From Childhood To Superiority Industry Chain, Shoe Enterprises Are Changing In Crisis.

How did Wenling's more than 30 thousand private enterprises live under the impact of the international financial crisis? - how about the private enterprises in Wenling?

Where is the next step?

In a two week interview with reporters in Wenling, reporters found that the breath of spring rose on this hot spot of entrepreneurial innovation: after the Lantern Festival of Wenling, most of the enterprises in Wenling started normal operation; the order volume of more than half of the city's enterprises was flat or rising; last year, the power consumption of industrial towns and townships in Dashi reached a record high in the same period.

A new vitality is quietly sprouting up in private enterprises in Wenling.

In the storm of international financial crisis, private enterprises in Wenling accelerated the pace of pformation and upgrading.

It is painful to experience crises, but the pain is accompanied by new life.

The "opponent" has become a "good brother". From the "small to the whole" to the building of the superior industrial chain, the 15 Chinese small and medium-sized shoe factories in the towns of Wenling, such as Ze Guo and Da Xi, have been ringing again.

The order for them is the local big shoe factory, Zhejiang good brother Shoes Co., Ltd.

There are opportunities in the crisis, but opportunities are left to those who are prepared. Standing in the workshop of "good brothers" shoes industry, Li Chuanfa, chairman of the company, told reporters that last year, many large Taiwanese shoe enterprises in Guangdong had retreated, and the "good brothers" seized the opportunity to contact WAL-MART. Their orders for WAL-MART sports shoes increased from 1 million pairs last year to 5 million pairs this year, and the total annual production volume of the company will also exceed 10 million pairs for the first time.

However, at this time, Li Chuanfa made an unexpected decision: despite having the ability to produce 3 million 500 thousand pairs of sports shoes a year, the orders increased sharply, but the "good brothers" no longer increased the equipment, instead, they subcontracted orders to other shoe factories, and at the same time introduced more than 40 research and development personnel with unprecedented strength.

It is the international financial crisis that has been spreading since last year to promote "good brothers".

"We have 32 steps to make a pair of sports shoes. We need more than 40 parts. In the past, all the parts such as shoelaces, upper and insole were done by ourselves.

Last year, prices of raw materials surged and external demand declined. We found that everything was done. It was very difficult to manage and produce. Two, the cost was too high, and there was a loss. "

Li Chuanfa said that in the past, he always liked to do things from head to toe, and felt a great sense of accomplishment. "Now, there are more than 180 enterprises in Wenling helping us make accessories and 15 companies to help us with OEM production. We and these enterprises have really become" good brothers ", and everyone has made profits.

Under such circumstances, "good brothers" turn to concentrate on two things: first, to open up the market, and the two is to develop new products.

At the moment, "good brothers" are in contact with European supermarkets such as Tesco and Auchan, expanding the market from the United States to Europe.

Considering that the impact of the financial crisis is likely to increase, they are making further efforts to develop new products and pry up emerging markets.

Cooperation between big enterprises and small businesses is not a case.

Zhejiang Fei Yue mechanical and Electrical Co., Ltd. and more than 100 small and medium-sized enterprises to establish a collaborative relationship, collaborative enterprises encounter technical difficulties, "leap" engineers will be free door-to-door service until help each other to solve.

The company is willing to give money to help supporting small businesses to acquire advanced equipment and speed up equipment pformation.

A director of the Taizhou economic and Trade Commission said with appreciation of this new trend that the industrial chain of an industry consists of six main links, including product design, raw material procurement, logistics and pportation, order processing, wholesale operation and terminal retail.

Some economists call it "6+1". In fact, competition in the modern market is already a competition in the industrial chain, which calls for private enterprises to bid farewell to the "small and full" development mode as soon as possible.

In order to encourage more enterprises to act as "good brothers" to form a cooperative mode between large and small enterprises in the same industrial chain, Wenling launched the "1+1+3" strategy, namely, helping 1 growth enterprises with a well developed key enterprises, plus 3 small and medium-sized enterprises, and supporting the business to SMEs.

