Asia Section

Seize the Development Opportunities for Hangzhou S

Time:2014-07-16 Source:worldsilk

    Taken in Jiebai New Century Mart 

    Taken in Jiebai New Century Mart

    Core Tip

    In 2014, China’s silk manufacture exports fell 55.6%, and silk garment exports fell 71.4%. March 13th this year, according to the Hong Kong silk fair, international silk seminar, the silk manufacture exports of India and Turkey are more than China for the first time. Hangzhou is the origin of the silk product in historical “Silk Road”, and now also has first-mover advantage of advanced design and sophisticated manufacturing. Faced with the special market trend of China silk, how to grasp the historic opportunity, break through the bottleneck in transition, and achieve innovation and development in “One Belt and One Road”? The author has done deep investigations and thoughts. Now some suggestions are given. This article is worth a read for our silk industry.

    Since the Chinese president Jinping Xi proposed the national strategy to construct "the Silk Road Economic Belt" and “the 21st Century Maritime Silk Road" ,the “One Belt and One Road” has become synonym of China’s contacting with international and reconstructing the world pattern. Now the ancient Silk Road brings to promote international trade, cultural exchange and trip to peace again. Feng Zhao, the NPC deputy, and also the curator of China Silk Museum, gave the proposal that Silk Road cannot make silk absence. He well expressed the Chinese silk people's thoughts. Whether the Chinese silk industry can stand on the “tuyere” of the “One Belt and One Road” and seize the opportunity on homeopathy? This is a common concern of the government and the silk industry.

    Position and status of the silk industry, as well as the new opportunities

    In the stage that the comprehensive reform of Chinese society comes into "three overlay" new normal and economic is affording downward pressure, China's silk industry is also going through “ labor pains” of transformation and upgrading, and encountering more difficulties than other real economy. Silk is traditional industry, belongs to both labor-intensive and capital-intensive. Although silk is also working to upgrade into the cultural and creative industries, by penetrating more cultural elements, fashion elements in product design, rising of labor costs and financing costs make silk manufacturer unsustainable. Many export-oriented enterprises transform silk manufacture to brand creation, and export to domestic sales, this process is also very painful. On one side, investing heavily to create brand cannot get instant results. On the other side, international market share falls sharply. In 2014, China’s silk manufacture exports fell 55.6%, and silk garment exports fell 71.4%. March 13ththis year, according to the Hong Kong silk fair, international silk seminar, the silk manufacture exports of India and Turkey are more than China for the first time. This undoubtedly adds a bit of tingling and alert to the Chinese silk people who determine to build silk country to silk power.

    Hangzhou is the origin of the silk product in historical “Silk Road”, and now also has first-mover advantage of advanced design and sophisticated manufacturing. A large number of international brands come to Hangzhou silk enterprises to sampling and order. Own brand building of Hangzhou silk enterprises has also burgeoned. Annual trade of Hangzhou silk once accounted for 25% of the country, and 20% of the world. Hangzhou has become an international and domestic silk trade center, a first real big silk product port in “New Silk Road”, the world's silk industry's most brilliant pearl. But it is understood, the sales growth of Hangzhou silk is also significantly weak, and various statistics reflect the sales decline, especially small and medium silk enterprises.

    Faced with the special market trend of China silk, how to grasp the historic opportunity, break through the bottleneck in transition, and achieve innovation and development in “One Belt and One Road”, has caused deep thinking among silk industry colleagues, of course, is bound to cause great concern of the government. Government of Zhejiang Province, Zhejiang Economic and Information Commission, both thematically study the measures to revitalize Zhejiang silk. Hangzhou Government, Hangzhou Development Research Center, Hangzhou Economic and Information Commission also intensively research the way to make Hangzhou silk internationalization and fashion. “Silk Road cannot make silk absence”, “One Belt and One Road” should become the strategic opportunities for Hangzhou Silk.

    Four key points to make Hangzhou silk industry bigger and stronger.

