Increased Export Orders

“The retaliatory increase in export orders for the hardware industry this year has caused companies to be overjoyed. The “labor shortage” not only tests the business strategy of the company, but also forces the industry to further consider the deeper structural adjustments and further enhance Technical equipment and product quality will be the inevitable trend of future development."

People may feel strange when they come to the hardware industry. However, as soon as you enter the kitchen and bathroom, they immediately enter the world of hardware products. They are large cabinets, steam shower rooms, small to faucets, showers, knives and scissors, and hardware. Products play an indispensable and important role in our daily life. In the industrial field, various types of steel pipes and hardware tools are silently playing a role in the normal operation of large industrial systems. At a recent industry promotion conference organized by the China Hardware Association, Zhang Dongli, chairman of the association, told this reporter that as part of the manufacturing industry, the era of the hardware industry’s interest in relying on cheap labor has ended, and it is currently undergoing structural adjustment. In the period of in-depth development, upgrading technical equipment and improving product quality will be an inevitable trend in the future development of the hardware industry.

Faced with labor shortage, it is not easy to transfer

Zhang Dongli told reporters that exports have always occupied a considerable proportion in the hardware industry. Last year, the industry’s exports have shrunk considerably. Since the first quarter of this year, orders for “retaliatory” growth have occurred in the tool hardware, construction hardware, and other industries, and the growth rate of many products has been more than 50%. “The association convenes relevant industry experts. Based on the analysis, we judge that this is due to the fact that trade dealers in Europe and the United States have underestimated the degree of economic and market recovery this year and changed the way to “replenish single orders” at the peak of the financial crisis and had to replenish their inventory in large quantities.”

It is reasonable to say that the market orders are overwhelming, and that it should be a happy event for the industry. However, many companies are “blazing their heads” for this purpose. At the promotion meeting, the reporter and the person in charge of a hardware company in Zhongshan, Guangdong Province, spoke up and told reporters: “After the Spring Festival, overseas orders suddenly increased dramatically. Even if the company is fully loaded, it will be difficult to meet the order volume. We went to recruit workers. It seems that all of a sudden it has disappeared. It is not a question of how much wages are added.” According to the reporter’s understanding, the problem of “employment shortage”, which mainly occurred in the southeast coastal areas, has not only further intensified but has also begun to shift to inland areas. The industry spreads.

In fact, as early as the end of last year, many hardware companies began to use their brains to retain workers, especially skilled workers. During the Spring Festival each year, many workers who work in the southeastern coastal cities begin to return to their hometowns and re-choose work sites and jobs after the next year. According to the reporter, in Zhejiang Yongkang, which is known as the hometown of China’s hardware, in order to enable workers to work on time, some eye-catching hardware companies adopted the “warm card” and “friendship card” approach before the Spring Festival. Sending year-end bonuses and welfares to workers, hoping that they will feel a sense of belonging to factories that have been working for several years, and that they will come back voluntarily in the coming year. Other companies have adopted the exact opposite strategy. In order to avoid the loss of workers, it is stipulated that after the Spring Festival to work, bonuses will be issued, and the amount of bonuses will be correspondingly higher than the industry average.

Even so, the number of workers who have flown to the three major hardware manufacturing bases in the Pearl River Delta, Yangtze River Delta, and Shandong Peninsula after the Spring Festival is decreasing. With the increase in the construction of second- and third-tier cities, living standards, and wage structures, the entire manufacturing industry The attractiveness of migrant workers is constantly decreasing. A deepening adjustment of the internal structure of the hardware industry has been inevitable. Many companies think of a relatively simple and straightforward approach: industrial transfer and corporate relocation. However, the relative concentration of the hardware industry in Guangdong, Fujian, Zhejiang, Jiangsu, Shanghai and some cities in Shandong Province are the frontiers of reform and opening up. After nearly 30 years of development, the industrial chain has been very complete, with some characteristic industry regions and specialty products such as Wenzhou. Metal case lighters, razors, Yuyao, Cixi plastic lighters, Fujian zippers, Leliu slide rail hinges, etc., have enjoyed a high reputation in the global market. These industrial regional advantages that have been formed after decades of accumulation have also taken considerable risks once they have been transferred.

Industry experts explained to reporters that first of all, the natural advantages of existing industrial clusters in terms of transportation, transportation, and especially exports, will be lost once the mainland is transferred. Secondly, within the industrial cluster, there are complete supporting systems for raw materials, processing, equipment, and packaging. “Now, some large-scale, high-standard leading enterprises have begun to concentrate on expanding their brands and marketing, and have given production links to the industry chain. The partners, that is, those whose quality and productivity are guaranteed, are doing OEM for themselves. It is still difficult for the mainland to build or duplicate such a complete supporting chain." Furthermore, the locations of the industrial clusters are all economically developed areas. “The government’s economic strength is relatively strong. Support for the enterprises and policy support are greater than those in the inland areas, especially in the face of the international financial crisis. The support of the government for reducing taxes and fees and even providing capital turnover is crucial." The expert also stated that “and if it is shifted to lowering labor, with the advancement of urbanization in the interior, the wage level and consumption level of workers will also increase year by year. If it takes less than a few years after relocation, As the area is closer, it is more than worth it."

Equipment technology upgrade, the provincial manpower must mention quality

Since passive industrial transfer “is not possible”, upgrading equipment technology through technological transformation and increasing unit labor productivity by accelerating production automation have become the industry’s choice. The above-mentioned person in charge of the business told reporters that “For companies such as us that have thousands of employees, monthly salary and welfare expenses increase by 100 yuan. The annual cost is several million yuan and even ten million yuan. For any company It is a huge investment. It is better to invest such high expenses in the upgrading of technology and equipment. With one-time investment, the benefits will be continuous."

At the beginning of this year, Zhang Dongli, the head of the industry, proposed that the hardware industry should use the pressure of labor shortage as the driving force to speed up the transformation from labor-intensive to technology-intensive. He analyzed that some well-known enterprises in developed countries rely on advanced equipment and technologies and their labor efficiency is 2 to 3 times that of Chinese companies. Therefore, although their labor costs are much higher, their products are still competitive in the international market. . Industry companies have also stated that the industry has developed so far, relying on past low-cost labor, extensive expansion of production to gain profits is gone, and the industry must move toward intensive, technical, and automation.

Zhang Dongli also told reporters that the technological upgrading of industries should not only improve labor productivity based on “replacement of labor with machines”, but also increase profits by increasing product quality and added value, thereby enhancing the overall competitiveness of the industry. “Taking the shower room industry as an example, this industry is a new industry that has been developed in recent years in the field of architectural hardware through the integration of faucets, showers and related electrical equipment. I went to Europe to inspect it, a set of top-level production in Germany. The price of steam shower room equipment is 200,000 yuan, which is several times or even tens of times the price of similar domestic products." He went on to say, "With such a huge gap, our company is not only losing. In terms of branding and marketing, although there is no doubt that brands and marketing, which generate high value-added channels, are in the hands of foreign distributors, I believe that the most critical factor is the stability and longevity of product quality. With three years without any problems, our products may have to be repaired in half a year. Of course, we have a longitudinal comparison, the quality of progress over the years is obvious to all.” Zhang Dongli concluded that the Chinese Hardware Association will fully play in the industry standard formulation The management and technical advantages in terms of certification and product quality inspection promote the further optimization and upgrading of the entire industry.