Fortune Story: Looking Back On The Twists And Turns Of Chinese Shoe Kings

In 1987, the daughter of the former Minister of the Ministry of Commerce went to Wuhan shopping mall and bought a new pair of leather shoes for 49.5 yuan.

But I didn't expect that this pair of shoes was only worn for a day, and the sole of the shoes took off the glue. It is said that the shoes were made in Wenzhou. After a while, the minister went to Wenzhou as the chairman of Wenzhou modern business civilization forum.

In the forum, the minister talked about it as a joke. On the stage, he talked, but the people sitting on the stage heard a cold sweat.

However, he specially clarified that the shoes were not Wenzhou shoes. After verification, it had nothing to do with Wenzhou people. People under the stage finally breathed a sigh of relief, but it did not last long.

Two years later, a girl from Northeast China bought a pair of Wenzhou shoes for her fiance. After wearing them for two or three days, she helped her husband at a wedding banquet. Looking down, she found that the shoes were filled with dung paper. In a rage, the couple sent the pair of shoes to the mayor of Wenzhou at that time

"Wenzhou people use this kind of shoddy leather shoes to dig people up. Do they blush when they are mayors?"

Just when Wenzhou leather shoes market fell into this storm of public opinion, Chen Dongmin broke in with Dadong and threatened to refresh the outside world's cognition of Wenzhou leather shoes market.

Deng Yao's Baili also opened a factory in Shenzhen, eyeing the mainland's shoe market. In Jinzhou, Fujian Province, a number of shoe enterprises emerged, including Ding Shizhong's Anta, Chen Xianmin and Zhang Wenyi's Daphne, Lin Heping's rich bird and Lin Tianfu's noble bird.

These shoe enterprises have left an indelible mark on China's shoe industry. Just like the question of whether Chinese shoes are surnamed "Wen" or "Jin", they have been fighting for the crown of China's shoe king.

However, in the long competition that has lasted for decades, some people are still strong, some people are submerged in the smoke of gunpowder, some people are dim exit, and some want to make a comeback after being out of the game.

Establishment and beginning

Chen photosensitive and Ding Shizhong had a "chance encounter" at the fork of fate when they were 17 years old.

Ding Shizhong is a native of Jinjiang, Fujian Province. His father took advantage of the first spring breeze after the reform and opening up to set up a shoe workshop. He sat at home and waited for people to come to the door every day. However, he felt that selling things should not wait for customers to come to their door. He had to go out and sell them, so he took 600 pairs of shoes to Beijing to sell, hoping to make a breakthrough.

Facts have proved that he has indeed become a good Beipiao. He not only sold all his shoes, but also rented a counter in the mall to specialize in the wholesale of Jinjiang shoes.

Business has started, but Ding Shizhong always has a question: it is clear that all shoes are made in Jinjiang. Why can the brand of Qingdao double star sell for 100 yuan, while his own Jinjiang shoes can only sell for 20 yuan?

The answer, of course, is brand.

As Haier Zhang Ruimin said, if you are a brand, you can sell it at a high price. So Ding Shizhong went back to Jinjiang and founded his own brand Anta.

Chen Guangming also left Wenzhou at the age of 17 and lived a life of wandering from south to north.

After that, he went back to Wenzhou to sell shoes wholesale and founded Dadong. Later, he went to Zhengzhou, Wuhan, Shijiazhuang and Beijing to sell shoes.

In Yunnan, Sichuan, Anhui, Jiangsu, Shandong, Inner Mongolia, Henan, Hebei, Zhejiang and other places, his footprints are everywhere. Even now, Chen Guangming cannot forget that experience.

In 1995, Fujian Shishi, known as the "China shoes and clothing manufacturing base", came out with a set of bagged shoes, which sold well in the market.

Chen photosensitive found that such hot shoes are only men's shoes. However, women's business is the best. Women's desire for shoes is also great. The founder of Chanel once said that she could see people naked as long as she wore shoes.

So Chen photosensitive changed the shoes into women's shoes directly, and pushed them to the market. Dadong also went on the track of Chinese women's shoes smoothly.

