Jinjiang Is Getting Away From "Shoe Capital". Who Will Be The Next Del Hui?

According to the world clothing shoes and hats net, this winter, to Jinjiang, Fujian.

It's extremely cold.

Before the new year's day, in a notice of claims disposal of assets issued by the local government media, Jay Chou's endorsement and slogan "Deerway, On The Way" were well known throughout the country.

Brand del Hui is on the list because of debts exceeding 600 million yuan.

Many assets including factories, land and warehouses are auctioned off by listed mortgages.

And only 5 months ago in August 5, 2017, another well-known shoe manufacturer in Jinjiang, Xi long, was also publicly declared a bankruptcy reorganization process by the Jinjiang court because of its debt problem.

Relying on the footwear industry, Jinjiang, a small fishing village on the southeast coast, has developed into one of the richest county-level cities in the country after reform and opening up.

In 2005, Hongxing Erke was listed in Singapore. In 2007, Anta landed at the Hong Kong stock exchange. Around 2009, many well-known brands including XTEP, PEAK, 361 degree and so on gathered into the capital market. Jinjiang shoe enterprises entered the peak period. More than 1/3 of the 2 million people in the region lived around the shoe making industry chain.

However, for the shoe industry in Jinjiang, the summit is only a short peak of the steep parabola in their growth trajectory.

Behind the tide of listing is the collapse of hundreds of small and medium-sized shoe factories. In 2011, Hongxing Erke was suspended on the Singapore stock exchange for alleged financial fraud, marking the beginning of the big shoe enterprises' dilemma.

The bankruptcy of XD and del Hui made the consumers who were familiar with them lament, but the shoes circle of Jinjiang seemed surprisingly calm.

"In 2011, the shoes made in Jinjiang had not been sold for ten years."

A shoe factory owner who once worked in the local shoe enterprises association sighed for reporters.

For him, the decline of Jinjiang brand shoe enterprises is more like a late implementation ceremony after the final judgment.

Wilderness, cottage, brand, capital, expansion and fall, Jinjiang is away from the "shoes capital".

The late brand awakening of Jinjiang businessmen

The same as Jiangsu and Zhejiang coastal areas, Jinjiang's land is poor and its resources are scarce. This is not a piece of soil that can breed agricultural civilization.

Minnan people became the main force in the next Nanyang during the Ming and Qing Dynasties. After the reform and opening up, overseas Chinese returned to Jinjiang, so that they found a way to survive.

The boss of a lingerie factory in Jinjiang knew that there was something like brassiere because of the return of her overseas sister, so she pulled down the research and started selling it from three to fifty, and gradually developed to mass production.

Most of the bosses of shoe makers in Jinjiang share similar experiences.

Ding Jiantong, 361 degrees, raised two thousand yuan in the living room by raising two thousand yuan by raising fish in the field and scattered workers. PEAK Xu Jingnan, who saved up the savings of a scooter and set up a sports shoe factory, set up a sports shoe factory in XTEP's own living room. Each of them paid 500 yuan each, and put up a shed to build slippers beside the river beside the village.

"As in Jiangsu and Zhejiang, bosses in Jinjiang can endure hardships and learn well, and one can earn money by selling shoes, and others are also rushing to the top."

A local shoe factory owner described this to reporters, but he also believed that unlike Zhejiang businessmen, the businessmen in Jinjiang were more colorful. "They will not go to the bottom of the house like Wenzhou people, and they are not good at making use of finance. They are generally conservative, and the development of enterprises is usually not very warm. There is nothing particularly good and nothing particularly bad."

In 1995, the Zhejiang footwear and apparel enterprise, the American brand of OEM, grew rapidly. But in 1990, it started to build a brand of Jinjiang footwear enterprises. But it was willing to be a substitute for ADI and Nike for a long time.

It was not until 1998 that under the strong guidance of the government, we began to realize the concept of "brand building market" and put forward "implementing the strategy of regional brand building and occupying the leading power of the market".

By 2004, the Jinjiang municipal government is still spending $about 18000000 on the licensing, certification and bidding enterprises in the previous year, encouraging enterprises to go out.

To be precise, in 2005 or so, a group of shoe bosses who first took the lead off the "ideological burden" finally began to roll their sleeves on the road of brand creation: in 2006, the German World Cup, 25% of CCTV5's advertising came from the Jinjiang brand, was ridiculed as "Jinjiang channel", and the story of Jinjiang's brand building also rose overnight.

