Minhou: Making Small Crafts into a Big Industry

As the first established town in the territory of Fujian in history, Minhou boasts rich cultural heritage; while in recent years, Minhou has been a highlight among all counties in the economic development of Fujian Province. It is the only county that remained among the top 10 counties with the strongest economic power and the best economic development achievements for three consecutive years. Besides the motor vehicle industry represented by Soueast Motor and Fujian Benz, which plays the leading role, the emerging cultural industry is an important supporting force. In 2012, the cultural industry in Minhou County achieved a total value-added of 3.4 billion yuan, which is 10% of the county’s GDP and almost twice the provincial average. The two leading categories of products that drove Minhou’s cultural industry onto the track of fast growth are handicrafts made of iron, wood, bamboo and rattan, and Shangjie root carving. The former sees high-ranking export volume in the province and even in China, while the latter enjoys an 80% share in the domestic market, making Shangjie one of the most influential bases for the production and sales of root carving products in China.

Driving up north from Qingkou along the No. 316 national highway, you will pass towns such as Nanyu, Shangjie, Zhuqi, and Hongwei. While seeing motor vehicle manufacturers such as Soueast, Fujian Benz, and United Power, you will also find a lot of root carving factories and handicrafts factories.

Drawing upon its rich cultural heritage, Minhou’s effort to make small crafts into a big industry has paid off. In 2012, the cultural industry in Minhou achieved a total value-added of 3.4 billion yuan, which is 10% of the county’s GDP and almost twice the provincial average. This shows that the cultural industry has risen into a pillar industry and a new growing point for the county’s economy.

How was the pillar erected and what role will it play? Let’s have a look into the representatives of the industry, the iron and wood handicrafts and Shangjie root carving.

Iron and Wood Handicrafts:Enhance the Competitiveness with Innovations

Bamboo abounds in the mountainous areas of Minhou, and towns like Hongwei, Zhuqi and Baisha has always had the tradition of bamboo weaving. However, except for the Minhou County Handicrafts Factory set up in the 1970s, all handicrafts makers in the area were mostly household workshops, and the business was far less than an industry.

The change occurred in the 1990s. In 1990, Fujian Minxing Weaving Co., Ltd. was established, aiming mainly at foreign trade, and a series of similar handicrafts companies mushroomed soon. In 1998, the handicrafts industry achieved 1.12 billion yuan of export value, more than 85% of the total export value of the county.

Entering the new century, Minhou County decided to break the old pattern of village- and household-based operation and form clusters for better development. And now a new pattern has basically taken shape. Led by key enterprises such as Minxing, Minquan and Yunfei, handicrafts manufacturers gather in towns such as Baisha, Hongwei and Jingxi, and mainly focus on handicrafts made of iron, leather, bamboo & straw, and wood. Meanwhile, supporting industries such as packaging, logistics, and raw material supply have also developed and a complete industrial chain has been formed, enabling the handicrafts industry in Minhou to benefit from its scale.

Mainly aimed at foreign trade, handicrafts enterprises in Minhou are frequent participants of the Canton Fair and once led the rank by the number of deals made among participants from Fujian Province. However, under the pressure of the global financial crisis in 2008 and the continuous RMB appreciation, the industry now faces huge challenges.

The only way out is innovation. “These enterprises have long been targeting foreign markets, and it is unrealistic for them to give it up altogether and shift to the domestic market.” said Hong Minjie, Secretary General of Minhou Handicrafts Guild. Innovation lies in creative ideas, designs, packaging, etc. The Christmas decorations exported earlier were mostly low-profile items, leaving the enterprises with limited opportunities to bargain. Later, some enterprises began to add highlight vanishes and shining bits in the paint and equip the products with music and lights. Such new products were warmly welcomed by the market even if the price was twice that of the old ones.

Fuzhou Star & Moon Home-Decor Co., Ltd. in Jingxi Town achieved a total export value of 12 million US dollars last year, 5% higher than the previous year. Chairman of the company Lin Shan said that in the face of a change in the consumption pattern in the US and Europe, they had been putting 15% of our profits into R&D each year and achieved a large catalogue covering more than 10,000 varieties. As he pointed out, “only with creative ideas, brilliant designs, reliable quality and excellent services can we retain quality customers.”

Chen Dingfeng, Chief of the General Office of Fuzhou Minquan Arts & Crafts Co., Ltd. in Hongwei Town also maintained that due to the impact of the financial crisis, the purchasing power was declining on foreign markets for handicrafts, and that foreign buyers were pressing harder for lower prices, substantially diminishing the profit margin of manufacturers. “Such a situation is forcing us to do our work better, be more professional and specialized, and ensure better product quality and punctual delivery.” Chen said, “For example, when you paint iron decors, the paint you use must be up to the standards for environmental protection adopted in Europe and the US, otherwise the whole shipment will be returned.” According to Chen, Minquan had a total export value of 220 million yuan last year, while for the first four months of this year, it has achieved 70 million.

Coming out of a staggering period, the handicrafts industry in Minhou regained its steady development pace gradually, and a new momentum has recently showed up. In 2012, the iron and wood handicrafts industry saw a total output of 5.374 billion yuan, up 27.1% over the previous year; and the output of the first four months this year registered 2.081 billion, an increase of 13.6% over the same period of last year. Four enterprises including Minxing and Minquan found their way into the 2012-13 list of key export cultural enterprises of Fujian Province, holding out hope for a flourishing future.

(Source: Fujian Daily)