Pearl River Delta Footwear And Footwear Manufacturers How To Deal With Industry Adjustment

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Xiaobian net to introduce the Pearl River Delta footwear and clothing industry in the adjustment of the industry, how do brand businesses do?

An insider who contacted the ZARA generation factory told reporters that at present, the Pearl River Delta shoes, clothing and other representative factories are becoming increasingly difficult. He learned that a Taiwanese manufacturer for ZARA OEM shoes had four factories in Dongguan, Guangdong, with a total of more than 10 thousand workers. Now the two factories have been shut down, and the factory has been compressed to 2000~3000 people. Before the Taiwanese businessman had a factory in Zhongshan, Guangdong, it had been sold off at about 18000000 yuan a while ago.

"The Pearl River Delta is still short of work, and many skilled old workers have returned to their homes. The efficiency and responsibility of young workers are much lower than before, but the cost of labor is rising every year. Moreover, the price of raw materials is rising, but the wages of workers have risen by 15%~20%, and the profit has dropped by 10%~20%.

Retail business is generally much poorer this year. Many buyers are buying a little bit, which also increases the manufacturing cost and manufacturing difficulty of the factory. "

Footwear manufacturing wholesaler Wang Li said in an interview with reporters.

The cost of manufacturing is rising steadily. The expansion of stores and the increase in prices have led to an increase in inventories and a decline in gross margins. As well as the rapid rise of online shopping, price competition has intensified, making traditional industries face challenges again.

A number of listed women's shoes companies suffered a net profit in Waterloo, which ended in the first half of June 30, 2014.

Brand Daphne's turnover fell 1.7% to HK $5 billion 80 million 700 thousand, gross profit fell 4.9% to HK $2 billion 865 million 500 thousand compared with the same period last year, and net profit plunged by 46.6%, down from HK $450 million 500 thousand in the same period last year to HK $240 million 700 thousand.

In recent years, many garment and shoemaking enterprises have pferred factories to Asian countries such as Kampuchea, Bangladesh and Vietnam.

In some fast fashion brands such as ZARA, H&M, UNIQLO and other brand stores, reporters also saw a decline in the proportion of Chinese made products, and more and more products from other Asian countries.

However, compared with the current manufacturing costs in the PRD, the increase in manufacturing costs in Southeast Asia is also faster than that.

In Kampuchea, the wages of workers almost doubled in a year.

At the end of last year, Kampuchea opposition party chairman Sanglanxi appealed to Kampuchea workers to strike a strike for raising basic wages, and the Kampuchea shoe making and shoemaking plant was completely shut down.

After that, many shoe factories and garment factories promised to raise workers' monthly salary from 80 dollars to 100 dollars in February 1st this year.

However, the pace of salary increase has not stopped. Kampuchea's garment foundry workers recently asked for the minimum wage to rise from the current 100 US dollars / month to 177 US dollars / month.

Li Peng, Secretary General of the Asian Footwear Association, said that despite the low wage base in these countries, such a rise has made many brands hard to digest, and the cost of rising is bound to be carried to the retail terminal.

When brands are under pressure, the days of manufacturers are even more difficult.

An industry insider told reporters that in the past few years, some good foundry factories have undergone varying degrees of changes this year. Because of the low profit margins of manufacturers, some choose to close factories and turn to other industries, and the footwear industry is more and more difficult to sustain the increasing labor costs.

Unless the enterprise has its own brand and channel, the situation is relatively good, and some pure foundry manufacturers, the economic benefits go from bad to worse.

Li Peng told media interviews that in recent years, with the rapid increase in manufacturing costs in the PRD, ZARA and other fast fashion brands and Nike and other sports brands have gradually shifted their orders to other Asian countries or regions. Some manufacturers have been pferring the production line to the needs of brands and buyers.

But wages in Southeast Asia are also rising rapidly. For example, wages in some factories in Jakarta, Indonesia are close to that in the PRD, while Vietnam, Kampuchea and other countries are not very stable, and workers strike from time to time.

At present, manufacturers, traders, brands and so on are in a confused stage, especially in the next step of manufacturing.

In addition, the rise of the Internet has made global prices more pparent and brand names.

It is more difficult for commercial entities to increase prices, and profit margins are becoming more and more limited.

"Foundry profits are very low, even if there is no money to earn, these manufacturers are willing to receive orders from brands.

At present, because of the terminal consumption at home and abroad, some non brand buyers are in arrears with the manufacturers' payment, and the manufacturers are in arrears with the payment of the materials suppliers. The triangle debts are becoming more and more serious.

At the same time, factories in the Pearl River delta still find it difficult to recruit workers. The monthly salary of factory workers is about 2800~3000 yuan, while the small factories are 4000~5000 yuan, and manufacturing links are facing unprecedented difficulties.

Li Peng said that the pfer of enterprises to Southeast Asia is also facing some problems, the PRD manufacturing costs continue to rise, and at the same time, production support, technology and other aspects have also been very good accumulation, and Southeast Asian countries manufacturing costs have risen sharply, so that buyers and brands are somewhat unprepared.

However, although footwear and other industries are now being tested, there are still rigid demands in the market. Many enterprises are adjusting their strategies to keep pace with the changes of the times. The whole industry chain is undergoing some changes.

In the Pearl River Delta region such as Dongguan, some large factories have gradually introduced advanced equipment to improve automation level. Although the initial investment is large, it is one of the most effective ways to alleviate the shortage of migrant workers.

Businessmen are making more adjustments in the channel, trying to find new growth points by developing online businesses.