Foreign Trade Shoe Industry "Double Turn" Strategy Struggling Summer

"In the second half of last year, I was afraid to pick up foreign orders, change orders for long term orders, change orders for big orders," and Mr. Chang, who is engaged in export trade, summed up his recent business situation.

Mr. Chang began to engage in export trade a few years ago, but at present, his foreign trade company has basically stopped all businesses and become a shell company.

In his words, the export environment is bad, raw material prices and labor costs are rising. This is the best way to preserve strength in situ.

"Wolf used to be a metaphor for a powerful foreign brand invasion, but in fact, we are facing too many difficulties at the moment, which is a real wolf era."

Mr. Chang's main business is exporting garments, shoes and leather goods.

Suppliers on the whole industry chain are superior to Mr. Chang.

During the interview, the reporter was informed that in the PRD footwear trading company, the export price was raised by 30%-45% to keep the cost.

Fall down?

Wait for death?

Or suicide?

This is a difficult proposition.

"Who moved my cheese" is the best selling book in the world. It interprets the truth of life: change is the only thing that remains unchanged.

How should the small and medium-sized manufacturing enterprises in the PRD respond to this life and death proposition under all kinds of crises?

"Foreign orders are afraid to pick up". The Pearl River Delta has a very high export-oriented economy. It is an important export commodity production base in Guangdong and even the whole country.

There are a large number of small and medium-sized foreign-funded enterprises and private enterprises, mainly engaged in processing trade and OEM, products are mainly exported, and traditional labor intensive industries are the main industries.

In the past few years, these enterprises relied on scale effect and cost advantage to earn meager processing fees. They could still survive. But recently, many enterprises began to appear to avoid foreign exchange orders in order to prevent exchange rate risks. They also changed their long-term orders to short-term orders, changed large orders to small orders, reduced total orders and reduced export volumes.

According to the National Bureau of statistics, during the first quarter of this year and the 103rd Canton Fair, enterprises in Shenzhen, Dongguan, Zhongshan and other places further reduced the number of orders and reduced the scale of production.

The export of traditional bulk products such as textiles, clothing, shoes, bags, furniture, plastic products, machinery and electronics has dropped sharply or declined.

Taking Shenzhen as an example, the export of bags and shoes and hats increased by 3.9%, down 16.2% from the previous year, and furniture and parts exports increased by 16.3%, down 23.7% compared with the same period last year, and the export of clothing and textiles decreased. 14.5%., Deputy Secretary General of Guangdong footwear manufacturers, introduced Yang Yelin, taking footwear exports as an example. The appreciation of the renminbi resulted in a decline in export profits. The rise of domestic CPI also led to the rising cost of raw materials.

"Foreign orders are afraid to pick up. Some companies have not even understood what is going on."

Under the double influence, the shoe industry shuffling is intensifying.

Yang Yelin, Deputy Secretary General of Guangdong Footwear Manufacturers Association, pointed out that the footwear industry, for example, will be constrained by five factors: exchange rate fluctuations, manpower shortages, raw material prices, domestic policy changes and anti-dumping policies.

"Now there is another oil price increase."

He said that this has an impact on all walks of life, the impact on the footwear industry is mainly concentrated in chemical raw materials, logistics costs and so on.

"If we do not start work, we will go bankrupt and start to lose money."

This vividly reflects the main problems prevailing in the PRD footwear industry.

"Now that iron ore prices are rising so fast, there are two problems.

First, the stockholders of raw materials make the metal price higher; the two is that our steel price has no advantage compared with that of the United States.

The boss of a small hardware processing enterprise in Lecong, Foshan, sighed that the implementation of the new labor law led to a rise in labor costs, which made the hardware industry worse.

"For foreign trade companies, our biggest problem now is the difficulty of drawing orders."

A staff member from a foreign trade company in Guangzhou told reporters, "hardware, clothing, quality toys, foreigners are very sensitive to price."

The price is low, we can't find factories to do it, the price is high, foreigners do not buy it. "

"At present, more than 80% of our own brand exports are settled in US dollars. If we do not want to deal with them, 10% or even more exchange rate losses will squeeze us less than 10% of our export profits."

