China leather industry to confront the financial storm

Footwear is one of the most important commodities for China export，under the current global economic turmoil parts of enterprise felt the pressure and some fell into the difficult period of time.

Shenzhen is a leading city in China leather industry，due to the impacts of economic slowdown from home and abroad，together with revaluation of RMB and restriction on environmental protection the industry is inevitable to carry out the reshuffle and industrial upgrading，over 30 tanneries has to move out of Shenzhen City. In addition the rising of raw material and labor costs became a big burden to the enterprises. A report from Shenzhen leather industry association said for further promoting the leather industry in Shenzhen they should encourage the enterprises to build their own brands，set up a group of well known brands，and further expanding the domestic market shares. At the same time they should boost the industries of fashion and creative，attract well-trained personnel，relying on fashion industry to promote the development of brands.

Leather industry in Dongguan City is known as a “Shoe Town” and also felt the “cold wind” blew from Wall Street in the America. This is because their footwear industry highly depended on the markets of European and the United States. This can be seen in this year exhibition held on November 1，2008，the visitors and buyers were not as many as previous edition. Some exhibitors said the visitors and buyers were even as a half as before.

Many shoemaking enterprises in Dongguan City depend on the business of OEM，products belong to low-end and low profits，these enterprises are lacking of designing，brand and sale channel，and weakness in crises，some of them had bankrupted hit by this financial storm.

Compared with other areas Chengdu shoemaking industry performed better than those in coastal areas since the beginning of financial storm，Chengdu has more than one thousand shoemaking enterprises and generated the output value of over 100 billion yuan，now Chengdu is a good option for the industrial transferring in coastal areas，many enterprises in developed areas begin their transition to Chengdu City.

The shoemaking industry in Wenzhou suffered great from the rising of raw materials and labor costs in the year 2008，the entrepreneurs sunk in their desperate thought，transition or settle down，a series of issues hunted in their mind，some chose to leave，some doesn’t，anyhow they should looking for breakthrough，otherwise they will fall into deep trouble.