1、 Current situation and sales comparison of global sock industry
Socks are necessities of life. The industry is large and has entered a stage of stable development. In 2015, the sock consumption scale of China, Japan, the United States and Europe (the European data is the total of Britain, France and Germany, the same below) was US $15.36 billion, US $4.73 billion, US $7.97 billion and US $5.27 billion respectively. Europe, the United States and Japan entered the stage of stable development of the industry earlier, and the compound growth rate in 2001-2010 and 2010-2015 remained between 0% and 5% (except Japan in 2010-2015). In the past 15 years, China's sock consumption has maintained a rapid growth rate, with the compound growth rate of sales of 10.41% and 10.20% in 2001-2010 and 2010-2015 respectively. It is predicted that in the next five years, the composite growth rate of sock consumption in China, Japan, the United States and Europe will be 0.7%, - 0.5%, 3% and 0.4% respectively.
Comparison of sock sales scale in the United States, Europe, Japan and China in 2015
CAGR comparison chart of sock sales in the United States, Europe, Japan and China (%)
Japan is the country with the highest quality requirements for cotton socks in the world, and the demand is large. In 2012, Japan consumed 1.337 billion pairs of cotton socks, including 190 million pairs of domestic production, down 6.39% from 2011; The import of cotton socks accounted for 85.99% of its consumption, up 0.29 percentage points from 2011. The domestic production of cotton socks in Japan has shown a downward trend year by year, but the proportion of its import volume to the consumption volume has shown an upward trend year by year; Among them, the amount of imports from China accounts for more than 85% of its total imports.
The global sock-making center has gradually shifted from developed countries to developing countries represented by China. In the 1970s and 1980s, the global sock manufacturing center shifted from the early United States, Italy and other countries to Japan, South Korea and Taiwan, China; Then, it was transferred to developing countries such as China, Türkiye, India and Pakistan, where production costs were lower. At present, China, Türkiye and Italy are the typical representatives of the sock production competition pattern. China has cheap labor resources and the advantages of a complete textile and clothing industry chain, but the pace of industrial transformation and upgrading is stagnant, and labor costs are high. In the future, China will transform from a manufacturing center to a high-end manufacturing and R&D center. Türkiye is close to the geographical advantage of Europe, but its production capacity cannot keep up with demand, geopolitical instability, and insufficient labor force will accelerate the construction of manufacturing center in the future. Italy is a traditional textile manufacturing center with advanced production technology and process, and has strong competitiveness in high-end sock production. However, due to high labor prices, it has gradually shifted to high-end textile and equipment research and development.
Major producers of cotton socks in the world
corporate name
different countries
Export volume/sales volume
Export/sales direction
advantage
GelalSocks
Türkiye
-
Europe
Family business, adjacent to Europe
NEMARS.P.A.
Italy
Annual sales in 2010 was 15.5 million euros
Europe
Strong R&D capability and advanced equipment
Beijing Fast Deer Weaving
Japanese capital
The export volume in 2013 was nearly 30 million pairs
Japan
Solely invested in Japan, with strict quality control
Yantai Thick Wood China Resources
Sino-Japanese joint venture
The export volume in 2013 was 22 million pairs
Japan
Sino-Japanese joint venture, cooperation advantages
Zhejiang Mengna
China
Exports of 100 million pairs in 2013
China/North America/Europe
Low production cost and strong production capacity
Jiansheng Group
China
The output of cotton socks in 2013 was 140 million pairs
Japan/Europe
Advanced production technology and strong production capacity
The production and manufacturing center represented by Vietnam has the advantages of labor cost, tax and resistance to trade barriers. In recent years, the hosiery industry has shown a trend of transferring to Vietnam and Pakistan with low labor costs, especially the newly signed TPP agreement, which has accelerated this process. Vietnam's manufacturing base has the following comparative advantages with China in terms of labor costs and tax treatment:
Comparison of labor cost and tax treatment between China and Vietnam
project
Vietnam
China
Labor cost
The average monthly salary is about 1000-1800 yuan
About 3500 yuan for the eastern coast
value added tax
20%, 10% in some regions, product export enterprises
25%
Starting from the profit-making year, the first four years are all exempted, and the next nine years are halved,
5%
Tariff of importing country: Japan
Tariff exemption
7%
Import country tariff: Australia
Tariff exemption
5%
Import country tariff: United States
14%, tariff will be exempted after the implementation of TPP
14%
2、 Analysis of the current situation and development trend of China's sock market
The growth of foreign demand for socks is sluggish, the domestic sock-making industry is extremely fragmented, and the manufacturing competition pressure of high-end products is less than that of low-grade products. According to the statistics of China's customs, the export value of China's sock fabrics in 2015 was 5.901 billion US dollars, down 4.21% from the previous year. Considering the impact of the TPP agreement, the cost advantage of Chinese sock-making enterprises may be lost, and the export is difficult to recover in the short term. The competition pattern of domestic sock-making enterprises is as follows:
(1) The industry is extremely fragmented: most cotton sock enterprises are small and micro enterprises with small production scale, scattered in Zhejiang, Jiangsu, Guangdong and other places, and this situation will remain in the future.
