Yiwu manufacturing, means that value for money, represented in China. Face of rising raw material prices, labor costs rise and the financial crisis, Yiwu create competitive advantage can maintain for how long? Yiwu "ant Merchants" how to maintain competition in the market leading position? We chose two representative Yiwu merchants, a "sock king", a "jewelry king" to try to answer these questions. We see that we still look forward to Yiwu.
Author: Li Xiang
A
Four floors of yiwu international trade City. It was not crowded, surprisingly clean, tidy. All described in the article will appear Yiwu This shop has about 60,000 business city. One of the most classic description is that if you have to switch on every 3 minutes, 8 hours a day does not stop, then you can spend a year out from inside it.
It was not the impression that sea of people in the wholesale market. Sellers are not attentive. Guards hired shops mostly young girls, they first learn is how to distinguish between tourists and the real buyers. Those who asked about the retail price of goods can not be counted as genuine buyers. Printed with an elegant design of the cloth bag, for example, more than 400 will only consider selling.
This small town 300 kilometers from Shanghai. Hangzhou Xiaoshan airport, from the most recent came, but also for nearly two hours. However, less than in the past three decades in, it has become the world's supermarkets. It is called the small business people's "Promised Land" or Mecca. Its own slogan is "Ocean of commodities, a paradise for shoppers." Yiwu has more than 60% of people have a business license, Yiwu Jia Shaohua, vice president of Business School said, "It's per capita bank deposits and car ownership is probably the highest in China." In Jia Shaohua the school, all students have started their night company.
However, it is not just a trade city, Yiwu, though, people believed in "no business is not rich." The enormous flow of goods in supermarkets the world, the same as the belt drive with the local manufacturing industry. In Yiwu International Trade City 60 000 booths behind, nearly 30,000 manufacturing enterprises. They sell their products, but also for the international brand OEM, one of the best is has its own brand. A straw manufacturers throughout the world a quarter of the straw, a zipper zipper manufacturer annual production of 200 laps can turn around the equator, a sock manufacturer has to be a first time sponsor of the Beijing Olympics.
If you are a member of the businessmen in Yiwu International Trade City has a booth, or further, and also runs a production of socks, screwdrivers, sticks or bags factory, then, do not know how to subprime loans, and Wall Street a variety of tricks, you'll know just what is meant by the last two years - exports down, cash flow problems, then, if not more careful, you run into difficulties. World is no longer charming, but also with not the same when you were young.
4 is an alarmist rumors, the dissolution of liquidation of the company's continuous news. Most people are cautious. Only one of the best claim to have the confidence to head off disaster, even though sometimes this confidence is not so precise. In many cases, their words more like a comfort others comfort her "Jack."
Two
Taxi exit yiwu city, impatient drivers do not need get off at the registration point as the housing out of the city gate shouted: "Sunbeam." Those clouds with manufacturing facilities located in industrial parks outside the city, out of security considerations, each driving a city cab, should be in out of the city register.
Zhou Xiaoguang, founder of Shin Kong jewelry may be the most famous traders of Yiwu. She is the first and only Yiwu City, a National People's Congress. She frequently appears on television and in newspapers. In to see me, she should immediately accept the Wang Xiaoya interview.
She is 47 years old, wearing a black suit, a factor binding patterns in the scarf, carefully scanning the brow, short hair is streaked over, his face placid, spoke almost calm to indifference, it is very serious.
She frankly admitted that his company is not a monster like business organizations, even though it has been in this town is so image. Thomas Mann describes in a small town merchant's novel, said the small cities also have their own Caesar. Large to small in Yiwu commodity companies as a production target of annual sales of nearly 30 million yuan and total assets of 5 billion yuan in the small town of Shin Kong is playing the role of Caesar.
