How Did China'S Manufacturing Enterprises Die? What Are The Internal And External Causes?

China manufacturing industry The current situation of enterprises is very poor, and there are many reports on this. So what are the causes of China's manufacturing enterprises? What are the internal and external factors? What should we learn from a manufacturing powerhouse like Germany? Let's sum up the N death method of Chinese manufacturing enterprises.

Price wars consume death.

Chinese enterprises like to price war, especially in manufacturing industry. Some products are low in price, but competitors will lower the price. I have contacted a family in Wenling. Shoemaking enterprises The main thing is to do Gym shoes The price has been low to 50-80 yuan, but some enterprises in Hebei will soon introduce 30-50 of the price shoes. As for the quality, it can be imagined.

Because of price war and vicious competition, many manufacturing enterprises are unable to make technological innovations simply because of their small profits. Like today's Chinese run is so popular, the streets are thousands of yuan Arthur and Nike, and some shoe companies in China are still fighting price wars. There are many links in shoemaking, and every step can be innovated. In the context of big consumption upgrading and overcapacity, enterprises are still churning out, and they can only be killed by low prices to seize the market.

The cost of labor is crushed.

In recent years, the cost of labor has risen rapidly. Many manufacturing enterprises are facing the pressure of wage increase of 15% per year, but the price of products has not been raised. In an interview with the report on the 2025 family business inheritance made in China, we found that most manufacturing enterprises have reduced their employees, but still can not withstand the pressure of rising costs. Moreover, the phenomenon of collective job hopping led by employees generally leads to the suspension of production. Moreover, the labor quality of workers in China has not improved at present. Many "post-90s" young people are reluctant to enter factories, and even the old people with white hairs can be seen on the production lines. For a long time, China did not attach importance to mechanic education, and did not respect skilled workers, so that the explicit and invisible costs of labor increased sharply.

Overflowing of money and drowning

The natural enemies of manufacturing industry are impetuous mentality and impetuous environment, and the biggest problem of currency flooding to China's economy is impetuosity. Because impetuosity, everyone wants to make quick money. For the boss of the enterprise, it is not as good as someone else to fry a suite to earn money for a year, but who is willing to engage in technological innovation, fine management, brand building and enterprise culture. Since the four trillion fiscal stimulus plan was introduced in 2009, the manufacturing industry has been on the decline. All the money has gone to real estate, chasing asset bubbles, and land and labor costs have risen year by year. Even HUAWEI's excellent manufacturing enterprises are burdened to leave Shenzhen.

A business owner who pumps water in Wenling told me that when the stock market went up last year, many employees were exchanging their "shares" and did not work hard. After that, of course, they were honest. This is actually a microcosm of the over capitalization of China's economy. It is clear that it is impossible to create real wealth by speculation but not everyone. What the manufacturing industry needs is a perfect detail, a perfect detail, a little bit of accumulation. Just like Germany, the stock market has never been skyrocketing and plummeting. Housing prices are almost motionless. Everyone can concentrate on their work and concentrate on their work and enjoy their lives. Of course, the quality of products produced will be excellent. Moreover, Germany has a large number of century old stealth champion enterprises, without a flicker of heart, how can the manufacturing industry be not strong?

Arbitrary guarantees are killed.

At the beginning of the establishment of Chinese manufacturing enterprises, many of them were entrepreneurs in a village or a town, and they had many connections with each other. Moreover, in the process of business growth, there is no shortage of human interaction and mutual support among business owners. One consequence is the emergence of mutual guarantee. It is a bit like a warship connected by iron bars in the war of Chibi. In particular, when the four trillion fiscal stimulus plan is introduced, banks urge enterprises to lend money and encourage them to guarantee each other. Some local governments, in order to consider the local economy and employment, will also use various means to guarantee some enterprises to guarantee those enterprises in trouble. In the environment of excess capacity, when banks started to borrow money, they would kill some of the companies that were fairly healthy, just as they were burning the warships.

Blind investment is pit death

Manufacturing is not easy to make money and is too tired, so many manufacturing industries will invest in projects that are not related to the main business. The most common thing is real estate. There is nothing wrong with doing this. However, it is easy to see other people making money if they are separated by mountains. For example, an enterprise in Suizhou, Hubei, was originally a farm product processing company. Its cash flow was abundant and there were stable customers like pizza hut. But somehow he went to Wuhan to do real estate. As a result, the real estate project was unsalable and occupied a lot of money. At the same time, it ran into a cash flow crisis. Just when the bank was lending money, a good company finally had to sell it to the Chia Tai Group.

