Shaping the future
In recent years with global competition, economic recession and rising yarn prices, overseas orders have plummeted, reducing export volumes by around 50%. To confront this new challenge, the people of Shetou have focused their efforts on R&D and high-added-value products. Some have tried moving their factories into China, but most "went quietly and came back quietly," with nothing but losses in their pockets.
"Marketing in China is a different proposition. It's not another Taiwan, but rather 50 Taiwans," Wei remarks. In September last year, he asked a customer in Wuxi, Jiangsu Province, whether they wanted to import some winter socks. The reply said, "No, it's still hot here." However that afternoon, the buyer drove north to where the weather was colder, and rang back to order winter socks for immediate delivery.
Johnny Hsiao, general manager of Hsiaotex Enterprise Co., another Shetou business, has more than once been pressured by distributors to consider moving production to China. He points out, however, that the yarn used in making socks is an elastic fiber, not suitable for production in colder areas. Until now they haven't ventured out of Taiwan because of lingering doubts about quality control.
The Hsiaotex factory is located near the village canal, the high speed railway runs above the factory, and the building is partially composed of several large metal sheets and containers. While the setup doesn't look terribly professional, an eye-catching sign set up in front of the building informs passersby: "The first hosiery factory in Tawan to pass ISO 9001."
In 1998, with the assistance of management consultants, Hsiaotex computerized their records of about 1000 different types of colored nylon yarn in their warehouse, which has made the task of maintaining and replenishing stocks easier and more accurate.
In order to revive the good times and restore Shetou to its place as Taiwan's hosiery capital, the Small and Medium Enterprise Administration of the Ministry of Economic Affairs, the local council of Shetou Township, and the hosiery industry association have given guidance and assistance. However, government support for the industry, when compared with assistance for higher-tech enterprises, is still rather meagre.
The Chinese government, in contrast, gives enormous support and encouragement to the industry in that country, where entrepreneurs can easily buy several hundred machines at a time. Government loans in Taiwan of NT$2 million or more involve a complex process that needs 200 to 300 forms to be completed and signed. A sock machine costs more than NT$600,000, and a machine for making tights costs several million; these expenses are a heavy burden for those trying to compete in a tight market. Hsiao claims that loans for such SMEs need to be made more accessible. He also points out that Shetou lacks land suitable for industrial development. Even though Changpin Industrial Park lies nearby, the area along the coast is unsuitable for storing raw yarn because of the salty environment.
To compete effectively with new products out of China, in the last decade Hsiao has been researching new directions. He's looked at the possibility of producing socks that can draw sweat away from the skin and resist bacteria, and he's shown at European exhibitions looking for new markets. He has several new ideas, such as socks made from bamboo-charcoal yarn that inhibit foot odor, socks that resist UV damage and protect against bacterial growth, and a new patent-pending idea-socks and gloves that keep the skin moist and protect feet and hands from becoming chapped. With these novel properties, they can command high prices-more than NT$1000-and are extremely popular in Europe and the US.
The problems of Shetou's manufacturing industry are yet to be resolved. The people are hoping that the government and the country in general will look after SMEs such as their own. The hosiery industry has been an integral part of Taiwan for around half a century, so let's try to hold on to it, develop it and ensure that it can look forward to a profitable future.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.
With machines running 24 hours a day, the hosiery industry has been an integral part of Taiwan for around half a century, so let's try to keep the machines going and ensure the business a profitable future.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.
Innovation in design. Shetou's hosiery industry hasn't limited itself to the traditional. New hi-tech products include protective socks, and socks made from bamboo-charcoal yarn which inhibit foot odor.