Jinjiang Shoes Enterprises: "Rush" On The Road Of Transformation And Upgrading

Since last year, the industry dilemma highlighted by overcapacity, overstock and homogeneous competition has continued to perplex the Jinjiang movement shoes Industry. Relevant industry insiders predict that the "consolidation" of the industry will continue in 2013.

Competition in the domestic market has intensified, and international demand has not yet fully recovered. Under the environment of internal extrusion and external pressure, Jinjiang sports shoes industry, which has experienced explosive growth for 20 years, is facing major challenges.

The reporter learned from an interview in Jinjiang that in the face of unprecedented survival pressure, "transformation and upgrading" has already become the consensus of the industry. At present, Jinjiang shoe enterprises are planning in many ways to explore their own "breakthrough" road.

Industry analysts further pointed out that there is no fixed model for "transformation and upgrading" to replicate. With the trend of differentiation and subdivision of the terminal market, Jinjiang shoe enterprises must adhere to the four major innovations of brand, technology, management and marketing, and explore the path of diversified transformation and upgrading of the shoe industry according to their own product characteristics and positioning.

　 Industrial dilemma under internal pressure and external pressure

Since last year, competition in the domestic sporting goods market has intensified, and the instability of the industry has gradually increased. Several sports brands in Jinjiang have also suffered from declining sales revenue and rising inventory.

On the other hand, due to the impact of the international economic environment, external demand, especially the demand of the European and American markets, is not stable, and the number of foreign trade orders of Jinjiang Shoes has declined.

Why does Jinjiang sports shoes industry, whose total output accounts for 40% of the country and 20% of the world, encounter difficulties?

"The current dilemma of China's sports shoes and clothing industry is mainly reflected in the problems of overstock and overcapacity," said Zhao Feng, director of the Sports Market Center of 361Du (China) Co., Ltd.

At the end of last century and the beginning of this century, with the rapid increase of residents' disposable income, people's demand for sports and leisure products exploded, bringing a very long boom growth cycle to China's sports shoes industry.

The following problem is that a large number of enterprises and funds pour into this industry, which will inevitably bring about a certain degree of industrial surplus and inventory backlog.

Zhang Tao, vice president of Anta, pointed out in an interview that, like any industry, the sneaker industry needs to be consolidated to different degrees after it has developed to a certain stage, entering a period of industrial adjustment.

At the same time, Zhao Feng also believes that Jinjiang footwear enterprises have numerous brands, high degree of homogeneity between them, and vague market positioning. In addition, in recent years, Nike, Adidas and other international brands have accelerated their penetration into China's second and third tier cities, further squeezing the market of domestic sports shoes enterprises.

"Since the 2008 Beijing Olympic Games, the problem of overstock in the domestic sports shoes industry has gradually emerged," Zhao Feng said.

Zhang Tao further pointed out that the current predicament of Jinjiang shoe industry means that the era of industrial development represented by "channel expansion" has passed. The way for enterprises to survive in the future lies in whether they can better adapt to consumer demand, constantly segment the market, and meet the differentiated needs of consumers by improving product specialization and single store productivity.

As for the market prospect of this year, Anta believes that the sporting goods industry is still mainly facing the fierce competition caused by inventory and large discounts, and is cautious about the short-term prospect of the domestic sporting goods industry.

"The industrial adjustment needs a 'deep cultivation period' to transform from extensive 'brand wholesale' to 'brand retail'," Zhang Tao pointed out.

　　 The industrial transformation is imminent, and Jinjiang shoe enterprises are hard to explore

"The competition in the sports shoes industry has become intense. Small and medium-sized enterprises can't afford to discount big brands; foreign trade orders are hard to find. Without transformation, small and medium-sized shoe enterprises will have a dead end," said Li Xinxin, general manager of Jinjiang Cheney Shoes and Clothing Co., Ltd.

