What Enlightenment Can China Get From Japanese Clothing Trade?

As long as the policies are properly handled, China should win the war more than Japan.

As the United States accelerates the Sino US trade war, many people can not help thinking of a country that has lasted nearly 30 years of trade with the United States - Japan.

In 1989, the United States launched the super 301 clause in accordance with the national trade assessment report, forcing Japan to initiate negotiations.

Some analysts believe that China now has many similarities with Japan at that time. Therefore, it is unavoidable to worry that the Sino US trade war will lead China to Japan's old road.

China has sufficient conditions to avoid repeating the same mistakes.

The trade friction between the US and Japan began in the early 60s of last century, and entered the white hot stage at the end of the last century in the early 80s of ~90. It lasted for more than 30 years.

During this period, the United States launched about 7 rounds of trade war against Japan, involving textiles, color TV, steel, automobiles, semiconductors and other products, and also proposed the opening of the domestic market and the appreciation of the yen.

Among them, the textile trade war lasted for 1968~1972 years.

In the 50s of last century, Japan's textile exports to the United States began to increase, causing the dissatisfaction of the textile industry in the United States.

The two countries signed agreements on textile trade, including the 1957 day US textile agreement, the 1963 US cotton textile long term agreement, and finally reached the US Japan textile trade agreement in 1972.

This textile friction has opened the prelude to the trade war between the United States and Japan.

Recently, Shen Minggao, chief economist of GF Securities, wrote that as long as the policies were properly handled, China should win more conditions than Japan to win the war.

He compares the similarities and differences between China and Japan.

From the point of view of manufacturing, the same is true: both China and Japan are promoting the process of industrialization.

Whether in terms of global manufacturing share or export share of the world, China is very similar to Japan in the late 80s.

Since China joined the WTO in 2001, its share of exports has increased rapidly. In 2009, it overtook the United States as the world's largest exporter. In 2016, China's exports accounted for 13.1% of the world's total exports.

In the 80s of last century, Japan's exports accounted for a peak of 10%.

The share of manufacturing output in China and Japan rose almost simultaneously with the export market share. In the mid and late 80s of last century, Japan's manufacturing industry accounted for 20% of the world's total share, which was second only to the United States. In 2016, China's manufacturing industry accounted for 25% of the world's total and became a truly world factory.

In addition, China and Japan are at the early stage of large-scale pfer of low-end manufacturing.

Relatively speaking, Japan is a smaller country, and its manufacturing labor cost accounts for a relatively fast rise, rising from about 25% to around 50% in 1971~1981.

In contrast, the labor cost ratio of China's manufacturing sector is close to the level of Japan in the early 80s of the last century, when Japan's low-end manufacturing industry had begun to shift to China.

The present stage of China is due to the increase of labor costs and the pfer of many low-end manufacturing industries to Southeast Asian countries. If Sino US trade frictions are aggravated, more enterprises will be pferred overseas to avoid high tariffs.

The author also said that China has sufficient conditions to avoid repeating the mistakes of Japan.

First of all, we have learned from the past to avoid the two key points of taking the old road of Japan. One is to prevent excessive appreciation of the local currency. The two is to prevent excessive reliance on the real estate industry to maintain economic growth.

Secondly, if we recognize the long-term nature of Sino US trade friction, we should vigorously tap the consumption potential of the 1 billion 400 million population, and even if it does not rely on export growth, China's economy will still be able to maintain the growth rate of 4%~6%.

In the next 20 years, China has the potential to become the world's new consumption center.

Japanese textile technology and creative advantages deserve more attention

We have noticed that the beginning of the trade war between Japan and the United States was the beginning of Japan's "science and technology based nation" strategy. Japan began to tilt its development focus to knowledge intensive industries, such as atomic energy industry, electronic information industry, computer industry and aircraft manufacturing industry, etc.

At the same time, Japan's textile industry, as a labor-intensive industry, has not fallen behind the high-tech industry, and its technological advantages have also been developing rapidly.

