The textile industry in China is the largest in the world in overall production, exports, and retail, with an output of 58 million tons a year in the fiber categories alone, accounting for more than 50 percent of the world’s total. In 2023, monthly textile production volume was consistently around 3 billion meters.
The global textile industry was estimated to be around US$ 920 billion, and it is projected to reach approximately US$ 1,230 billion by 2024.
Textiles are products made from fiber, filaments, yarn, or thread, and can be technical or conventional depending on their intended use. Technical textiles are manufactured for a specific function, such as seatbelts or diapers. Conventional textiles are made for aesthetics first but can also be useful, such as jackets and shoes.
The textile industry is an immense global market that affects every country in the world either directly or indirectly. From a global perspective, the textile industry is an ever-growing market, with key competitors being China, the European Union, the United States, and India.
Due to comparably low labor costs, reduced commercial barriers and better information flows, China still presents one of the most attractive destinations for clothing manufacturing. In 2021, approximately 23.5 billion units of apparel were produced in China.
International trade figures further emphasize China’s current position as the world’s largest textile-exporting country, followed by the European Union and India.
Despite a stable growth of China’s clothing industry, several challenges for the sector have emerged on the horizon. Rising labor costs and increasingly strict environmental policies are among the most prominent issues for Chinese clothing companies.
To cope with the changes, an increasing number of Chinese textile enterprises have turned their focus to upgrading their industrial infrastructure and modernizing their production processes.
Because of the wide variety of textile products, there are many different manufacturing processes involved: the harvesting of plants, the tending of cattle, and the technology in creating synthetic thread. All these components of the textile industry create a large money-making machine that provides millions of jobs to countries around the world.
China has the world's largest and most complete textile industry chain. It is also the largest producer, exporter, and consumer of textiles.
In the leather footwear segment, revenue in China is expected to reach US$ 14.76 billion in 2023, according to Statista. In comparison, the United States will generate revenue of approximately US$ 24.1 billion this year.
China's leather footwear market is seeing a rise in demand for high-quality, sustainable, and domestically made products. A similar shift is happening in the rest of the footwear industry.
At the same time, the footwear market in China is projected to generate a revenue of US$ 82.82 billion in 2023, with an annual growth rate of 3.77% (CAGR 2023-2028). The non-luxury sector will account for 96% of sales in the market.
China’s leather exports were up by nearly 20 percent in 2022 while imports were down, according to the China Leather Industry Association.
China’s leather industry generated sales revenue of RMB 1.16 trillion (US$ 162 billion) in 2022, decreasing slightly by 0.1% from the previous year. Exports of the entire leather supply chain amounted to US$ 107.55 billion, a year-on-year increase of 19.3%, while imports amounted to US$ 17.27 billion, a decrease of 12.3% year-on-year.
Imports of raw hides and skins were 1.21 million tons and US$ 1.35 billion, down by 3.1% and 6.9% compared to the previous year.
Semi-finished leather imports were 502,000 tons and US$ 1.02 billion, declines of 15.8% and 18.3% year-on-year.
Finished leather imports totaled 49,000 tons and US$ 900 million, declines of 24% and 18.3% year-on-year.
In 2022, China exported 10.23 million leather garments valued at US$ 170 million, higher by 18.2% and 20.2% respectively over 2021.
Imports in 2022 were 337,000 leather garments totaling US$ 110 million, declines of 26.4% and 3.5% respectively from the previous year.
In the footwear sector, in 2022, China exported 9.29 billion pairs of footwear for US$ 57.58 billion, increases of 6.6% and 20.4% year-on-year. Footwear imports totaled 190 million pairs and US$ 5.9 billion, down by 10.3% and 3.7% from the previous year.
China exported 720 million pairs of leather shoes for US$ 11.46 billion, higher by 7.8% and 14.9% over the previous year. Leather shoe imports were 71 million pairs and US$ 2.8 billion, slightly lower by 0.2% and 0.8% from last year.
China's highly market-oriented textile industry is deeply integrated into the global supply and value chains of the sector.
Over the past few years, the world has undergone profound changes, and China-US relations have encountered significant challenges. However, certain aspects remain unchanged: economic and trade cooperation between China and the US is mutually beneficial, and the two countries are highly complementary and interdependent.
In the aftermath of the pandemic, many Chinese companies were forced to readapt, embracing online channels, and using live broadcasts and social platforms to promote and sell their products, expanding their customer base and attracting new consumers.
After years of cheap labor in China, the financial incentives to remain in the region are diminishing as wages go up and many household names decide to outsource manufacturing to other places.
