Shoemaking enterprises: seeking change and showing their talents

At the 120th Canton Fair, the footwear showroom was particularly deserted compared to other exhibition halls such as food and textiles. According to customs data, in the first nine months of this year, China’s footwear exports amounted to 35.57 billion U.S. dollars, down 12.77% year-on-year. In September, China’s footwear exports accounted for only 3.739 billion U.S. dollars, down 17.64% year-on-year. Exhibitors have said that due to the weak economic recovery in the world and the instability of the international financial market, the current export situation is not optimistic. Enterprises can only explore new ways to reduce costs, expand new sources of customers, and innovate designs.

The international market is still in the doldrums

“This year’s buyers are much less than in previous years.” On November 1, Kang Ren’s Director of Foreign Trade, Ren Renzan, told the International Business Daily. Although the day was only the second day of the third session of the Canton Fair, Yan Renzan had already felt the chill of the footwear export market.

Shen Bin, head of the footwear industry of Zhejiang Huiyuan Foreign Trade Co., Ltd., said that the company’s exports this year have shrunk by about 10% from last year. "This has been a small drop in the footwear industry." Shen Bin said.

The sluggish demand in the international market is the main reason for the decline in China's footwear exports. Shen Bin told the International Business Daily that the international market has been in a difficult state. In the past few days, a British buyer complained to him that the recent sharp depreciation of the pound has had a great impact on his business. The Goldman Sachs Group recently issued a warning that the pound will depreciate by 25% by the end of 2016. British buyers say his company's full-year profit margin is only 20%. Shen Bin said, "He will be busy this year after the devaluation."

The deterioration of the operating environment in the international market has directly led to the difficulties of domestic footwear export enterprises. Yan Renzan bluntly said that the sharp depreciation of the ruble this year has caused many Russian companies that have delivered deposits to break the contract. This has led to the collapse of a large number of shoe-making enterprises in Wenzhou, with accumulated losses of several billion yuan.

Yan Renzan believes that although the exchange rate of the RMB against the US dollar has depreciated this year, it will have a certain effect on the export of footwear products. However, in the case of sluggish demand in the international market, Chinese footwear export enterprises are still struggling. "Now it should be a relatively dark period." As for when the light comes, he thinks it will take another 3 to 5 years.

Enterprises seek change and show their talents

At present, large-scale shoe-making enterprises such as Kangnai, with 36 years of history and 14 assembly lines, have exported nearly 40 million US dollars this year, a slight increase of only one or two points compared with last year. Yan Renzan said that the export of footwear products produced by Kangnai can be kept stable thanks to Kangnai's continuous expansion of customers in Europe and the United States and other countries and regions, ensuring the stability of the export market.

For China's footwear exports how to get out of the predicament, Shen Bin said that the price war is not a long-term solution, the key is to improve product quality, try to reduce costs, in order to enhance the competitiveness of enterprises in the international market. Zhejiang Huiyuan Foreign Trade Co., Ltd. brought a new imitation leather fabric jointly developed with German design company. The appearance and touch are the same as the leather, and the price is only half of the price of leather. “We are still going to India and other countries to purchase raw materials to save costs.” Shen Bin told reporters that the quality of fabrics produced in those countries was poor, but Shen Bin took a professional team to redesign the leather and produced it with The texture of the colorful leather, some fabrics imitation of the rubber touch.

Xu Yadong, general manager of Qingdao Shuangxing Celebrity Industrial Co., Ltd. injection shoe factory, also said that if there is no innovation, it is difficult for enterprises to survive. In recent years, Double Star has continuously innovated the shoemaking process and the style and function of shoes. This year's export volume has achieved double-digit growth. The double-star celebrity brought an electronic chip to a shoe that participated in the exhibition. In addition to the positioning function, the chip can also add functions such as step counting and blood pressure measurement according to customer requirements. This product has won the favor of buyers from countries and regions such as Europe.