Chen photosensitive should give thanks to Lin Heping, because the bagging shoes are made by Lin Heping's rich and noble birds.

Lin Heping is a very charismatic person. In 1982, he was unanimously recommended as the factory director by the members of the village's agricultural society. A few years later, with 40000 yuan, he gathered 19 cousins to set up Shishi tourist souvenir factory, selling sandals and slippers.

In 1989, the tourist souvenir factory was reorganized, and four of the 19 cousins were left, and they unanimously elected Lin Heping as the leader.

But at this time Lin Heping did not want to sell sandals any more. He focused on leather casual shoes and began to start the leather shoes business and set up a rich bird.

The results showed that Lin Heping's choice was correct, because two years before the fire of bagged shoes, his rich bird had been jointly rated as the first Chinese shoe king by the General Administration of quality supervision, inspection and quarantine, leather industry association and other institutions.

It was also in this year that Lin Tianfu founded a company in Jinjiang to export sports shoes to foreign countries. At that time, he didn't want to be an independent brand. He just wanted to follow the trend and do OEM and OEM business with many local shoe factories.

However, Lin Tianfu gradually became ambitious. With the OEM and OEM business getting better and better, by 2002, the OEM production mode could not meet the market demand, so he registered the noble bird trademark and began to take the brand line.

Similar to Lin Tianfu, Chen Xianmin also made shoes OEM at first. In 1987, he and his brother-in-law, Zhang Wenyi, established Yongen group in Hong Kong, the predecessor of Daphne, mainly engaged in OEM.

As we all know, Hong Kong is a place where every inch of land is worth an inch of money. In order to reduce costs, Chen Xianmin built Daphne's factory in Putian, Fujian Province, which can export shoes to the United States and obtain labor and materials in the mainland at a low price.

Just like Alipay initially appeared to solve the trust problem between Taobao buyers and sellers, Daphne was sold in the mainland only to solve the problem of material storage for export.

At that time, the turnover speed of export products was relatively slow, which led to many of Daphne's shoes in the warehouse. In order to solve the inventory problem, Chen and Zhang simply transferred the accumulated shoes for domestic sale to the mainland.

One carelessly sold a shoe empire.

Deng Yao, who was born in Hong Kong, also went to the mainland to look for a factory contract because of the cost problem. During that time, Deng Yao traveled back and forth between Hong Kong and the mainland, taking Hong Kong's designs to mainland shoe factories for OEM, and then bringing the finished products back to Hong Kong for sale.

The cost has been reduced, but the problem also follows: the production and marketing cycle is too long, which is difficult to adapt to the changes in Hong Kong market demand.

Deng Yao knew that Hong Kong was a tiny place compared with the mainland. At that time, the spring breeze of reform and opening-up was blowing in his face. In order to break the situation, he directly suspended Belle's sales in Hong Kong and set up Belle shoes industry in Shenzhen to develop the mainland market.

A track, six people, a silent contest, began.

Competition and highlight

The competition between Deng Yao and Chen Xianmin is the most direct and fierce.

In the millenium, a time when channels are king, the consumer market has a single purchasing channel, e-commerce has not yet developed, the Internet bubble burst, and the cold winter of capital swept across the world.

Many Internet enterprises failed to survive and went to the end. On the contrary, shoe enterprises started the reform of retail and launched a nationwide enclosure movement - constantly opening stores and seizing market share.

Deng Yao's goal is department stores across the country. In other people's eyes, he takes Belle into the major shopping malls with the posture of a monopolist. He almost crazy wants to occupy each of the most prominent display cabinets in the mall, and does not leave any opportunities for his peers.

This kind of madness is summed up perfectly by the market in one sentence: as long as there is a department store, there will be belle.

Chen Xianmin and Zhang Wenyi tried to avoid shopping malls and put their focus on street stores. Since 2002, the two of them with Daphne quickly opened stores in second and third tier cities, expanding their share.

They have found a shortcut to open more stores near KFC and pizza hut. The world's largest catering group, yum, has brought huge traffic.

