How Can Shenzhou International Survive In The Cold Winter?

Yes

For an enterprise, time is life and delivery time is the soul.

According to the world clothing shoes and hats net, BELLE sells and the United States continues to lose money.

In the clothing and footwear industry, some enterprises fail and some struggle on the line of loss and pformation.

Under such a big trend, a company has not only "lived" down, but also prospered in its business, its share price has increased 50 times in 8 years, and has reached the top of the domestic clothing listed enterprises with the market value of about 70000000000 yuan.

This leading enterprise is not something that is familiar to people.

But a foundry factory, which is known for its low profit margins, is the largest in China.

Garment manufacturers and exporters Shenzhou International Group Holdings Limited (hereinafter referred to as Shenzhou International).

The company is the main supplier of international brands such as UNIQLO, Adidas, Nike, Puma and so on.

Japan War

The helm of Shenzhou International is the Ma Jianrong family of 28 billion 800 million yuan.

Ma Jianrong is the chairman of the board of directors of Shenzhou International. At the beginning, he was the Ningbo Shenzhou weaving company, which was taken over from the father of Ma Baoxing (hereinafter referred to as "Shenzhou weaving"). The company, founded in March 1990, is the predecessor of Shenzhou International.

In the late 80s of last century, in order to solve the problem of urban labor surplus, the Beilun district government of Ningbo took the lead, and jointly invested with Shanghai knitting twenty factory and foreign invested enterprise to build Ningbo Shenzhou Manufacturing Co., Ltd.

Before joining the Shenzhou weaving company, Ma Baoxing was the vice director of technology in Shanghai knitting twenty factory and vice director of Linping knitting factory in Yuhang.

He was introduced to Shenzhou as a senior managerial talent and was appointed deputy general manager.

In 1990, Ma Baoxing moved his family to Ningbo and devoted himself to the opening of the textile mill.

Ma Jianrong, who was only 25 years old, followed his father at the time to enter the knitting and weaving department of the textile mill.

As soon as he entered the factory, Ma Baoxing found that the real problems and difficulties were far more than imagined, and the situation was very complicated.

At that time, the whole industry became depressed and the market prospect was unpredictable.

More importantly, the newly built factory is "poor and white". It has no money, no one, no technology, let alone the order, which makes Ma Baoxing quite worried.

However, without any retreat, he quickly adjusted his mindset and began to take various countermeasures to deal with all kinds of disadvantages.

The first is capital.

Although Shenzhou weaving is a three party investment, virtually all funds are not in place.

Not only that, the company still has debts in its construction, counting the production start-up funds, with a gap of about 3 million yuan.

In order to make up for the gap, Ma Baoxing ran around to find financing in the city. He managed to make up all his money and pay off debts.

With the start-up capital, Ma Baoxing began to think about developing the market.

At that time, the low-end market of domestic exports of textiles had been basically saturated. If we want to open up the situation immediately, we must form differences.

Ma Baoxing believes that if the low end is done from the beginning, it will be very difficult for the company to get rid of this market position.

Thanks to the steady and vigorous development of Shenzhou weaving in the future, in the final analysis, Ma Baoxing has benefited from the establishment of the "middle and high end" line and the persistence and development of Ma Jung Rong.

Where can this opportunity be found? Ma Baoxing has been trained in Japan in the early years, so he first turned his eyes to the more familiar Japanese market.

Japan's quality requirements for imported garments are very strict, and the quality standard of Japanese baby clothing is even higher, mainly reflected in the requirements for fabrics, formaldehyde residue and dyeing, and the values of various indicators are much higher than those of the domestic industry standards.

This high standard is also reflected in the price.

At that time, an adult T-shirt was sold for $1.2 while a baby's garment could sell for $1.5.

Aiming at this opportunity, almost all the "zero start" Shenzhou weaving began to open the Japanese market a little.

In order to meet the Japanese standard for OEM, Ma Baoxing, who is knitting expert himself, took part in the battle. With his many years of relationship, he invited the experienced teachers in Shanghai knitting twenty factory to develop training, and trained a large number of skilled workers and backbone for Shenzhou weaving.

Despite all efforts, the road to Japan is not smooth.