In recent years, the shrinking of the local garment manufacturing industry in Japan is a fact.

Compared with the scale of production, Japanese textile industry has always maintained the global leading edge in leading technology research, fashion creativity and brand marketing, which has aroused our concern.

High technology R & d stay ahead

From the late 90s of last century, Japanese garment enterprises accelerated their production capacity to overseas.

According to statistics from the Japan Textile Importers Association, the import penetration rate of Japanese domestic clothing imports has reached a record high for 5 consecutive years.

In recent years, the scale of local production of onward, WORLD, TSI holdings and Sanyang chamber of Commerce, Japan's four largest garment enterprises, has also shrunk.

EDWIN, Japan's largest jeans manufacturer, closed two Japanese factories in late May.

One of them is the Xiang Ye factory in Tianjin Light City, Aomori, which has less than 40 employees and produces jeans ranging from several thousand yen to more than 20 thousand yen.

EDWIN plans to integrate the plant with the Aomori factory in Tianjin, while volunteered at two factories.

In addition, the Hechuan factory in Akita county was closed at the end of May.

At the same time, the fast fashion companies represented by the fast selling group of UNIQLO parent company are expanding the capacity of overseas factories, and gradually pferred from China, Vietnam and other major production bases to countries with lower labor costs, such as Ethiopia and Bangladesh.

Ryui Seiso, chairman and CEO of XXX group, said that Ethiopia, which has not yet introduced the minimum wage system, can further reduce the production cost of UNIQLO and enhance the competitiveness of product prices.

Therefore, UNIQLO will insist on expanding the scale of overseas production and processing bases.

There are local media reports in Japan.

Custom companies have even begun to shift manufacturing to overseas.

According to the Japanese economic news, a clothing custom shop in Tokyo is very close to the people. Shopkeepers say they have been making all the custom garments to Vietnamese factories for sewing. The cost of labor has been greatly reduced.

In fact, from the apparel industry chain, Japan has exported low value manufacturing links in the supply chain, and still has the right to speak in advanced technology and technology.

Japan has been leading the world in the field of innovation and development, which determines that the Japanese apparel industry still has absolute advantages in international competition.

For example, many countries are producing denim fabrics, but the denim made in Japan has its own unique characteristics.

Japanese denim has been following the traditional techniques, produced with the old Japanese loom, pays great attention to color change in dyeing, and brings forth endless innovations in weight and texture.

Japanese DENIM DENIM is very popular in the United States, with local consumers approving: "Japanese brands focus on washing, fading, and handwork. They are all solid at the same time, sometimes sacrificing time for quality and at cost."

Brand creative marketing firmly hold hands

Statistics show that the peak period of local clothing production in Japan was in the early 90s of last century, when the garment production rate was 50.5%, and the data continued to decline after that.

Later, Japan began to enter deflation.

Processing plants have to cut production costs.

At the same time, due to the aging of the population and other reasons, seeking overseas labor force has become a major choice for the development of the garment manufacturing industry.

The survey by the Japanese department store association shows that the rise of fast fashion is also one of the reasons for the rapid decline of local garment production in Japan.

Because of the economic recession, consumers began to lean towards low price clothing, and high quality and high price clothing sales declined.

Experts have analyzed that in recent years, a large number of Japanese clothing enterprises have adopted the strategy of "mass production system and low price commodity", and pferred production to other developing countries, which has become the main reason for the depression of local clothing production in Japan.

In order to enhance the competitiveness of the local garment manufacturing industry, the Japanese government launched a brand new "real Japanese made" label in recent years.

The "real Japanese made" label can be affixed to the garments for textile, dyeing and sewing production in Japan.

However, the label only shows that clothing is processed in Japan and does not restrict production enterprises from importing raw materials from abroad.

Japanese media reported that although the price of Japanese made garments, which are scarce in value, is high, there is still a certain market. This label has been recognized by the middle and high income groups in Japan since its implementation.

