The Miserable Fate Of Luxury Manufacturers: Profits Are As Thin As Sheets Of Paper, Led By Brands.

< p > < strong > a slave in the knowledge foundry chain of luxury goods factory < /strong > < /p >

< p > > a href= "http://sjfzxm.com/news/index_c.asp" > luxury products factory < /a > how to divide the profits between brands and brands? What kind of game do the "origin effect" play? Can the generation factory get rid of the passive situation controlled by others?

The situation of luxury goods factories has always been a mystery topic. Reporters recently went to visit some luxury factories to unveil the secrets of luxury goods factories. All these luxury factory representatives lamented: "the huge factory is just a slave in the OEM chain". < /p >

< p > < strong > "profit is as thin as a sheet of paper" < /strong > /p >

< p > "thousands of thousands of packages, but only earn two bottles of mineral water money, the profit is as thin as a piece of paper!" Zhang Jieda, chief executive officer of Dongguan Huida handbag factory, was so open to reporters.

This has almost become the voice of many luxury manufacturers.

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< p > this enterprise has seven or eight brands, including COACH, PRADA, ARMANI, BURBERRY and so on, with an annual output of 1 million 600 thousand -170 and a total of 10 million luxury brand packages. The output of the brand "href=" http://sjfzxm.com/news/index_f.asp "COACH" COACH "/a" ranks the top ten among the global foundries. It is one of the ten largest foundry enterprises in China.

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< p > Zhang Jieda said that the gross profit of the luxury foundry will not exceed 10 points, and the OEM enterprises will continue to operate mainly by quantity.

For example, a COACH package priced at 3000 yuan, we sell to Hongkong trading company 120 yuan, the cost of 100 yuan, of which 45 yuan for material costs, 20 yuan for labor costs, 35 yuan for the rental of water and electricity and other costs, a package of only 20 yuan to make money.

This is a good situation, sometimes the cost control is not good, a bag is often only 5 yuan RMB, that is, two bottles of mineral water money.

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< p > "business has been more difficult in recent years, not only with a small profit margin, but also a serious impact on the enterprises sustained by the continuous economic shocks of the world economy.

One hundred percent of our products are exported to Hongkong, 75% to the United States, 25% to Europe.

In the past two or three years, the US market has been sluggish, and American consumers have reduced their consumption levels and affected sales. In the current situation, there are no signs of improvement in 2013.

The European market is better, but it is mostly consumption driven by tourists.

Coupled with domestic recruitment difficulties, less manpower, less than 6000 packages per month, due to insufficient manpower and often late delivery, only air freight, the cost has increased.

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< p > Shi Dagui, general manager of a handbag factory in Panyu District, Guangzhou, maintains that 10% of gross profit is the best result of controlling cost and management. If a little careless, 10% of gross profit is bound to be lost.

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< p > Shi Dagui analysis said, a luxury brand package, manufacturers sell for $20-30, the final price of the market will reach up to $400-500 per handbag. Among them, trading companies play a regulatory role, probably take away the profits of 10%-20%, and get rid of more than 20 points of tax, and the brand is divided into 40%-50% profits.

The brand name makes a lot of money by brand name, and there is no fixed proportion. The bigger the brand name is, the higher the proportion of the profit, but the cost is less than ten percent.

"In the industrial chain of luxury goods, a huge factory is just a poor slave worker." < /p >

< p > < strong > "game of origin only caters to consumers" < /strong > /p >

< p > according to the insiders, the most important thing for consumers to pursue luxury goods is the "origin effect", that is, where manufacturing is produced, which is also an important selling point for enterprises to create luxury goods.

In particular, some immature consumers in China buy luxury goods for the label "M adeinItaly" or "M adeinFrance" printed above.

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< p > in fact, in accordance with the provisions of various countries, the product in which country completed the last processing steps, eventually become finished products, which country is the country of origin.

As a result, luxury brands are trying to cater to the psychology of consumers. They are pporting the materials to the OEM countries, completing most of the product processing steps, and then returning the "semi-finished products" almost finished products to the country, completing the last part of the processing steps in their country.

The origin of such products is the country where the luxury brands are located.

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< p > Zhongshan, Guangdong, Huamei, a target= "_blank" href= "http://www.91se91.com/" > clothing < /a > factory has worked for some luxury brands, and Wang Wenliang, general manager of the factory, told reporters, for example, a British a target= "_blank" href= "href=" > brand clothing. After finishing most of the processing steps in the country, the remaining buttons were not fasten, and the zipper was not installed. The branding demanded that the "semi finished product" of the finished product be shipped back to the UK, and the buttons were fasten and zipped to make the finished products, and then exported to other countries, the country of origin could be labeled as "Britain".

This "origin game" is not only in accordance with the law, but also caters to the psychology of consumers well, and has become the commonly used "hidden rules".

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< p > industry insiders told reporters that this kind of "hidden rules" not only made the product label a "country of origin" with great honor, but the "semi finished product" was difficult to ratified because it did not complete the final process, so the duty to return to the country was much lower than that of the finished product.

In addition, generally speaking, the technological level of the OEM enterprises that can be luxurious brands are not very different, so the general consumers are hard to identify.

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< p > Wang Wenliang said that for luxury brands, products can be better reduced by other countries, but the risk is whether the quality control is in place. Once the quality problems arise, the overall image of the brand will be affected and the brand value will be lowered.

Therefore, luxury brand manufacturers are more selective in the choice of OEM enterprises, not in terms of scale but in technology, and are more willing to maintain fixed cooperative relations.

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< p > < strong > "always led by the branding" < /strong > /p >

< p > reporters visit the luxury OEM enterprises has a particularly obvious feeling that business owners tend to be cautious and cautious, or refuse to interview reporters, or strongly urge the real names to be hidden in the manuscript. This obvious feature is determined by their status in the industry chain.

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< p > Zhang Jieda bluntly said: "to put it plainly, a brand name is a" rice master "of the producers. If they order, we will have the job to do so and the enterprise will have a way out.

We are always led by brands.

Although we want to get rid of it, it is also a big problem for a large scale enterprise to dissolve and resettlement employees. Once we are doing OEM, it is a bit hard to stop.

The Huida handbag factory was originally located in a town in Dongguan. Later, it was because the factory area was not able to meet the requirements of luxury brands, and the factory was rebuilt in the next town.

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< p > some luxury goods producers complain that the OEM luxury brands do not have the autonomy of business activities. Even the suppliers of spare parts are designated by customers, but once the supply is not timely, the delivery time is delayed, and the responsibility is entirely in the manufacturer.

The brand will distribute the hardware parts according to the quantity of each batch of OEM products, and once a set of hardware parts is lost, the OEM enterprises must report to the local public security organs for registration, and the brand will agree to reissue them to the producers.

"This is mainly due to the fact that luxury brands do not trust domestic foundry enterprises, and prevent OEM companies from making fake high imitation luxury goods with accessories."

Zhang Jieda said.

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