Treat shoemaking as a technology factory to create an annual revenue of 28 billion, deciphering the secret of Taichung’s low-key shoe king | Famous artist | Sanli News Network SETN.COM

Text/Duan Shijie/Jinzhou Weekly

Laiyi Group, which comes from Taichung and set up factories in Vietnam as early as 1990, has produced more than 300 million pairs of shoes in the past five years, including the recently popular Adidas SAMBA and Biden’s HOKA. Laiyi has become a brand factory in An important new force in Vietnam.

▲Laiyi Group, which has been established for more than 37 years, has already established a foothold in the sports and leisure shoe industry. On the right is Chairman Zhong Deli of Laiyi, and on the left is General Manager Lin Changyong. (Photo/Provided by Today Weekly)

Whether it is HOKA, the mysterious new shoe worn by US President Biden, or the popular Adidas SAMBA sneakers endorsed by Korean group BLACKPINK, they all come from a low-key shoe factory in Taichung: Laiyi Group.

The “mysterious shoe king” with revenue of 28 billion yuan and EPS of 6.26 yuan last year has produced more than 300 million pairs of shoes in the past five years. If a pair of shoes is 25 centimeters long, more than 300 million pairs of shoes will be lined up. It can circle the earth nearly twice.

Laiyi Group was established in Taichung in 1987. It has bases in Vietnam, China, Myanmar, and Indonesia, and has more than 55,000 employees. Its products mainly include casual shoes made by vulcanization and sports shoes made by cold bonding. If Baocheng and Fengtai are the global OEM leaders in sports shoes, they are the global leaders in the field of vulcanized shoes. On the basis of vulcanized shoes, it has also successfully switched to sports shoes, and currently the proportion of sports shoes has reached 70%.

Laiyi’s top three customers are all well-known brands: Adidas, the largest customer, accounts for about 58% of sales, second is Converse, a subsidiary of the NIKE Group, accounting for 21.4%, and third is the company’s stock price that has risen sharply in the past year. HOKA, a brand owned by Deckers, has risen, accounting for 13.4%.

The pioneering advantage of manufacturing in Southeast Asia first laid the foundation for Laiyi’s competitiveness.

Chung De-li, chairman of Laiyi, witnessed the take-off of Taiwan’s shoemaking industry. After graduating, he worked in a shoe factory. At that time, Adidas placed orders for Taiwanese shoe factories through agents. The quality and production management concepts brought by Adidas made him stay. Very impressed. After working for 11 years, he was familiar with the shoemaking industry and co-founded Laiyi with five friends in 1987. The current general manager Lin Changyong is one of them, and the two parties have cooperated for more than 37 years.

Grasp the advantage of manufacturing in Vietnam

When Laiyi was preparing to expand its factory westward in China, it was already two or three years behind big manufacturers such as Bao Chan, so it turned to Vietnam and settled in Ho Chi Minh City in 1990, becoming the first foreign-funded shoe factory in Vietnam.

“When I first came to Vietnam, I still swatted flies with one hand and ate with the other.” Chung De-li recalled. Vietnam entered the market early and laid the foundation for Laiyi’s current position. On the one hand, labor is cheap, and on the other hand, exports from Vietnam to European customers also have tariff-free benefits.

Lai Yi not only went to Vietnam early, but also went to southern Vietnam ahead of its peers in 2003 and invested in the Yi Xuan factory in Vinh Long Province. It is now Lai Yi’s largest factory. Lin Changyong said that at that time, he thought that in the future, more manpower would be needed to cope with production capacity. A factory often requires 20,000 people. The abundant and cheap manpower supply in undeveloped areas has also become a solid backing. In addition to Vietnam, China and Myanmar, Laiyi has also been deployed in Indonesia for two years, and the Indonesian factory will enter the mass production stage.

In addition to the first-mover advantage of manufacturing in Vietnam, the unique design and development and the ability to deploy automation in advance further amplify the competitiveness of Laiyi.

(Read the full text… https://bit.ly/44bHhak)

For more information, please refer to the latest issue of “Today’s Weekly” (Issue 1427)
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