Manufacturers in China build brands as the path to success

Their Dada & Co. factory in Ningbo, in eastern Zhejiang province near the coast, churns out eight million pieces of women and children's clothing a year, targeting middle- to high-end customers in Europe and the United States.

But the couple, like other business owners in China's manufacturing zones, says they are starting to produce their own branded merchandise, as they believe that the Asian giant's days as the main “workshop of the world” are numbered.

“There is no loyalty in this business. If we do not keep lowering our prices, the buyers would give the work to our competitors,” Bao told AFP on the sidelines of the biannual Canton Fair in Guangzhou, China's largest trade show.

“But with rising labor costs in China and the fierce competition with neighboring manufacturing hubs like Vietnam and Cambodia, we are bound to lose in the competition.”

So the couple hired a design team of 60 people — some of them from France and Italy — to promote Dada as both a domestic and international brand, not just a supplier to the world's elite fashion houses.

“Overseas fashion brands have for years been making lots of money from the products we made. It is now time for us to be rid of their control and be the decision-makers on pricing and profits,” she said.

Dada is planning to outsource production and gradually shift its focus from serving overseas buyers to selling its own goods at home — capitalizing on the recent rapid growth in Chinese consumption of designer and luxury goods.

As a test, the company opened five stores in second-tier Chinese cities in the middle of the financial crisis last year, taking advantage of low property and start-up costs.

“Customers are happy to find a home brand which offers products of comparable quality to famous overseas brands,” Bao said, adding that Dada will launch between 130 and 150 franchised stores in China over the next two years.

The company is even mulling a listing in either Shanghai or Hong Kong within five years.

1|2|Next Page>>

SharePrintEmail

Write a Comment

Enter your comments - 3000 characters max

Type in image code

Submit

 Receive China Post promos Respond to this email