The reporter learned from the interview in Jinjiang that the increasingly severe market environment is forcing Jinjiang shoes to seek new changes and accelerate the exploration of a transformation path suitable for its own characteristics and positioning.

Dodge Group strives to be the "Foxconn" in the field of sports shoes.

Dodge Group, founded in 1994, has insisted on OEM production for nearly 20 years. From the original three mu land and one floor, it has now developed into a famous OEM factory of Adidas, NewBalance and other famous brands, with an annual output of 20 million pairs of sports shoes.

"When other enterprises are spending money on advertising and branding, we stick to the principle of only doing OEM to maximize our manufacturing capacity," said Lin Yongcan, chairman of the board of directors of the company.

In order to keep up with the quality requirements and fashion trends of international brands, Dodge Group invests tens of millions of yuan in R&D alone every year. Through 20 years of accumulation, Dodge has become a stable supplier of international famous brands. Last year's sales revenue increased by 68%. This year's production orders have been arranged until June.

At present, the OEM of international high-end shoe brands is shifting from Guangdong to Fujian. Dodge is trying to obtain more OEM orders through the evaluation of more multinational companies and intermediaries. Lin Yongcan told reporters, "Not only products have brands, but also manufacturers have famous brands. Dodge is trying to become the" Foxconn "in the field of sports shoes."

Today, Dodge Group, which has the industry leading manufacturing capability, has sold out of the international market. At present, Lin Yongcan is negotiating with the famous Austrian tennis brand HEAD to fully acquire its production and sales rights in mainland China.

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　　 Yeli Sports - focus on technical innovation in subdivided fields.

Like most sports shoe enterprises in Jinjiang, the start of Yeli Sports relies on the rapid expansion mode of "advertising+channels". Lin Shaoxiong, president of Noli Sports (China) Co., Ltd., told reporters that in 2006, the company completed its original accumulation through large-scale advertising, brand promotion and channel construction.

But by about 2010, with the gradual loss of cost advantages in labor and raw materials, the development of enterprises has encountered "bottlenecks". What is the next step?

"There are 120000 sweat glands on the soles of people's feet, and the traditional shoe upper technology can not solve the problem of breathability and sweat absorption of sports shoes." Lin Shaoxiong said that since 2010, the company has found its own development direction, and has made great efforts to develop "breathable shoes" with unique sole technology.

In 2011, Yeli breathable shoes came into the market, and won consumer recognition in just a few months; In 2012, it was awarded the "National Industrial Design Excellence Award" by the Ministry of Industry and Information Technology. "Breathable shoes are just a function of shoes. With independent intellectual property rights, in the future, Yeli will make 'breathable shoes' a separate footwear category," Lin Shaoxiong told reporters.

Famous football sports - comprehensive transformation of products and channels.

"We don't make sneakers anymore," Li Zican, general manager of Mingzu Sporting Goods (China) Co., Ltd., told reporters.

From Kong Linghui's endorsement of Anta, Jinjiang shoe enterprises have learned "celebrity endorsement+CCTV advertising", and CCTV5 has almost become "Jinjiang Channel". "Now is the era of demand differentiation and market segmentation. Consumers have stopped buying stories and concepts."

In order to get rid of the market dilemma, NFC has voluntarily given up the fight in the field of sports shoes. In 2011, the company fully contracted the production of sports shoes and turned its business to the field of fashion casual shoes.

Li Zican said, "Every year designer Go to Japan and South Korea to learn the latest fashion, and develop casual shoes with the unique style of famous feet. Last year, the company also closed more than 200 old sales stores and opened more than 100 new stores in high-end malls such as Wanda and Dayang Department Store. "

"From products to marketing channels, Mingzu is undergoing a revolutionary change." Li Zican believes that "to be an enterprise is like being a person. Small and medium-sized shoe enterprises must make their personalities and values known and forge a path that suits them."

　　 The transformation of shoe enterprises needs to strengthen four innovations

On February 27, Decathlon, a global sporting goods retail giant, officially opened its store in Wuyuan Bay, Xiamen, Fujian.

