Is The Development Of Footwear Industry The Way To Attack Or Defend? Where Is The Direction?

Such an era

No longer a shallow concept of globalization.

Can cover

2015 is about to end. China's economic downturn has become a reality. GDP growth slowed and stock market turbulence. Shoes and clothing The industry has entered a low growth period of cold winter. The tide of business closes has become an open secret in the industry. The integration of mergers and acquisitions has become the norm. The underlying cause of stagnation is the structural adjustment of the underlying industries brought about by the upgrading of consumption and the Internet revolution. Facing the crisis, we should not only see threats, but also see opportunities. We should not only see the problems, but also see the direction.

In the fifth Plenary Session of the 18th CPC Central Committee, held in Beijing in October 26th, the 13th Five-Year plan will be the focus of discussion. This is the first five year plan since the current administration took office and the last five year plan to achieve the first centenary goal. This plan will become the general plan for China's economic development in the next 3-5 years.

The purpose of this paper is to observe the brand development of China's footwear industry from a global perspective. Where is the direction of attack or defense?

China's Transformation: the death of "world factory"

The "13th Five-Year plan" put forward the concept of Intelligent Manufacturing in China very clearly. The meaning of Chinese wisdom is very extensive. It includes hard technology driven by industry 4, 3D printing, intelligent robot technology, and so on. Design The soft driving of innovation and creative industries will drive industrial upgrading, upgrade the traditional manufacturing industry to the new intellectual manufacturing industry created by China, and get rid of the position of the thirty year world factory and become the world's intelligent manufacturing power.

With the rapid development of China's economy and the weakness of labor cost advantages and environmental supervision and consciousness, "made in China" has swept the world. However, the rapid expansion of the past 30 years has been difficult to sustain. On the one hand, due to the international economic downturn, the demand for Chinese made products in the international market has greatly shrunk. On the other hand, the development of China's manufacturing industry has been constrained by environment and resources.

In 2013, China's total exports amounted to 41400 billion US dollars, equivalent to half of the total GDP, and the dependence on foreign trade reached 50%! Chinese manufactured goods accounted for 20% of the world market. China is almost recognized as the "world factory". The so-called world factory, in short, is the large-scale production and manufacturing base of industrial products for the world market. China has exported more than about 50000000000 garments annually, and the output of shoemaking has exceeded 10 billion pairs. Leatherwear Luggage exports account for more than 1/4 of the world's total supply. Each export volume is the most in the world. But how many Chinese brands do we really have, what can we really get from it?

Why does a pair of Nike shoes cost more than 100 yuan in China, but they sell to China more than ten times? Why does a iPhone phone have a profit of only a few percent in China, while Apple Corp can get more than 90% of smartphone profits? What are the principles behind these rules? Let's review the classic smile theory first.

Taiwan Transformation: Smiling Curve

The "smile curve" (SmilingCurve) theory was born in Taiwan in the 90s of last century. At that time, Taiwan was also an important foundry base in the world. Facing the spanformation, Stan Shih, founder of Acer group, found that the profit value created by the global industrial chain was completely divided by the R & D design institutions and downstream brand channels.

In order to "rebuild Acer", Mr. Stan Shih is determined to change this unfair situation and enhance the added value of the industry as the strategic direction of Acer. After more than ten years, Mr. Stan Shih has revised the "smile curve" to date and launched the so-called Shi's "smile curve" as the direction of the medium and long term development strategy of various industries in Taiwan.

{page_break}

Although the smile curve theory is very simple and pragmatic, it points out the strategic direction of Taiwan industry's future efforts. Under the guidance of the concept of added value, enterprises can only continue to move and locate continuously with high value-added blocks, so as to sustain development and sustainable operation.

The successful way of Apple Corp is to occupy the two ends of the smiling curve completely, from the source's R & D design, the integration of software and hardware, to the control of terminal brand and channel, and the illustration of classic smile curve.

China's footwear industry is now facing the economic downturn. It will begin to experience a downturn in the field of low value added industries, such as mature industry, market saturation and overcapacity. The theory of smiling curves can provide a new direction for thinking.

Korean Transformation: creating an economy

In the first ten years of twenty-first Century, it was the 10 year of Korea, with rapid economic development and continuous improvement of innovation capability. Samsung, LG and so on have jumped global giants. However, in recent years, under the influence of the global economic downturn, the economic development momentum of South Korea has gradually slowed down. It faces several challenges, such as economic downturn, slow employment growth, sluggish domestic demand market, lack of risk innovation capability, and lack of vitality of enterprises.

