Industry news

Let'S Erke-The power of unity

On July 21, Hongxing Erke announced on his microblog that he would donate 50 million materials through Zhengzhou Charity Federation and one foundation to help the disaster areas in Henan. At first, this microblog message had very few comments and attention, because Hongxing Erke's official micro was not a member and the number of fans was pitifully small. When the news was spread, it was finally pushed to the hot search. Many netizens left messages below to express their sadness. Everyone thought that enterprises that were going bankrupt should donate so much money to the disaster areas in Henan at one time. Hongxing Erke was praised as a low-key conscience enterprise.

Then, during the live broadcast in Hongxing Erke, the live broadcast room was immediately crowded, with a maximum of 49000 onlookers and sales of more than 10 million yuan. Many years ago, Hongxing Erke's slogan of "to be no." was still heard, but now this national brand has gradually faded out of people's sight. No wonder most people think it is going bankrupt. So, what are the stories behind this brand and why is it suddenly popular now?


According to official information, Hongxing Erke Industrial Co., Ltd. was founded in June 2000 and is headquartered in Xiamen, Fujian Province. At present, it has developed into a large sportswear enterprise integrating R & D, production and sales with nearly 30000 employees. The company has more than 7000 stores all over the world, and its products are sold in Europe, Southeast Asia, the Middle East, North and South America, Africa and other countries and regions. It has exclusive trademark rights in more than 100 countries around the world, with a brand value of more than 21.9 billion, and has won the awards of "China's 500 most valuable brands", "Asia's top 500 brands" and "Forbes Asia's top 200".

From this point of view, Hongxing Erke has been established for 21 years, and has gained many honors in the process of growth. Hongxing Erke brand originated from Hongxing shoes co founded by Wu Rongzhao's father and family members. Later, his father withdrew his shares. In 2000, when Wu Rongzhao's father led them to establish Hongxing Erke, it began with a blank factory. Moreover, it is little known that the assets of the enterprise founded at the beginning are negative, carrying more than 10 million yuan of bank liabilities, and even the plant has a large amount of arrears. Therefore, the start of Hongxing Erke is extremely difficult, which also implies that the following two decades of development are full of ups and downs.

Twenty years of ups and downs

The founding process of Hongxing Erke was also tortuous. It took 20 years to have today's Hongxing Erke, from his father and family members, to his father's withdrawal, and then to the two brothers Wu Rongzhao. Wu Rongzhao said that the name "Erke" implies the entrepreneurial spirit of constantly overcoming difficulties and surpassing oneself in the process of creating a brand. In fact, the brothers Wu Rongzhao, who decided to be an independent brand, have the tenacity to fight and work. In these 20 years of development, it also reflects their spirit of continuous struggle and overcoming difficulties, and has written a magnificent brand development history.

Compared with the whole international market, China's clothing industry in 2000 is still in its infancy. Many concepts are not mature and have just begun to form the concept of brand. At the beginning of its establishment, Hongxing Erke had no advantage in brand premium. In addition, the problem of accounts receivable was difficult to solve, and the serious lack of funds has been threatening the survival and development of Hongxing Erke. Therefore, Hongxing Erke decided to introduce foreign strategic investors and began to explore the establishment of an exclusive agency model. Wu Rongzhao made up his mind that he would rather eliminate some dealers with strong financial strength than those with high loyalty to Hongxing Erke's brand. After this wave of desperate operations, Hongxing Erke gradually improved and the company's negative equity situation was effectively improved.

Quality first

Wu Rongzhao recalled: Hongxing Erke was the first batch of enterprises to fully use environmental friendly glue. This kind of glue has high requirements for process, and it is easy to open the glue if the technology is not qualified. After overcoming the technical difficulties, Hongxing Erke applied this technology to the products of a foreign brand. Who would have thought that the purchasers of foreign brands were "furious" when they learned that "small Chinese factories" such as Hongxing Erke should not develop and apply such hard core technology. This will lead to easy glue opening of the product, and there is no quality assurance. Finally, after the enterprise issued the "quality assurance letter", it was able to let the goods leave the factory. Finally, excellent technology and quality have been verified by the market.

