Miuccia Prada, the inheritor and chief designer of the Prada family, said that shoes made by Chinese artisans are her favorites.
So why does Sun Yafei, CEO of 5lux.com, an online source for luxury items in China, feel awkward when asked by customers if a foreign brand product is made in its original nation? Probably because most of them are not.
Take Swarovski Crystal, for example. Although the brand comes from a small town in Austria called Wattens, most of its products are made in Southeast Asia – including China. Nevertheless, at least one customer insisted on returning the goods after seeing the "Made in China" label on it.
Since well-known international brands began searching for manufacturing bases in eastern China's coastal areas in the 1980s, globalization has assigned the work of producing and processing to China. As a result, China has built up a complete and mature manufacturing system in its Jiangsu, Zhejiang and Guangdong provinces, according to the Economic Observer.
But Sun must still face the fact that many Chinese consumers don't trust "Made in China" – even if Prada gives it the seal of approval.
International brands, crafted by Chinese
After visiting many factories in Jiangsu, Zhejiang and Guangdong Provinces in search of a manufacturer for his own clothing brand, Sun found that even ordinary-sized plants could produce up to a million pieces of clothing a year.
A small plant with staff of about 100 in Xiamen is capable of fabricating products for over 20 international brands, including Armani, according to Sun. In one leather craft factory, Sun found every worker wearing gloves and mask. The plant was dust free.
Quality inspection is stiff. In addition to the ultimate check waiting for products, the design, clipping, molding – every procedure of the manufacturing – was self-inspected first, Sun recalled. Even slight scratches could not pass muster.
International brands set rigorous requirements for products made by their contractor plants. For example, Prada assigns teams and inspectors to supervise its overall production procedure.
Sun also recalled what he saw in an Italian manufacturing plant, which claimed to be a "handmade" item workshop. "I only found three to five workers there," he told the newspaper. "They also used sewing machines often due to the difficulty of ensuring the orderliness of stitches by hand sewing."
"They looked like Chinese workshops in the 1950s-1960s, but they make products for big international brands like Gucci," Sun said.
The so-called handmade products in Europe can also be made in China's Guangdong Province, according to Yang Yelin, an official from the Guangdong General Chamber of Commerce. "Our crafts may even be better than the Europeans," added Yang, who often visits contract plants in both Asia and Europe.
Eighty percent of Coach bags, a top-ranking American brand, are made in China, the newspaper said. The procedures are the same as in places such as Italy and France, according to Victor Luis, president of the Coach Retail International Department. That's why there is a label in each Coach bag saying "It is made in China by the most excellent crafters."
China needs own top brands
The gap between Chinese and international brands is a matter of culture and history, according to Yang. Most Chinese brands are very young, while some world famous brands are more than 100 years old.
Shi Jihong, president of Chinese bag-maker Newcomer Group in Pinghu of Zhejiang Province, said Chinese manufacturers depend too much upon international markets. "If the international markets sneeze, we get a cold," he said. "As an original equipment manufacturer, we have no orders when our overseas customers lack business."
Although the business situation in the first half of this year was good, many manufacturers in Pinghu predicted that orders in the second half may decline as international consumption weakens. "We worry about our businesses and orders year-by-year," Shi told the newspaper.
Moreover, the profit for export-oriented enterprises is very low, with the net profit rates of some manufactures at only 3-5 percent.
To cope with the dilemma, Shi has proposed that Pinghu's 500 bag makers should set up a "Fifth generation market" based on the entire industrial chain. Different from traditional wholesale and retail markets, the "fifth generation" market would cover all trade in the overall industrial chain, from material sourcing to product selling.
Shi also suggested that Chinese manufacturers should create their own brands. "It is a big trend," he said. Though our products are high quality, we lack world famous brands, which needs more focus, Yang agreed.
However, Chinese enterprises need to treat their international competitors well, at first. If we want to change the global attitude of "made-in-China" products, we have to change Chinese manners, Shi added.
So far, Newcomer Group has become a competitor with Samsonite due to the successful expansion of its brand Newcom, even though it was the contract manufacturer of the famous US luggage maker. Shi plans an initial public offering for his luggage business in Hong Kong next year.
