Cost Pressures Of Raw Materials "Destroy" Pnational Footwear Industry

Analysts believe that the increase in input costs is one reason Adidas shut down the Suzhou plant.

According to Adidas's official statement, apart from the factory directly under way, there are still more than 300 factories in the country that are still producing Adidas products.

Prior to this, Nike also closed its footwear factory in China, currently "Vietnam made" Nike.

The number has surpassed "made in China".

To buy a pair of shoes at Adidas (Adidas) store and watch the tag carefully, the probability of "MadeinChina" will probably be lower than that of "MadeinVietnam" (Vietnam made) in the future.

Yesterday, Adidas group commissioned the Ogilvy public relations company to confirm to the West China Metropolis Daily reporter that "Adidas will close its only own factory in China later this year" because of the strategy of re integrating global resources.

At the same time, Adidas also has more than 300 foundries in China to work together. "

At 10:30 pm yesterday, Adidas also issued a statement that the factory in Suzhou will be closed, "it is true, but it has not pferred the factory to any other place".

It is reported that Adidas China is a wholly owned subsidiary of Adidas group 100%. It has registered and opened production base in Suzhou. Its trade headquarters is located in Shanghai, with branches in Beijing and Guangzhou, and Suzhou plant is also its only own factory in China.

Question 1 production base pferred to Southeast Asia?

It is understood that Adidas Suzhou factory has 160 employees, the affected factory workers will receive normal wages and higher than the international standard of compensation.

A statement from Adidas yesterday night said that the closure of Suzhou's factory was due to a strategic consideration of reintegrating global resources, a strategy that would help Adidas better play its scale effect and reduce complexity.

Whether Adidas's production base will move to cheaper Southeast Asia? Adidas did not give an exact reply.

Analysts believe that the increased cost is one of the reasons why it closed the Suzhou plant and found a cheaper production base.

Yesterday, the West China Metropolis Daily reporter went to Chunxi Road Adidas stores to investigate and found that the products made in China are still the mainstream, but Vietnam, Indonesia, Malaysia, Philippines, Turkey and other places are also manufacturing a lot of products.

The production base of Adidas was first in Europe, then pferred to Japan, followed by Korea and Taiwan, China, followed by mainland China.

Now it will be pferred to Kampuchea, Vietnam, Bangladesh and other countries.

Nike has also experienced the pfer of such industries.

3 years ago, Nike closed the only shoe factory in China.

Reporters visited Nike stores yesterday and found that their products were distributed in China, Vietnam, Malaysia and Sri Lanka.

Question 2 will other generation factories be affected?

It is understood that 50% of Adidas's products are made in China, in addition to a factory directly under way. At present, there are more than 300 foundries in the country that are still producing Adidas products. The reporters found that the manufacturers mainly concentrated in the Yangtze River Delta and the Pearl River Delta region.

The closure of the factory directly under the Suzhou, Adidas's official statement also specifically put forward that "China also has more than 300 generations of factories to work together", the speech conveyed the representative factory will not change signals.

But Li Peng, Secretary General of the Asian Footwear Association, believes that if Adidas reduces the production line on a large scale, it has a great impact on the generation and matching, and many generations of factories are difficult to live independently. In this case, if the factory wants to rely on the order of Adidas and other enterprises to survive, it must follow the Southeast Asia.

Reporters learned that, in the more than 300 factories for Adidas OEM, Taiwan Yuyuan group accounted for a large share of the order, and many factories in mainland China, specially for Adidas and other OEM, but this enterprise has begun large-scale pfer to Southeast Asia in recent years, and factories in mainland China have begun to shift from coastal areas to low cost labor areas in the mainland.

Question 3 why is there no Adidas factory in Sichuan?

Are there any enterprises in Sichuan and Chengdu in Adidas's foundries? Yesterday, the staff of the Sichuan clothing (apparel) Industry Association told the Huaxi Metropolis Daily that the more than 400 member enterprises of the association did not produce Adidas products.

Peng Jun, chairman of the western shoes capital, also revealed that Chengdu shoe factory is mainly made of leather shoes, and there is no substitute factory for Nike sports shoes.

Is Adidas's production base likely to be pferred to Sichuan? As of press release, Adidas did not respond.

However, Tang Jiqiang, director of the development and Planning Bureau of Chengdu high tech Development Zone, said yesterday, "we do not accept such a labor intensive industry pfer."

He said that Sichuan is attracting high-end industries, and has to attract investment according to the needs of industrial development.

It is understood that Sichuan's eastern coastal industrial pfer is mainly based on electronic information manufacturing, software outsourcing services, biomedicine, automobile manufacturing and other industries.

Question 4, where will the next production base be?

The production base has been pferred from Europe to Japan, Korea and China, and now it has been pferred to Vietnam, Indonesia and other countries.

Like Adidas, Nike global design, global search for foundry enterprises, global sales of sports brand, and then the next stop production base will be where?

It is understood that at present, the number of Vietnamese made Nike shoes has surpassed "made in China".

As the largest foundry of Nike, Limited by Share Ltd, Taifeng enterprise, has publicly stated that India has a reasonable labor cost, a strong source of labor and a geographical location close to the EU market, which will create another competitive production base for the company.

According to public information, Adidas plans to increase garment production in Central America by 5 times before 2015, while withdrawing some of its capacity from Asia.

Other sportswear manufacturers have begun to shift production to Central American countries.

In addition, according to Xinhua, the volume of exports in the Middle East and Africa will rise by 12% in the next ten years, and may also take the place of China and become a concentrated manufacturing base for low price commodities.

Journalist observation

Transnational giants "southeast flight"

For decades, pnational sports apparel brands such as Adidas and Nike, like migratory birds, flew to Japan from Europe and America, flew from Japan to China, Taiwan, Korea, and then flew to mainland China. Now they fly to Southeast Asia and South Asia. There is only one reason: where the manpower cost is low, they fly to where.

With the rise of labor costs, many economists believe that China's demographic dividend is gradually disappearing.

Compared with other high-end industries, Adidas and Nike are more sensitive to cost.

With the pformation of China's economy to capital and technology intensive industries, pnational giants extend their industrial chain to countries and regions with lower cost, which is the strategic adjustment to adapt to economic globalization.

And many Chinese enterprises have begun to focus on Southeast Asia, South Asia and other places, and set up factories in the sea.

In the context of economic globalization, an important determinant of where to build factories is where to achieve higher profits.

Transferring factories to lower cost countries and regions does not mean abandoning the Chinese market. On the contrary, it is more likely to create higher value.

One day, China will lose the status of "world factory", but this also means that China's economy has achieved a qualitative leap in the process of actively adapting to globalization.