In 2004, Chen and Zhang said to the public that one of every five pairs of women's shoes in the Chinese market comes from Daphne.

It was in this year that Zhang Wenyi used false land sales to defraud money and run away with money until he was arrested and jailed in 2007.

Although Zhang Wenyi's incident had a certain impact on Daphne's popularity in the capital market, this influence was eliminated after Chen Xianmin handed over the power to his nephew Chen Yingjie.

In 2009, under the leadership of Chen Yingjie, Daphne introduced the famous private placement TPG. Under the suggestion of TPG, Chen Yingjie acquired 60% equity of Fu Zhen international, and entered the medium and high-end women's shoes market, directly into Baili's hinterland.

One said they were Mercedes Benz of women's shoes industry, the other said that they were BMW of women's shoes industry, but both of them were more brave in the war.

Deng Yao and Belle went to the Hong Kong stock exchange for listing successfully in the year when Zhang Wenyi was jailed. From 2010 to 2012, on average, he would open a new store, with a market value of more than HK $150 billion in 2013, becoming the largest shoe retailer in China after Baidu and Tencent among the listed private enterprises at that time.

Chen Xianmin is not weak. In those years, she invited a spokesperson, published a book on Daphne's business model, and her nephew Chen Yingjie married Han Yuqin, the dry daughter of Zhang Guoli and Deng Jie, and so on, which only increased Daphne's topic and popularity.

At its peak in 2012, Daphne had 6881 stores, nine times the number in the first year of expansion.

At that time, none of them paid much attention to Chen photosensitive, because compared with the size and popularity of the two shoe industries, Chen's Dadong was just a small workshop

Chen photosensitive this person, most can disguise as a pig to eat a tiger.

He did not directly conflict with Deng Yao, but learned from Shi Yuzhu. He almost started the strategy of encircling the city in rural areas with Shi Yuzhu's pace. One was brain platinum and the other was selling shoes.

Chen photosensitive also does not compete directly with Chen and Zhang brothers. He sets the price of shoes very low, and then opens a shop next to Daphne to enjoy the flow brought by Daphne shoe store.

After all, purchasing power is downward compatible. You can ask rich people to buy low-cost goods, but it's hard to let people who have no money buy high-priced things. As a result, the general manager of Dadong shoes also said that "without Daphne, there would be no Dadong".

Compared with Chen Guangming, Lin Heping can make Deng Yao more alert because his Fuguiniao, Baili and Daphne are known as China's three major leisure brands.

Lin Heping wants to be a big company, and it is a famous international company. After the establishment of Fuguiniao, he developed the belt, leather bag, luggage market and women's shoes market.

In the past few years when Belle Daphne opened a shop crazily in Dadong, Lin Heping took the rich and noble birds to rush forward. With his left hand, Chen Zhonghe, the former coach of China's National Women's volleyball team, and Lu Yi, an actor, were invited as spokesmen by his left hand. With his right hand, there were 3000 stores around the country. Consumers gave him the nickname "county men's shoes carrying handle".

"Shoulbazi" ushered in the highlight moment in 2013. It not only ranked third in the national casual shoe manufacturer and sixth in the brand shoe manufacturer, but also was listed on the main board of Hong Kong this year. On the first day of listing, its share price once hit HK $8.9/share.

The next year, Lin Tianfu also took the noble bird to the market.

From a certain point of view, Lin Tianfu doesn't want to lag behind others, especially Lin Heping, who even takes a brand name that is so similar to him.

But Lin Tianfu is different in that he focuses on professional sports.

In order to make the noble bird famous, he cooperated with the State Administration of China to become the sole sponsor of China's national golf team, billiards team and bowling team. He sponsored the phenomenon level talent show "happy male voice" and won the sponsorship of the United States, so that the seven teams of American basketball dream were put on their sports equipment.

In 2008, Lin Tianfu invited Andy Lau to speak for him. With the smooth holding of the Beijing Olympic Games, the noble bird was completely popular. In the following two or three years, it opened three new physical stores every day in the country, the number of stores increased from 1847 to 5057, and the business income rose from 600 million to 2.65 billion.