"Without a brand, there is no right to speak. This taste is really bad, which strengthens my determination to lead the transformation and upgrading of enterprises and build my own brand." Wu Rongzhao told reporters that even when undertaking the agent processing business to maintain operation and production, Hongxing Erke has never given up its adherence to quality and its pursuit of innovation. Brand comes from quality and quality comes from innovation. Wu Rongzhao implemented "two legs" walking: changing the extensive family management mode, introducing professional managers, and promoting the standardized operation and group development of enterprises with scientific management; Introduce the "lean production" mode, implement the "science and technology leading" strategy, establish the first perfect product R & D and technology research center in China, and make efforts from the level of "new technology, new materials and new design" to create a high-quality, high-grade and high-tech professional sports brand.

Hongxing Erke has established the first national Footwear Testing Center certified by CNAs in the industry and built a first-class biomechanical laboratory with the world's top sports research institutions. Over the past 21 years, Hongxing Erke has never stopped its pace of innovation. At present, the company has 272 patents, including 51 invention patents, which is rare in sports shoes and clothing enterprises.

Subsequent challenges

However, the good times did not last long, and a new crisis appeared again. Around 2007, Hongxing Erke opened many stores all over the country, but many stores once fell into losses due to "greed for perfection", unscientific location and management. Hongxing Erke's growth is a process of trial and error and self correction. It breaks its arms to survive, "cuts down" all loss shops, introduces ERP system, and reorganizes the channel structure in the scientific management mode of digital presentation and evaluation. This time, hongerke passed.

The inventory crisis from 2012 to 2014 once again pushed Hongxing Erke to the edge of a cliff. Wu Rongzhao smiled and said, "most of my white hair is contributed at this stage." The concept of fast fashion was the upsurge of the garment industry at that time, and brands such as Zara and H & M quickly attacked cities and territories at that time. This upsurge of fast fashion made Hongxing Erke "itchy", and it began to blindly imitate and follow the style of fast fashion products. However, the concept of Hongxing Erke as a sports brand has long been deeply rooted in the hearts of the people, and its fast fashion transformation is not "bought" by consumers. The house leaks, but it rains continuously. A fire in 2015 burned down nearly half of hongxingerke's production facilities, and the customer's purchase orders could not be guaranteed. Wu Rongzhao recalled, "at the most difficult time, our cash flow was not enough to support a week". During this period, Hongxing Erke finally realized the importance of returning to the main sports industry, determined the development route of product and technology integration, put forward the enterprise development vision of "building a world leading sports brand", and began its own scientific and technological transformation.

Usher in the dawn of hope

After experiencing a series of setbacks and failures, Hongxing Erke also became braver and braver, and successfully learned a lot of instructive experience. The company has introduced a forward-looking amoeba like business model to promote the transformation of the team from manager to operator; It has continuously invested in technology and product research and development, accumulated more than 200 patented technologies, and become a national intellectual property demonstration enterprise in one fell swoop. Hongxing Erke, who survived the disaster, has now entered a healthy and steady development track.

From OEM to imitation to the accumulation and application of technology, Hongxing Erke's concept is constantly changing with the change of the times. At present, Hongxing Erke has realized the connection of informatization from R & D to the value chain, and can support through its own production capacity and quickly supply the market. At the same time, Hongxing Erke also has strict control over the quality of products, and does not lose international brands in terms of comfort and appearance.

Future Erke

Today, Hongxing Erke has gradually sold its products overseas. The brand has a layout in Southeast Asia, the Middle East, Eastern Europe, North and South America, Africa and other regions. It has more than 1000 stores overseas and has exclusive trademark rights in more than 100 countries around the world.

The measure of a person's success is not the height he stands at the top, but the rebound when he falls from the top to the bottom—— Wu Rongzhao, founder of Hongxing Erke

Wu Rongzhao said that the strength of the country depends on the real economy and requires entrepreneurs to start businesses, innovate and create in a down-to-earth manner. In the final analysis, the choice of joining the industry is the self-determination of pursuing the ideal - insisting on doing one thing well all his life, and determined to build Hongxing Erke into a leading sports brand in the world. From the above, Hongxing Erke is indeed a good brand with toughness, respect for consumers, focus on quality and great patriotism. Once again, after being popular among ordinary consumers, they also expressed their hope to be a century old enterprise and become a proud national brand. At the same time, we also sincerely wish their development will be better and better. I believe this vision will eventually come true!

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