To this day, when the renminbi has reached a new high with the US dollar, the loss of profits caused by exchange rate is a chronic but huge impact on some export-oriented enterprises who are keen on exports, and the profit margins are small and mostly settled in US dollars.

A lighting company always said, "although the export products have been increased, they have been eaten up by the RMB appreciation immediately. This kind of small step run up appreciation is a chronic impact on enterprises."

In addition, because of the poor credit foundation, the financing difficulties have been increased.

Many enterprises fail to meet the risk control standards of banks. Under the premise of tightening the economy, SME loans and financing are difficult.

Technology upgrading and price rise is obvious. In the context of increasing labor costs, rising RMB exchange rates, bank interest rates and export policy adjustments, the road seems to be no longer viable at low prices. The OEM road for SMEs to survive has come to a ten character intersection.

Many small and medium business owners are still struggling to find a way out.

Recently, the price of daily chemical industry and footwear industry has increased.

However, in the buyer's market, the bargaining power of these brands is very low. According to the Pearl River Delta's footwear trade company, it is expected that only the export price is up 30%-45% to keep the cost, but the foreign buyers have not yet fully accepted this range, which leads to a sharp decrease in the trade companies.

On the other hand, the boss of the daily chemical industry said that only by reducing the expenditure of internal activities and publicity activities, reducing the production of some products and organizing the study of employees, the operating pressure caused by the decrease of cost rising customers was suppressed.

In order to reduce costs, some Foshan Lecong hardware enterprises began to pfer industries to lower cost areas.

There are also enterprises that can avoid this bloody storm -- investing a lot of money to upgrade the industry.

Although 40% of the small businesses in the lighting industry opted out of competition, NVC has invested a lot of money recently to set up R & D centers in Shanghai and began to expand the capacity of various production bases.

In addition, it has become the first brand of small household electrical appliances in the world, and has begun to attack the domestic market with its ACA brand acquired in North America.

Industry experts pointed out that to enhance the competitiveness of the brand, it is bound to require enterprises to enhance bargaining power, technology upgrading and price increase, both hands must be hard.

Yin Kang, vice president of Huizhou Rex Optoelectronics Technology Co., Ltd. believes that macroeconomic regulation and control is not pferred by the subjective will of the enterprises. Since the enterprises are unable to change the industry, they can only seek new market opportunities in the unbalanced industry.

"The government is still growing in fixed asset investment, but it is only a small increase. But in the construction of large industries, such as the Beijing Olympic Games, Shanghai fair, Guangzhou Asian Games and Shenzhen all England Association, these government led investments are very large.

In such a region, there will be an average growth rate.

We don't need to be too pessimistic.

Pearl River Delta SME survival mask, hardware processing industry shuffled to shuffle, "many enterprises really do not know if we can survive this year."

The owner of a small hardware business in the Pearl River Delta said.

Since the implementation of the new labor law this year, the labor costs have skyrocketed and the price of steel has been rising.

Many enterprises have indicated that they hope to upgrade their profit margins through technological upgrading, but there are not many enterprises that are expected to have technological upgrading capability.

The traditional hardware processing companies interviewed by reporters said that the rise in raw material prices and the implementation of the new labor law had the greatest impact on them.

Beginning in 2007, the international copper price rose by 66%, and its total price rose by more than 300%.. Baosteel recently reached an agreement with Rio Tinto of Australia on the benchmark price of iron ore in 2008, and the price of related ore has increased by 79.88%-96.5%.. The owner of a small hardware processing enterprise in Lecong, Foshan has sighed. The technology upgrading space in the hardware industry is relatively small. After the implementation of the new labor contract law, the manpower cost has increased dramatically, which is unbearable for the processing industry.

Hardware enterprises plan the big pformation of industrial pformation, including the big shift of industrial base.

It has been revealed that recently, a group of hardware enterprises in Yunfu, Foshan, planned to set up a stainless steel processing base in Yunnan, hoping to pfer some industries to the region where the labor cost is relatively low.

Another way of pformation is packaging.

Reporters learned that Foshan's venture capital venture recently began to flourish. Enterprises hope to go on the market by so-called "technology concept" or sell it to more powerful enterprises after packaging.

