Voice Of Wenling: Into The "Shoe Road", We Will Not Easily Fall Down!

In July, the fire broke out in Wenling.

As temperatures rise, as the largest production base of injection shoes in China, the economic temperature of shoe enterprises has dropped to the lowest level in Wenling.

RMB appreciation, raw material prices, workers difficult to recruit, export tax rebate reduction, fierce competition, tight capital chain......

This series of problems has hurt the bosses of shoe companies.

In the face of numerous difficulties, they are experiencing the baptism of ice and fire.

20% small factories quietly shut down in Wenling, Hengfeng, Chengbei street and other shoe industry town, eyeful is a shoe factory building.

Behind these signs, "some shoes", there are some large scale factories, some of which are several storey houses, and some are just a door face.

In these different sizes of shoe companies, they can see the signs of rental housing from time to time.

"These are factories that shut down."

A taxi driver told reporters that he had a fellow townsman in Henan who had just worked in a shoe factory in the north of the city for a few days. The company stopped two production lines, and the townsman had to find another job.

Huang Xiaobin, deputy director of Wenling Industry Bureau, told reporters that at present, there are more than 5000 shoe factories in Wenling, and about 20% of them are shutting down or shutting down according to the industry bureau.

"Small businesses are shutting down quite a lot, and large enterprises are basically producing."

According to the statistics from last month on Wenling's main footwear enterprises, no one in the top fifteen companies stopped production in the 1~5 months of this year, and five of them had two digit growth in output value, but ten showed negative growth.

The first shoe business in Wenling, the largest shoe manufacturer in the first half of the year, is not optimistic. The output value of this year's 1~4 months is 110 million yuan, down 19% from the 140 million yuan of the same period last year (21%?

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Huang Xiaobin introduced that the shoe enterprises in Wenling started in the middle and late 70s of last century. At that time, Wenling people started walking around the streets and making shoes, selling plastic products, selling tofu, and gradually began to have small workshops for shoemaking.

Small workshops are getting bigger and bigger.

In 2006, a large number of shoe enterprises appeared, from more than 3000 at the beginning of the year to more than 5000, most of which were small workshop type enterprises.

"At the time, I also thought about cutting down a lot. But when we look at the statistical reports, the output value is pretty good, so we put it temporarily."

Huang Xiaobin said, unexpectedly, the market is now automatically "downsizing".

In fact, the change of external environment began to show signs in 2007.

RMB appreciation of 1% per cent, profits will be affected by 4 to 5%, while the average profit margin of shoe enterprises is around 10%. In this case, who will do the loss, only big enterprises are still sticking to it.

Employees dropped from 170 thousand to 110 thousand. "In 2004, we issued an investigation and research article, saying that Wenling shoe enterprises were beset by besieged cities.

The shoe industry rebounded strongly in 2006.

Unexpectedly, the old problems have not been solved this year, and new problems are emerging.

Pan Keqiang, Secretary General of Wenling shoes and Leather Association, told reporters that the main problem of shoe companies in the past two years was the difficulty of recruiting workers and the rising labor costs.

Wenling is the industrial gathering place of the footwear industry in Zhejiang. Most of them are small and medium-sized enterprises, and the demand for employment is large.

Among migrant workers in Wenling, the footwear industry accounts for 1/3 of the total.

But since 2004, the number of migrant workers in the shoe making industry has been decreasing.

With the implementation of the labor contract law and the improvement of migrant workers' autonomy consciousness, employment is showing a trend of supply less than demand. Most enterprises are faced with the challenge of employment.

In order to recruit workers, many enterprises stick to the base camp to attract talents, and take the initiative to attack the labor exporting provinces and cities.

At the same time, for older employees, it is better to write articles on "emotional retention".

"Some employees are sick, and the boss personally gives him noodles". In order to keep people, the shoe enterprises boss tries their best.

