From garment manufacturing to finished sofas, upgrading from low-end products to high-end customized products, from OEM to self created brands, from all export to domestic market in mainland China—— Executive Vice President of National Taiwan Enterprise Confederation
Chairman of "Huatong Furniture" Group, the world's largest customized sofa
Successful transformation and upgrading of Taiwanese businessmen
Xie Zhitong always leads
Sample display of "Huatong Furniture" Group
As one of the first Taiwanese businessmen to invest in the mainland, it is not easy to muster the courage to be the first to "eat crabs".
From garment manufacturing to finished sofa, upgrading from mid and low-end products to mid and high-end customized customization, from OEM to self created brand, from all export sales to opening up the mainland domestic demand market... Xie Zhitong has always been ahead, and with determination, vision and persistence, he has created his own era.
Xie Zhitong, one of the first Taiwanese businessmen to enter the mainland market, has worked hard with wisdom and diligence. Now he has become the executive vice president of the National Taiwan Enterprise Confederation and the chairman of Hangzhou Huatong Furniture Group, the world's largest customized sofa mass production factory.
From Taiwan to the mainland, a major choice on the path of entrepreneurship
In the 1970s, Taiwan was in a period of rapid economic development, with business opportunities in all walks of life. In 1975, Xie Zhitong, who had just graduated from university for one year, decided to seize the opportunity to resign and start his own business.
After several years of international trade, Xie Zhitong started his own business. He took out all his savings, drew some investment, and set up a clothing factory with less than 100000 dollars of original capital. Thanks to the right time to set up the factory and his own hard work, Xie Zhitong's entrepreneurial path went smoothly. By the end of the 1980s, Xie Zhitong's fur garment factory in Kaohsiung had grown from a small workshop with 30 or 40 people at the beginning to a large garment production enterprise with thousands of employees.
However, the weather is unpredictable. At the time when Xie Zhitong's enterprise was developing rapidly, Korean clothing with relatively low cost poured into Taiwan, which undoubtedly brought Xie Zhitong a severe challenge. Gradually, in the increasingly cruel competition, Xie Zhitong's factory began to go downhill, and as time passed, the operation encountered difficulties. On this basis, Xie Zhitong was not intimidated by difficulties, nor did he stick to the beaten track and do not want to make progress. Instead, he wisely saw the mainland market with rapid development and low labor costs. Immediately, without hesitation, he decided to invest and set up a factory in the mainland.
This is the first transfer since Xie Zhitong started his business, and also the first major choice.
In order to find a good investment location, Xie Zhitong sent people from southern Guangdong to Heilongjiang all the way north. Finally, after many investigations and careful consideration, the factory was located in Fuyang, Hangzhou. Xie Zhitong believes that Hangzhou has been the hometown of silk since ancient times. The clothing industry is very developed and there are many raw materials. In addition, the girls here have been trained since childhood and most of their needlework is good, so it is easy to learn how to make clothes.
"At the beginning, garment production was still in the stage of manual production, and one worker could only produce one garment a day. I immediately realized that such production efficiency was certainly not good." Xie Zhitong recalled that later, he introduced the concept of assembly line garment production. From a sewing machine that can only make one piece a day to six pieces a day, six times the production efficiency has brought him huge benefits. In less than three months, not only benefits, but also benefits. In 1994, Xie Zhitong's export volume reached more than 40 million yuan, ranking the second in Zhejiang Province in that year. The factory also developed into a large factory with more than 1000 people. This was a great creation at that time.
It is true that opportunities always come with challenges. In the 1990s, private enterprises in the mainland began to rise. Xie Zhitong once again welcomed the challenge from private enterprises in the mainland. Xie Zhitong said: "Private enterprises in mainland China have grown too fast. We soon felt pressure from production lines and fashionable clothing styles. Among them, brands will be counterfeited by other small enterprises."
Around 1994, Xie Zhitong clearly remembered that at that time, counterfeiting of brands often occurred in the mainland, and everyone seemed to be familiar with it. In addition, the living conditions of the mainland people were not very rich at that time, so counterfeit brands had a super market. Since then, Xie Zhitong began to encounter the "Red Sea War" with fierce competition in the economic market. Not only were products counterfeited and customers robbed at low prices, but also talents were poached by private enterprises, from sample designers to workshop supervisors; From quality control technicians to senior executives of enterprises, all these have become the targets of private enterprises.