In this way, large enterprises go to the two ends of R & D and brand marketing, and SMEs go to the direction of improving technology and equipment capabilities.

The history of economic development at home and abroad has proved that whenever crises occur, a large number of leading enterprises will emerge. They will integrate resources and achieve development, and at the same time, they will also lead to the formation and growth of the industrial chain.

Private enterprises in Wenling have made a welcome step.

These days, Zhong Renzhi, chairman of Zhejiang Xin Lei electrical and electronic Limited by Share Ltd, is very busy. In late March, their new product, the 5000 swing piston rotary air compressor, will be sent to the largest building chain store in France.

This is a year later, "Xin Lei" air compressor once again entered the European market.

"The order is full all year round. Now we are busy with the pilot test of the new product, and we must hurry to recruit workers."

Zhong Renzhi, who had difficulty in taking the time to interview the reporters, said: "last year, our staff reduced from more than 2000 to more than 700. Next we have to make up for the posts we laid off last year."

"Xin Lei" is the largest small air compressor manufacturer in China. It produces 1 million 500 thousand air compressors annually, and all of them are exported to Europe and the United States, of which 70% are exported to Europe.

Before 2008, half of the air compressors in the European market were manufactured by Xin Lei.

In March 2008, the European Union made an anti-dumping ruling on China's small air compressors, and Chinese enterprises were defeated by one vote. Xin Lei was added 77.6% of the high import tariffs.

The successive international financial crisis has made Xin Lei difficult.

The prices of raw materials such as copper, iron and aluminum for the production of air compressors have risen sharply, and the external demand in the US and EU has dropped sharply. "Our exports have declined rapidly, and the European market has almost been lost."

Zhong Renzhi recalled, "the price war in the domestic market is even more tragic. At that time, we went to the edge of a cliff and could be broken up at any time."

At a critical juncture, "Xin Lei" hired experts from many universities in China to launch a new product with huge sums of money -- the swing piston rotary air compressor was put on the market and saved the enterprise.

Compared with the traditional piston type air compressor, the new product is not only completely innovative in structure, but also has low noise, high accuracy and nearly twice the mechanical efficiency, and its service life has increased from 500 hours to more than 10 thousand hours.

The unique new products have once again opened up the European market, and orders are flying like snowflakes.

"At present, the price of our new product is 30% higher than that of the old one.

Moreover, it used to be OEM for others, but now it has used its own brand, and its profit has increased from 3% to more than 30%.

Zhong Renzhi said.

The "Xin Lei" move is not only beyond the European competitors, but also more importantly, they successfully break through from hundreds of local companies that mimic similar products.

Wenling mayor Ye Haiyan said in an interview with reporters: "because of their limited strength, most of the private enterprises start from imitating others. If this is stopped, they will not have the ability to innovate. If they do not have their own brands, they will only get into the homogenization competition and never grow up."

The crisis forced Wenling's private enterprises to "do what others can't do."

The sales volume of 2008 is doubled from that of the previous year. The orders received since the beginning of this year can double again this year.

"We are currently supporting more than 10 domestic vehicle companies including FAW, SAIC and Jianghuai.

In recent years, vehicle prices have dropped. Because of the technological pformation under the same quality, the price of new products is 10% lower than that of similar products, and orders are more. "

Chairman Lin Dayu was very lucky for his decision last year. He mortgaged all his home and invested 80 million yuan in technical pformation. The quality of the final product jumped and the cost dropped. "Other enterprises can not compete with us."

In March 5th, on the "two sessions" in Wenling, Chen Gang, a member of the CPPCC National Committee, submitted a well prepared proposal - "the urgent proposal to establish a state-owned holding Guarantee Corporation to solve the crisis of enterprise mutual insurance chain".

Chen Gang is the director of the Malaysia group of the top ten industrial enterprises in Wenling.