Ding Shizhong is naturally not sure to admit defeat. In the market, everyone likes to compare Lin Tianfu's noble bird with his Anta. However, he is a man with a strong competitive heart: "I have always been very competitive in whatever I do since I was a child. No matter what I do, I have a stronger competitive heart than others."

In order to succeed, he will be very risky to bet. For example, in 1999, he took 20% of Anta's annual profit and asked Kong Linghui, an athlete, to speak for Anta. In order to build momentum, he took three-quarters of Anta's profit to smash advertisements on CCTV.

No one understood, but he just won. Kong Linghui won the Sydney Olympic Games in 2000. For a while, Kong Linghui became a hero in the eyes of the Chinese people. Anta, the spokesman of Kong Linghui, naturally became a hot topic.

The promotion of brand awareness directly drives the growth of sales, which makes Anta's turnover rise from several million to 20 million, and from 20 million to 200 million.

In order to get the password for business growth, he never gives up the opportunity to visit competitors. For example, in 2010, he visited Belle and Daphne to understand how Bailey's supply chain works, so as to respond quickly to the market, and understand how Daphne spent eight years to realize the system transformation of retail operation.

During the period of 2000-2013, even though these six shoe enterprises were comparing and competing for the market, they did not affect their shop opening, making money and listing.

But some of them didn't expect the storm to come so fast.

Turning point, foreign invasion and internal worry

In 2013, Ding Shizhong tweeted that the era of making money with your eyes closed is over.

When he said this, Anta's clothing revenue in 2013 exceeded that of shoes for the first time. This is obviously not a good phenomenon. Anta was established to be a shoe brand that can go abroad and become the king of shoes in China. However, clothes sell better than shoes.

At this time, the background of the times is that after the savage expansion of more than a decade ago, the price war among enterprises directly led to the decline of industrial profit rate. At the same time, a series of costs such as raw materials, water and electricity, factory rent and so on continued to rise. The "low cost, low profit" processing trade mode has obviously no way to go.

More importantly, around 2012, Taobao, VANCL, Jingdong, vipshop and other converging platform e-commerce are just like Japan Zhongtian. The rapid development of mobile Internet and the rise of e-commerce have brought a fatal impact to offline physical stores.

Zong Qinghou and Dong Mingzhu once denounced e-commerce in CCTV's dialogue column, which hurt China's real economy. So when Deng Yao and others came back to their senses, Taobao was already full of cheap brands.

Magically, 2015 seems to be a fork in the road for everyone's fate:

By 2017, the net profit of belle has dropped by 55% in two years, and nearly half of its wealth has evaporated; Daphne lost money for the first time in history. In the next five years, Daphne closed 1256 stores every year, which was called "the king of closing stores";

Fuguiniao's net profit declined for the first time. In 2016, it directly announced the suspension of trading for three years. During these three years, fuguio's turnover and profits fell continuously - from nearly 3 billion yuan to less than 500 million yuan, and the net profit directly changed from profit to loss.

The thunder of the noble bird was also buried in 2015. Lin Tianfu seems to have become a Shopaholic and has been buying and buying crazily: investing in Hupu, Kangpaisi sports, Hubei jiezhixing, mingshoku and a football brokerage company in Spain, collecting the exclusive operation rights of and1 in China and acquiring the game company of Xingyou Technology.

Even if the Shanghai Stock Exchange didn't stop, he would have bought Weikang fitness for a high price of 2.7 billion yuan. As a result, the noble bird, which straddles multiple industries, suffered losses in 2018 and its revenue began to decline.

The external environment may be a direct factor, but the internal factors are also crucial.

Deng Yao once tried to build his own e-commerce shopping platform, creating taoxiu.com and yougou.com. He even recruited Xu Lei of Jingdong and Zhang Xiaojun of VANCL, the former as CMO and the latter as coo.