Ma Jianrong recalled that when he visited a Japanese client, he was disturbed by a question from the other side. "Why did the batch of clothes go into the water?"

When the company was founded, it chose the Japanese market, which brought the rebirth pain to Shenzhou weaving, and also brought the sweetness of suffering.

Shortly after the start of weaving, Shenzhou introduced Japan's advanced business management mode, from quality control to hygiene.

Strict management coupled with strict control of quality makes Shenzhou weaving become profitable in 1992, and its positioning of "high-end high-end foundry" is also gradually clear in the market.

By 1995, Shenzhou had gained a reputation in the industry.

All this has laid a solid foundation for the subsequent acquisition of major international customers in Europe and the United States.

Ma Jianrong, chairman and executive director of Shenzhou International Board

Taking UNIQLO is an adventure.

1997 is a very important year for Shenzhou weaving.

A lot of events happened this year, and the most important thing is that enterprises start MBO (management buyout).

The initial three party shareholders decided to resell the shares to the Ma Baoxing family. Shenzhou weaving also welcomed the turning point from entrepreneurship to rapid development.

In that year, Ma Jianrong, 32, took over Shenzhou weaving from his father.

At the age of 13, Ma Jianrong followed his father to join the textile industry. Since the beginning of his apprenticeship, he has been rooted in this industry for nearly 20 years.

He has been in Shenzhou weaving for 7 years. He is one of the "senior leaders of the mountain", who has been the manager of knitting and weaving department.

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In 1997, it was UNIQLO, the first major international customer who continued to cooperate so far.

The first collaboration with UNIQLO had to be an adventurous attempt at Shenzhou weaving.

It was during the Asian financial turmoil that it was still in the growing period of UNIQLO. It made a 350 thousand production order to Shenzhou, which was a good business but with some harsh conditions. It must be completed within 20 days.

This is a piece of cake for Shenzhou International today, but at that time it meant the biggest challenge since its establishment.

Whether it can be completed on time will determine the survival of a company to a certain extent.

After repeated measurements, Shenzhou weaving finally chose to face difficulties and work overtime, and eventually completed the order on schedule, winning the reputation and long-term cooperation opportunities in one fell swoop.

Today, Shenzhou International has become the largest supplier of UNIQLO.

In addition, since 1997, Shenzhou weaving has also made an important attempt.

Before 1997, most OEM enterprises were engaged in OEM production, and Shenzhou weaving was no exception.

The so-called OEM is that the OEM enterprises only focus on production and manufacture, and have no right to interfere with other links such as design, sales and so on.

In this mode, most of the value is in the hands of the customers, that is, the brand operators.

Therefore, OEM enterprises are very passive, with small added value, low bargaining power and small profits.

In the face of this situation, Shenzhou weaving began to extend to the upper level of the industrial chain, the fabric field, and voluntarily undertake various services in the supply chain of knitted apparel, trying to pform from pure OEM to ODM mode gradually, in order to seek breakthroughs.

The so-called ODM, is more than OEM design link, from design to production is completed by the OEM enterprises, after the product is formed, the brand side directly OEM to buy.

Do not belittle the design link, it allows the foundry manufacturers to have intellectual property rights of products, and thus form a certain right to speak. The relationship between manufacturers and branding is no longer a simple relationship between procurement and production, but a collaborator.

The ODM mode of Shenzhou weaving is mainly embodied in the production process of fabrics, and the garment production link is still OEM mode.

That is to say, it will develop and manufacture corresponding fabrics and make garments according to the requirements of customers for functionality and design. The fabrics produced are designed by themselves, for internal use only.

After many years of development, Shenzhou weaving business has now covered the middle and lower reaches of the industrial chain, providing various services including fabric, dyeing and finishing, printing and embroidery, cutting, sewing, packaging and logistics, forming a quasi vertical industrial chain with few vertical vertical integration.

In the process of building the whole industry chain, Shenzhou weaving has also made a good place. It is also ignored by the vast majority of garment foundry enterprises, or it does not pay much attention to it. It is for customers to strictly examine, for example, to promise Japanese customers that all factory garments can be guaranteed to be sold directly.

This has not only shaped the quality of Shenzhou garments, but also saved the process for customers, saved manpower and time cost, and increased the credibility of Shenzhou weaving enterprises. This also created conditions for the subsequent opening up of the European and American markets.

