Chengdu Wuhou OEM Shoe Enterprises: Crisis Under Prosperity

More than ten years ago, OEM

The profit is "selling a pair to earn a pair", but now the profit is extremely low, even "only sells one pair to make one".

Wuhou District, Chengdu is known as "

Capital city, which has a large number of OEM mode factories.

In the face of a sharp decline in export volume, many

Actively pforming the domestic market, electricity providers have become their first choice.

The Internet is making them more open and changing the OEM factory mode.

Cheng Minghua, director of a shoe factory in Chengdu, told reporters that the Internet has changed their R & D and production processes.

"With the help of Alibaba's" China Quality "platform, we learned to build our own brand by using e-commerce.

Now no longer rely on foreign trade orders, they are just icing on the cake.

In the future, our goal is to sell private brand sales of 70% of all factory orders. "

The crisis of prosperity is coming quietly.

But more than a decade ago, many Chengdu shoe factories, including Cheng Minghua, could not imagine what the day would be like without foreign orders.

Cheng Minghua's shoe factory has many years of experience in the international first-line brand, and the OEM brands include nine hee, Zara and so on.

Before 2008, they mainly engaged in foreign trade and subcontracting production.

At the peak, capacity reaches about 1000000 in one year.

It is mainly exported to European and American countries.

Cheng Minghua's shoe factory is also the epitome of China's OEM factory.

In 2002, Cheng Minghua began to manufacture shoes as self-employed.

At that time, the developed countries took a fancy to China's cheap labor force and began to shift manufacturing industry to China on a large scale.

These orders from international brands have made many small factories like Cheng Minghua survive and live well.

"At that time, many big factories couldn't do the lists, so we could do them one by one."

Relying on foreign trade orders, the shoe factories in Chengdu had a very good time, and when the demand for the domestic market had not yet been released, no one thought of setting up their own brand.

However, in 2008, the global financial crisis broke out, and the situation of China's OEM factory was in sharp decline.

Media reported that a fireplace manufacturer in Cixi, Zhejiang, was 30% less than its order in 2008.

"Business is getting worse."

Cheng Minghua said that many shoe factories began to turn to the domestic market.

Perhaps it is out of inertia, perhaps, has not yet found a new direction. After turning to the domestic market, the shoe factory does not directly deal with consumers' brand and market, but continues to choose the OEM mode.

"Start processing products for distributors in various parts of the country."

Reconstruction of R & D and production processes by Internet

Then, in 2013, foreign trade continued to deteriorate.

Cheng Minghua said, "orders have shrunk by 70%, but orders from the Internet have increased by 150%."

At that time, China's OEM factory began to realize the hope brought by the Internet, and also looked for new directions from here.

The Internet has also begun the process of reconstructing traditional industries in China.

"In 2014, we made a comprehensive adjustment to the process of R & D and production."

Cheng Minghua said that after a period of testing, they found that the shoes on the line were newer and better, while the line was simpler, more practical and better.

According to this feature, shoe factories begin to deploy part of R & D team to develop products in line with the popular trend online.

In the production process, shoes are very seasonal, so the factory usually produces the winter shoes in advance, which leads to no order in winter.

But network orders are real-time data production, and a lot of netizens are browsing, so they can produce more.

This real-time online order makes up for the order gap period under the winter line.

"Before November, it began to take a vacation, and now it will not be a holiday until January."

A shoe factory official in Chengdu told reporters.

The Internet also changed the production process by reducing inventory and reducing the capital turnover cycle to a week.

"Direct cash pactions are online."

Cheng Minghua said that before making big orders, the capital turnover period is usually about half a year.

"The other side has not been off the road has been very good.

Because of the turbulent domestic environment and currency devaluation, many factories can not recover the order.

Some colleagues lost tens of millions.

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Brand pformation has begun

In addition to R & D and production, the greater impact of the Internet on the OEM factory lies in the way the brand is molded and the user's thinking changes.

As Ma Yun said, the chain of relationships between brands and their foundries, and between brands and their existing customers, is shifting and changing.

In July 2015, Cheng Minghua's shoe factory decided to use the "China made" project launched by Alibaba to open its branding road.

Relying on this platform, shoe factories have harvested more orders.

"The dealer sees our products in the shop, the style is very novel, and the quality is very good, so they are attracted to come to us to place an order."

Cheng Minghua said, this is a window, has played the demonstration effect.

Zhang Qin, vice president of Taobao, said: "many traditional enterprises have very advanced manufacturing processes, but their products are rarely recognized by consumers because of their lack of brands.

This project is hoping to integrate the strength of the parties, to endorse the good sellers, and to promote the rapid growth of a number of high quality and high standard independent brands.

The e-commerce platform also provides manufacturers with the opportunity to directly face consumers.

"Now our private brand orders are only 10%, and by the end of this year, our target is 25%."

Cheng Minghua told reporters that by 2020, their goal is to order 70% of their own brands.

To achieve this goal, they are changing.

"We are starting to train fixed users, and we are trying to do word of mouth marketing for brands."

More importantly, with the help of "China Quality" platform, manufacturers are interacting with users.

Wang, director of a furniture manufacturer in Shunde, Guangdong, told reporters that after the ice cream machine was launched on the "Chinese made" line, many users reflected the function was too single, and suggested adding the function of making sand ice.

After adding these functions in the second generation of ice cream machine, "now users say the capacity is too small, not enough for a family of three stuttering."

The third generation is ready to expand capacity. "

After such efforts, OEM manufacturers began to harvest hope on the electronic business platform.

Last year, we sold 17 thousand pairs of shoes a day.

Now the business environment here is very good.

Basically all manufacturers are using the Internet to pform, but the way they operate is different. "