Looking At The Future Of China'S Manufacturing Industry From The Moving Of Nike Adidas Vanke To Southeast Asia

In Vietnam, a clothing The monthly salary of workers is only 500 yuan. The minimum salary in India is 250 yuan per person per month, while that in Bangladesh is about 300 yuan. However, in Guangzhou, it costs 2500 to 3000 yuan a month to hire a lathe worker, and some high-end garment enterprises have to pay 4000 yuan a month to workers. The huge labor cost gap has led to the news of the closure of foreign factories in China, which has become a real problem facing China's manufacturing industry.

Recently, the news of foreign capital "fleeing" from Chinese factories to Southeast Asia came one after another. Except Nike Adidas In addition to the amazing actions of large companies that have attracted wide attention, some small enterprises have already taken action.

According to the World Investment Report 2012 issued by the United Nations Conference on Trade and Development (UNCTAD), the inflow of foreign direct investment into Southeast Asia in 2011 was 117 billion US dollars, an increase of 26% over the previous year, while the growth rate in China was less than 8% over the same period.

In the global economic turmoil, the rising cost of "Made in China" has made foreign enterprises flock to the more attractive Southeast Asia. China, the "world factory", is facing a new round of challenges, and the "war" is spreading to Southeast Asia.

　 Adidas "Farewell" to China Low Cost Becomes the Largest Bait

After Nike closed its only production plant in China in 2009, adidas, another sports brand giant, recently announced that it would close its only factory directly under the company in China in October this year, or move to Southeast Asia.

It is puzzling that Adidas has made such a move when its sales in China have soared. The official reason is "the strategy of re integrating global resources", but the insiders believe that the increase of China's production costs may be the real reason for Adidas to close its factories in China.

Running a business in Zhenjiang, Jiangsu shoes Ms. Song, from a similar OEM factory, said frankly that due to the overall bad situation, the factory's order volume this year decreased from 800000 last year to 600000. The loss of 200000 orders must be related to the 10% increase in employees' wages. According to statistics, in the past decade, China's average wage has grown at an average annual rate of 7% - 8%.

Another insider said that in Vietnam clothing The monthly salary of workers is only 500 yuan. The minimum salary in India is 250 yuan per person per month, while that in Bangladesh is about 300 yuan. However, in Guangzhou, it costs 2500 to 3000 yuan a month to hire a lathe worker, and some high-end garment enterprises have to pay 4000 yuan a month to workers.

The huge labor cost gap has led to the news of the closure of foreign factories in China, which has become a real problem facing China's manufacturing industry.

While foreign-funded enterprises have "fled" one after another, some Chinese clothing brands have also chosen to "leave home". Vancl CEO Chen Nian recently disclosed that Vancl has moved some shirt orders to Bangladesh since last year, and its cost can be reduced by about 30% compared with that in China.

After a storm of factory relocation, people can't help worrying about the future of China's manufacturing industry. However, among many voices, people can not help wondering whether foreign enterprises will move their OEM factories to Southeast Asia? In addition to low-cost competition, is "Made in China" better than Southeast Asia in other places? However, no matter what the result, "Made in China" will inevitably compete with Southeast Asia.

　 "Made in China" is difficult to replace non price advantages

A series of actions by foreign-funded enterprises and local enterprises have caused disputes about the advantages of "Made in China".

It has always been the way for enterprises to survive by pursuing low costs. The rising cost of China's manufacturing industry must be the root cause of foreign capital flight. The exchange rate, rent, raw material prices and other factors included in the cost, especially the sharp rise in labor wages, have greatly reduced the cost advantage of "Made in China".

However, although cost advantage is no longer the hot spot in the eyes of foreign investors, the old brand "Made in China" still occupies the production highland.

As we all know, low cost is not the only criterion for enterprises to consider when selecting processing plants. Good industrial environment, skilled workers and other factors are also indispensable, which is the strength of Chinese enterprises.

When talking about the advantages of "Made in China" over Southeast Asia, Ms. Song confidently said: "It has been a long time to be a processing plant, the overall quality is higher than that of Southeast Asia's factories, and the operation is more skilled. I believe that foreign enterprises will not simply pursue low costs without regard to quality and efficiency."

Indeed, when the news that Adidas had closed its factory in China was noisy, its official also issued a statement emphasizing that "there are more than 300 OEM factories in China to work together", and the words conveyed the signal that the OEM would not change.

Therefore, it is a wise choice to face up to the problems and actively respond to the threats in Southeast Asia. Zhang Qing, president of Beijing's key sports marketing agency, said in an interview: "This behavior of foreign brands is very normal, just like when they came to China. What we should do is to face the problem squarely, think about how to maintain our advantages, and how to transform from 'Made in China' to 'Created in China'."

When China's economy is growing gradually, OEM enterprises can no longer bow to low costs. What they can do is to firmly grasp the non price advantage. In this regard, Zhang Qing said: "Compared with other countries, China still has obvious advantages. First, we have a supporting industrial chain and a complete industrial system, and the global market is a guarantee. Second, our factory operators and technicians are highly skilled, and have strong cluster advantages. Third, our production environment is very superior, and our infrastructure is perfect. These advantages are all Southeast Asian countries What the family does not have. "

From this point of view, although "Made in China" is becoming more and more expensive, its non price advantage still beats Southeast Asia.

　　 Reflection: transformation is imperative

After regaining confidence, China's manufacturing industry cannot avoid the migration of foreign brands to Southeast Asia. It can be said that this is both a challenge and an opportunity for OEM enterprises. China's economy is in a severe transition period, under heavy pressure, enterprises should also carefully consider how to prepare for a rainy day in troubled times.

Zhang Qing believes that the transformation of OEM enterprises is imperative. On the one hand, factories in coastal areas can be transferred to the central and western regions of China to reduce costs, expand production scale and increase output; On the other hand, we should consider improving the automation level of production, reducing human participation and increasing the scientific and technological content.

At present, the labor advantages in the central and western regions of China still exist. The merger of Intel's Shanghai Pudong factory and Chengdu factory, and Unilever's relocation of its production base from Shanghai to Hefei are all steps taken by multinational companies to move to the Midwest. In addition, in July last year, Gou Taiming, the boss of Foxconn, the world's largest contract manufacturer, announced that he would add 1 million industrial robots to the assembly line within three years. Obviously, some enterprises have realized the high labor cost in the future and have turned to machines to replace labor, thus improving labor productivity and product quality.

Today, the PK war between Southeast Asia and "Made in China" is becoming increasingly fierce. Despite the constant noise outside the venue, Chinese enterprises have begun their transformation, seeking for their own way out, and at the same time trying to justify the name of "Made in China".