But this year, recruitment difficulties have become secondary problems, because a considerable number of small and medium-sized shoe enterprises have closed down and closed down, resulting in a large number of workers on the market.

According to statistics, in 2007, the total number of shoemaking enterprises in Wenling reached 172 thousand, an increase of 19 thousand over 2006.

A leader of the Wenling Municipal Bureau of personnel, labor and social security said, "in recent years, the number of migrant workers in Wenling has decreased by about 10% every year.

At present, about 300 thousand of the migrant workers in Wenling are mainly concentrated in three industries: about 110 thousand of the machinery industry, 110 thousand of the footwear industry, and 50 thousand of the three production service industry.

The number of shoe enterprises employees has decreased from more than 170 thousand in 2007 to around 110 thousand this year. We can see the current situation of Wenling shoe enterprises.

The most terrible thing about a shoe boss who has been working for 12 years is the capital chain crisis. "The exchange rate is rising, the workers are in short supply, and the price of raw materials is rising."

Speaking of these, Lin Mingbiao, the Veteran General Manager of Wenling's famous shoe enterprise, is one of the top two.

Like many shoe companies in Wenling, Lin Ming opened his mouth and didn't talk about making money, only talking about survival.

"In the first half of the year, it will be hard to keep the deficit. Hopefully, the situation will improve in the second half of the year, and it will generate some profits."

12 years ago, Lin Mingbiao started from a small workshop, and her hands were tired. The women's shoes that went to Dubai and the African market are now turning to the United States and Europe. The number of women's shoes exported each year reaches 10 million pairs.

As an export oriented enterprise, the impact of exchange rate is the first.

"RMB appreciation of 1 cents, my profits will lose 5 cents."

According to Lin Mingbiao's calculations, the profit ratio of the RMB exchange rate and the export of each pair of shoes is 1: 3, that is, the appreciation of RMB is 1%, the profit will be reduced by 3%, and the profits of each pair of shoes will be between 1.5 and 2 yuan. "In 2007, the appreciation of RMB, our order turned from profit to loss."

Lin Mingbiao, who had suffered a great loss, quickly understood the relevant foreign exchange knowledge and signed an interest rate lock agreement with the bank.

Just came out of the predicament of RMB appreciation, Lin Ming soon faced with a big problem of raw material prices.

Especially since the beginning of June, the soaring raw materials made Lin Mingbiao feel more difficult.

The sole of shoemaking needs to use a kind of TPR chemical raw material. Because of the soaring oil prices, the price of TPR has increased by 2000~3000 yuan per ton in the recent one week, and the original 11000 will now sell 13000, and the original 14000 will now sell 17000.

"The orders for June were all white."

Lin Mingbiao told reporters that they had 4 months' difference from the quotation, the order, the final delivery and the collection.

In the past 4 months, once the raw material suddenly rises in price, it is impossible to raise the price to the customer.

At the beginning of June, TPR suddenly increased prices, making the cost rise by about 10%, while 10% was already a considerable profit margin for shoe manufacturers.

"It will take another 2 months. If the raw materials go on like this, we can only lose money."

Lin Mingbiao disclosed that in Wenling shoe enterprises, like them, it has been pretty good. It should almost have fallen before the end of May. It has survived the shoe industry in May. It should be said that it has a strong vitality, and all of its own efforts to resolve various crises.

The shortage of employees is not terrible. The appreciation of RMB is not terrible. The price of raw materials is not terrible. What is really terrible is the crisis of capital chain.

Lin Mingbiao said that many small shoe enterprises are facing a crisis of shortage of funds. "Many enterprises guarantee each other, once a company has a problem, it will soon fall down."

But Huang Xiaobin disclosed that at present, Wenling has already had the situation that shoe enterprises meet banks to catch up with them.

A shoe boss who has been working for 18 years has asked for delivery before, and now the horse and horse are left behind. "How can it be so fast in one year?

What's going on? "

Zhu Fude, who is specializing in the production of children's shoes, is a bit puzzled.