(2) Low-grade products: small enterprises, outdated production equipment, backward process technology, lack of independent research and development capacity, relatively single product varieties, serious homogenization, lack of market competitiveness, it is difficult to enter the domestic and foreign high-end markets.
(3) The competition in the middle and high-end markets is relatively stable: there are not many cotton socks manufacturers in the middle and high-end markets, and they have advanced production equipment, management concepts and production technology, more innovative research and development capabilities and marketing capabilities, and have strong competitiveness in domestic and foreign markets.
China's cotton sock fabric export quantity (unit: 10000 pairs) and export amount (unit: 10000 dollars)
The domestic sock-making industry has accelerated its transformation to high-end products, and the production of low-end products has shifted to Vietnam, Pakistan and other countries with low labor costs. First, Chinese sock-making enterprises can build production lines in countries with lower labor costs in the TPP agreement (such as Vietnam), and take advantage of the zero-tariff advantage of countries in the TPP to increase their market layout. Second, the production of low-end products is transferred to Vietnam, Pakistan and other countries with low labor costs, which is conducive to the adjustment of the product structure of Chinese enterprises, the upgrading of products and the promotion of the healthy development of the industry.
The domestic sock industry has experienced relatively rapid growth in the past 15 years and is expected to slow down in the future, but the per capita consumption and brand concentration of socks are still low. China's growth rate in 2001-2010 and 2010-2015 was fast, and the compound growth rate exceeded 10%. It predicted that the compound growth rate of China's sock sales in 2015-2020 would reach 0.7%, and the growth rate would slow down. But in 2015, China's per capita sock consumption was only US $11.2, compared with half of that in Europe and the United States, and less than one third of that in Japan. Therefore, although the growth of domestic sock demand slows down, with the upgrading of domestic consumption, the consumption of high-grade socks will continue to increase.
Domestic socks mainly compete with low-end brands
location
price level 
Representative brand
Sales terminal
Middle and low end
5-15 yuan
Hengyuanxiang, Meiji, Longsha and other domestic brands
Supermarket, wholesale market, small commodity market
Midrange
30-50 yuan
Nike, Adidas, Nike (China) and other brands
Large shopping malls and specialty stores
high-end
>50 yuan
Okamoto, crocodile, thick wood and other functional and brand products
Shopping malls, customized
Forecast of the market size and growth rate of China's sock industry from 2010 to 2020 (unit: USD million)
Per capita consumption of socks in Britain, Germany, France, the United States, Japan and China in 2015
Socks consumption gradually attaches importance to quality, fashion and functionality. 1. With the rise of the post-90s and the increase of residents' income, consumers' demand for socks has turned to personalized, fashionable and high-quality, such as various types of silk stockings and pantyhose; 2. Driven by scientific and technological progress, the textile industry has continuously developed new materials and applied them to the production of socks, and has developed more functions of socks, such as exhaust, moisture removal, sweat absorption and rapid drying, antibacterial and deodorization, infrared thermal insulation, and summer cooling; 3. The sports crowd has been expanding recently, and the demand for socks for various sports is increasing, such as running socks, mountaineering socks, football socks, basketball socks, tennis socks and golf socks. Diversified demand has prompted high-end cotton sock producers and retailers in the sock industry market to set up high-end cotton sock counters in China, and offline retailers have emerged boutiques, integrated stores and other models, thus improving the consumption level of socks.