In 1995, Xiao-Guang Zhou Yu and her husband founded the Shin Yun new jewelry. She has not received much education, always circumspect on the face of the outside world, but she and his company are a large number of jewelry companies in Yiwu, survive and become the strongest. They set up the company, Yiwu has more than 100 jewelry companies, once the peak close to 4000, with raw material prices, labor costs rise and the financial crisis, this figure declined each year, in March 2008, when there are more than 3000 companies, the end of 2008, there about 2000. In just the past year,
I do not know how many family persevered. Shin Kong has maintained over the years is a certain level of growth. This makes Zhou Xiaoguang satisfied, she was always congratulate himself began in 2005, the strategic adjustment.
The transition origin Zhou Xiaoguang study on overseas markets. At that time, more and more competitors coming in jewelry industry, whether in manufacturing or sales side end. Domestic manufacturers have been selling a product is not empty, is to be a large backlog in dealers hands. Zhou Xiaoguang smell it on the market for floating anxiety breath. While jewelry makers are still living the easy life at the time, but still decide Zhou Xiaoguang, Shin Kong to gradually shift from the wholesaler retailers, from manufacturers to brand operators. Associated with these two decisions are: to establish their own sales channels, create their own brand.
From today's point of view, the importance of these two decisions in any case not be overestimated. Brand for the company to avoid becoming a pure foundry business, subject to orders from overseas markets. In addition to several companies in the giant foundry, the type of company in the financial crisis triggered by the recession in the vulnerable. Direct control channels are to Sunbeam on a more agile response to market demand. Xu Ping, chairman of Shin Kong assistant or think, very often, not because there is no market demand, but the missing link sellers, leading to a lot of Chinese OEM enterprises drained, because it is a lot of orders coming from the channel.
When the channel operators face their own difficulties, the order also disappeared.
Sensitive to the market early to feel the same for Zhou Xiaoguang to the impact of depression on the jewelry industry. April 2008, Zhou Xiaoguang in the United States to visit local customers and friends, the way to do market research. She randomly visited several jewelry on Fifth Avenue in New York stores, found that the daily traffic of these shops dropped from 100 to 40, the amount of per capita consumption dropped from 200 U.S. dollars to 80 dollars, naturally, the daily sales also plummeted. She knew that the wind direction changed again.
Later, she said, her in the face in August 2008 and in September began a bad situation, peace of mind, unlike many private entrepreneurs as fear. Those who have been entrepreneurs take the economy for the express often that the company's rapid growth is a matter of course.
The end of 2008, Zhou Xiaoguang, many entrepreneurs with Yiwu do exchange. She can comfort you that things are not really like all that's is so difficult, could not see the sunshine and hope, "but we did not psychologically prepared, all of a sudden feel panic." Panic, the next step, you will get lost, do not know what is the objective, and uncertainty about the future of fuzzy cognitive, but also further increased the fears of today.
However, Zhou Xiaoguang see in the future also does not Boulevard sunny. She just hoped that this can become a quiet period of years. Quiet time to feel at ease in self-improvement. This sound is often people in the high growth period is difficult to take into account, after all, in the high growth period, growth is first. As long as the Note Printing functions work as usual, no one cares where the factory building.
Three
Weng Rongdi a suit, wore a red striped tie, comb small separately, spoke with smiles, fully consistent with the public's imagination in zhejiang businessmen: a low-key, from time to time make fun of both eyes or facial expressions are a shrewd business sense of passing , spoke with the tone of conversation changes will change - when he lowered his voice, he would like to show that I complain, I am not satisfied, but you know the line, do not tell other people may say.
I see him, he was living in Hangzhou, a star standard hotel room, because the weekend he wanted to study finance at the Zhejiang University. Started the business from the traditional manufacturing industry has been found only in the financial industry overall economic status of the river's upper reaches, have shown strong interest in the financial industry. Example, started out from the feed industry Yonghao, now is a financial tycoon.
And, like many manufacturers in Yiwu, Weng's three brothers also started to trade, by making the brand socks agents, established sales channels nationwide. The experience herein Weng's brother in 1995 may create Langsha Socks played a major role. But Wengrong Di prefer not to say the experience, but the brand. He always said, the three brothers she chose to do socks, the most important reason is that they find, dresses, shirts, pants, ties and so on with brand-name, no brand name only socks. Business before the special three brothers went to Beijing registered a "Langsha" brand and trademark to all registered on 42 categories.