But Liu qiangdong couldn't let Xu Lei go. In those years when Xu Lei worked in Baili, Liu qiangdong did not miss drinking and chatting with him and persuading him to return to Jingdong.

Sure enough, before long, Xu Lei went back, Zhang Xiaojun also left, and Baili failed because she didn't attach importance to self built e-commerce platform.

Another key point is that Belle lacks design genes. This is almost a recognized fact, and in the current era of post-90s as the main consumer force, this is fatal.

Even Sheng Baijiao, Deng Yao's right-hand man, admitted that Baili had no sense of fashion. He said that when he took the elevator, he found that only two out of 20 people wore formal shoes, and one of them was himself.

You know, belle is mainly to produce formal shoes.

Daphne has also embraced e-commerce. It has reached cooperation with tmall Jingdong vipshop and other platforms, but it has made a strategic mistake, that is to invest in "Yaodian 100" e-commerce platform with Baidu.

According to Chen Xianmin, in order to fully support the development of "Yaodian 100", Daphne closed its advantageous distribution channels such as Jingdong, letao and haolemai.

Unfortunately, point 100 failed, Daphne bet wrong. Daphne also has a hard injury, that is, the fight between the Chen and Zhang families.

Generally speaking, the family business will go better at the beginning, because everyone's heart is the same, they all want to make the company bigger and stronger, so they all go to one place, but when the enterprise grows bigger, everyone will no longer hide the evil of human nature, and will become the embodiment of selfishness, and want to swallow more rights and interests.

Chen Xianmin and Zhang Wenyi appear to be relatives. In fact, they often fight for interests. For example, at a board meeting just after the group's listing, they almost fought over the direction of decision-making.

Daphne also changed many times, from the joint management of Chen Xianmin and Zhang Wenyi, to Chen Xianmin's fading out of the power center, to Zhang Wenyi's arrest and imprisonment, Chen Xianmin's nephew Chen Yingjie came to power, and finally Chen Yingjie stepped down, and Zhang Wenyi's two sons took the helm. Once the group encountered a crisis or difficulty, the fight for rights would be staged.

The biggest problem for rich birds is that when they seek transformation, they enter too many dangerous and unfamiliar industries, such as investing in P2P platforms, mining and real estate.

Lin Heping might not have thought that P2P enterprises would become violent and rich birds would be involved in debt disputes because of this P2P dream, so that the children of Lin Guoqiang, the co-founder of Lin Guoqiang, directly announced that they would give up all their property.

After Lin Tianfu bought and bought, he finally found that the noble bird was losing money. So he began to sell and sell back his blood. At the same time, he closed the shop offline. But the problem with the noble bird is that Lin Tianfu is a good boss, but he is not a qualified helmsman.

Lin Tianfu can't keep up with the pace of the times. Many of his ideas are based on his early experience, judgment or cognition.

He was willing to invite everyone to eat lobster from five-star hotels at the ordering meeting, but he hesitated on the key issue of whether to spend thousands of yuan on graphic design, and pursued "one word for all" in internal decision-making.

Even if the team has a direction, Lin Tianfu will still adhere to his own ideas, what he says is what.

Bankruptcy, reorganization and future, hope

Segane once said that if you don't know the direction of your voyage, any wind is not a downwind for you.

If there is no tailwind, it is easy to capsize.

In 2019, with a three-year suspension, declining profits and high debt, a generation of shoe king Fuguiniao declared bankruptcy.

At that time, there was a rumor at that time that the rich bird who could not pay for the money even planned to use shoes to pay off the debt. According to the report of China Securities, the debt repayment plan of the rich bird was that 100 yuan of debt could be exchanged for 1.11 yuan in cash and 1.63 yuan in shopping voucher, and the creditor could purchase and pick up the goods at the designated store according to the face value of the ticket within three years after obtaining the purchase voucher.

In the same year, there was a popular saying on the stock market and in the market: the rich bird, the noble bird, the bird of joy. There was no good bird in the stock market.