His proposal stems from the "guarantee storm" that China and Malaysia group encountered last year.

It turned out that in the summer of 2008, the ten strong industrial enterprises and building materials enterprises with sales revenue exceeding 1 billion yuan led to the financial crisis due to the huge guarantee provided to two dilemmas in Taizhou. Subsequently, the bank pumped about 50000000 of the long bid group, and the "long bid" was on the verge of bankruptcy.

The "ambush" behind the "long bid" is an intricate "guarantee chain" - and the China Malaysia group is the main enterprise that provides joint guarantee.

Behind the "China horse", there are also a large number of guarantee enterprises.

At this time, "Domino" may collapse at any time.

"At that time, banks rushed all over."

Chen Gang's look was a bit thick when he remembered a few months ago. "However, the main business of" China Malaysia "was developing very well.

"At that time, the 17 banks that were lending to us ran to the house and told the family without any reservation. They promised not to bring losses to the bank. Finally, none of the 17 banks drew money from us, which gave us room for survival and development."

To this day, the aftermath of the wave of mutual protection around the "long bid" has been exhausted in Wenling.

"On the surface, this is the contradiction between the development of enterprises and the lack of financing channels."

Chen Weiyi, Secretary of the Wenling municipal Party committee, said, but in a deeper sense, this is the inherent character of private enterprises.

"Private enterprises are mostly linked by blood and emotions, so there are many benefits of" sentimentality ", but the operation lacks systematization and scientificity. When the scale of enterprises is large, the risks are great.

"Long bid" is because the irrational decision-making and over diversification led to the collapse of the capital chain, and its crisis has produced a chain reaction, which has harmed a large number of related enterprises.

It can be seen that the system defect is the root of the mutual insurance storm. Now, this shortcoming has come to the time that we have to change.

The lessons that lie ahead of us are forcing companies to turn around.

At the end of last year, the China Malaysia group established a board of directors. The 5 directors included senior managers from outside and set up a collective decision-making mechanism.

"We had such a plan, and the crisis brought us to speed up the pace of establishing a modern enterprise system."

Chen Gang said.

Sheng Shijie, director and group vice president of the Malaysian group, which was introduced by a large state-owned enterprise in Tianjin, told reporters that on the one hand, the chairman of the board of directors of the group was no longer a chairman of the subsidiary company. It was fully authorized and effectively controlled. On the other hand, the company set up a rigorous decision-making system. "For one of the most common examples, such as projects with investment of more than 5 million yuan, we must make collective decisions now, and it is no longer a single person to say so."

The "forced force" of the crisis is so strong that Wenling private entrepreneurs, who started small businesses and started their family businesses, are colliding with the cost consciousness and modern financial knowledge, financial management and production concepts. From family management to open management, we strive to explore the establishment of a modern enterprise system.

The government has increased the intensity of guidance for the listing of enterprises' fees and "visible hands". Crisis is like a teacher. It not only gives education to enterprises, but also gives the government a lesson.

Wenling has clearly realized that the root of the current problems lies in the structural and quality problems of the private economy itself.

We should take a look at the ills and take into consideration the current difficulties and long-term development. In this regard, Wenling has launched a "two hands" prescription: on the one hand, we should guide enterprises to speed up the pace of institutional innovation, gradually improve the governance structure and establish a modern enterprise system; on the other hand, we should guide enterprises to speed up their bid farewell to extensive management and walk out of the road of pformation and upgrading that is consistent with the reality and has distinct characteristics.

Institutional innovation is the key link.

In accordance with the situation, Wenling has launched a number of exemplary corporate governance structures to guide enterprises in the city to learn from them.

The listed company "Leo shares" is one of these battalion companies. Since last year, a number of local private entrepreneurs have come to visit.

Zhang Lingzheng, general manager of Leo, told reporters that these colleagues said that family management and extensive development should be changed.

Reporter in the interview also heard a new thing, Wenling today