta's foreign trade is stronger than that of the Pearl River Delta.

The Pearl River Delta's foreign trade mainly depends on foreign investment and foreign labor in Hong Kong, Macao and Taiwan. At present, foreign businessmen still account for 60% of Guangdong's total foreign trade.

With the rising cost of labor in the Pearl River Delta, some foreign businessmen will once again migrate to low labor areas.

In addition, the number of self owned brands and working environment and salaries in Jiangsu and Zhejiang provinces will also attract some skilled migrant workers in Guangdong.