China'S Footwear Industry Faces Challenges In Developing Overseas Advantages

< p > in almost all African countries, the unemployment rate is second only to the political turbulence factor of tribal conflict.

Every political party and politician in a stable country will also take the unemployment rate as the first goal in the election campaign.

In order to solve the local employment problem and develop the friendly economy between China and Africa, in 2011, Huajian group was invited by the Prime Minister of Ethiopia to set up a factory.

Although Chinese businessmen are usually considered inefficient, the Ethiopia people did this work at an extraordinary pace.

"At that time, our enterprise created the first place in Africa, that is to say, we built a factory of nearly 600 people in three months."

Zhang Huarong said that after three months, the factory doubled the total export of the "a target=" _blank "href=" http://www.91se91.com/ "shoes" /a in Ethiopia.

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Although P seems to be making a hasty decision, Huajian is very satisfied with this investment.

Hai Yu, vice president of Huajian group and general manager of Overseas Investment Corp, said: "the labor cost of African countries is now 1/6 to 1/7 of our domestic level, and the local electricity supply is adequate, and the electricity price is only half of the domestic cost.

In addition, there are plenty of cowhide and sheepskin, and the raw materials are very rich.

In comparison, the cost of manpower in Ethiopia is lower than that in Southeast Asia's emerging manufacturing countries, Vietnam and Kampuchea, including lower social costs.

In addition, the rich "a target=" _blank "href=" http://www.91se91.com/ "leather" /a "resources and more mature" a href= "http://www.91se91.com/news/index_c.asp" leather technology "than other industries, the World Bank report said that the footwear industry will be the foundation for the development of the African continent and the key to success or failure.

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At the same time, the OEM factory that does not sell domestically has also made the accusation against China somewhat convergent. P

The opposition of European and American politicians and some African countries generally believe that the main purpose of Chinese enterprises to develop on the African continent is to extract raw materials and find market for China's manufactured exports.

As the world bank said, China's "a href=" http://www.91se91.com/news/index_c.asp "light industry manufacturing industry < /a > will pfer production to Africa, which is a good starting platform for the African continent's" long lag "economic pformation.

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"P" challenges the establishment of factories in Africa. Huajian Group believes that the biggest problem is localization of enterprises.

Hai Yu said that after all, shoemaking is labor intensive, and the profit margin is generally between 5% and 10%.

The logistics cost of the domestic manufacturing industry is generally controlled at 2%, but it has risen to 8% in Ethiopia.

The high cost of logistics in Ethiopia is a comprehensive problem. "Although the Ethiopia government encourages foreign investment, the operation efficiency of the relevant departments is very low.

The ministers of the government will talk about supporting foreign investment, but when they import raw materials, they do not sit at the door to clear customs.

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< p > according to local policies, the equipment and raw material import of < a href= "http://www.91se91.com/news/" > shoes > /a should be duty-free.

Hai Yu said that when they first shipped the first container, the shoes used for them were buckled by the customs.

In addition, the perforator of the shoe was also held, and the customs officers did not know it, and thought it was a pistol.

Hai Yu said that at present, the factory imports about 8 containers of raw materials every month, exports 12 containers of < a href= "http://www.91se91.com/news/" > finished shoes < /a >, "about 2/3 of the materials are imported, and the remaining 1/3 can be settled on the spot, for example, a lot of sheepskin, cowhide and so on."

After this incident, hay found the 6 vice heads and all the directors and directors of the local customs, and held a 6 hour meeting to discuss the matter.

Later, the more than 20 staff of the customs also went to the shoe factory to investigate the process and the machines used in the factory. "They never experienced this, so we had to spend more time doing basic work.

Otherwise, there is no way to survive. "

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"P > local traffic and pportation is another big challenge." from the port of the largest port to Djibouti, we have 800 kilometers to our factory, but there are only two lanes in two directions. Once a car breaks down on the road, the whole road will be blocked.

Moreover, the frequency of road use is high and road conditions are getting worse.

Hai Yu said that the main reason for poor pport efficiency is that the local authorities do not allow foreign investment in the logistics and pportation industry.

This is a fatal problem for enterprises involved in the global production chain.

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< p > "leadtime in enterprise production" refers to the time from the order to the production of shoes.

For example, the fashion show in Milan in March, a week later, the model was made.

Fashion is so fast now. "

Hai Yu said that at home this time is usually 60 days, but in Ethiopia only raw material imports will take 30 days, "the fastest 80~90 days in the local area."

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< p > besides, "the whole country in Ethiopia has not experienced the process of industrial civilization, and the workers lack the idea of industrial civilization. The organization, discipline and obedience and sense of responsibility are much worse than that in China."

