China’s shoe industry needs to break the OEM situation and build its own brand

like other traditional manufacturing industries, the labor-intensive footwear industry, which is highly dependent on exports, has encountered the problems of declining exports and shrinking labor force. Recently, at the third world footwear industry development forum held in Dongguan, the shoe capital, China Leather 1ndustry Association issued a call to “change the previous situation of only OEM work, extend the industrial chain and play independent brand”

Wu Gede, chairman of Chengdu yibailan Shoes Co., Ltd., has been a little annoyed recently. Orders from his U.S. partners have shrunk by 60% since August, which is bad for the company, which produces OEM shoes and exports 80% of its products. Wu said that in Chengdu, it is very common for the export of shoemaking enterprises to decline

Wu Germany: about 30% of them are under started or even stopped production. 1f we calculate the shortage of orders, it’s more than that< According to Su Chaoying, President of China Leather Association, in 2010, China produced 13 billion pairs of shoes and exported 10 billion pairs of shoes. The shoemaking industry is highly dependent on exports, while this year's export volume of leather shoes dropped by 7-8 percentage points in addition to the shortage of orders, the bigger problem for shoemaking enterprises is that they can’t recruit workers. Profits are too thin and work hard. The shoemaking industry is losing its appeal, and workers are moving to other labor-intensive industries such as electronics< Wu: there is still a shortage of workers. The statistics of the last two years show that about 15% of them have been lost. 1t's not easy to recruit workers in Sichuan, a labor-intensive place while wages and raw material prices are rising, factory order prices are always low. Wu Germany calculated a sum of money. The profit of a shoe produced by his factory is only US $1, but this kind of shoe is sold to US $300 or US $400 in Europe and America Zhang Huarong, chairman of Dongguan Huajian group, who also produces OEM shoes, pointed out that the long-term production mode of OEM enterprises’ striving for survival by grabbing orders has led to vicious competition in overcapacity Zhang Huarong: we are used to manufacturing enterprises. When we have orders, the price is cheaper and the scale is larger. Foreigners are used to placing orders in China at a lower price than the unit price. China’s production mode of grabbing orders for survival (unsustainable) requires a mathematical model Wu Gede, chairman of Chengdu yibailan Shoes Co., Ltd., also believes that if we do not develop our own brands, we will be stranded Wu Germany: when the economy is peaceful, there seems to be no risk; But when the economy fluctuates a little, the first (damaged) is the OEM; Because the OEM enterprise does not have its own terminal, your orders are completely dependent on other people’s market. When other people’s market is bad, your orders will be directly affected, and it is difficult to turn around. This time, we will learn a lesson the footwear industry has now turned its attention to the domestic market, but it is not easy to take the road of independent brand, which needs at least more than ten years to cultivate. Su Chaoying, chairman of China Leather Association, said that in the 12th Five Year Plan of the leather industry, the cultivation of independent brands is the top priority for the transformation and extension of the industrial chain of the footwear industry Su Chaoying: during the 12th Five Year Plan period, we should create 3-5 international famous brands, and at the same time focus on supporting a number of brands with a certain scale and strength to go on the market

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