Wenzhou shoe companies if they can not effectively transform and upgrade really only leave it?

Looking at China's shoe and clothing market, many private business owners in Wenzhou reported that their sales increased a lot in 2010, but their profits have fallen sharply, even worse than in the financial crisis. Zhou Dewen, head of the Wenzhou SME Association, said that the gross profit margin of a large number of traditional small and medium-sized enterprises is only 1% to 3%. "The pressure for survival is even greater than the financial crisis."

When the financial crisis two years ago, the export of many Wenzhou enterprises drastically reduced, resulting in the closure of some enterprises and the suspension of half production. The situation in 2010 was different. Last year, the operating pressure of a large number of traditional Wenzhou enterprises mainly came from rising labor costs, rising raw material prices, and appreciation of the renminbi.

Under the background of inability to transform and upgrade, some enterprises can only choose to “go out of the market”. According to relevant department statistics, more than 2,000 enterprises in Wenzhou were revoked their business licenses in 2010, of which half were manufacturing and manufacturing related companies. Although this is better than the city’s cancellation of more than 3,000 companies in 2008, “a large reduction in profits” still poses a serious situation for the company.

Sales growth, profit decline

Zheng Chenai, President of Wenzhou Garment Merchants Association and chairman of Zhejiang Aobenni Garment Co., Ltd., said that from January to November last year, the output value of more than 300 large-scale enterprises in Wenzhou reached 26.4 billion yuan, an increase of 30% over the same period of last year, and the export also increased by 20 More than %, but companies generally reflect that "profits have been very few".

In the “China Shoes Capital” in Wenzhou, a person in charge of a shoe leather business pointed to a workshop and said that there were originally 14 production lines, and now 4 of them have been stopped, mainly because workers could not be recruited. He said that the wages of the original workers were 1,200 yuan/month and they have now risen to 1,500 yuan to 1,800 yuan/month. Even so, they cannot recruit enough workers.

It is understood that currently, Wenzhou enterprises are generally absent from work. Taking garments and footwear enterprises as examples, there is a general gap of 10%-20% in employment, and migrant workers do not have large-scale unemployment problems at all. In addition to the slight decline in the rent for industrial housing in 2009, there was still more than 5% increase in 2010 and 2009 compared to the same period in 2009.

In addition, raw materials rose by about 20%, and the profits of Wenzhou shoe leather companies have fallen from the previous 8% to less than the current 2% to 3%.

With the shrinking of corporate profits, there is also an increase in tax revenue. A person in charge of the Wenzhou Industry Association said that in order to complete the taxation task, some department personnel asked the company to prepay the tax for the next year. Some companies had no choice but to pay in advance. "The burden of tax burden is relatively high." The person in charge believes that the current level of taxation of Chinese companies ranks among the highest in the world, exceeding most of the developed countries.

In addition, energy conservation, emission reductions, and interest rate increases are also increasing production costs.

In mid-September of last year, the relevant departments of Wenzhou City monitored the operation of 129 key industrial enterprises in the city. Compared with the second quarter, only 33.3% of the company's profits increased.

A person from the industrial and commercial department of Wenzhou City analyzed that due to the increase in various costs last year, clothing, shoe leather and other manufacturing enterprises, "increasing orders and reducing profits," are common phenomena, and affect the associated companies with the manufacturing enterprises and other related businesses. Many companies are struggling. Among the companies whose business licenses have been revoked, manufacturing and affiliated companies accounted for half of the total. For example, in Lucheng District, among over 500 companies whose business licenses have been revoked, there are more than 300 enterprises and affiliates such as apparel and shoe leather.

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"Unfortunately, sales prices are difficult to raise, and companies can only bear the pressure of rising costs themselves." Wu Jianhai, founder of China Commodity City in Cameroon, said that unlike the decline in the profits of manufacturing companies, he now has better business profits than the financial crisis, but it is far from To the level before the financial crisis. A former South African businessman said that because of the heavy price, the profit of commodity trade has been very low, and the profit rate of clothing, shoes and hats has been less than 1/10 of that in 2000, and even lower.

One phenomenon is that Yiwu Small Commodity Market, which is closely connected with the export of Wenzhou products, has also seen many embarrassing situations in which private enterprises have orders that they cannot sign.

New vicious circle

Asheng reluctantly said that doing business is getting more and more boring. He is considering whether to leave the sofa industry that has been in business for many years. "Continuing to do it means waiting for death; if you don't continue to do it, then what else can you do?"

Zhou Dewen, head of the Wenzhou SME Association, said that under the circumstances where the cost has been substantially increased and profits have been significantly reduced, the new round of large-scale semi-cessation, suspension, and closure of Wenzhou SMEs is likely to erupt this year, even exceeding the 2008 level. . At the same time, it also forced companies to accelerate the transformation and upgrading.

"The sharp decline in profits will help promote the transformation and upgrading of enterprises." Zheng Chen Ai said that about 30% of clothing enterprises above designated size, because of higher product positioning, brand marketing done better, the current survival is still relatively good. At the same time, in more than 2,000 Wenzhou apparel companies, about 30% have their own production bases in the central and western regions.

During the transformation and upgrading, some Wenzhou enterprises have chosen to enter the high-tech fields, such as Zhengtai's entry into the solar energy industry, Aokang's launch of biomedicine, and Hailu’s hepatitis B immunoglobulin project.

It is a pity that this kind of transformation and upgrading company has not emerged like bamboo shoots in Wenzhou. On the contrary, a large number of Wenzhou enterprises are focusing on real estate, and the phenomenon of “large enterprises building buildings and real estate for small enterprises” has emerged.

In the "2010 Top 100 Enterprises in Wenzhou City", except for two real estate companies and six construction companies, more than 40 other manufacturing companies are involved in real estate development. Using the enterprise as a financing platform to obtain a large number of bank loans and investing in real estate and other industries, this phenomenon is common in Wenzhou. In addition, large-scale real estate development companies established by manufacturing companies are currently at least seven in Wenzhou, and each has a capital scale of more than 3 billion yuan.

With the help of industrial capital, Wenzhou's housing prices and land prices rank among the top in the country. From May to August last year, the average transaction price of commercial housing in Wenzhou City was approximately 28,000 yuan per square meter, ranking the first in major cities in the country. At the end of November last year, the “former Wenshi Yuan” plot was confiscated by the property and the floor price was as high as 37,000 yuan/square meter, becoming the new king of the country. It is understood that Confidence Real Estate is a large-scale real estate development company established by several Wenzhou manufacturing companies.

As a result, a clear circular chain is present in front of the eyes: Business is difficult to do - capital transfers real estate - housing prices rise - business costs increase, profits decline - companies are more difficult to do.

"The rising cost of this round of private enterprises should cause the government and society to pay close attention," said Zhou Dewen.

Zhou Dewen said that the state should introduce policies to guide private capital investment as soon as possible, and they must truly implement these policies. It is almost one year since our new 36 article came out. Until now, I haven’t seen the dawn well. With these policies, we are very much looking forward to the various ministries and commissions, various local governments can introduce good implementation details, and they can be introduced very well. s project. But unfortunately, until now, I think there is no such good news.