Adidas Recently Announced Its Last Factory’s Closure in China

Recently, it was reported that the world's second largest sports company Adidas would shut down the only one of its own factory in Suzhou in October this year. Adidas officials confirmed this message to reporters yesterday, but it stressed that Adidas still have over 300 cooperation industries in China, the shutting down will not influence the production, closing factories is based on the consideration of the strategy of re-integrate global resources.Nevertheless, business market is still inevitable to associate this action with the phenomenon that domestic manufacturing labor costs rises sharply, recruitment is difficult. But it is not accidental, it's more like a trend. When the global economic crisis broke out three years ago, Nike shut down its last factory in China so as to deduce resources unavailable in China. If compare Nike and Adidas these multinational giants to "migratory birds", it's natural for them to leave, because now here is no longer lush trees, the land is no longer fertile, either. However, in the eyes of some observers who focus on the transformation and upgrading on domestic intensive manufacturing industry, most of the "baits" in China which attracts these "migratory birds" are based on the cheap labor, and this situation will sooner or later change with the development of national economy and living standard.According to the reply of Adidas headquarters, "To close the factory is for the re-integration of global resources". This is the only reason. And as Xinhua reported, Suzhou Industrial Park Administrative Committee, said in a material to the media that it completely understood Adidas's plan of global resources re-integration, which also agrees with the trend that Suzhou Industrial Park Administrative Committee requires transformation at present.It is worth noting that Adidas's so-called "integration strategy", also appeared in Nike's official statement in China. In March 2009, Nike announced the closure of its footwear production facility only owned by it - Taicang plant. At that time, Nike in China responded to South reporters that "The purpose is to further promote the long-term procurement integration strategies and streamline the supply chain.".In fact, Adidas did not deny the correspondence between shutting down the factory and the rising costs, and it seems that there doesn't exist any conflict between "global resource integration" and "rising costs". Recalling the long-term history of sporting goods manufacturing industry, Adidas, Nike and other multinational sports clothing brands has been always choosing the way "Where the cost is low, there is the wayIn the beginning, they established producing bases in European America which is regarded as the birthplace of brands. To take the example of Nike, for the sake of saving costs, it built its own overseas production line in Japan as a start. In the later few years, Japanese Yen had been constantly rising as well as the labor costs, which made Nike's producing costs upper and upper and upper. In 1975, Nike's producing lines in Japan were transferred to the relatively low-labor -costs places in Korea and Taiwan. In the 1980 s, and for the same reason, Nike's main producing lines were transferred to Fujian and Guangdong. In recent years, with the rising of Chinese labor costs, it targets at the lower labor costs in Southeast Asia.Independent analysts Liao Jierong believed that from the transaction structure of stakeholders, for Adidas and Nike, this kind of "rolling stone" is normal.However, they are faced with the pressure from consumption market. "Particularly for Adidas, which should be the "fuses" of London Olympics as the first class sponsor, but surprisingly, the reaction of consumers has been under the bottom, it is difficult to start shooting reckon without one's host." Normal 0 7.8 Å 0 2 false false false MicrosoftInternetExplorer4 /* Style Definitions */ table.MsoNormalTable {mso-style-name:nh<; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:""; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman"; mso-fareast-font-family:"Times New Roman"; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;}

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