    How can this be achieved? This paper proposes a few suggestions for the government and the industry to reference.

    --------Steady growth in structural adjustment, seeking potential meanwhile doing alterations. Growth is the core indicators to measure the industry’s health. Hangzhou silk continued to rapidly grow in more than a decade, while negative growth appeared in 2014, it is a dangerous signal. "Migrating to the less developed regions" seems to become a law of the world's silk industry, but Hangzhou silk must break the law. “Steady growth in structural adjustment, seeking potential meanwhile doing alterations”, Premier Keqiang Li’s metaphor gives a clear direction for Hangzhou silk industry.

    Hangzhou silk industry structure is basically include a few large and many small and medium enterprises. CATHAYA, WENSLI, DALI, JIN FUCHUN, these enterprises shows their strong and always the winner. They all have excellent highlights of transformation and upgrading in cultural creativity, wisdom industry and diversified development. Immediately, the focus of steady growth should be to maintain the growth of small and medium enterprises. Government and industry associations should take on the overall situation of enterprise’ development, closely pay attention to the industry economic data, help to solve the financing difficulties, high financing expense and payment arrears of small and medium enterprises, guide enterprises to achieve product innovation, technological innovation, marketing innovation and management innovation. Use lower cost and highly innovation to withstand the downward pressure. Promoting the whole industry’s sales growth is the cornerstone of industry’s healthy development.

     To break the practices in silk industry that "Migrating to the less developed regions", Government and industry associations should guide enterprises to joint reorganization and cross-border cooperation through policy development and structural adjustment. Make the overall situation, seek potential trend, and gather the silk, land and labor resources in other areas of the country for Hangzhou silk. The rapid development of Hangzhou city has made the front end of the silk industry chain greatly weakened. While the Midwest intends to develop the silk industry through the opportunity of “One Belt and One Road”, they urgently want to introduce famous silk enterprises, brands, celebrities of the eastern coastal areas, and also get policy support in the investment. Equity investment cooperation, setting point and layout in Midwest, developing excellent silk base, taking advantage of lower labor costs to establish strategic bridgehead in the "New Silk Road", are all conducive to long-term development of Hangzhou silk. The joint reorganization is indeed is the fast track to make the business bigger and stronger. Under the construction background of "New Normal" and "One Belt and One Road" for Chinese economy, do alterations first and then joint, to be bigger makes way out, and to be stronger has unexpected development.

    --------Promote international cooperation and build "four centers". Hangzhou has continuously researched and published China silk fashion trends for more than ten years. This research has been cooperated by China Textile Information Center, China Fashion Color Association, China Silk Associationand international R & D team, China Academy of Art, Zhejiang Sci-Tech University, and leading enterprises in Hangzhou. It has been the longest development trends research in international silk industry, made more and more attention and influence in silk industry. This will lay the foundation of constructing an international silk industry research center.

    Hangzhou has successfully held six China international silk forums. Each forum was a world silk industry event that filled with visitors. This was also the world silk industry's largest and most distinctive peer exchanges, which promotes understanding and mutual trust, also contributes to the interact development of the world silk industry. Hangzhou has actually become an exchange center of the world silk industry.

    China international silk fair has been held for fifteen times in Hangzhou. This is the world's largest professional silk exhibition, which is held by China Commerce Ministry and Hangzhou Government. The exhibition has created the atmosphere that makes Hangzhou become the world silk trade center, and formed the consensus that “world silk depends on China and China silk depends on Hangzhou”.

