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For Beijing clothing wholesalers, an International Clothing City?

May 15, 2015

konjaku: this is one model for social and economic development: a familiar but strained, deteriorating institution (in this case, the clothing wholesale markets in central Beijing) is ordered shut down, and those associated with this institution are supposed to move to a new, spacious, modern site outside the city. Given that the wholesale markets are viewed as magnets attracting the “low-end population” to live and work in those districts in which the markets have grown up, moving these markets to new facilities on the periphery is perhaps also supposed to transform the target population out of their “low-endedness,” although this is unsaid. In the spacious, shining, modern, rational model of an “International Clothing City,” in which all the processes of manufacturing and selling are brought together, those who were previously thought “inappropriate” for the capital, will find their true place and function. For the time being, the small wholesalers are being rapidly removed from locations in the center of Beijing, but where they are going seems to be still up in the air. The first article here suggests it will be Yongqing. The second article gives another perspective.

Note: there are two major clothing wholesale complexes in Beijing, Dahongmen, which is to the south of the city center, and the Beijing zoo area clothing wholesale market.

Dahongmen:

http://english.visitbeijing.com.cn/shopping/markets/n214860924.shtml

Beijing zoo:

http://www.meiguoxing.com/Shopping/Beijing_Zoo_Clothing_Market.html

Hebei Yonging grabs the Beijing-Tianjin-Hebei clothing market group –will construct a composite satellite town

2014-05-19 http://finance.sina.com.cn/china/dfjj/20140519/010919145268.shtml

The relocation of the Beijing wholesale markets has become a hot issue this year. As many markets and associated businesses have taken a wait and see attitude,the two Dahongmen markets, and six other major markets last Friday signed a contract with the Yongqing International Clothing City. In the future Yongqing International Clothing City is planning to attract clothing businesses both from the Bejing-Tianjin-Hebei region, as well as from the Yangtze River triangle and the Pearl River triangle, to forge a clothing industry center. These eight markets altogether posses more than 9000 businesses, with 35,000 employees. The terms of the deal are still being negotiated.

“Every single one of our businesses are moving to Yongqing, Dahongmen textile market board chair Wang Jilei said. These businesses are very willing to move to Yongqing, because a collection of Daxing clothing manufacturers have already moved to Yongjing, therefore the wholesalers will be closer to their supply chain. As for the Dahongmen original location, Wang Jilei said they had been renting there. After they move to Yongqing they will get property rights, and they will also be able to buy and own other stores within the market. “We will not only have our original business, but we will also have a new investment channels.”

A reporter at this newspaper has learned that many other Dahongmen wholesale markets are planning to move to Yongqing, and a number of them have already signed contracts. The Beijing wholesale markets in Xicheng and Fengtai, previously looked at Langfang and Baoding in Hebei, and Wuqing near Tianjin. Why did these eight large markets decide to move to Yongqing? The first factor is that it is relatively close to Beijing. Its location is an important nodule in Beijing Tianjin unification, being 48 kilometers from Beijing, 60 kilometers from Tianjin, 80 kilometers from the Beijing capital airport, 110 kilometers from the Tianjin new harbor, 17 kilometers from the Second Capital Airport. Especially once this new airport opens, Yonqing International Clothing City will take a big step forward in internationalizing its business.

The Yongqing International Clothing City is located in the Hebei Yongqing Taiwan New Industrial City, occupying 5000 acres. The clothing industry is its first focus, but there is also e-commerce, freight delivery and shipping, banking and tourism, and other service industries under development. When the building project is completed it will be a next-generation new satellite town for Beijing, the largest business assemblage in China. Building of the Hebei Yongqing Taiwan New Industrial City began in 2006, but since then the Taiwanese merchants has disinvested, at present the Zhejiang merchant consortium has taken over. In the future the name will be changed to either Yongqing International Clothing City or Yongqing New Economic Zone.

The following photo sequence documents the wholesalers in the process of moving out of their old quarters, along with photos of construction in the Yongqing Taiwan New Industrial City, dated 2014-04-03.

http://www.llzg.cn/forum/topic-72930.html 2014-04-03_1396503971669

2014-04-03_1396504921152 2014-04-03_1396504946621

location of Yongqing

location of Yongqing

2014-04-03_1396504273998 2014-04-03_1396504317727 6608733_110924971000_2

rendering of the completed International Clothing City

rendering of the completed International Clothing City

Beijing Zoo Area Wholesale Markets will settle down where? In Yongqing, the Quota of Land Needed is still in Suspense, Undecided

2014-07-01 http://www.nbd.com.cn/articles/2014-07-01/845226.html

Source Daily Economic News (Meiri Jingji Xinwen) Reporter: Zhang Wen, dispatch from Langfang

Originally within the industry many firmly believed that the wholesale markets around the Beijing zoo would settle down south of Beijing in Yongqing. However, the suspense of where markets will actually end up has once again arisen. As reported, the Dahongmen markets are planning to move to Yongqing, but now the land required for the new construction has not yet been acquired. On 06-25, a staff member at the Yongqing Taiwan Industrial New City who was reluctant to give his name, leaked to the Daily Economic News that they had only acquired some 700 mu of land which was designated to be a garment factory in the Yongqing International Clothing City. The land for the Dahongmen and other wholesale clothing markets is still in the planning phase, not yet resolved. From 2010-09 up to now, they have acquired 400 mu, and in the first half of this year Hebei and Langfang together designated another 350 mu. They still need an additional 2000 mu. (A mu is one sixth of an acre). The same staff member said, “Right now we are waiting for the national plan to appear, hoping that will solve the problem.”At the same time, this reporter has learned that Beijing city intends to tighten its management controls, not only on the large clothing wholesale markets like Dahongmen, but also on the small scale clothing, shoes, hat, and sundries “morning markets” that set up on the street.