Langsha 1996 China Central Television started to advertise. It even let the CCTV advertising department staff were quite surprised: "a few dollars a pair of socks, and do what ads?" Three brothers of the strong brand awareness of Chinese businessmen at that time are few and far between in the absolute. "To tell the ugly point, almost all of my profits invested in brand building above the ... ... (Branding) this is easy to talk about, it is hard. After all, are out to cash." Wengrong Di said. Then again its own brand Langsha spillover to other areas of textiles, most notably Langsha underwear.
Then, like all ambitious Chinese manufacturers, Langsha began tenaciously to the top of the mobile value chain. The most famous incident comes as Wal-Mart refused to order Langsha caused controversy. Despite this low-cost supermarket has an excellent reputation among consumers, but in the eyes of the image of the supplier is the opposite. It is always by lowering the purchase price to force manufacturers to constantly reduce costs. The one hand, suppliers have to keep low-cost, low-cost, low-cost and distress, on the other hand, the huge shipments of letting Wal-Mart suppliers are unable to stop the same as opium.
In 2003, Langsha into Wal-Mart's global procurement system. In 2005, Wal-Mart Langsha received orders for three million U.S. dollars, 2.5 million U.S. dollars in 2006, 2007, is 220 million. But Dion's brothers are very disappointed. July 2007, Wengrong Di said, unless Wal-Mart at least 30% of the price increase, or Langsha will no longer provide products to Wal-Mart.
Weng Rongdi later explained that the move was not aimed at Langsha Wal-Mart, but at Langsha global buyers. "Chinese people do not wear nylon 5 years ago stockings. Do you take orders over the nylon, then the low end of the product, my wages and raw material costs are rising, the cost of one operator, certainly can not do. This is not against the Wall M, is the global procurement business. and our own company's positioning of "," Langsha to all domestic and international client a introduction to raise prices of the requirements, other customers have agreed, on the Wal-Mart
I think many people will ask you, you look at how the current economic situation. You see the situation in the Yiwu what?
Yiwu enterprises, I see still pretty good. Usually we will have the exchange. Yiwu enterprises are basically trade diversion from the production, so the sensitivity of the market is very strong. Like our product line, sometimes 3 times a day change. Yiwu of some large enterprises have already made the decision of the market and a voice.
In addition, these business owners are very dedicated. This is also crucial. Their factory is done bit by bit, he will certainly be very care. These companies-plant, the boss during the day receive clients, depends on the machine at night to see the factory to see the management of. In the dedication, the Yiwu is a good group of entrepreneurs.
For you, feel when changing external environment?
SARS started in 2003, companies began uncomfortable. When SARS is not the whole entire month of production, but Yiwu enterprises or the workers have left the factory. We are more than 3,000 manufacturing workers at the time, they left the factory. Then later, water and electricity. Then rise in utility costs. And then the staff wages, raw material prices, RMB appreciation, decreased export rebate ... ... you think about the profits of the manufacturing sector have a total number? Has been very difficult enterprise.
Yiwu listing of particularly scarce.
Yiwu private enterprise which we are the first listed. Yiwu local companies tray is not big enough, are light industrial products. Consideration of each company is different. Like us, the brand has done a dozen years, the capital market has also organized more than ten years. I am now the main sponsor small loans. We are not just small loans that now, but the next five years, ten years of strategic development needs.
You want to finance it?
Should have the idea. I am now the director of commercial banks in Jinhua. And I think we can finance their own future, more gains. Such as a bank. If we develop this industry themselves, will certainly take more social responsibility.
Since when you care about capital?
We started in 1998. Time is to IPO listing, then select the backdoor. Access to capital markets is not all to entrepreneurs themselves, it would be corporate brands, influence, product line extension, a positive effect on governance structure.
I see Langsha history, find you have been very restrained.