The blind investment of enterprises often brings great pressure to the cash flow, but for the private manufacturing enterprises, they have suffered unfair treatment in comparison with the central enterprises and state-owned enterprises in terms of financing. Even those companies that focus on their main businesses are often bankrupted because of bank loans, and those who are not honest. It's easy to ruin the mentality of manufacturing enterprises by tasting the investment blindly. If you taste the sweetness of making quick money, it will be hard for you to set foot on your mind to do business again. For example, a migrant worker, who honestly did his job well enough to live a well-off life, had to get rich through stocks and gambling, and to make excuses for "making money like this". The author has thoroughly investigated nearly a hundred manufacturing enterprises. When they talk about the situation of their industry, they generally believe that if they focus on the main business, even if they are not living well before, they can still live steadily. After all, manufacturing is a solution to people's necessities. Those who die are not doing their job properly. They want to make quick money and do not earn.

Internet + death

The Internet revolution is still in progress, the Internet is changing China's economy, but the impact on traditional manufacturing is not a positive factor. Because the Internet can not change the credit situation of the economy and society, the products on the Internet are cheaper and more crude. Many manufacturing enterprises feel the negative effects of "Internet +".

For example, Zhejiang Yunhe is the capital of China's wooden toys. Some enterprises have increased sales through e-commerce, but later found that the price of online products is getting lower and lower. If we guarantee the minimum quality standard, it is impossible to make such a low price. Moreover, nowadays, the cost of getting the attention of the enterprise products on some e-commerce platforms is getting higher and higher. Coupled with the so-called wave of "mass entrepreneurship and innovation" caused by the Internet, many "post-90s" have been more and more impatient in traditional manufacturing industries. On the one hand, there is a talent gap. On the other hand, labor costs are climbing steadily. Some excellent manufacturing enterprises are killed by "Internet +".

This is not to say that the manufacturing industry should not use the internet tool, but the key is how to use it. Like Germany's manufacturing powerhouse, the Internet is not widely used, which is a problem. The Internet has not brought about the transformation and upgrading of enterprises. Instead, it has made the economic environment more impetuous. This is a phenomenon that must be vigilant.

Transformation is not timely dragging death

The problem of overcapacity in the traditional manufacturing industry is very serious. If some enterprises fail to make timely transformation, they will fight fiercely in the Red Sea, unable to bear the rise of cost, and gradually become depressed or even die out. Rainy day is the most basic quality of an entrepreneur. In fact, there is much room for transformation and upgrading of traditional manufacturing industry. For example, some enterprises are developing to more subdivision and more professional fields. Some enterprises abandon low profit products and focus on products with high profit margins. The difference between Chinese manufacturing industry is not the so-called "Internet +", but the import substitution through technological innovation. In this process, the transformation of manufacturing enterprises needs to do a lot of work. If not timely and let the external environment deteriorate, the result will naturally be eliminated.

Careless sudden death

Most of China's manufacturing enterprises have gone through twenty or thirty years of history, and enterprises have reached the critical stage of handover. The hard work of a generation of entrepreneurs will be destroyed if they fail to succeed. Most of the entrepreneurs who grow up under the superior conditions will feel that the traditional manufacturing industry is too tired and bitter. Compared with their parents, they tend to be more impetuous. Li Haicang, like Haixin iron and steel, died suddenly without succession planning. It was obvious that the two generation returned from abroad simply did not like manufacturing and could not do well in the manufacturing industry. At present, some manufacturing enterprises in China are at the intersection of economic cycle, industrial cycle and enterprise succession cycle. If inheritance is careless, sudden death may occur in the context of economic downturn and industrial recession.

China's manufacturing industry is really hard. We have visited nearly 100 manufacturing enterprises in the process of making the report on the 2025 family business inheritance report made in China. To tell the truth, the first impression of manufacturing industry in some areas is "depression". 70% of the difficulties faced by China's manufacturing industry are attributed to the policy environment, including the long term "national retreat", the serious shortage of skilled workers' education, the spamming of money, the excessive tax burden of private manufacturing enterprises, and so on.

However, we should also see the good side. Now the government is paying more and more attention to the manufacturing industry and is working hard to create a favorable policy environment for manufacturing enterprises. In the course of our visit, we also find that China's manufacturing industry has many encouraging lights. Enterprises in the positive transformation, to specialization and high-end development, to get rid of the mire of low price competition; for example, some "post-90s" have taken the manufacturing family business class, they are very pragmatic and diligent, and also have great ideas. They have no impetuous young people at all. Instead, they will inject new vitality into the manufacturing industry; for example, some manufacturing enterprises are already truly invisible champions, focus on subdivision and grasp the core technology, and further implement "Refocusing", and strive to achieve import substitution; for example, some manufacturing enterprises rely solely on research and development of new machines, greatly improving the efficiency of the entire industrial chain, and some enterprises are also actively exploring in the field of intelligent manufacturing. For example, many manufacturing industries.

Manufacturing is the foundation of a country. Manufacturing is dead, but China's economy is dead and the Chinese nation is dead. The two generation of manufacturing family businesses shoulder the heavy responsibility of history, and need continuous learning to realize the transformation, upgrading and development of family businesses.