Perspective on Chinese shoes overseas markets lower price war

Perspective on Chinese shoes overseas markets lower price war

Domestic manufacturing price war raging now burn the overseas market: low-cost competition, many Chinese enterprises, kill each other to form a “rise in exports, economic decline,” the unfavorable situation, as tariffs and technical barriers, the restriction of Chinese products into the international Another obstacle to the market. Experts warn, regardless of cost, do not speak the rules, one-sided pursuit of “profit-for-market”, not only can easily lead to foreign anti-dumping, and will affect our technological innovation and undermine their international competitiveness.

Case Study

In 1998, a pair of shoes the average export unit price was 5.79 U.S. dollars; in 2002, only 5.03 U.S. dollars Price per pair.

Chinese shoes, but also “carry” How long?

China’s shoe export unit price continued to fall, has grown from 5.79 U.S. dollars in 1998 down to 5.03 U.S. dollars in 2002. In this case, some enterprises in order to survive, knowing that there is no profit or even lose money orders have to. The consequences resulting from disorderly competition is — Chinese shoes and “low” paintings on the equal sign.

Making shoes is the marginal profit

Last year, China’s annual output of 6 billion pairs of shoes, equivalent to a pair of world per capita. As the rapid growth in the number of footwear enterprises, more and more domestic companies will be the last to do to fight the foreign products. A crowded aisle to see a good business sales style, each other “copy”, the simplest and most effective way is to compete with each other “bargain.”

Wenzhou Ding Feng Shoes Co., Ltd. Chairman of Lilin Chen said, shoemaking cost accounting basis the cost is not the shoe itself, but by the market price to set. Products, markets, prices can be higher, or lower prices naturally. Shoes have to do now is modest profit, the price year after year. Such as budget, last year sold 270 pairs of shoes per year, can only sell 200 a pair.

Annual output of 600 million pairs of shoes in the “Chinese shoes” Wenzhou shoe enterprises veterans about this thing all look dignified. Aokang President Wang Zhentao Group Ltd., said a few months ago Aokang received a large enterprise 1.2 million foreign orders for leather shoes, the other side and the price is 3.2 U.S. dollars per pair, we figured sure loss. Other places they do not wanted to get a pair of 2.9 U.S. dollars only. Everyone knows that, Wenzhou shoe industry experienced ups and downs in the earth-shaking changes have taken place after, and now the shoe size, strength, first in the country, quality, brand-building is also the nation, only instead of getting lower and lower prices.

From the China Leather Industry Association reported that the footwear industry as the world center of gravity shift to developing countries, China has become the shoe of the production and processing centers and sales centers. Expected in the next ten years, the Chinese leather industry good momentum of development will continue. The future of the domestic leather industry, a breakthrough in foreign trade, exports continue to increase substantially.

Enterprises go from here

Many enterprises have pointed out that “Rome was not built, cold day.” To prevent fratricide among peers, must first strengthen effective regulatory and industry self-regulation. It was suggested that, by the industry associations to come forward and qualify a minimum price for export shoes.

Practice, however, see, this trick may not be effective.

Wenzhou’s lighter as industry, to try to have done in 1994, when the export price of Wenzhou Lighter not to even one U.S. dollar, then Smoking Set Association to formulate “rules”, the minimum limit 2, and below this price, all the accessories company refused available sources. But the good time, as “new generation” enterprise constantly emerge, in order to quickly cut into the market, not attend to “the old rules,” did not take long, “rules” die a natural death.

The shoe business unanimous view is that China must play its own shoe brand, increase product value, enhance the overall image. Entrepreneurs suggested that creating and licensing process, companies can increase step by step, level by level. For example first create a regional brand, and then to scale new domestic brand, until conditions are ripe to enter the international brand. View of the current industry situation, all proposed conditional creative license to take up the responsibility of enterprises, increase manufacturing capacity, promoting other brands popular business enterprises to the road. For those who are not currently have the creative license conditions for enterprises, big businesses can join together first, or first for the international and domestic brand-name companies to do the development process.

According to the planning of China Leather Industry Association, in the next 10-15 years, we should strive to create 3-5 international brands, the “shoe-making power” into the world’s shoe-making power.

How to turn over Chinese shoes

In fact, many Chinese footwear enterprises have already begun not only to “create card” of the effort, and start looking for the path of internationalization. In this process, the operation of a variety of ways. Some takeovers of listed companies, and some directly to set up factories abroad, as well as the adoption of powerful agents, with channels open up the market … …

1993, “China Top Ten Footwear King” title Kangnai Group first half of 2001 the first store opened in France to Paris and New York. In the same year in June, Rome, Italy, the world’s shoes are also made Kangnai store. This year in December, Los Angeles will open a flagship store Kangnai 200 square meters. So far, Kangnai has more than 10 countries have established more than 70 stores and create Kangnai shoes export average unit price of 13 U.S. dollars in the market price.

Currently planted in China more than 2,000 stores, 800 shop store marketing network Aokang Group, has been in Italy, the United States, Spain, more than 50 countries and regions registered a “Aokang” trademark, with more than 200 established foreign trade relations. Recently, Aokang has the largest shoe company with the GEOX, Italy signed an agreement to jointly develop the world’s shoe market. In addition, Aokang to build five distribution centers around the world, established in the global chain of 4,000 stores.

More and more enterprises understand the brand, especially brand name has become a passport to enter the international market. Enterprises have their own brand only to get a higher profile and reputation in order to win consumers, thus accounting for market stability. Only to make high-quality brand-name products, the days of Chinese shoes have stood up.

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