Albany, NY -- (SBWIRE) -- 01/27/2014 -- Due to slowdown in economic growth both in China and beyond in 2012-2013, leather shoes manufacturers and leather shoes retailers shouldered grave operation pressure in the wake of the slowdown in the industry.

Output & Consumption

The economic slowdown frustrates Chinese consumers who have weakening willingness to buying non-necessities such as leather shoes. As such, adverse factors, including price hike of raw materials, growing exchange rate and soaring labor cost, bring with tough business environment for entrepreneurs who, in turn, hold pessimistic attitude towards future development. In 2012-2013, both the output and consumption of China leather shoes industry witnessed a decline, with the output growth rates down to 5.29% and 7.45%, respectively, while the consumption growth rates down to 9.22% and 8.42%, a level well below the 2010 boom albeit its outperforming the 2011 level. Thus far, the confidence of both consumers and entrepreneurs has yet substantively changed for better. Given this, it is expected that the growth rates for both the output and consumption in China leather shoes industry will sustain slight decline tendency between 2014 and 2015.

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Export

Anti-dumping investigations launched by many countries on made-in-China leather shoes are very frequent for a long time, which forces Chinese industrial players to bear higher import tariff and anti-dumping duty. In Nov.2012, Zhejiang Aokang Shoes won a lawsuit in an anti-dumping case, which cheered up Chinese leather shoes makers’ export confidence to some extent. According to the estimate, the export volume of made-in-China leather shoes will realize slight growth in upcoming two years.

Industrial Cluster

The production of leather shoes in China still concentrates in Fujian, Zhejiang and Guangdong provinces, the combined output of which accounted for 69.62% of China’s total in 2013. As a result of the growing wages and decreasing labor resources, leather shoes enterprises in the three provinces are encountered with higher operation pressure. In the meanwhile, some leather shoes producers are transferring their production bases to West and Central China where feature abundant labor resources and lower pay. It is projected that the leather shoes output of these three provinces will occupy a decreased proportion of the total in China, and that the output in Hunan, Chongqing and Sichuan will see a rise.

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Marketing Channel

Along with the ceaseless improvement and development of e-commerce, China online shopping industry has long been maintaining booming development. In 2013, the market size of China online shopping industry soared by 40% year-on-year to roughly RMB1.82424 trillion. Many leading leather shoes enterprises including Belle, Aokang, Red Dragonfly, Yearcon and Mulinsen have jumped on e-commerce business by opening up flagship stores or franchised stores through the platform of Tmall, JD and other well-known B2C websites.

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Leading industrial players continue to give priority to expansion or renovation of franchised stores. For instance, Belle International is keen on expanding retail outlets, with the number of self-run shoes retail outlets increasing by 442 on Chinese Mainland in the first half of 2013. Another example is Zhejiang Aokang Shoes, which, on the contrary, puts sub-brands together in a store with larger coverage and more staff for sale or sort management.

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