Leather industry: when shuffling

At present, Shenzhen's leather industry is a leader in China

“Our industry was once an unappreciated industry and it was not listed as a superior traditional industry in Shenzhen until May of this year.” People from the Shenzhen Leather Industry Association said in an interview with reporters that the 9+1 Shenzhen traditional industry gathered together. In the base format, the leather industry is the "1".

It is understood that the leather industry in Shenzhen is currently at the leading position in China, but due to the economic situation at home and abroad, the current industry is in a state of reshuffling, and industrial upgrading is imperative. The construction of the leather gathering base of the task is still in the stage of waiting for approval of land use, and we should be the slowest one among the 10 advantages of traditional industries.

70% of companies are engaged in export

The development of the leather industry in Shenzhen is basically synchronized with the development of the SAR. In 1978, Hong Kong businessman Zheng Keming signed the contract number CND001 with the Shenzhen Municipal Government and opened Lo Wu Handbag Factory. This is Shenzhen's first foreign-invested company and kicked off the economic growth of Shenzhen and the construction of the leather industry in Shenzhen.

“At the beginning of the reform and opening up, there were tanneries throughout the country, with a large amount of idle equipment and technical talents. After foreign capital, especially Hong Kong capital, entered Shenzhen, it attracted a large number of technical talents and cheap labor in the Mainland, which provided the starting point for the leather industry in Shenzhen. Very good conditions.” The relevant person of the Shenzhen Leather Industry Association told the reporter that at the time it was mainly some companies that had made up to three things. This kind of development has lasted for about 15 years.

In the mid-1990s, a number of private local companies appeared in the leather industry in Shenzhen. They began to take the path of their own brands, such as Belle, COBO and other brand companies, and created more than a dozen domestic famous brands. At the same time, the leather industry in Shenzhen was also formed. A certain scale: By 2007, there were more than 800 shoe-making enterprises in Shenzhen, about 1,500 luggage and leather goods manufacturing enterprises, over 200 leather and fur garment companies, and more than 200 raw and auxiliary materials and supporting enterprises, and 1800 trade and distribution companies. There are more than 500 enterprises above designated size, and the industry employs more than 500,000 people; the total output value of the leather industry, the total output value of sales revenue exceeds 40 billion yuan, and the sales revenue exceeds 35 billion yuan. Shenzhen enterprises exported 4.24 billion U.S. dollars and imported 466 million U.S. dollars.

At present, the leather industry in Shenzhen is still mainly exported, and it is in the transition period from OEM, ODM to OBM. The export products are mainly exported to the United States, followed by Europe and Asia, accounting for 70% of the total. In terms of domestic sales, small and medium-sized enterprises OEM or re-brand for large companies; large enterprises sell their own brands in domestic shopping malls, supermarkets, specialty stores, and counters, and domestic sales account for about 30% of the total.

Industry is facing reshuffle

The changes in the economic situation in recent years have greatly affected the development of the leather industry in Shenzhen. The Deputy Secretary-General of Shenzhen Leather Industry Association, Yu Yuqin, said that the appreciation of the renminbi and export tax rebates have had a huge impact on the export-oriented leather industry. The company’s profits have fallen sharply and even suffered losses. Environmental protection has restricted the upstream tanning industry, which was originally in Shenzhen. More than 30 tanners have all moved out of Shenzhen; coupled with the sharp increase in raw material prices and increased labor costs, the burden on companies has increased.

“The U.S. financial tsunami has had a great impact on us. At present, the industry is shuffling, and a group of backward companies are going to die.” Yan Yuqin told reporters that large enterprises are getting stronger and stronger, and small enterprises that take orders to survive are difficult to survive. Enterprises haven’t received single orders. Since last year, small and medium-sized enterprises (SMEs) have been closed one after another. This trend has become increasingly obvious this year. “Some companies say that they have lost their money.”

The days of business that can survive are not good either. “If you are exporting, it would be better if the Hong Kong-funded companies directly took orders in Hong Kong. If the local companies in Shenzhen have less profit to take orders from themselves, it would be very good if the companies in the manufacturing sector have a 5% profit.” Introduction, even if it is Shenzhen Belle leather industry leader Belle, its own brand of product profit is probably about 12%, the agent's product profit also failed to reach this number.