From clothing to sofa, an important transformation after success
In the face of such fierce competition in the mainland clothing market, Xie Zhitong is again facing the pressure of transformation or transfer.
This time, it was not only a shift of position, Xie Zhitong even chose to change the industry. "At that time, we had no profit in the clothing industry, so we had to transform." After that, Xie Zhitong went to the United States to invite people to investigate which labor-intensive industries had not moved to Asia, and finally found the finished sofa. At that time, many American factories were making sofas, but they did not produce sofas in South Korea, Hong Kong, Taiwan and other countries and regions, especially in the mainland. Xie Zhitong, who has always been keen, immediately "sniffed out" the business opportunities. At the moment, he decided to switch to finished sofas and invest in and build Huatong Furniture Co., Ltd. in Fengchuan Town, Tonglu County, Hangzhou. The products are mainly for export.
"At that time, we didn't know, but now we think it was a revolution, bringing an industry worth hundreds of billions of dollars from the United States." Recalling the past, Xie Zhitong was full of pride.
In order to take the initiative, Xie Zhitong set out to build a complete industrial chain. In more than 10 years, he has invested in the establishment of a leather factory, a wood frame factory, a paint factory, a sponge factory and many other subsidiaries. He checks from the source to provide reliable raw materials and a series of related supporting products for the production of finished sofas.
With the continuous development and growth of the enterprise, the passivity of OEM "making wedding clothes for others" also made the intelligent Xie Zhitong fall into meditation. He got the idea of building his own brand again. But how can we achieve the best benefits? After careful thinking and market research, he finally chose brand acquisition. Xie Zhitong believes that it is not easy for independent innovation brands to be recognized by consumers abroad because of their low popularity and reputation. Buying a brand can get twice the result with half the effort. As a result, Xie Zhitong thought of it and did it. In the following years, Xie Zhitong's "Huatong Furniture" has successively invested in the acquisition of four major foreign brands, including internationally recognized household brands with high popularity, and "Ketu" with a history of 100 years in the United States.
At the same time, in order to comprehensively improve the level of customer service, since 2008, Xie Zhitong has launched a perfect customized service, that is, customized products according to the special needs of customers. In short, it means that enterprises can produce and manufacture products according to the needs of customers, and position products at 3% of the pyramid in the United States. "Because these people have stable incomes, they are not vulnerable to financial turmoil," Xie Zhitong explained. More miraculously, the enterprise boldly demonstrated its commitment, and the production time was shortened from 45 days to 17 days. The delivery time was 17 days, the delivery time was 30 days, the delivery time was 40 days, and the customers could enjoy the products in about 5 weeks, which was faster than the production time of the local factories in the United States!
"Due to the different preferences, requirements, addresses, etc. of each customer, at the beginning, there were many mistakes. Fortunately, there were not many orders at that time, we could compare and confirm one by one to ensure that there were no mistakes." Xie Zhitong said, "Today, Huatong has about 3000 customized orders every week, becoming the best and largest customized mass production factory in the world.".
"We should especially thank our customers for their tolerance and development with us." Of course, Xie Zhitong also gave customers the best return with rising profits.
After 20 years of development, Huatong Company founded by Xie Zhitong has developed into a powerful enterprise group. The precise and unique vision and timely transformation and upgrading are indispensable. "Transformation and upgrading are what enterprises should do, and Taiwan enterprises have a strong awareness of them, because we have seen five financial reforms in the past 30 years, and we have already known when we should find new ways to deal with market changes. Enterprises need to start transformation and upgrading before the crisis, or it will be late," Xie Zhitong said, "I think the most important thing for enterprise transformation and upgrading is determination, followed by vision, and a little bit of luck". Xie Zhitong smiled that he was lucky to succeed in transformation.
Although the export business is flourishing, the unique crisis awareness of businessmen has made Xie Zhitong more aware of today's achievements. He believes that the current market structure of Huatong relies too much on export. Whether from the perspective of risk diversification or from the perspective of long-term development, domestic marketing is a must.