According to information from China’s National Bureau of Statistics, the average factory wage doubled between 2013 and 2021, from RMB 46,000 (US$6,440) per year to RMB 92,000 (US$ 12,880).
Another significant shift has been the increased Chinese government’s support towards a more sustainable textile industry. The recent launch of the ‘Reborn – China Fiber Zero Carbon Action 2023 — Sustainable Textiles Credible Platform’ was recently launched at the National Exhibition and Convention Center in Shanghai.
It is supervised by the Department of Consumer Goods Industry of the Ministry of Industry and Information Technology and Suzhou Market Supervision Administration, and will be jointly run by China Chemical Fibers Association and the National Advanced Functional Fiber Innovation Center, according to China Daily.
China is the world’s largest producer and consumer of chemical fiber – a crucial raw material for the textile industry. China produced 64.88 million tons of chemical fiber in 2022, which was more than 85% of the country’s total fiber processing volume and more than 70% of the world’s total fiber output.
According to He Yaqiong, Director of the Department of Consumer Goods Industry of the Ministry of Industry and Information Technology, the government is working to establish China’s recycled fiber standard certification system with the establishment of the Sustainable Textiles Credible Platform as one of the steps to do so, China Daily reported.
Duan Xiaoping, vice president of the China National Textile and Apparel Council, said the green development of China’s textile and chemical fiber industry is “leading in the world”. He cited the low consumption of raw materials and energy for products, the low resources and energy consumption to produce the same number of products, the top place of the world’s output of recycled fibers ranks, and the top-class recycled fiber production.
Duan recommended the establishment of a complete waste textiles recycling system to achieve zero old clothes waste to tackle the waste-related pollution and ensure a steady supply of raw materials to produce green fibers.
Green clothing brands and efficient recycling systems are only a part of what needs to change for fashion to become less polluting.
With sustainable clothing brands slowly emerging in China, Chinese consumers are gaining eco-consciousness about the source of the fabrics they wear. The budding awareness coincides with Beijing’s ambitious green plan to become carbon neutral by 2060, and recently, it announced a new goal to tackle the notoriously polluting textile industry.
The Chinese government set a new goal to increase the recycling rate of textile waste from 20 percent to 30 percent by 2030 through a relatively "more comprehensive" recycling mechanism and a campaign to raise consumers' and producers' awareness about recycling.
Beijing said it plans to promote low-carbon textile production, encourage using sustainable fibers, strengthen producers’ social responsibility, improve the current textile recycling system, and raise investment in research and development for textile recycling technology, among other steps.
In China, textile manufacturing relies heavily on coal-based energy and is estimated to have a 40 percent larger carbon footprint than textiles made in Turkey or Europe.
The textile industry is also infamous for its massive water usage. The production of a ton of textile requires the use of 200 tons of water, with cotton production consuming up to 95%. China’s textile industry consumes over 850 Mt of water - approximately 6.3 percent of the total national water consumption. A pair of jeans can use over 3,700 liters of water and produce over 33kg of carbon.
On the demand side, only less than 1% of the post-consumption fashion items were recycled in China. Many of the discarded fashion apparel is sent to landfills, incinerators, or waste-to-energy plants.
In some communities in China, people are taking action to encourage sustainable fashion. A zero-waste shop like The Bulk House in Beijing, for example, sells products made from organic materials like cotton bags, while the e-commerce platform JD.com collects donated clothes for local charities at no extra charge.
Regionally, the textile industry is primarily situated in the southeast of the Pearl River Delta, the Yangtze River Delta, the Bohai Sea region, and the southeast of the coastal regions.
While there are 50 textile clusters in China, the five provinces of Shandong, Jiangsu, Zhejiang, Fujian, and Guangdong in the eastern coastal region are 70% of China’s overall textile production.
The China National Garment Association (CNGA) states that “China’s textile industry has achieved an edge by making clothing items in all categories in a quick and timely manner that ensures its leading position in the world’s industry regarding capability and efficiency.”
Footwear Segment: There are four major footwear industry clusters in China, predominantly located in the southeast coastal regions. The Guangdong footwear industry base, with Guangzhou and Dongguan at the heart, focuses on medium to high‑end shoes, while Zhejiang, with its footwear sector in Wenzhou and Taizhou, produces medium to low‑end footwear.
The western region’s footwear industry is headed by Chengdu and Chongqing, with medium to low‑end women’s shoes accounting for most of its output. Fujian’s footwear industry, led by Quanzhou and Jinjiang, specializes in leather shoes and boots as well as sports shoes.