Decathlon Wuyuanwan Mall has a business area of 4000 square meters and sells more than 35000 kinds of sports products worldwide, which can meet the needs of all sports enthusiasts from beginners to professionals.

At the same time, the mall also provides customers with a 200 square meter free outdoor playground and multi-function sports experience area. There are fitness equipment experience area, outdoor mountain sports experience area, roller skating trial area, badminton and table tennis experience area, etc. In the future, Decathlon's stores in Xiamen are planned to increase to 4-8.

"From selling products to selling experiences, Decathlon mode represents the mainstream direction of sports brand marketing in the future," pointed out by relevant insiders.

From the perspective of market development stage, in the past, most domestic sports shoe enterprises were "brand batch". Enterprises produced, advertised and promoted, and dealers sold, and manufacturers rarely really contacted the "fresh experience" of front-line consumers.

With the improvement of industry segmentation and specialization, enterprises must accelerate the transition to "brand retail". Just like Decathlon, it pays more attention to consumer experience and realizes rapid response to market demand.

The trend of individualization and differentiation of market demand has been irresistible, whether it is to adhere to OEM, or to innovate marketing mode and technological innovation, which puts forward more diversified transformation requirements for shoe enterprises.

Zhang Tao believes that there is no fixed model for transformation and upgrading to be replicated. However, there are still some common factors in the exploration of enterprise transformation:

Brand power innovation. Brand power determines the comprehensive bargaining power of enterprises and consumer recognition. The shaping of the brand culture of small and medium-sized enterprises is not to invite stars to speak for and advertise for everything. It also requires long-term resource investment and clear brand positioning to create its own unique brand cultural connotation.

Lean management innovation. Lean management tests the ability of enterprises to "wring water in the towel". "The bold and fresh way of the past is no longer feasible". For the survival and development of modern enterprises, we must improve the efficiency of production, marketing and scientific research management, reduce the comprehensive operating costs, and improve the quick response ability of the supply chain.

Innovation in product technology innovation and R&D capability. In the future development trend, the shoe industry brand will certainly move towards fine differentiation and specialization. For example, a large number of minority sports goods brands abroad focus on outdoor, mountaineering, bicycle and other professional fields, with clear positioning for each other. Traditional enterprises should continue to increase R&D investment, improve the scientific and technological content of products, enrich the product structure and types, improve market competitiveness, and meet consumers' personalized and differentiated consumption needs.

Continuous innovation of marketing mode. With the change of people's lifestyle and consumption habits, consumers demand not only the physical products themselves, but also the process of consumption experience. Enterprises should constantly innovate marketing models, emphasize experiential marketing, and focus on improving the attractiveness of channel terminals to consumers and the productivity of individual stores. At the same time, we will accelerate the development of e-commerce to achieve the balance between physical channel terminals and online sales.

"It must be pointed out that the development of e-commerce at this stage is a double-edged sword for shoe enterprises," Lin Yonghong pointed out.

"At present, online sales has become a synonym for cheap and convenient. For the same shoe, the price difference between online stores and physical terminal stores is at least one third. Once the price difference is too large, online sales will inevitably have an impact on the operation of physical stores, which is very likely to cause resistance from dealers."

Due to the rapid expansion of sales channels in recent years, many shoe enterprises are struggling: they do not shrink physical stores, and the costs of store rent, wages and other costs are increasing; Once it shrinks, it faces the embarrassment of overstock of distribution channel inventory, difficult recovery of payment for goods and early investment.

For example, terminal stores of some Italian shoe brands sell "limited edition" high-end products, which mainly play the role of image display and brand promotion. Online sales are popular.

Lin Yonghong believes that physical stores focus on high-end product sales and corporate image promotion, while online sales focus on the mass market. Achieving "two legs walking" and target market differentiation should become the development direction of Jinjiang shoe enterprises in the future.