Lin Tianfu is also not easy. In 2020, the theme song of the noble bird is debt collection. Its market value will shrink from 40 billion yuan at its peak to 1.4 billion yuan, and Lin Tianfu will become an old Lai with a debt of 3.4 billion yuan. This is only a few years before he became the richest man in Quanzhou.

Today, the core of the noble bird's office has moved from Xiamen to Jinjiang. Back to where it started, Lin Tianfu also handed the baton to his son.

In April this year, the bankruptcy reorganization plan of the noble bird was approved, which means that the noble bird has crossed a hurdle. Lin Tianfu has always told his son that in the next two to three years, we must recover the reputation and reputation lost by the company.

Lin Tianfu still wants to be the king of Chinese shoes.

Belle was privatized and delisted in 2017, when Deng Yao chose to cash out.

In the process of Hillhouse's privatization of belle, Mr. Deng Yao said: "I don't care whether I quit or not, nor do I care about money. What I care about is whether the company can work with better partners to lead Bailey International's more than 100000 employees to Nirvana and revive."

Zhang Lei, the founder of high-ranking leaders, cried after hearing this. No one would deny Deng Yao's significance to Baili.

Later, under the operation of Zhang Lei, Belle digital transformation, in line with this era, Bailey's sub brand taobo international was listed on the Hong Kong Stock Exchange in 2019, with an opening market value of more than HK $60 billion.

In a super brand day event of vipshop this year, Belle's one-day sales volume reached 55 million, a year-on-year increase of more than 120%, a record high.

Maybe Baili king is back, but Deng Yao's figure is not found.

Daphne closed more than two-thirds of its offline stores in 2020 and announced that it would completely withdraw from the physical retail business of medium and high-end brands. Chen Xianmin regretted that he said in a public speech: "if I can come back, I may do another 10 years before retiring."

However, the world has no if, the reality is very cruel, capital has been far away from Daphne.

Even if Daphne tries to enter the field of sports shoes this year, it is not favored by the capital and the market, because this field has already been saturated and the competition is fierce, which belongs to Ding Shizhong and Anta.

In this shoe king's competition, Ding Shizhong ran to the last, which does not mean he won.

Anta has been living in the question of "is Anta's FILA or FILA's Anta" in recent years, because according to its financial report, the revenue of FILA in 2020 has exceeded that of the main brand.

Because of this, Anta has been shorted by overseas well-known institutions for five consecutive times.

If Deng Yao knows that FILA China has become an excellent trump card in the hands of Ding Shizhong, the leader of Anta, he does not know whether he would sell FILA China to this competitor 12 years ago.

And in the women's shoe market, Chen photosensitive surface seems to be a sure bet. Its big east such as this year's sales of 100 million, annual revenue of 5 billion, 9000 stores across the country, dozens of factories and more than 20000 employees to support its shoe industry empire.

But he and Dadong are the most controversial enterprises and people in China's shoe industry. His argument is that it is successful in terms of business, but in the eyes of insiders and outsiders, it is low and explosive.

Previously, a group of well-known experts, high-end independent designers, Wenzhou shoe factory boss, and industry insiders even launched a debate on the "low price model of Dadong shoe industry".

Some people say: Dadong mode, low price competition, a dead end. There are also high-end independent well-known designers said: Dadong is just a garbage seller, even worse than garbage, because the garbage can be recycled, which causes great pollution to the environment.

Chen photosensitive of course needs to take big east to change. For Dadong, its transformation needs a long process, especially brand upgrading. It is not difficult for high-end brands to expand into low-end markets, but it is difficult for low-end brands to climb up.

Many enterprises have died in the process of reform. Whether Dadong can succeed or not and whether Chen photosensitive will become the next Deng Yao still needs a question mark.

There is no doubt that the market space of China's shoe industry is still huge. China is not only the world's largest shoe producer and exporter, but also the world's largest shoe consumer.

In the future, who can sit in the shoes King's position, and has been unchanged, no one knows. It is easier to succeed than to keep meritorious service. Chen Guangming, Deng Yao, Chen Xianmin, Lin Heping, Lin Tianfu and Ding Shizhong have all succeeded.

At present, there are only two of them.