We have been in real estate. It was 2003, but from April 2004, we withdrew from the. State macro-control was proposed. We make judgments that this industry should be a high risk sector. We then will have no access. Of course, we do certainly will use their own funds, rather than private funds. As too risky.
If you can undo it, you still do it? After all, the profits will be huge temptation.
Never mind about the undo does not undo, there is no such a choice. Should be said that we have been very clear, no matter what outward investment, we do not become the main industry. Brand building, the main industry expansion, innovation, technological innovation, the introduction of foreign talents, we do a lot. We have always think so, we must make steady, there is no need to do risky things.
Now we began our smart, before people say that we silly - own brands do so well, you do not do real estate; private lending so sharply, you old obsessed with their own funds.
When will recognize the importance of brand?
Realistically speaking, before founding Langsha, our brand awareness is very high.
Where did this consciousness come from?
Mainly from the operation of foreign brands and their investigation, including Coca-Cola, including Procter & Gamble.
This brand awareness company in Yiwu seems to be very small.
This is easy to talk about, it is hard. After all, are out to cash.
Do you have this kind of anxiety - the cake itself, the industry is small, but very competitive.
This is not anxiety, this is how we have to face things. Our industry, in fact, very large investment in fixed assets, so net profits are meager. To re-enter this needs to come with a lot of money. Moreover, we always say, only sunset products, there is no sunset industry. We did growing up.
However, a large number of industry profits look higher.
Climb high, then drop weight. We do this, do not die ... ... haha.
Your own social circle is like?
We do not have any special social occasions. The main factory, and then will attend a class. Mainly in the business. Would not deliberately go to what activities.
You than ten years, what has encountered difficult times?
The course of doing business will certainly run into a little frustrated. But I feel deep frustration did not come across. You say that this financial crisis What kind? This time, private enterprise is the best on the test. Warn you not to abuse, particularly investment, not the mountain that looks high. Investment in the stock market, including the pursuit of the so-called high-profit industry, could have been learned. So, some things to make it clear their own. Do not do this today, tomorrow, to do that, the crisis came, very nervous.
Less sensitive about things, little touch. Government interest in the things we have to do. Do you really going to invest, spend their own money to vote. Of course, I still believe that infrastructure should be the government to invest in railway, highway, this is not your vote. Let me say that you even have street trees will not solve the problem.
The outside world can only see one side entrepreneurial success, laughing. But their hearts can be very painful. Such as iron and steel industry profits high, many people want to do. Good times, but iron ore prices, steel prices when the market fell bad ... ...
How do you see corporate social responsibility?
Enterprises to take social responsibility, I also have this view. Have the basic welfare. But social welfare would be raised over a number of lazy, it is not desirable, we hope that the Government can consider. I often Wang Waimian go. Some European countries, I do not favored. Life without passion, and finally raise a number of lazy. The sky will fall pie, and does not work, still receive a salary, why to go to work ah? Even the wages available to work, not as an unemployed worker, then you say, who are willing to work ah? Chinese people still have to work hard, Qinjianchijia. This is our advantage.
China does not accept, we consider repeatedly refused their orders. "
This story has a good ending. Wal-Mart and cooperation Langsha the end of 2007 resume. Langsha not lose orders, but also for their value chain in the manufacturing sector move forward a step. If a company even have dared to reject Wal-Mart, then it has no reason to yield to orders. Since then, Weng Rongdi been proud Langsha bargaining power. In his view, this company finally Yiwu bargaining power, and even pricing.
On the other hand, Weng's brother has come exceptionally early awareness of the capital. Weng Rongdi been repeated on several occasions, Langsha began in 1998 to seek public listing. Unfortunately, this process is extraordinarily long, about ten years later, in 2007, with 70 million through the acquisition of the original ST chief control of the controlling stake, Langsha able to achieve reverse merger. And it was not a pleasant start. News reports at the time as long as the rake, you can see behind the manipulation of stock prices has been done to Aung Brothers Co., is quite helpless.
In addition, small loans Weng's brother or the main sponsor, Wengrong Di Jinhua is also a director of commercial banks.