In short, Japan's textile technology, including machinery manufacturing, dyeing finishing, new product development, marketing and many other aspects, is in the leading position in the world. This advantage is difficult to replace other overseas production bases.

With the gradual increase of production costs in developing countries, Asahi, a well-known Japanese shoe maker, plans to move all its production lines back to Japan within 5 years. Its official said that the price of products will rise by 20% to 30% after returning to production. However, through technological innovation, the production speed can be shortened by two or three months, and the shipments of the best sellers can be improved.

This shows that although fast fashion companies like UNIQLO pfer their capacity to overseas production, brand, fashion and trade in the high-end value chain are still in the hands of the Japanese.

Itou Tada, Japan is currently the world's leading textile seller, holding a large number of international brand franchise or exclusive agency rights.

Itochu's businesses connect all businesses through the global information system.

Its strategic principle is large group scale operations and small company management thinking. This approach helps to establish an enterprise system that can respond quickly and flexibly to the changing times.

This is a large and small mode of division of labor and cooperation, so as to form a powerful force to promote global expansion.

Manufacturing industry is seriously deficient.

At present, the labor costs of Asian and African developing countries are also rising. Compared with the Japanese mainland, the cost of labor costs at home and abroad has been shrinking.

Therefore, the Japanese government is also trying to attract overseas factories to return to China through new policies, but little effect has been achieved.

Some experts have analyzed that there are industry differences in production returning to Japan.

In areas where labor costs are relatively low, production is likely to return to Japan, but industries that require large numbers of manpower are very difficult, such as low pport costs and labour intensive ones.

Enterprise.

In recent years, the Japanese government has called on local manufacturing to improve automation and save part of the workforce.

However, it does not have much effect on garment manufacturing, because a lot of garment production processes depend on manual operation, so it is difficult to fully realize automation.

Together with UNIQLO, its brand GU is focused on Asian countries, improving its technical capabilities, and developing a low price production system that integrates popular elements into commodities.

In Ryui Masa's words, "Asian factories have a strong learning ability", while Japanese factories are short of employees, and their age is too large.

"There are peer companies asking us to increase orders for domestic factories to ensure stable income for Japanese industrial workers."

In the Kyushu and other places with factories, Japan's domestic large shirt manufacturer Shan Xi company responsible person said that due to the large-scale relocation of Japanese manufacturing industry, local textile enterprises compete for layoffs, Japan's local textile production of skilled personnel is less and less, aging is serious.

He reluctantly said that if more factories in developing countries such as Asia and Africa were not used to make clothes, then Japanese clothing would be difficult to compete with other overseas counterparts. After all, cost advantage plays a decisive role in clothing sales profits.

The Japanese government is also actively seeking solutions to the adverse effects of aging and minority production on the manufacturing industry.

Last month, the Japanese government announced the basic policy of economic and financial operation and reform 2018.

The plan decides that a large number of foreigners will be attracted to work and live in Japan.

It is reported that the background factor of this scheme is that the population is decreasing year by year and the problem of aging is becoming more and more serious.

In order to minimize the cultural and language barriers of foreigners working and living in Japan, the plan has also formulated corresponding measures.

Another point is quite important. Insiders pointed out that since the financial crisis, Japan's economic recovery has been slow, domestic demand has been sluggish, and local clothing sales in Japan are not booming.

At present, UNIQLO has about 790 stores in Japan, which has been stagnant for a long time.

On the contrary, in April of this year, UNIQLO issued its first half financial year end results at the end of February this year. Its sales in developing countries such as Asia rose sharply, and overseas sales for the first time surpassed that of Japan.

According to the report, UNIQLO's total overseas sales totaled 507 billion 400 million yen (about 29 billion 700 million yuan), an increase of 29.2% compared with the same period last year, operating profit of 80 billion 700 million yen (about 4 billion 700 million yuan), an increase of 65.6% over the same period last year.

The strong performance of UNIQLO's Asia based overseas business has led to further expansion of its overseas capacity.