In 2003, del Hui signed Jay Chou's endorsement 10 million years later. In 2005, XTEP 8 million bid for the sponsor of the Nanjing National Games. No one ever thought that MIZUNO from Japan took 10 million half road to kill.

As a result, Ding Shuibo, who just left Nanjing, immediately returned to raise the price to 15 million. In the same year, PEAK $4 million became a sponsor of PEAK's NBA team, the TOYOTA center of Houston rockets home.

PEAK billboards on NBA

Some of them also go against the sword.

The "Jordan" brand, founded in 2000 in Jinjiang, relies on the edge ball with the name "Jordan" of the United States, which has created different brand image and market position.

In 2012, Michael Jordan sued Jordan, China. After three years of lawsuits, the Beijing high court failed to win the final judgment in 2015. Jordan, who refused to accept the appeal, continued to appeal to the National High Court and finally won the lawsuit at the end of 2016.

However, in July of last year, because of the sponsorship of the National Games in Tianjin, Jordan, a defeated Chinese lawyer, received a letter from the US attorney Jordan. The brand was deeply rooted. The "stubborn" Chinese Jordan counterclaim lawyer infringed his reputation right and claimed 1 million 100 thousand for the other party.

Despite the awakening of brand awareness, in this group of "avant-garde" bosses, some characteristics of Jinjiang businessmen remain.

A practitioner who has served as an executive at several shoe enterprises in Jinjiang has concluded to reporters that compared with Zhejiang businessmen, Jinjiang businessmen's family concept is heavier. After growing up, the living environment of professional managers in enterprises is not as good as that of Jiangsu and Zhejiang. Jinjiang businessmen are not as fond of holding together as Zhejiang businessmen, and there is not much overlap and mutual help between enterprises.

A local shoe business owner who once did the middle scale recalled to reporters that PEAK Xu Jingnan was just like everyone else before the listing two years ago, and suddenly became "big" after listing.

For those shoe makers who build national brands, the boss thinks "it's not a big deal."

After a short capital feast

Before and after 2008, due to the reduction of foreign trade orders and the appreciation of Renminbi, many small and medium-sized shoe factories which exported to Jinjiang were unable to carry the impact.

At that time, it was also the time when those big Jinjiang shoe enterprises entered the capital market and enjoyed the feast of capital.

Looking back now, compared with the small and medium-sized factories that had been closed down earlier, the Jinjiang shoe brands that had taken the lead in expanding their scale had not been able to avoid the upgrading of the industry.

In the early days, these shoes companies entering the capital market did show differences in Jinjiang.

361 years (01361.HK) two years after the listing, revenue reached 5 billion 500 million yuan, an increase of 30% compared with the time of listing in 2009, net profit from 900 million to more than 1 billion 100 million, and one billion threshold; while XTEP International (01368.HK) only received 2 billion 800 million yuan in 2008 when it went public, the highest peak in 2012 reached 5 billion 500 million yuan, and net profit also rose from 500 million yuan to 1 billion yuan; 2011, PEAK sports (01968.HK) 4 billion 700 million revenue and net profit of 4 billion 700 million.

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The listed shoe enterprises can come out in the slide of the Jinjiang shoe industry, and greatly benefit from the financing of the listed companies, which have a rapid and exaggerated capital, and this expansion is mainly reflected in the number of stores.

According to the Hong Kong stock market, in June 2008, the number of 361 degree authorized retail stores was 4632, and 7681 in mid year 2011. In 2011, XTEP also rose from less than 3000 stores to 7596; PEAK reached closer to 8000 in 2009 on the basis of 6000 stores in 2009.

361 degree shoemaking workshop

"At that time, we all compared each other, who opened more stores, thousands of new stores a year, the government is also very supportive, then there is the official competition ranking, see who can compare who, we are proud of this."

A shoe manufacturer in Jinjiang recalled to reporters that building more factories and opening more stores is the inertia thinking of Jinjiang bosses.

Relying on the purely vertical expansion mode, of course, it is weak.

In the face of electric shocks, consumer upgrades and overcapacity, the tactics of expanding stores were quickly falsified.

Before Delhi and hydel collapsed, Jinjiang shoe companies had long been collectively sinking: as of 2016, the net profit of 361 degrees has dropped to 400 million yuan, less than half of the time of listing; XTEP International's 500 million yuan net profit was flat compared with that at the time of listing; PEAK sports had been delisted from Hong Kong stock in 2016; 603555.SH has been squeezed into A shares in 2014, the first year's performance did not look so good, and its revenue and net profit decreased by 20% and 26% respectively compared with that before the listing.

