Earthquake Raids "East Shoes Westward" Or Variable

As an important province in the Midwest of China to undertake coastal industrial pfer, will Sichuan be passive in undertaking the gradient pfer of eastern industry due to the earthquake.

In some industry circles, the earthquake may magnify the enterprises' concern about whether Sichuan is safe or not, and then cause Sichuan and the five central provinces of Anhui, Hunan, Hubei, Jiangxi and Henan to be passively involved in the competition of eastern coastal enterprises' industrial gradient pfer.

Will such worries become a reality?

Debate: whether shoe companies continue to move westward to Sichuan is an important province in the Midwest of China to undertake coastal industrial pfer. Whether the 5. 12 earthquake will delay Sichuan's undertaking of the pace of industrial gradient pfer in the east or become passive in its acceptance is becoming one of the focal topics discussed by the industry.

Some of the westward shift of the earthquake caused the collapse and damage of the factory buildings, serious damage to the infrastructure, logistics system, casualties, and the closure of factories due to power failure. These are a reminder of the risk of the westward shift of the eastern coastal enterprises and the "siting" of Sichuan.

In addition, under the constant panic of persistent aftershocks in Chengdu and Chongqing, concerns about the potential safety hazards of investment enterprises in Sichuan and Chongqing are being unconsciously magnified.

Jiang Yuanwu, general manager of AOKANG Chongqing Real Estate Co., Ltd. believes that there is no need to worry too much about them. Taking Tangshan, Hebei as an example, he believes that after the great earthquake, Tangshan's economic development did not stagnate. Therefore, the earthquake does not have a long-term and fundamental impact on the local economy. "For AOKANG, our confidence in investing in the West has not wavered, and speculation about the possibility of natural disasters such as earthquakes can not decide whether we invest or not, and we are not too frightened by the destructive power of the earthquake."

Cao Xinyu, vice president of the China Textiles Import and Export Chamber of Commerce, has constantly stressed to the outside world that the impact of the earthquake on Sichuan's undertaking industrial pfer will only be limited to a very short period of time. He added: "the earthquake is only a temporary factor, rather than a long-term factor, which may postpone the industrial ladder pfer plan, but there will be no fundamental change. Sichuan's advantages in undertaking industrial pfer still exist."

"Earthquake": shoe enterprises face the choice of life and death before the earthquake in Wenchuan shocked the Chinese people, China's shoe enterprises have been in the constant "earthquake".

"Nowadays, enterprises talk about cost is no longer a question of profit, but whether they can continue to live."

A shoe enterprise boss's heart also tells the Eastern shoe enterprises are facing the life and death torment.

"In the global context of industrial pfer, today, the manufacturing sector is far from saturated in the eastern region, which is suffering from multiple challenges such as raw material, labor costs rising, RMB appreciation, processing trade and export tax rebate policy adjustment."

Zhang Shuhua, chairman of the China Leather Association, said the bottleneck for the development of the shoe enterprises in eastern China.

But at the same time, Bishan, Chongqing, which has the reputation of the western footwear capital, is in a big way to welcome this opportunity of industrial adjustment.

The word "cost revolution" is very popular in this year's shoe industry in Wenzhou.

The head of AOKANG group, a private shoe making enterprise, said: "the overall cost of shoemaking this year has increased by 20% compared with that of last year. Under the situation that the retail price of leather shoes has not risen, the cost pressure of enterprises is getting bigger and bigger."

It is understood that AOKANG set up a cost team this year, set up full-time posts, further refinement of cost control.

Quantitative utilization of raw materials, further integration of human resources, and even energy conservation in offices and living quarters are all being considered.

In the Wenzhou Ouhai Industrial Zone, which is known as the Chinese shoes capital, this is the time when production is busy.

The rise of costs weakens the enterprise's ability to resist risks, so enterprises are careful to make orders.

"In fact, enterprises do not have no single list to do so, but they are afraid to accept it. They are not affected by the instability of the RMB exchange rate. Some of the bills in August and September are afraid to pick up. They can only pick up some recent ones."

Recently, a boss with 500 shoe scale enterprises said, "the overall cost of our enterprises has increased by about 26% over the past year. After the implementation of the new labor contract law, the increase in wages alone has increased by 2 million yuan, and most of the other costs are raw materials, export tax rebate and RMB exchange rate.

At present, enterprises are basically in a dilemma.

"It's too fast for us to prepare. It's just like a disaster."

A boss who has run shoes for more than 30 years said.

The same situation, the Pearl River Delta seems to be more serious: according to the November 2007 statistics report of the Asian footwear industry association, there are five thousand or six thousand shoe factories in Guangdong, and more than 1000 large and medium-sized shoe factories have been closed, of which two or three shoe factories in Huidong have closed four hundred or five hundred small shoe factories in more than 3000 months.

In addition to policy factors, the industry itself has also made it possible for enterprises to be doomed from today's founding.

At present, more than 70% of the PRD enterprises still rely on the "low cost, low profit" processing trade mode, always living at the low end of the price chain, with a profit of only 5%-10%.

Such labor-intensive enterprises do not have the core competitiveness. Once the low cost advantage is lost, they will directly face the choice of life and death.

