Hidden opportunities in the Chinese footwear industry crisis

Recently, the World Bank, China's economic growth for the next two years from 9.6% and 8.7%, respectively, up 11.3% and 10.8%, and that East Asian economies, strong domestic demand and absorb the financial markets expected the credit crisis and high oil prices impact, particularly in China, domestic demand continued to expand, will be the lead promoter of regional growth.


Some analysts believe that with the urbanization and young adults into the service industry, footwear will be non-essential items they purchase an important item. Even if China can not maintain a double-digit growth, consumer spending will remain fairly robust. Mainland residents to purchase shoes of consumers will reach level of developed countries, UBS estimates that the mainland in 2010 shoe market capacity will reach 12 billion U.S. dollars, the per capita amount will purchase 2.2 pairs of shoes.


Cost factors have constrained the development of
sas comfort shoes


National Bureau of Statistics data show that 1-10 months of this year, the National Industrial prices rose 2.8%, raw materials, fuel and power purchase prices rose 3.9%, raw materials and energy purchase prices is the main reason leading to rising costs. "This year, rising raw material prices, the company production costs remain high, despite a variety of efficiency savings measures, our export is affected." Shoes Co., Ltd., Guangdong Jie He Yuling said.
timberland safety boot


The industry believes that, in recent years, raw materials, labor costs, energy costs Zhujianshangsheng, market intensified competitive pressures Di Jia Ge Shi De Qiyewufa pass the cost of the product, so Xiaoshou cost a percent of sales increased year by year, gradually Xueruo Gain Ability.


Challenges, many companies began to try to raise prices. In the footwear industry official said Kit, companies are reducing prices by increasing export of raw materials increases. However, the enterprises are not easy to increase the rate of increase of raw materials export offer increase over the previous year. Moreover, for most small businesses, price increases could mean the loss of some customers and markets.


Guangdong College of International Economic and trade experts believe that Professor Li Jun, raw material prices and oil prices climbing, the "Made in China" tremendous cost pressures, and will gradually weaken China-made products of international competitiveness.


    Anti-dumping dilemma


From June 2005 the EU formally announced China's two shoes anti-dumping investigation began, the shoe wars between China and Europe has been going on for more than 2 years. October 7, 2006, the EU began to levy on Chinese shoes enterprises 16.5% of high anti-dumping duty for a period of 2 years. In September of this year, the EU launched the anti-circumvention investigation against Chinese leather shoes.


It is understood that the implementation of EU anti-dumping measures in the past year, China's exports of leather industry had a big impact. Arts & Crafts Import and Export Chamber of Commerce under the China Light Industry data provided by the first half of this year, the EU anti-dumping leather shoes product imports fell 7.76% compared with the same period. Among them, the import volume from China was 086 million pairs, amounting to 943 million U.S. dollars of imports, respectively, fell 26.37% year on year and 21.36%.


In response to the EU on China leather shoes products trade barriers, some Chinese shoes enterprises to the EU court of first instance proceedings, sued the European Council released the collection of anti-dumping duties of 16.5% did not comply with the EU laws.


It is reported that the EU Court of First Instance has completed the Chinese shoe anti-dumping proceedings instituted in the first round of the reply, Aokang and other Chinese shoe enterprises will enter the second round of the respondent, the time will be about one year. Vice Chairman of China Leather Association, Aokang Group President Wang Zhentao that Chinese shoes enterprises will strive hard in the second stage of the judicial process to achieve a breakthrough.


Another way to find solutions


Artificial trade barriers for the European Union, aware of this will become the trend of Chinese shoes enterprises on the one hand actively responding, on the one hand began to look for multi-channel market. EU anti-dumping in the pain suffered, the Chinese footwear enterprises become familiar with the EU rules of the game, many shoe line, he began to move up the mid-range to long-term deal with the barriers. "With a positive attitude to deal with trade friction, can not say it is not a new opportunity. Enterprises can take the opportunity in the product structure, quality and competition policy adjustments will greatly enhance the entire industry." Trade and economic relations experts believe, Zhou Fen Xi , a difficult situation of Chinese shoes enterprises should pay more attention to improve their competitiveness.


In fact, no significant effect when the various efforts, the Chinese footwear enterprises in upgrading their own, he began to realize this fact: The EU market is not the only option.


In November 2006 in which the EU ruling against Chinese shoemakers took effect four months later, the China-Africa Cooperation Forum Beijing Summit & Third Ministerial Conference held in Beijing. China and Africa in the economic areas related depth discussion and cooperation during the summit held a second session of China-Africa Business Conference and other activities, the Chinese footwear enterprises welcomed a historic opportunity.


In recent years, Chinese shoe exports to Africa is the rapid growth trend. Quanzhou, China led in recent years has increased the shoe on the non-investment, footwear enterprises in Zhejiang have also not far behind, the data show that the first three quarters of 2006 alone, exports to Africa in Zhejiang Province reached 210 million pairs of shoes and exports 320 million U.S. dollars.