Hai Yu said that in many factories in the local area, about 30% of the workers lost their figures in second days after the completion of their salary. "Generally 15 days later, the wages were almost spent, and these people went back to the factory to continue their work."

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< p > in Huajian group's factory, the problem of being late for work was relieved until someone was expelled 5 times due to a total delay.

Moreover, the popular military training and gymnastics in domestic manufacturing enterprises are more essential here.

As a result, this training has greatly improved the health of the employees. "When they came in, they received military training, and they poured a large number of them in fifteen minutes, but now they have no problem in training for half an hour to forty-five minutes."

Hai Yu said.

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< p > but in order to solve the cultural differences, Huajian group regularly arranges Ethiopia employees to go to China for training.

Local medical conditions can only be used for emergency treatment of appendicitis, all of which have been cured in China.

In fact, Chinese entrepreneurs have clearly realized that management will be the key to success or failure of African factories.

As the World Bank report says, for example, in Ethiopia, some "well managed" local enterprises have almost the same production capacity as those in China and Vietnam.

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< p > Zhang Huarong said that they are currently considering investing in other African countries in the second half of 2013.

The factors that affect decision-making include: whether the enterprise is in operation, whether the market operation is dynamic, whether the political situation is stable, and whether the local labor law meets the development needs.

For this giant shoe business, it is still necessary to "invest and fumble".

The China Africa strategy provides support to the China Africa strategy, which is the Central African Development Fund.

The two have signed an agreement and invested $2 billion in ten years to develop a manufacturing cluster in Ethiopia that focuses on the a href= "http://www.91se91.com" > /a >.

The latter is a private equity fund of the China Development Bank system.

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< p > Hai Yu said that this can create 100 thousand jobs for the locals.

It can solve the contradiction between leather, workers and high unemployment.

"China's manufacturing industry is more suitable for Africa to go out, but the manufacturing industry in Europe is not necessarily adapted to Africa."

Zhang Huarong said, because China's manufacturing main body footwear industry, < a target= "_blank" href= "http://www.91se91.com/" > clothing "/a" and other light industrial products are still in the extensive stage, and need to rely on a large number of cheap labor support.

But Europe's high-end manufacturing and lean manufacturing do not have development conditions in Ethiopia.

Their industrial management, civilized management mechanism, and industrial facilities and comprehensive support are not compatible with them.

Therefore, traditional manufacturing and low-end manufacturing have great prospects in Ethiopia. "

He said.

In this way, another consequence of the shift of China's shoemaking factories to Africa is to push the pformation and upgrading of China's extensive manufacturing enterprises, or else there will be no way out.

From the perspective of Africa, the policy support of the two governments is the greatest advantage.

Hai Yu said.

In fact, this is also the main reason why they chose Ethiopia instead of other African countries.

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After P's turmoil in the 80s and 90s of last century, the African continent's desire for factories and foreign exchange has been fulfilled.

In addition to solving the employment problem and stabilizing the political situation, "they are actively learning the experience and process of China's reform and opening up for 30 years, and want to make use of the local cheap labor market to develop manufacturing industry and earn foreign exchange for the country."

Hai Yu said that compared with Asia, Africa has the best tax exemption policy in the world, which is obviously attractive to an export-oriented enterprise.

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Although P is criticized by European politicians and some African politicians, Chinese factories are generally welcomed from the government to the public.

Especially for manufacturing enterprises specializing in exporting, "they can not reach their own level of business, and we will not face their domestic market", so they will not conflict with the local footwear industry.

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< p > as a friendly gesture, Huajian group also invited the owners of more than 20 local shoemaking enterprises to visit and study. "We supply them with some materials, and the price is much lower than that of the locals, and they are also welcomed by local business owners.

We have to explain to them that only by forming industrial clusters and developing hundreds of shoe factories can we develop better.

Hai Yu said.

In 2012, the Ethiopia government approved the 3 square kilometres of land construction and light industry development and development special zone. "The future industrial park will be dominated by footwear industry, and will also involve the manufacturing of light industries such as luggage and bags, and there will be more and more manufacturing enterprises in China."

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"P" is currently located in the industrial park of Addisababa, which is located in the vicinity of the industrial park of the Oram Du Kang District, near Addisababa. It has already had 1700 local employees and more than 100 Chinese staff members, and has invested more than 10 million US dollars, "http://www.91se91.com", "International shoe city" /a. "P".

The three production lines can produce more than 2000 pairs of shoes every day, mainly for the international top brands.

Including GUESS, COACH, TOMMYHILFIGER, and so on, affixed the "made in Ethiopia" label, shipped to the United States and Europe.

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