Market saturation Dongguan shoe contracted for the winter

Dongguan Huahong Footwear Co., Ltd. has 3,000 to 4,000 workers at its peak, which is now reduced to around 800. What makes the company's chairman Guo Xiaoping laugh and cry is that even at this current scale, it is known as an "excellent factory" by overseas buyers, and it has squeezed into the top ten shoe factories in Dongguan, the world's largest shoemaking base. Before that, Dongguan's shoe factories frequently hit thousands or even tens of thousands of people. His factory has always been only a mid-range scale, and today it is the first-rate factory.

The market downturn "This year's footwear industry is extremely bad. This situation is unprecedented. In the past, when the economy was in recession, it was often shifting. Unlike this year, the world could not even find a market with a slight boom point. European and American traditional market orders The contraction was very severe and orders fell sharply. At present, mainly low-cost orders are the main factors, while domestic sales are extremely fierce. R&D and market development investment are very large. In order to maintain normal expenses such as water, electricity, and labor costs, even if it is not We must also take orders for making money.” Guo Xiaoping appeared very helpless when interviewed by reporters from the “First Financial Daily” yesterday.

The downturn in the market can also be seen in the 2012 financial report released by the six domestic sports brand companies. In 2012, the total inventory of the six sports brand companies was as high as 3.327 billion yuan, while the inventory of Li Ning Company (02331.HK) alone was as high as 9.19. Last year, it reported losses of nearly 2 billion yuan. Women's shoes giant Belle International (01880.HK) also faced high inventory levels. Last year, inventory turnover days rose by 15 days to 167.6 days.

In the face of saturation in the domestic market, many shoe companies have taken online and offline discounts and other promotions. This year, Li Ning has promoted the company's sales, and it has jointly launched an e-commerce platform, Vancom Eslite, to launch the "48-hour limited sale of 19 yuan" sale. A few days ago, Dangdang.com's "tail goods exchange" famous product sales channel has also officially launched operations, Xtep, Nike, Adidas and other sports big discounts are three-fold capped. Following Dangdang, where the customer entered the discount sale market, Belle International's e-commerce platform Youjia Fashion Mall recently also announced that it will split the premium shopping mall into a discount sale market.

The cost of climbing shoes companies are busy moving "shoes are now generally facing a serious shortage of export orders, even the price of turnip cabbage prices that were not even worthy of the past, we are desperately trying to grab the cheap orders. And domestic sales of R & D costs are high, the pressure on capital quite Big, but banks are far from hiding from manufacturing companies, we are like plagues, unless we have mortgages.” Guo Xiaoping told reporters.

Although the price of orders has plummeted, the wages of workers are still rising. Guo Xiaoping said that the current monthly salary of 3,500 yuan is also very difficult to recruit skilled workers, there are already many large factories around could not withstand the pressure, have reduced size or moved, such as his factory next to a brand of the original eight production lines, now There are only two left. Although Hua Hong footwear industry began to walk on both legs “inside and outside sales” in the early years, the situation is slightly better than some pure-play shoe factories, but it also feels chilly. Because of the pressure of manufacturing costs, he has been shrinking the size of the Dongguan factory over the past few years.

“We are discussing measures with some shoe companies, hoping to get the Ministry of Commerce to help transfer some of the production to industrial parks in Cambodia and other Southeast Asian countries,” said Li Peng, secretary general of the Asian Footwear Association.

The reporter learned that due to the rapid increase in labor costs in the Pearl River Delta, the monthly salary of workers has expanded from more than 50 US dollars in some countries in Southeast Asia to over 200 US dollars in previous years. Some shoe factories in the Pearl River Delta have gradually transferred some of their production capacity overseas or in the Midwest. The world's largest footwear company, Baocheng Industry, has set up factories in Jiangxi and Anhui in recent years. Guo Xiaoping told reporters that he is currently setting up a factory in Guizhou, and now has a scale of 800 people. The monthly salary of workers is generally only 1,500 yuan, and the technical level has yet to be improved.