    China silk fashion trends research publication, China international silk forum, China international silk fair, are all valuable asset accumulation of Hangzhou silk, and also the solid foundation for a new round of industrial upgrading and internationalization. The new round of industrial upgrading is to promote international brand construction of Hangzhou silk. Commerce Ministry has pointed out in silk industry “Twelfth Five” development program that we should further expand the silk brand products in international market share, guide competitive enterprises to go out, conduct overseas investment and cooperation, brand acquisition, marketing network construction through acquisitions, shares and other forms. In recent years, the WENSLI Group has acquired a French century silk enterprise and recruited international luxury brand persons in charge. Some Hangzhou silk companies have started to open stores in international metropolis. In Italy and France, there are a lot of silk enterprises or silk brands are difficult to maintain, and expecting China silk enterprises to purchase and cooperate. Hangzhou government should formulate relevant policies, take advantage of the opportunity, actively guide enterprises to go out, and try to reach some joint venture projects with French, Italian famous silk enterprises within a year or two, also including the leading silk brands of Thailand, Cambodia and other Southeast Asian countries. Exert the cluster effect to make Hangzhou silk become an international brand, build Hangzhou into an international brand center of the silk industry, make Hangzhou silk convert from the amount into a qualitative advantage and brand advantage, and accelerate Hang silk to gain harvest in the construction of "One Belt and One Road".

    --------Expand air silk road and create online famous integrated hall. To continue to be the sales champion, Hangzhou silk should plug “the wings” of the Internet. This year, Prime Minister also repeatedly referred to the “Internet +” on government work report and the press conference. It can be seen, traditional industries are doing adjustment and transformation when economic downturn, and the new Internet economy still has huge room for growth. The State Council has recently agreed to establish China (Hangzhou) cross-border e-commerce comprehensive test area. Hangzhou is “Silk House”, also a gathering place for IT industry. Development of Big Data technologies and e-commerce platformcan provide information technology support to better explore the global market for Hangzhou silk. How to take advantage of Hangzhou powerful Internet should become the starting point for Hangzhou to weave the new silk and walk the new Silk Road. Government and industry associations should seize this great opportunity of establishing China (Hangzhou) cross-border e-commerce comprehensive test area, and co-ordinate the establishment of "Hangzhou Silk Famous Museum." Although Hangzhou silk has started online sales, only the shops that companies set up are not enough. Outsiders often complain that they do not know where to buy the real Hangzhou silk. If we can strive to create a Hangzhou silk business platform, which makes the world of online shoppers at ease, value for money, we will be able to create more demands. Therefore, the government should be determined to use the existing silk network platform to build a "Hangzhou Silk Famous Museum", which is not only for the country but also for the world, authorized by the government to use "Hangzhou silk geographical indications", and has quality and price supervision and assurance. Let Hangzhou silk “fly” in the "Internet +".

    --------Strengthen industry management and gather social force. Hangzhou silk has built a strong industrial base and unattainable industry status. This is formed under the careful planning, guidance and policy support of the government, efforts for suggestions and guidance to promote coordination of industry associations, active participation and help of science research institutions, atmosphere creation and propagation promotion of news media, hard work and tough tackling of enterprises themselves. The industry position is really hard to come andan opportune crystallization. Now Hangzhou silk is not decisive to the city product gross growth contribution rate, but silk is still a gold card of Hangzhou. Hangzhou silk in historical origin, culture precipitation, and human feelings perhaps cannot be replaced by any other industry and product. Therefore, the government must use a special feeling, a different kind of perspective on silk, to love silk and to support silk. In the strategy of "One Belt and One Road", silk industry management should be strengthened and not weakened, and silk support fund should increase rather than decrease. Industry associations also need to increase the strength, give more and more specific guidance in terms of adjusting the structure and steady growth, lead enterprises to inline while cooperate with the outside, transform and upgrade, and assist the government to help solve some practical difficulties of SMEs. Science research institutions and the news media are allies for the healthy development of Hangzhou silk, the variety of social resources are all needed when Hangzhou silk has temporary difficulties and hindered growth. Social force of Hangzhou silk which has been formed should continue to gather together. This is also a competitive advantage to make Hangzhou silk fortunate than the silk industry in other cities. In this way, Hangzhou silk will certainly not lack in the "One Belt and One Road", Hangzhou silk also will be able to sustain a healthy and rapid development.

      Jianming Fei

    Director of Hangzhou Silk Culture and Brand Research Center