When the shoe companies in Jinjiang are still expanding, there is research report analysis that the convergence of Jinjiang brand positioning and operation mode leads to their respective lack of characteristics, and the ability of enterprises is not very different.

The enterprises in the early stage are familiar with the way of success of the leading enterprises, so long as they can grasp the growth opportunities of the industry, they can catch up quickly.

When the industry enters the adjustment period, the competition pattern is solidified, which makes it difficult for these brands to produce a real breakout.

A former foundry executive who worked for a number of listed shoe companies, OEM, told reporters that for them, listing and opening shops were only superficial. At that time, a large number of shoe companies had problems with their capital chain, and only a few of them were healthy. Even if they were listed companies, they would not allow credit.

After the problems in the head office of Jinjiang footwear industry, the whole industry chain also suffered a fatal blow.

The OEM factory of the above executive service went bankrupt several years ago, and he himself traveled far away from Zhejiang, completely away from Jinjiang shoes circle.

A medium-sized shoe factory owner who began to engage in shoemaking and foundry business in the late 80s of last century was also bankrupt in 2015. He once wanted to make shoes for life, but now he can only live in debt.

"For the big Brand Company, the government has been supporting and supporting, do not want them to go bankrupt, but now the government has no ability and no need to do so. The failure of del Hui and" Xi Long "can not blame anyone, the aftermath is being processed, and the bosses are also looking for new ways out.

Lv Qinghua, director and doctoral tutor of Fujian business research center of Huaqiao University, Quanzhou, told reporters.

In the "13th Five-Year plan" of Quanzhou, the automobile and integrated circuit industry has been developed as a key industry in the future. "Jinjiang Municipal Economic and social development statistics bulletin" in 2016 shows that the GDP of the year is 174 billion 400 million yuan, and the output value of footwear industry is 100 billion 900 million yuan, accounting for 58%. In 2012, this figure is 70%.

"After several years of pformation, Jinjiang's economy can be said to have gotten rid of its dependence on shoemaking."

Lv Qinghua said.

Who will be the next del Hui?

With the evolution of users, local pformation and industry downturn, the surviving Jinjiang brand will continue to survive.

At the beginning of 2015, at the XTEP ordering conference, Ding Shuibo put forward the slogan of "returning from sports to sports" in 3000 XTEP dealers. He always favored the entertainment stars such as Nicholas Tse and Han Geng. He hoped to turn from the leisure sports brand to the professional sports brand. He invested in the Nordic outdoor sports brand ONE WAY and built a 361 degree children's clothing at 361 degree, and made efforts to the professional sports and children's wear fields. After the listing of the great bird in 2014, it tried to invest in many assets including sports games, sports insurance, sports media and so on, hoping to build a sports concept based on sportswear. After the delisting, PEAK also expressed the need to establish an industrial ecosystem including sports goods, sports events, sports big data and media.

In fact, "diversification" and "all sports" already have forerunners.

The professional outdoor sports Pathfinder (300005.SZ) was forced to enter the business of air tickets, ski resorts, outdoor tourism online platforms and expand business categories in 2013, but no fundamental changes were made.

In the second half of last year, the Pathfinder announced a focus on outdoor sports equipment.

The concept of "whole sports" and "ecological circle" is not a magic drug.

In the shoe market of Jinjiang listed companies, its share price has almost been cut off since 2011.

To some extent, Anta Ding Shizhong is probably the only one of the Jinjiang shoe enterprise bosses who really jumped out of the thinking of "township entrepreneurs".

In 2004, Ding Shizhong, who was not short of funds, saw Lining's success. He resolutely broke the concept of family business and decided to let the company go public.

In 2009, Anta acquired the international brand "FILA" and began multi brand strategy.

After the fall in 2012 and 2013, Anta sports (02020.HK) had a 13 billion 400 million revenue in 2016 and a net profit of 2 billion 400 million, double the 2012 trough.

Its share price has risen from the lowest HK $3 in 2012 to the latest HK $38 / share, becoming the only sample approved by the market in Jinjiang shoe enterprises.

"The most glorious period for the once barbarous growth of Jinjiang shoe enterprises has long gone by. It is necessary to have their own characteristics and excels, and understand the adjustment and pformation of their industries, but the shuffle will continue. The elimination is still doomed to be eliminated, which is normal."

For the future of Jinjiang shoe enterprises, Lv Qinghua made such comments to reporters.

Who will be the next del Hui and Xi long long in Jinjiang?

More interesting reports, please pay attention to the world clothing shoes and hats net.