In the whole textile industry chain, the profit of the whole industrial chain is the highest, and the more complete the industrial chain, the smaller the loss of enterprise value.

As early as the 90s of last century, Shenzhou weaving could be aware of the problem of production mode and constantly upgrade and upgrade.

In contrast, many textile enterprises in China still remain in single link and single mode production.

Although there are serious overcapacity in the domestic garment industry, Shenzhou International production workshop is busy.

The "equipment maniac"

Ma Jianrong, who took charge of Shenzhou weaving, always focused on the main business of textile and garment making. He only immersed himself in making products and never set foot in other investments.

"It is enough to do a good thing in one's life". It is the life creed he emphasized many times.

Ma Jianrong attaches great importance to the practice of internal strength. He believes that only when practicing internal strength can he stand upright.

It is an indisputable fact that clothing is a small profit on behalf of the industry. How can we maximize the value? Apart from elongating the industrial chain, we must maximize production efficiency and save and lower all kinds of costs.

To improve production efficiency, we must pform the existing backward state, introduce first-class equipment and technology, and create a world-class core competitiveness.

To this end, after Ma Jianrong took office, the most prominent performance was to carry out technological pformation at the expense of capital, and "to spend money before making money".

The amount of money he invested and the risks involved could not be reached by ordinary enterprises.

Before 2000, Shenzhou made almost 90% of its profits, almost all of which was devoted to technological pformation, such as the introduction of the most advanced knitting machines in the world at the time of tens of millions of yuan.

With the promotion of equipment upgrading, in 1998 and 1999, the sales and profits of Shenzhou weaving for two consecutive years increased by 30%.

In 2000, the net profit of Shenzhou weaving was 210 million yuan, 19 times that of 1997.

In June 2005, Shenzhou International, which integrated many businesses, was founded by Ma Jianrong as chairman.

In November of that year, Shenzhou International Exchange was listed on the main board of HKEx.

At that time, the output value of Shenzhou was 8 times higher than that of Ma Jianrong when it took over, and its annual profit doubled 23 times to 350 million yuan.

Ma Jianrong said, after landing at the Hong Kong stock exchange, "just spent one night, I spent all the more than 900 million Hong Kong dollars that I got on the market at the time, what to do or upgrade equipment".

Ma Jianrong is an absolute "equipment maniac".

After the listing, Shenzhou International has always insisted that 50% of its profits should be used for technological pformation.

Shenzhou International, which has capital and technology support, is growing more rapidly.

This has attracted the attention of large enterprises such as Nike, Adidas and Puma, and has established cooperative relations with Shenzhou International.

In this way, Shenzhou International not only widened the market, but also widened the types of garment production, and changed the proportion of product production. From the original production of a single casual clothing, it gradually changed to a production oriented sport clothing and a casual clothing supplement.

"Some people think that Ningbo has entered the late stage of industrialization. The textile industry is backward production capacity, the elimination of industry, pollution is also much, I was very depressed."

Ma Jianrong said that in the early part of 2008, he first had a "shake and confusion" for the industry.

Because of the rise in labor costs and so on, many people advised Ma Jianrong to sell the factory and make other investments.

But he is not willing to take the company executives to conduct research on productivity, investment environment and competitors in China and Southeast Asia.

He found that there are still many surplus labor forces in the central and western regions of China, while the new textile industry in Southeast Asia has low efficiency and low labor cost, but the industry chain is not formed, and it can not produce high-end garments.

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Finally, Ma Jianrong came to the conclusion that "no one country can catch up with the manufacturing advantages of China's textile industry in the next 20 years."

As a result, he resolutely determined to continue to make Shenzhou International, and invested more than 400 million yuan to expand the scale and technological pformation.

This time, Ma Jianrong did the right thing again.

In 2008, Shenzhou International sales reached 4 billion 800 million yuan, an increase of 1 billion 200 million yuan over the previous year, with an annual profit of 700 million yuan, an increase of nearly 300 million yuan over the previous year.

After the financial crisis in 2008, the garment industry showed an obvious polarization.

20% of the enterprises survived very well because they remained focused and did not stop the pace of industrial upgrading. Most of the enterprises that had problems appeared to be investing in money quickly, such as real estate, stock market and futures market, which eventually led to the breakup of capital chain.