Yongqing’s dilemma

Yongqing (“forever clear”) got its name in the Tang dynasty, during the Chaotian reign period (742-756). It meant, “the desert that is always clear.” It is directly south of Beijing, on an axis 60 kilometers from Beijing, and the same distance from Tianjing. It is under the administration of Langfang, a prefectural-level city in Hebei. If one takes the 828 road bus from the Yongdingmen long distance bus stop, after 29 stops one can get off in front of the Yongqing government building, but as for going back to Beijing, the last bus leaves at 5 in the afternoon. In its long history, the speciality in Yongqing has been agriculture. It is a latecomer to other forms of economic development. In terms of the total sum of economic activity, Yongqing ranks at the bottom in the Langfang administrative district. In 2013, total income was only 920 million yuan; among the 380,000 permanent residents, 340,000 are farmers. Being close to Beijing and Tianjin has not helped to quicken the pace of Yongqing’s economic development over the last couple of decades. On the contrary, it has accelerated the erosion, as young people and businesses moved away.On Cailiu Road. Yongqing’s main shopping street, the owner of a home appliance store said, “the goods we sell come from Guangzhou. But they first go through Bazhou or Langfang, only then do they reach Yongqing. This reporter did an internet search for ”Yongqing distribution company,” and only one company came up, besides three based in Langfang.

However, starting in 2009, the Yongqing government has been very effective in attracting investment and new businesses. [details omitted]. Zhejiang business associations, which have played a leading role in the Beijing wholesale clothing markets, have been behind the effort to bring these markets to the Yongqing International Clothing City (previously called Zhejiang Commerce New City), located inside the Yongqing County Taiwan Industrial New City. According to a government website, more than 670 clothing manufacturers have signed contracts to move to Yongqing. An Industrial New City staff member said the plan is to have businesses representing all stages of the clothing business, including manufacturing and processing, to move to Yongqing. This supply chain, including the clothing wholesale markets, will be a major artery for the Chinese clothing industry to become international in scope. There are also plans to build a high-tech industrial park in Yongqing [details omitted].

A staff insider told this reporter, “We hope to find a profitable equilibrium developing both the clothing industry and the high-tech project. In the end we must see which has the best prospects. To deal with the problem of finding the target quota of land, we either have to focus on one over the other, or somehow increase and decrease proportions to balance them out. Actually, in Yongqing, even though it is a big agricultural county, at the same time there is a problem with finding enough available land. As a staff insider said, of the 65.7 square kilometers designated for the Industrial New City, only 8 square kilometers conforms to the use standards of the plan. There are high hopes for the Yongqing International Clothing City, but construction is lagging. A taxi driver told this reporter, “for years there has been no movement, now suddenly on the net there’s lots of talk.” This reporter went to the site of the Yongqing Taiwan Industrial New City to investigate. There is one area near the road where the buildings are already constructed and finished, but another large area of land blocked off from view, wrapped around by a fence made up of signs advertising the project. 2014-04-03_1396504820054

“the largest clothing industrial base in the north”

“At present we have already built eight factory buildings, each is 6500 square meters. They have not yet been put to use. There are 30 garment factories under construction, these are almost finished. However, as far as businesses go, the plan has just come out, and we do not have many takers yet,” leaked an insider staff member. As a net news site states, “the Yongqing International Clothing City began construction in 2010-09. Total land area is 30,000 mu (5000 acres), budget is 80 million yuan. The Beijing branch of the Zhejiang merchant association took the lead, and numerous Zhejiang entrepreneurs invested. Over 670 clothing manufacturors have already signed contracts, and eight of the Dahongmen clothing wholesale markets on 05-16 announced their move here.” Concerning these eight markets, an insider said, “More or less all of them are already investors who have stock in the Yongqing project.” An insider revealed:” The Dahongmen wholesale clothing market Zhejiang merchants started managing the Yongqing project in 2009. At that time, a mu of land cost between 30,000 to 100,000. They purchased land and began to develop a first class development. However, in the last five years, the pace of advancement slowed. The original plan –to build garment factories in the first phase, and to attract clothing businesses in the second –has been put on hold, because they have only acquired 700 mu of land. There are 600 clothing manufacturers who have already paid all or part of the money but they have not yet gotten the land to build the factories for them. At present, the price for a mu of land has risen to above 300,000 yuan.”

The dilemma that the Dahongmen merchants face, is that they have not yet succeeded in building the part of the project that is for the clothing merchants, while Beijing city is increasingly tightening its control over the wholesale markets for clothing and other sundries. A wholesale dealer said, “ We have heard Beijing city will soon issue a new policy, making it more difficult for the wholesale markets to operate as they have in the past. When this comes out, those involved in the wholesale business will have to quickly come up with a scheme to adjust and find new opportunities.” An industry insider said, “If the wholesale markets are going to move outside the capital, this will effect both the merchant tenants, and those who own and develop commercial properties. The former are searching for space in a new market, the latter are looking for new investment opportunities. The two are not necessarily bound together. The developers may decide to invest in an area in which there is not already a flourishing market, which may make it uncertain for tenants. On the other hand, if the developers choose a place where there is already a well-established market, it may be hard to accommodate so many newcomers.

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