China'S Shoe Enterprises: China'S Heroes In Dilemma

After nearly ten years of rapid development, China's leather shoes industry is growing at an annual rate of 23%, which is much higher than the growth rate of China's GDP.

In recent years, there are about 20000 leather enterprises and nearly 2 million employees in China's shoe making industry. Each year, they produce nearly 7 billion pairs of shoes and 60% of the world's footwear. They are the world's largest footwear manufacturing base and the largest footwear exporter in the world, accounting for more than 53% of the world's total exports.

However, an undeniable fact is that 83% of the total footwear in China is low and medium grade. The added value of products is very low, while most of the middle and high grade shoes are imported from abroad.

The reason for the lack of competitive advantage in foreign enterprises is the lack of competitive advantage in business concepts, management concepts and management methods. The operation of enterprises is more and more difficult. Enterprises often appear in the operation: no order worry, no order; there are a lot of bottlenecks in the production process; a year after the operation of the enterprise, a large number of raw materials are in stock; finished products are backlog; receivables continue to rise, capital turnover is difficult; the cost of products is high; stock accounts are not high enough, and the stock market is not clear. Many shoe enterprises are in a state of loss or hidden loss. Some enterprises, though effective, do not reflect the best benefits, and others only have profits from statements but not profits. Shoe companies are in product development, production technology and equipment.

In addition to backward ideas and management methods can not adapt to the rapid development of the times, the traditional footwear industry is labor-intensive industries, the technology content of their products is not too high, small and medium enterprises are gradually developed from the family workshop, habitual workshop management mode is still deep-rooted, coupled with some enterprises have always attached importance to output, good at pursuing wind and imitation, so that the scientific and standardized management of the market environment in the enterprise can not be applied, this invisible to the talent set up three unable to cross the "threshold", talent can only be in the "edge" of the enterprise, no way to integrate in the enterprise.

At the same time, Chinese shoemaking enterprises are facing three challenges in the face of cost pressures: the appreciation of the renminbi, the reduction of the export tax rebate rate, and the ban on the import of raw skins into the banned catalogue have led to the rise in costs; the increase in raw material prices and freight rates, the shortage of labour supply, and so on, have resulted in an increase in costs, and the EU has imposed anti-dumping duties on leather shoes imported from China.

Due to the fact that there are many imperfections in the existence of evil spirits, the homogenization of products is extremely serious and price war is imminent.

Even some so-called "famous brands" are parroting, imitating the operation mode of international brands, forming empty brands, resulting in different brands of the same products in the wholesale market.

Relying solely on Outsourcing (OEM) has been unable to support the long-term development of the brand. This hollow brand can only maintain its surface prosperity.

More seriously, under the premise of the deepening of the new economic wave, the trade volume of China's footwear industry is increasing, and it has also led to strong rebound from these countries or regions until fierce confrontation.

With the wider and deeper participation of Chinese enterprises in international competition, the non-tariff barriers to trade will also increase and the situation is grim.

According to the statistics of China's Ministry of Commerce, as of the end of 2006, there were over 800 anti dumping, countervailing, safeguard measures and special investigations in 47 countries and regions.

According to the WTO report, there has been a noticeable downward trend in anti-dumping cases around the world.

This year, especially in recent months, a number of overseas media and people have criticized the "problem products" made in China, such as toys, toothpaste, food and so on. Europe and the United States have made many difficulties in China and even responded to the neighboring countries such as Philippines and Indonesia.

Immediately after that, the prohibition against China's "problem products" has been repeatedly occurring in the international community. The price of "made in China" seems to be a synonym for "dangerous and unreliable" for a time. "Made in China" is facing a lot of trust crisis. This "storm" has also brought a heavy shadow to the export of Chinese footwear enterprises.

It is worth noting that some countries in the world are calling for more and more imported products, including textiles and clothing, with the tag of origin.

The above measures are aimed at helping consumers grasp the origin information of products and avoid misleading, and further prevent infringement of intellectual property rights. In fact, they set up a fence for export enterprises.

If the origin mark is implemented, the producer must be responsible for the product plus the country of origin mark, and must ensure that the information is correct, otherwise it will be severely punished.

According to the report, Italy customs confiscated goods with unreal origin labels every day, most of which were imported from the mainland of China.

At present, although the European Union has failed to impose a compulsory import label on imported products, the European Commission may reconsider the issue of the origin labels of imported footwear products in view of the increasing demand for further protection of the EU footwear industry.

From a philosophical point of view, challenges and opportunities are two aspects of a thing. The so-called challenge is actually an opportunity.

How can Chinese shoe enterprises take advantage of this difficult situation in a difficult situation, make sharp innovations and turn disadvantages into advantages, thus jumping to a new and higher level? This may be a problem that everyone in charge of shoes enterprises and senior managers is worth exploring and thinking.

In this merciless market competition full of crisis, every hero has his own unique strategies. Only a real hero can withstand this storm and storm.