Zhongshan HUAFA hardware Zhang surname boss told reporters, "technology upgrading requires strong financial strength, most enterprises do not have this strength.

We can only sneak up against the new labor law, only hope that the workers will not make trouble; we can only shut down when we make trouble.

Lighting industry upgrading degree "cold winter", every month this year is losing money!

I have been making lamps for three years, and it is hard to make it every year. "

Mr. Zhang of a luminaire Market is worried.

Since last October, the prices of raw materials such as copper, crystal and other raw materials for making lamps and lanterns have risen, and the price of lamps and lanterns has increased by 10% to 30%..

Recently, the export market has turned pale, and many lighting enterprises have been attacking domestic sales and further worsening the industry competition.

China has become the world's largest producer and exporter of lighting appliances. At present, the world produces 4 billion energy saving lamps, making 90% of China's manufacturing.

Yin Kang, vice president of Huizhou ray electric, believes that the situation of lighting industry is grim this year, and some small enterprises which are mainly processing are hard to survive this year.

The blind expansion of large enterprises will also be in a predicament.

In addition to the price rise of raw materials and the increase in labor costs, the lighting industry is also affected by the US debt crisis, and its export market shrinks rapidly.

China's lighting and lighting enterprises, which take the US as the main export market, are facing a reshuffle.

"The output of domestic lamps is" the oldest "in the world, but the brand is" zero ", said Dou Linping, Deputy Secretary General of China lighting and electrical appliances association.

It is reported that at present, there are tens of thousands of domestic lighting enterprises, and the homogenization of industry competition is serious.

The strong lighting enterprises spontaneously shift the R & D focus to energy saving technology, and many enterprises begin to increase the sales of two or three line City outlets.

Shoe industry "double turn" strategy fight bitter summer this year, 1-5 months, the Pearl River Delta footwear exports decreased by 1/4. compared with the same period last year, but this is not the "sunset" scene, "river side" is domestic production and trade enterprises to raise export prices, because only in this way can we survive.

"The other side of the river" is that overseas buyers can not accept the raise price, the two sides are deadlocked.

Yang Yelin, Deputy Secretary General of Guangdong Footwear Manufacturers Association, said that this is only a temporary phenomenon, and the manufacturing advantages of Chinese footwear industry are still obvious.

But after this period of shuffling, the shoe enterprises, which rely solely on low price operations, are bound to get out.

Before May, footwear exports dropped by 25.7%. According to Yang Yelin, the global annual output of shoes is about 15 billion 600 million pairs, of which China's production has exceeded 11 billion pairs, occupying more than 70% share.

However, he admits that this year's situation is not very satisfactory. Taking footwear exports as an example, the appreciation of the renminbi has led to a decline in export profits, and the rise in domestic CPI has led to a rise in the cost of raw materials.

It is understood that in 1-5 months of this year, more than 2300 of the 5000 footwear trading enterprises in the Pearl River Delta region did not have any export business, and the total export volume was 940 million pairs, which fell by 25.7%. compared with the same period last year. According to Yang Yelin, the average export price of footwear in China in 2007 was less than 3 US dollars per pair.

"Only the export price is raised by 30%-45% to maintain the cost, but foreign buyers have not yet fully accepted this magnitude, which has led to a sharp reduction in export volume for trading companies."

Transfer and pformation are two pronged approaches. Yang Yelin said that the idea of "dual pfer" (pfer and pformation) has become a common practice for footwear enterprises to cope with "bitter summer".

The shift is to shift the overburden production base elsewhere.

Yang Yelin said that in the case of Dongguan and Shenzhen, factories in the past are gradually becoming urban centers, and operating costs are rising naturally.

"I suggest going to the West and north of Guangdong."

In pition, we must take the middle and high-end product line and control the scale, and the 300-500 person is the most suitable one.

In addition, we should change our business ideas, take the initiative to attack, seek cooperation between big brands, and reduce risks.

It can also be converted from foreign trade to domestic sales to fight its own brand.

The international oil prices soaring in the daily chemical industry, which are soaring on the ice, are cutting down the daily chemical industry of the subordinate petroleum derivatives.