"Made In Vietnam" Can Not Replace "Made In China"

On the plane from Hu Zhiming back to Guangzhou in June 21st, the first Financial Daily reporter met a Austin D.Dolezal, director of SR., Asia Research and Development Department of an American listed company, "SKECHERS" (Cage) footwear industry (Dongguan) Limited. He often travels to factories in China and Vietnam.

He believes that Vietnam's factory costs less than China, but "Vietnam made" can not replace "made in China".

In a written reply to our reporter later, Duli Chao said that, like Nike and Adidas, Cage did not own any factory, and most of its shoes were commissioned by Taiwan funded factories.

As an American listed company, Cage has huge sales volume of about $1 billion 450 million a year, so in order to maintain market share, it needs to exist in many places instead of all in one place.

Du Li believes that Vietnam's main advantage is cost, but that is not all.

Europe has anti-dumping duties on Chinese shoes, but it has little anti-dumping duties on Vietnamese shoes, so Vietnamese factory shoes can be exported to Europe.

The main considerations of Cage's establishment of a commissioned processing plant include: labor cost and pnational management cost; logistics and pportation; labor supply and efficiency; local material supply; long-term political stability, stability of labor relations; capacity to expand production and develop new products.

At present, Skech has 25~30 factories in China, which are located in Putian, Dongguan, Zhongshan and Fujian provinces of Guangdong province. Some factories are known to have 35 assembly lines, and some factories are very small with only 4 production lines.

Skech has only one factory in Vietnam, and there are only 4 production lines in the factory.

Factories in China and Vietnam mainly produce shoes for the American market, while products are also exported to Europe, Asia and South America.

Duli told reporters that Skech had to prepare for the continuous rise in the cost of Chinese factories, because the cost of domestic labor in China is increasing, and the renminbi is also appreciating against the US dollar.

They have plans to expand Vietnam's factories and other shoes with relative advantages.

"As long as the labor force in Vietnam can be supplied, we want to greatly expand the capacity of Vietnamese factories."

But even so, Duli still believes that China is the best place to make their products, because the support from the middle and lower management and the broad product line have not yet been produced by other factories like Chinese factories.

However, Skech is also working with factories in other countries to pfer part of the capacity from China to make his products more convenient to meet demand.

At the same time, Skech will continue to look for cooperative factories in other parts of China.

CEO, the US household appliance group, also believes that "made in Vietnam" is a supplement to "made in China", but it can not replace "made in China".

Because about 80000000 of Vietnam's population does not support such a large capacity.

However, "made in China" in the past ten years, the global "single show" situation will change.

With the rise of global protectionism and the appreciation of the renminbi "made in China", the advantage of "made in China" will be weakened. Breaking through tariffs and other trade barriers will inevitably lead to the global "diversified" manufacturing pattern.

"However," made in China "still has an irreplaceable advantage.

Huang Jian told the first Financial Daily reporters, "first, China's industrial chain is well matched, two is skilled labor, and the three is that China has a huge consumer market."