Xie Zhitong said that now, the company's scale and profit scale have met the requirements. Next year, the company plans to go back to Taiwan for listing, and when it gets a listing fund, it will open retail stores in the mainland. Previously, it was mainly a supplier and seller, but there was no offline space. Now it is ready to take the domestic sales route, and retail stores should also be operated. He hopes to bring the concept of customization to mainland customers, and also hopes to succeed in the experiment.
From individual to society, realize the spiritual transition of life
The continuous success of his career has made Xie Zhitong feel more and more responsible for giving back to the society and extending a helping hand to those who need help.
"I think I'm a scholar, and I can't be too rich when I run a business. If I make money, I should think of ways to give back to the society. If we make money here, we should help people here." Xie Zhitong said that the most effective reward is to help poor students, so that the development chain of society will continue to improve.
Since 1999, Xie Zhitong, who was then the president of Hangzhou Taiwan Compatriot Investment Enterprise Association, has cooperated with some Taiwan funded enterprises in Hangzhou to support 100 poor students in local universities. To this end, Hangzhou Taiwan Enterprises Association has also set up a special grant fund to build three Hope Primary Schools. To this day, Xie Zhitong still insists on supporting poor students, so that they will not worry about their livelihood and concentrate on reading. Xie Zhitong said, "Because education is a great cause for a hundred years, only by doing a good job in education can the country have the opportunity and advance."
Doing good deeds is not to seek reward, but Xie Zhitong still hopes that everyone can pass on their love. "I believe that if everyone has this idea, the mentality and change of this society can be met in the future, and the progress of the whole society can be seen in cultural and spiritual aspects. The material civilization is developing rapidly, and the spiritual aspect is also indispensable. We need to work together. I am glad to see many people around me doing these things.
Youth exchanges that must be enhanced from the two sides of the Taiwan Straits to the future
In recent years, Xie Zhitong has devoted a lot of energy to cross-strait exchanges. He said that the main reason for the failure of trade in services is that the mainland has developed rapidly in recent years and Taiwan's youth lack self-confidence. The main reasons for the lack of self-confidence are too self closing and insufficient information. The only way to solve the problem is to strengthen exchanges. Since this year, Xie Zhitong has worked with some Taiwan funded enterprises to plan and promote Taiwan university students to come to Taiwan enterprises in the mainland for internship. Different from other internships, this activity is in cooperation with several universities in Taiwan, that is, Taiwan college students will practice in Taiwan funded enterprises throughout the second semester of their senior year, and the credits will be scored by the practice factory. This half year long internship will enable Taiwanese youth to further understand the mainland, the humanities and the development here, and also provide experience for future employment and entrepreneurship. At present, it has established contact with Taiwan Fengjia University, etc. And continuously communicate with Taiwan's education department to allow them to recognize this credit.
"I believe that the youth on both sides of the Taiwan Straits have different perceptions, which can be brought closer through continuous exchanges." Xie Zhitong said that the reason why Taiwan youth oppose trade in services is that they do not understand it. In fact, it is very simple. Taking the barber industry, which was most opposed at that time, as an example, my average haircut in the mainland was 106 yuan, while in Taiwan it was 400 New Taiwan Dollars, about 80 yuan. Why should I give up higher profits and choose to open a shop in Taiwan? It should be more cost-effective for Taiwanese people to come to the mainland. To say the least, even if some mainland compatriots are willing to open a barber shop in Taiwan, they will also bring funds. Employees must find local people. If someone brings money to invest and provide jobs, why not!
Since 1989, Xie Zhitong has considered himself a witness to the development of the mainland: "It can be said that I have witnessed the growth process of the mainland from poverty and backwardness to rapid development, as well as such great achievements today. I remember that in 1989, the mainland's foreign exchange reserves were negative. Now in 2015, it is 4 trillion yuan, the largest foreign exchange reserves in the world. This development is amazing and earth shaking."
"Taiwanese youth really need to come to the mainland more often, especially today when the mainland strongly supports entrepreneurship." Xie Zhitong, a entrepreneurship born student, was very impressed with college students' entrepreneurship. "If you don't try, you don't know, you must try when you have the opportunity. Of course, you must be ready before starting a business, and have some knowledge reserves and work experience.". Xie Zhitong suggested that we must work for a period of time, look for opportunities, and then wait for the opportunity to act. We should not be blind, as it is doomed to failure. "But it is difficult to start a business. It is really difficult to start a business. It is good to have one success out of 10. This must be explained to everyone."