To avoid "shock": "East shoes move westward" this shoe industry's "earthquake" epicenter in the East.

Since the second half of 2007, a large number of small and medium-sized shoe enterprises have closed down in Dongguan and Wenzhou, the two largest footwear base in China.

Facing the "earthquake", the migratory birds in the East are moving westward.

"In the whole process of moving east shoes, the most powerful promoter is not the government but an invisible hand - cost."

Zhang Shuhua, chairman of the China Leather Association, believes that the footwear industry is a "migratory bird economy" and is always pferred to countries and regions where labor costs are low.

In the 60s of last century, the world shoe center moved to Japan and South Korea in Italy in 70s, moved to Taiwan in China in 80s, and pferred to Guangdong Dongguan and Zhejiang Wenzhou in 90s.

Nowadays, the shoe center is pferring to the central and western parts of China. The low cost advantage of the west is like a huge depression, attracting the capital inflow into the East.

"The reason why AOKANG chose to invest in Bishan should be AOKANG moving directly to the trend of China's footwear industry moving from east to west, and welcoming the result of strategic adjustment from domestic and international competition."

Wang Zhentao, President of AOKANG group, said so.

Driven by AOKANG, the shoemaking enterprises in the western shoe market have developed rapidly, and enterprises in the coastal areas have shifted to the West.

Recently, more than 20 shoe factories supporting the processing of Brazil's shoe giant, Dongguan, have been quietly moved to Bishan, the western shoe market, for the two time.

"Moving east shoes to the west" also provides convenience for the development of the western market.

At present, due to the blocked foreign trade, many shoe companies are turning to domestic sales. The three giants of Dongguan shoe industry, Yuyuan, Xing ang and Huajian, are now forging ahead with their own brands to rush to the mainland market.

In this war of domestic sales, the western market has become a competitive destination for all shoe companies.

Recently, the largest leather trade and trading center in Western China will soon be put into operation. The leather city integrates wholesale, retail and display of leather goods, bags, leather shoes and leather products. Based on Chongqing, it will radiate the surrounding areas such as Sichuan, Guizhou and Yunnan, providing convenience for the footwear industry to develop the western market.

In the process of "shifting East shoes to the west", the government's influence should not be ignored.

If the shortage of energy and labor has sowed the "fire" of the shoemaking enterprises in the eastern coastal areas, then the government's policy guidance is a catalyst for the shoe industry to escape.

The shoemaking industry is a chicken ribs for the eastern coastal areas. It is attractive to the vast Midwest cities.

The shoemaking industry can bring huge employment population, can drive huge GDP output value, and has a strong industrial driving role, which makes local governments heartbroken.

Therefore, the attitude of the eastern government is different from that of the eastern government. The Chongqing municipal government has stepped up the planning of the park, issued preferential policies, and opened the door to welcome the entry of the eastern manufacturing sector.

In April this year, the main leaders of the municipal Party committee and municipal government of Chongqing took the initiative to invest in the eastern coastal cities.

Insiders said, "this movement of" East shoe westward shift "is like migrating birds to avoid winter. As the winter of Chinese footwear industry has arrived, the slow flying enterprises are likely to become the victims of this winter.

The new path of Chinese shoe industry pfer has been clear.

Cost: western advantage still exists. "Sichuan and Chongqing undertake the eastern industry gradient pfer advantage is still obvious".

For some of the concerns and doubts in the industry, Zhu Zhaoyang, deputy director of Bishan County, Chongqing, the West shoe capital of the eastern footwear industry, is vigorously undertaking the "no".

"The best place for Sichuan and Chongqing to undertake the gradient pfer of textile industry is because the investment environment is the most competitive, the energy is relatively abundant, the land cost and labor cost are lower than the eastern coastal areas, and has a certain foundation in supporting production in the textile industry. With the continuous improvement of infrastructure such as highways and pportation, these are the favorable conditions for the pfer of the Eastern Textile Industry."

According to Zhu Zhaoyang, deputy chief of the economy of Bishan County, Chongqing.

"The average wages of textile workers in the Pearl River delta range from 1600 yuan to 1800 yuan, while the minimum wage standard in Bishan, Chongqing is only about 568 yuan. In addition, the energy in the Pearl River Delta is relatively tight, and electricity consumption in Dongguan and other places has already stopped three to four, while Sichuan and Chongqing will have better electricity consumption."

Zhu Zhaoyang said that compared with the Pearl River Delta, Bishan has an advantage.

According to Zhu Zhaoyang's estimate, the cost of industrial investment in Bishan county is 400 yuan to 500 yuan lower than that in the eastern coastal area by the construction cost of comprehensive land price, building materials, supporting facilities and infrastructure construction.

In addition, the production costs of various taxes, water and electricity, manpower and other production costs will be reduced, and the production cost of the West Coast enterprises in the eastern coastal areas in Bishan can be reduced by about 30%.

According to Jiang Yuanwu, general manager of AOKANG Chongqing Real Estate Co., Ltd., compared with the eastern coast, AOKANG produces at least one pair of shoes in Chongqing, which can save at least 20% of the cost. "This is not a case of AOKANG's family, actually it can be regarded as industry data."