HONG KONG, May 22, 2012 - China suppliers of bags and
footwear are relying on diverse business strategies to cope
with threats to competitiveness in a slow market.
This is according to Global Sources'
(NASDAQ: GSOL) China Sourcing Report: Bags & Footwear (http://www.chinasourcingreports.com/bagsfootwear).
The Report covers the major products in China's bags
industry, namely fashion, travel, business and
special-purpose bags. The footwear industry is represented
by slippers and flip-flops, and casual, sports, work,
safety and occupational shoes and boots.
"These are difficult times for China's bags and
footwear suppliers. Higher costs are a fierce challenge to
margins and economic downturns in North America and Europe
continue to depress demand. Survival plans addressing these
issues are therefore multipronged," said Publisher of
the Report, Livia Yip. "Besides enforcing cost-cutting
measures, China suppliers of bags and footwear are
enhancing products and cultivating new markets to attract
more orders and maintain revenue."
The Reportindicates that many manufacturers are moving up
the value chain to justify rising prices and secure better
margins. This is especially true for footwear suppliers.
They are elevating the output of genuine leather pairs,
partly because staying with low-end models risks trade
barriers from certain countries.
Meanwhile, China's bag suppliers are launching
sophisticated models with emphasis on greater visual appeal
and special textures to generate more orders.
With orders from Western markets still sagging, efforts to
prop up both footwear and bag sales also involve targeting
alternative destinations such as South America and Africa.
Suppliers secure revenue, higher prices inevitable
China Sourcing Report: Bags & Footwear shows heavy spending
weighing down on prices. In the past 12 months, companies
have seen pig- and sheepskin costs surge by 80 percent and
50 percent, respectively. Labor expenditure has shot up 20
percent, making production even more expensive. Smaller
orders from buyers in critical markets are exacerbating
difficulties as low output makes it tough for suppliers to
achieve economies of scale.
Consequently, 80 percent of companies surveyed said they
plan to raise prices in the coming six months to offset
increased outlay and keep profit margins reasonable. Only 6
percent of manufacturers said they can reduce quotes to
gain a competitive edge.
To help minimize price increases in the long term,
suppliers aim to whittle down overall expenditure.
Cost-saving efforts include paying for materials outright
to get lower rates from providers, and boosting production
efficiency through intensified employee training.
Negotiating with customers to set specific delivery dates
that allow exchange rate adjustments to be factored into
prices is an option as well. Some exporters are relocating
part of their production to provinces such as Anhui, Henan
and Sichuan where operational costs are lower and labor is
more easily accessible.
Other industry trends indicated by China Sourcing Report:
Bags & Footwear include:
70% of suppliers expect higher export sales in 2012
47% of manufacturers plan to raise capital expenditure to
Many suppliers list stricter overseas standards and the
yuan-USD exchange rate as challenges
Supplier profiles, price forecasts, and the latest bags and
footwear for export
The 115-page China Sourcing Report: Bags & Footwear
provides detailed profiles of 51 suppliers with verified
manufacturing and export credentials, plus contact details
of 25 more suppliers. It also includes a Product Gallery
featuring 135 of the most popular export models, with key
specifications and full-color pictures.
The Report's survey, price trends and supply forecasts
aim to help buyers make better-informed purchasing
Specialized Global Sources websites, face-to-face events,
trade magazines and research reports
China Sourcing Reports are part of Global Sources'
sourcing and product information services. These include
Global Sources Online (http://www.globalsources.com),
China Sourcing Fairs (http://www.chinasourcingfair.com),
Online Sourcing Fairs (http://www.onlinesourcingfair.com),
Private Sourcing Events (http://www.PrivateSourcingEvents.com)
and Global Sources monthly magazines (http://www.globalsources.com/SITE/MAGAZINES.HTM).
For more information about Global Sources' products and
services that connect quality buyers with verified
suppliers, please visit http://www.corporate.globalsources.com.
China Sourcing Report: Bags & Footwear is available for
purchase at http://www.chinasourcingreports.com/bagsfootwear.
Free information about China suppliers of bags and
footwear can be found at