Fordelon's children's shoes 2/3 export, 1/3 domestic sales, export back, after all, foreign trade is now depressed, and the domestic market atrophy, let Zhu Fude can not understand.

"Our goods were sold well before, and many customers were demanding that we deliver them."

But only a year later, the days changed, and the bustling delivery scene was gone, which made Zhu Fu De somewhat unaccustomed.

In the first half of this year, Zhu Fude sold about one million pairs of domestic shoes, down about two hundred thousand pairs from the same period last year.

"It used to be bitter, but now it's hard."

Zhu Fude sighed.

After graduating from Wenling high school, Zhu Fude went to Shijiazhuang to sell shoes.

It began 6 hours in the morning and came home at night. It took 6 years.

In such difficult conditions, Zhu Fude still diligently studied all knowledge about shoes, and light notebook took more than ten books.

The contents are detailed to this extent: when the temperature is between 26 and 27oC, what shoes are best sold.

In 1990, Zhu Fude founded his own factory.

In the past 18 years, it has been a stumbling block, but Zhu Fude admits that he has never been so confused.

The pressure of rising costs is hard to come by. Labor wages are rising. Last year, the average wage of ordinary workers was 1200 yuan a month. The general market price this year is 1400~1500 yuan, and the skilled workers are higher, at least 1700 yuan.

The price of raw materials is also increasing. The sole price of each pair of shoes has increased by 5 to 1 yuan, and the profit of each pair of shoes is 1.5 to 2 yuan. The pressure of the enterprise is very large.

Zhu Fude said, everyone should wear shoes, but for shoemaking enterprises, how to make shoes with profits is a big problem now.

"I estimate that at least 400~500 shoe enterprises in Wenling will fall this year, and if the external environment continues to deteriorate, more enterprises will be closed."

Zhu Fude sighed.

The myth of low price is breaking down. Pan Keqiang, Secretary General of Wenling shoe leather association, has nearly 5000 shoe factories in Wenling, and produces about 800 million pairs of shoes each year, accounting for 10% of the total shoe making in the country.

Last year's output value was about 22000000000 yuan, accounting for 1/5 of GDP in Wenling, and its products were exported to more than 140 countries and regions, with an export volume of 15 billion yuan.

In the past, the shoe enterprises in Wenling basically followed the trend of low price and low grade development. Even some large enterprises did not win by brands. Competition often fell into the vicious circle of "you are cheaper and I am cheaper than you".

But now the myth of low price is breaking down.

Rising wages, rising raw material prices and rising uncontrollable costs have led to low cost becoming the past.

Export has exchange rate risk, export tax rebate is down again, domestic market competition is intense, shoes in Shandong, Hunan, Hebei and other places are coming up, raw material rising is unbearable cost pain.

And tight credit and tight funds are a common problem for shoe companies.

The besieged city has not disappeared. For Wenling shoe companies, it is now in progress.

However, some big shoe enterprises have already realized this problem and embarked on the road of quality and brand.

In the past, shoes in Wenling were mostly sold in the Middle East and Dubai, which were suitable for the demand of oil workers there.

Now, many Wenling shoe companies have entered the European and American markets and become long-term suppliers of large supermarkets such as WAL-MART, Auchan and TESCO.

This is the direction of Wenling shoe boss's efforts.

The crisis is the breakthrough of the opportunity, the expression of Wenling under the plight of the four kinds of expression, self-confidence Li Chuanfa: wrong into the "shoe road", I will not easily fall down this year's difficult situation, or there are not many shoe enterprises can still smile on their faces.

Brother Li Chuanfa is one of them.

His factory in Russia started production in June last year and is doing a good job.

His company in Egypt can generate 4 million to 5 million profit every year.

And his shoe factory in Wenling, the product export is basically not affected.

In the workshop of brother shoe industry in Dashi Town, the reporter saw Li Chuanfa who just returned from abroad.

Let's go to the workshop and have a look.