Sourcing fairs are easing woes

SHANGHAI: Philip Cheng, chairman of Strategic Sports, was struggling to find a way to have his export-oriented business survive in the global economic turmoil.

Shrinking global demand and rising operating costs forced Cheng, the leader of the Hong Kong-based safety helmet maker, to shed 2,000 jobs, or 40 percent of its total workforce.

"We used to say the winner becomes the king and loser becomes the bandit," he said. "But now the king is actually anyone who can survive the economic slowdown."

Numerous small and medium-sized enterprises in China, especially those in the textile industry and targeting overseas markets have been especially hard hit by the economic downturn.

Yet as some local entrepreneurs called for a bailout, others have gone all out to cut operating costs and to find new markets. And Cheng's plant, which has focused on the overseas market for nearly two decades, is for the first time trying to tap the Chinese mainland market.

"The domestic market is becoming increasingly important for our future success though it's not an easy task to crack it," the chairman admitted. "We have our products tailor-made before seeking any buyers."

Without resources for direct sales for domestic buyers, Cheng turned to a professional trading service company that brought him to the China Sourcing Fairs: Fashion Accessories and Baby & Children's Products, which was held recently in Shanghai.

Organized by Global Sources, a leading B2B media company and a primary facilitator of trade with China, the fairs brought together domestic suppliers and both overseas and domestic buyers including Ahlens, C&A, Creata, Marks & Spencer and Otto International at 470 booths in the Shanghai New International Expo Center.

"The Chinese mainland is outperforming the retail market in many western countries, and recently experienced the highest retail sales for nine years," said Global Sources' Executive Director Sarah Benecke. "Overall spending has increased due to rising incomes in both urban areas and the countryside bringing many opportunities for suppliers of consumer products."

Cheng said exhibiting at the China Sourcing Fairs helped the company meet international buyers of baby and children's products as well as hundreds from the mainland, Hong Kong and Taiwan. And other exhibitors, including Meng Dazhi, deputy general manager of Shanghai Style Fashion Accessories Co, echoed his view.

"Facing the pressure of the global economic downturn, we are keen to boost our core competitiveness," he said. "We have to team up with the up-and-down streams of the industry, and transfer ourselves from being a simple trading company to a diversified service provider including design, production and quality control."

In a bid to remain in the business, the company recently invested in two manufacturing plants and employed five designers.

"The winter is chilly," Meng said. "We are glad to have had the opportunity to meet our target buyers at this show."

(China Daily 01/19/2009 page6)