In response to the crisis, in early 2013, South Korean President Park Geun hye put forward the implementation of the "creative economy".

(CreativeEconomy) innovation strategy development thinking, we should apply science and technology, information and communication technology (ICT) to all industries, promote the combination of industry and industry, industry and culture, promote the development of new industries, and create new employment. In order to achieve the development of the "creative economy" for the future, the South Korean government has introduced some countermeasures, hoping to rebuild the Korean economic growth mode through these measures and lead the economy out of the predicament.

{page_break}

The creation of the economy is based on imagination, creativity and technology as a basis for promoting economic development. First, we should break the barriers between departments, promote information sharing, and emphasize the guidance and promotion of the government. Two, we should focus on integrated development and promote original innovation. Three, we should pay attention to macro management and establish a good ecosystem.

It is precisely under the drive of the national strategy that Korea has become a center of the world's creative industry. The design of South Korea has swept the globe. From the rise of Samsung Electronics to the Korean wave sweeping Southeast Asia, the marriage scandal between Korean stars and Chinese female stars has become the gossip theme of millions of young people after tea. The most common face of the east gate of Korea is the Chinese, especially the brand that is mainly consumed by the young group. It has been sent to Korea to buy the edition. As the four Dragon of Asia, Korea is the first model to realize the successful spanformation of the economic structure.

Industrial Transformation: innovation and wisdom

According to domestic authoritative financial media, as the cost of China's manufacturing industry is rising steadily, the world footwear industry is tilting from China to Southeast Asia. Since the financial crisis in 2008, Southeast Asian footwear industry has taken nearly 30% of China's foreign trade processing orders. People in the industry are worried that if the spanfer of overseas orders is accelerating, the shoe industry of more than 20 million people in China will be faced with the impact.

It is precisely because China is only assembling and processing, so it can only engage in the production of simple products. It is for this reason that the whole world can see Chinese goods everywhere: clothes and shoes are hung in the mall, and everyone can see it is made in China, but you can't see the design, logistics, marketing, pricing power, and most of the machines that are manufactured abroad for processing these products are not seen by most people. Therefore, although Chinese products can be seen everywhere in the world, China has not gained the profits it deserves.

The problem of China's footwear industry is on the surface of overcapacity. In fact, it is a question of structural adjustment of terminal retail mode and R & D design capability. Product strength and brand power, coupled with the improvement of terminal retail innovation capability, can really help to improve the global competitiveness of Chinese shoes and clothing brands. Going out and implementing global resource integration and industrial mergers and acquisitions are the only way to upgrade China's footwear industry and globalisation. The upgrading of China's footwear industry must become a global company.

The growth experience of world-class enterprises has proved that a company without core R & D capability is difficult to achieve sustainable development. Only by occupying the commanding heights of industrial technology can we lead the technological progress of the industry and gain the first mover advantage in competition.

Brand spanformation: towards internationalization strategy

More and more shoes and clothing national brands began to seek the stage of going to the world. One of the highlights of the 2016 spring and summer China International Fashion Week, which was just concluded in Beijing, is a variety of world-class crossover and cooperation attempts: for example, the stunning appearance of Korea's supermodel IRENEKIM, and the cross border cooperation between China and Korea's cutting-edge designers. The Q fashion women's shoes, which are behind these phenomena, are also announces the launching of the international brand strategy through the theme of "Cinderella travel" and the full English marking It "sQ".

Behind the internationalization strategy of Q, there are multiple meanings:

One is the deep integration of international design creativity. Korean design is just the beginning. Based on the global hot effects of Korean fashion and creative industries, the best designers in the world will design Oriental Works for the Chinese.

The second is the deep integration of international fashion resources so that Chinese consumers can have more fashion choices and enhance their aesthetic awareness and national brand awareness with a global perspective.

The second is the deep integration of international market resources. The domestic market is great, and the international market is a broader stage. Before we are always consuming the fashion of Milan, Paris is popular. When can we let Oriental fashion design enter the European market? This is the dream of all Chinese national clothing brands.

The 13th Five-Year plan has sounded the horn of the great revival of the Chinese nation. In such a spanformation era, how does the shoe and clothing brand seize the opportunity to enhance the value and control of the upper and lower ends of the smiling curve? Seize the opportunity in the new round of fashion change and push China's national brand onto the world stage?