In contrast, Shenzhou International has invested billions of dollars in equipment and technology upgrading in recent years.

Therefore, the industry believes that the first-class technology equipment is a major reason for Shenzhou's leading industry.

When the order is greater than the production capacity, most enterprises will choose incremental production. While expanding production, Ma will always use the limited funds to buy the world's top equipment to enhance efficiency, and he has won a lot of returns.

Buying equipment does not mean investing unilaterally. Every year, the cost saved by Shenzhou International is up to hundreds of millions of dollars due to equipment upgrading or technology upgrading.

For example, in 2007, automatic bed cutting was introduced from Italy and the United States. The integration from drawing to tailoring is operated by computers. The material can be saved by more than 15%. This means that 15 tons of cloth can be saved to enterprises every day, and the company can save at least 100 million yuan a year.

There are many similar examples.

In addition to technological pformation, Ma Jianrong's investment in R & D is also considerable.

He has invested more than 500 million yuan in one breath to build two world-class R & D centers, engaged in thousands of people related to scientific research, and developed more than 1000 new fabrics every year.

"Due to the advantages of fabric research and development, the profit margin of sports shoes developed by Shenzhou International and international brand has reached 50%, and the supply is in short supply."

Ma Jianrong said.

Fast and fast

With the upgrading of technological equipment and R & D innovation, Shenzhou International has improved its production efficiency.

"Clothing is a labor-intensive industry. In the past 10 years, the number of workers in the company has not changed, and the output value has increased by more than 10 times. This is due to machine replacement and continuous improvement of production automation efficiency."

High efficiency has saved more and more manpower cost for enterprises, and has become a major factor for OEM enterprises to firmly grasp customers.

"For clothing enterprises, time is life, and delivery time is the soul."

Ma Jianrong often said, "if you think of it, you can't miss it."

How long does it take for a million pieces of orders to be delivered from order to delivery? The answer to Shenzhou International is 15 days.

"Our orders and deliveries are all carried out through the Internet. There is no other way.

15 days to deliver products, this is a very efficient industrial chain, from spinning, weaving to clothing and printing and dyeing, all links are standardized production, and no half difference is allowed. "

In addition to equipment and technology, Shenzhou International supply chain advantage is also very obvious.

Shenzhou International adopts vertical integration mode, concentrates all production processes on the same industrial area, reduces time and logistics cost, reduces unit fixed production cost, and makes production more flexible.

At the same time, for the cooperation of big brands such as Nike, ADI, UNIQLO, Shenzhou International also set up a dedicated factory, one stop can complete from fabric research and development, design, proofing and production and other links.

This "bag check in" type of OEM is leading in China. Adidas, Nike and other brands have moved the design center directly to Shenzhou International plant area, which is closely integrated with design and production.

The modifications made by the brand designers can be modified within a few hours, which greatly reduces the lead time and the market cycle of new products.

According to industry practice, it takes three and a half months from placing orders to products, while Shenzhou International can be completed within two weeks.

Another important reason for Shenzhou's high efficiency is modularity.

The modular product system can produce different products through different combinations. The principle is similar to that of building blocks.

For example, the production of shirts, in the past, a worker from zero to skilled clothing, at least 6 months, and now only a simple training, an hour can master, production efficiency greatly improved.

Thanks to the absolute advantage of technology and efficiency, as early as 2012, Shenzhou International had four main customers, UNIQLO, Nike, Adidas and Puma, which accounted for more than 70% of the total sales volume of Shenzhou.

It is the long-term and stable cooperation with these big name customers that Shenzhou International's performance can keep up with the growth of the industry in the continuing downturn.

In 2015, when China's textile industry was in a predicament and sales volume declined by 6.4%, Shenzhou International sales reached a record high, with sales volume of 12 billion 600 million yuan and net profit of 2 billion 350 million yuan, up 13% and 14% respectively over the previous year.

Shenzhou International rapid response and efficient supply chain represents the biggest advantage of the apparel industry at present.

"Many enterprises do not want to do supply chain and production, and rush to make brand, but Shenzhou International focus on supply chain has become a scarce resource."

Ma Jianrong said.

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