Nike China Makes "Hidden Rules": OEM Orders Are Heavily Outsourced.

"Old old case" suddenly rises. After the media's attention was once silent, "famous multinational enterprises exposed to sweatshops" were again pricked out of "pus and blood". One was there. Nike The senior manager of the factory for 6 years has placed a thick page of dozens of pages on his desk, telling the author the true story of sweatshop and revealing the details of his experience.

Nike creates China's hidden rules.

How much is 5 yuan divided by 8 dollars?

The small denominator is large and the result is small.

But it is these "small" numbers that make up a famous sport for Nike. brand The profit growth has made a lot of contributions.

I was informed that during the 2003~2007 years, Nike's manufacturers in the mainland of China had been repeatedly complained of a large number of illegal use of outsourcing workers.

"In the past years, in Nike's sewing football contract factory, a large number of outsourcing labor force was used to complete production at a very low price. In Jiangxi, Northern Jiangsu and Anhui, such a phenomenon has existed for many years. Mike, the former chief executive of Nike's important sewing football contract factory told me.

"A football sewing machine with a market price of 8 dollars is priced at 7 yuan, and the outsourced workers can only get 5 yuan if they sew one Nike." In the 6 years that Mike has served, there are about 5 years to help factories to "check" Nike's audit of the factory. "Only a hundred people, four or five factories per person per day, and 120 thousand shipments per month, Nike has not noticed." What is interesting is that this factory has become a model of "excellent factory" in the social responsibility report issued by Nike in 2008.

Zhu Jinqian, a spokesman for Nike, said that Nike had invited third parties to investigate the complaints about its foundry factories.

　　 Phenomenon: Foundry Order Be heavily outsourced

"They are the most important and largest contractors of Nike's manual sewing in China. They basically undertake the processing and production of all hand sewing football in China by Nike. The monthly shipments of Nike hand sewing football are 200 thousand to 300 thousand." Mike refers to "them", which is Shanghai Wande sporting goods company (hereinafter referred to as Shanghai Wan de) and Shanghai Bai en sporting goods Co., Ltd. (hereinafter referred to as Shanghai Bai EN).

Shanghai Wan de has two processing plants, Jiangxi Wuyuan Wan de Ball Co., Ltd. and Jiangsu Huaian Huaiyin District Xu Xu town Wan de ball factory (hereinafter referred to as Jiangxi Wan de and Jiangsu Wande, the two factories were closed by the end of 2006), Shanghai banen banner has Jiangsu Bain sports products limited company and Jiangsu Xin Ye sporting goods Co., Ltd. (referred to as "Bai en" and "Xin Xin Ye").

In Mike's dozens of pages of reports, Nike has been employed for many years in the two most important sewing football contract factories in mainland China: from 2003 to 2007, the two suppliers subcontracted their later businesses, and the orders were largely produced by rural families in remote mountainous areas.

OEM is itself a kind of outsourcing. According to Mike, Nike's OEM orders in the mainland suffered a lot of "re outsourcing".

Why do we do this?

Enterprises are always profit driven.

Restore: completing the process in remote rural areas

For the "re outsourcing", Mike carried out the path of "restoration" for the author: secretly passing football balls to remote rural areas through secret and complex web like processing networks, where the sewing process of world famous football is completed at the lowest cost.

According to the staff who had worked in Wande, Jiangsu, before the formal establishment of the plant in November 2005, Shanghai Wande worked through the local middleman for more than 2 years. "The middleman took the ball from Wande company and distributed it to the local rural women to carry out the ball sewing at home, and finished the gall bladder and sealing process at home, then finished the football, and shipped it back to Shanghai Wande." Even though Shanghai Wande has opened factories in Jiangsu and audited by Nike, outsourcing has not stopped.

Jiangxi Wande, founded in 2001, is doing business in this way: Shanghai Wande is responsible for negotiating orders with customers such as Nike. Orders are posted, cut and printed by factories. Jiangxi Wande has pulled the ball pieces to Jiangxi, and has used the company's local network in Jiangxi to transport the vast majority of ball pieces to some processing points in Jingdezhen near Wuyuan. When the production chain ends here, some factories will distribute the ball to nearby villagers for profit or progress.

According to the above statement, subcontracting has existed for a long time in Nike's manual sewing football field. According to the introduction, a skilled worker can finish sewing soccer balls between 4 and 5 days a day. The staff of Jiangxi Wande's office staff (even if they are not in the factory) are only 130, which means that the output of each month is around 12 thousand, but the actual situation is that the number of football transported to Shanghai by Jiangxi Wande every month is about 80 thousand. Only 100 workers in Jiangsu, Wan De, are producing 20 thousand soccer balls per month.

"Even the employees in the shop do not work in the factory on weekdays. Only when Nike comes to check, the factory responsible person will be rewarded with 10 yuan / day to call them to the factory and create the illusion of their attendance." I have witnessed these "fake" scene Mike recalls the author.