According to report, Belle, which has more than 4,000 sales outlets in China, has been continuously developing for more than 10 years. However, this year, due to the impact of the financial tsunami, it has seen negative growth in October. “The ordering in the previous period is not optimistic.” An industry source told reporters.

In addition, as a traditional type of industry, Shenzhen leather companies also have a relatively large number of relocations. “For example, the Taiwanese-funded enterprise Hassan, who made a fortune in Shenzhen, was moved to Kunshan because he couldn’t get it. Four to five years ago, he moved to Kunshan to develop.” Yan Yuqin introduced that among the well-known enterprises, Bao Kai’s footwear industry moved to Huizhou, in addition to Husson’s. Jia Haoyun will also be relocated to Huizhou next year.

Leather industry still has a bright future in the domestic market

"However, to make shoes as a package in fact, it should be a sunrise industry in the country, because the domestic demand for consumption has a gradual increase in the process, with the improvement of the living standards of Chinese people, bag shoes were former luxury goods, but in the future it is consumable. Consumer products, the demand market will be very large." Yu-Qin Qin said.

According to industry insiders, currently in China, the more developed areas of the leather industry are mainly the Pearl River Delta region, the Yangtze River Delta region, and Chengdu and Chongqing regions, while leather enterprises in Shenzhen are mainly targeting high-end markets.

"Involving the low-end market from the high-end market is relatively easy." Yan Yuqin said that at present, some enterprises in Shenzhen have also used multi-brand strategies and started to intervene in the low-end market from the high-end market.

According to reports, self-owned brand enterprises in Shenzhen have already formed a “Bai Li model” that integrates manufacturing, transportation, retailing, etc. “Of course, not many companies have such a solid fund to clone Bailey’s model, but deep enterprises After creating their own brand, they will also open their own stores in some cities, or engage in franchise stores.” Yan Yuqin said.

Talking about the development of the leather industry in Shenzhen, a report of the Shenzhen Leather Industry Association proposed that enterprises should be encouraged to develop their own brands and take Belle as a leader to establish a team of leading brands in the Shenzhen leather industry and continue to expand their influence and possession in the domestic market. Rate, guide enterprises to the development path of OBM (brand export), develop fashion and creative industries at the same time, nurture high-end design talents, drive brand development with fashion; focus on supporting the two major professional markets of China South City and Agile, strengthen cooperation with the business sector, nurture Shenzhen local leather professional exhibition, improve the industrial chain.

Base construction still pending land application approval

“Compared with high-tech and other industries favored by thousands of people, our industry has been neglected for many times. I basically make things like this on my own, and the market's viability is strong.” Related people in the industry It is believed that Shenzhen’s attitude toward the leather industry has a process of understanding. The earliest thought that the industry was heavily polluting and that it was in the processing industry did not regard it as an advantage in the traditional industries. The efforts of the leather industry and related parties made the leather industry. In May of this year, it was included in traditional advantageous industries and agreed that the leather industry should build an industrial base in Shenzhen.

The report of the Shenzhen Leather Industry Association also pointed out that under the new situation, the industrial upgrading of the leather industry is imperative. An important point is the development of the headquarters economy and the establishment of a permanent industrial gathering base and headquarters building in Shenzhen.

“At present, our land report has already been marked up. We hope to apply for 60,000 to 80,000 square meters of land at the Henggang Sub-district Office to build an aggregation base. However, we still don’t know whether we can approve it or not.” Yan Yuqin told reporters The progress of the construction of the agglomeration base was introduced. “To tell the truth, before our industry was listed as an advantageous traditional industry, the industry was rather discouraged. After being included in the advantageous traditional industries, everyone was very enthusiastic about the construction of the gathering base. However, the problem now is that the land has not been approved. Only when the land is approved, the second step will be carried out."

People in the industry said that the government's response is often relatively slow. For instance, in response to this year's situation, there are no concrete measures in Shenzhen. “The trade and industry departments in Jiangsu and Zhejiang have some relatively clear preferential policies for small and medium-sized enterprises, such as small and medium-sized enterprises. The government will have some relevant subsidies to increase the level of informatization, build scientific research centers, and expand factories. However, Shenzhen does not have such specific measures for small and medium-sized enterprises. The leather industry is hard to reach.