By simple calculation, we can see that according to Mike's statement, Nike's workers have "capacity" up to 10 or even higher in one day, only more than 100 workers can produce 80 thousand manual soccer per month.

In fact, Nike's soccer foundries are not just outsourcing in China. After many investigations, I learned that in 2006, Pakistan's football representative factory, SagaSports, was terminated by Nike on the grounds of "neglecting labor rights".

To confirm the explosion of deep throat, I called Shanghai wand's telephone number this week. The staff said the factory was about to move, but the boss was in Hongkong, but refused to disclose its contact details. When I went to his factory in Nanhui, Shanghai, the other side refused to enter the company on the grounds of confidentiality agreement. {page_break}

Data: $8 for outsourcing and only 5 yuan for outsourcing.

Although it is impossible to investigate the profit data of outsourcing from the factory, but through other ways, I still know the fact that the cost of outsourcing is surprisingly low.

According to the data provided by Nike, a pair of Nike shoes priced at 600 yuan in China, the order price of the factory is 20 dollars, the order price is 10 yuan hats, the market price is 100 yuan, the 3 yuan unit price socks can be sold 25 yuan...... The ex factory price is ninety percent off of the selling price, which is already Nike's "business rule".

"In the production of footwear and clothing, the bargaining power of Chinese factories is not high." The representative of a shoe factory in Fujian, Nike, told the author.

In the field of football production, the foundries who have more voice power are also very limited in profits. According to the author's investigation, the factory price of a tailored sewing machine priced at $8 is 7 yuan, and if it is outsourced to the workers, the factory can make a profit of 0.6 yuan ~1 yuan /. Mike also confirmed that the outsourced workers could only earn 5 yuan for sewing a $8 ball. Visible, even if a large number of outsourcing operations, the real profit is Nike.

"As far as I know, in Nike's high-end ball industry, the factory's profit is about 50 yuan, and usually does not choose to outsource production. But in the middle and low end, a lot of outsourcing is needed to ensure profits. Li Li, who had had business contacts with Nike in a soccer factory in Dongguan, told the author.

Strange phenomenon: Nike audit factory "repeated check reactive power"

It is understood that in Nike's last round of factory censorship, several major manual sewing football foundries have been shut down. After being discovered by Nike in 2007, Nike had gradually quit the OEM business of Nike football, and Anhui Xin Ye subsequently found similar cases.

Nike has also been working on the internal audit of Jiangxi Wande. In December 12, 2005, Nike carried out the first "audits" of Jiangxi wand, which was basically audited every month for more than a year until the closure of Jiangxi Wande in 2006. However, the outsourcing phenomenon was never found.

On the contrary, Nike's social responsibility report released in 2008 described Shanghai Wande: "in 2007, a football supplier in North China is a good example. In the face of high wages, unattractive work and high turnover rate, the factory has carried out training programs, mentor programs, master and apprentice bonuses, and other innovative initiatives to maintain a high level of productivity and quality, while workers have also been treated fairly. The 10 most skilled workers in the factory today are four times the average wage (including bonuses), and sewing positions are becoming more and more popular." In other words, Shanghai Wande was not only found to be heavily used outsourcing workers, but also Nike tree as a model for "excellent factories".

What causes Nike to "check reactive power repeatedly"?

According to Mike, Nike's social responsibility department looks at the social responsibility audits of factories only when looking at the wages, hours, wages, items, etc. of the factory's wages, whether it meets the requirements of laws and regulations, and it can not be seen from the wage table whether the actual output of factories matches with the actual production capacity of factories. That is to say, there is no outsourced outsourcing. "According to the information submitted to Nike, a worker will produce 8 soccer balls a day, which is totally impossible." At the same time, Nike's QA (quality and safety) department is responsible for evaluating the quality and qualification rate of the factory, and can see the actual output of the factory, but it is also not responsible for checking the actual number of employees.

Response: Nike invited third party agencies to investigate

Nike spokesman Zhu Jinqian said that Nike had already received complaints about wander company and launched a thorough investigation after learning the matter for the first time in 2007. "After investigation, we failed to confirm that the related complaints against the supplier were established and failed to confirm whether the products involved were regular Nike products or counterfeit products." It is reported that Nike has invited the third party FLA (Fair Labor Association) to investigate the existing facilities of Wande and Xinye company to understand the real situation. In addition, Nike has appointed an independent third party company to investigate unauthorized subcontracting complaints and evaluate existing procurement procedures.

Zhu Jinqian emphasized that before 2008, the production of hand sewing football was subcontracted to two Nike sewing factories for sewing centers in North China. The subcontracting mode has been terminated. In fact, Wan de stopped all production at the sewing center at the end of 2006. At present, all hand sewing football made by Nike in China is produced by a factory affiliated to Wan de. "Through single factory production and subcontracting, Wan de can directly supervise the production of all football products, and the production process is more transparent to Nike. This new model has been implemented for over a year.

According to the author's understanding, a number of famous sports brands such as Nike and Puma are also commissioned third party organizations to jointly investigate outsourcing behavior of Dai.