There are over 2,300 footwear manufacturers in Jinjiang, Fujian Province, with a combined annual output value of nearly RMB 100 billion (US$ 14 billion). Their production of travel and sports shoes accounts for 40% of China’s total production or 20% of world production.
Jinjiang International Shoes and Textile City, Jinjiang’s largest marketplace for footwear materials, started trial operation in December 2020 as a national pilot for market procurement trade. In June 2022 alone, it logged RMB 2.57 billion (US$ 359 million) in export value, which was a growth of 14.2% over the same period in 2021.
Once the third‑phase expansion project is completed, it will become the largest professional shoe and textile marketplace in the Asia‑Pacific. This innovative market allows the one‑stop procurement of raw and auxiliary materials, helping to unify the local footwear industry and expand its potential for sustainable development.
Many brands have started to build innovative technology into their footwear. Nike’s latest smart shoes, for example, offer smartphone connectivity so that wearers can tighten and loosen their shoes through their mobile apps, including the voice control function of iPhone’s Siri. SEMS, a mainland brand, has launched different types of smart shoes with features such as location tracking, sports monitoring, and training plan creation.
These include smart shoes for children, football players, motion sensing games players, VR games players, students, pregnant women, and the elderly.
The intensive competition in the footwear world has led to some market segmentation. Many of the better‑known international and domestic sports shoe brands have chosen to largely focus their efforts on the adult market. As competition increases, the market is expected to become more fragmented, with companies seeking to target niches and sub‑categories.
Labor costs in China are rising with the development of the economy, which puts pressure on manufacturers. Some of them have adopted smart production facilities to improve efficiency and quality.
An example of this is the automatic laser cutter that is being used by a company to produce footwear materials and midsoles, discarding the manual mold‑making process. Another company uses a computer‑controlled automatic template exchange machine, which can operate automatically on a continual basis, stitching shoe uppers.
Users can input the required patterns, based on which the machine will complete the stitching. Smarteye Tech Limited, a Lenovo Group subsidiary, uses high‑resolution 3D industrial cameras together with a vision‑guided robot movement algorithm to streamline procedures in 15 shoe‑assembling work stations. The system automates tasks such as line drawing, vulcanization and treatment spraying of uppers, and adhesive injection.
The high value‑added in the footwear industry is mostly concentrated in areas such as design, market development and brand promotion, whereas manufacturing remains at the lower end of the value chain.
The main retail channels for footwear in China are department stores, specialty stores and e‑commerce. Part of the appeal of specialty stores lies in their robust brand image, rapid cash flow and prompt and effective customer feedback. But they also have disadvantages, and some customers have complained of the lack of variety in products and brands.
Several footwear centers have been built in China to encourage the local development of footwear materials and support the local shoemaking industry. In Wenzhou, a few trade associations have established a one‑stop product and service platform, billed as “China’s footwear and footwear material city.”
In July 2022, an international e‑commerce festival was held in Lucheng, Wenzhou. Some 100 KOLs (key opinion leaders) were invited to attend online, while more than 300 enterprises participated offline. The platform offers a huge variety of footwear and footwear materials, many from well‑known brands, and now attracts buyers not just from across China but also from the rest of the world.
Wuhou District in Chengdu, hailed as “China’s women’s footwear capital”, has more than 500 footwear enterprises in its industrial park. One feature of Wuhou is that it collaborates with online livestreaming platforms and uses big data to actively push footwear to interested clients.
In recent years, consumers have shown a preference for buying their shoes on e‑commerce platforms. An Askci Consulting report reveals that China’s online footwear market reached US$ 19.1 billion in 2021, accounting for 27.3% of the overall footwear market.
According to China Insights Consultancy, leisure footwear and clothing takes up the largest share of the online market (45.4%).
Taking a different approach, a few manufacturers have started to channel more of their products through hypermarkets and moved away from single‑brand specialty stores. Typically, these brands will set lower price points when selling through hypermarkets, with middle‑aged and younger consumers as their target.
China’s footwear trade fairs, which take place in several locations across the country, are seen as one of the key means for industry players to stay informed of the latest developments.
Since 2022, China started implementing provisional tariffs that are lower than the most‑favored‑nation (MFN) rates on 954 imported commodities. In particular, the provisional MFN tariff for ski boots, cross‑country ski footwear and snowboard boots was reduced from 14% to 4%.
Under CEPA, in principle, all Hong Kong products manufactured in compliance with the rules of origin can enter the mainland with a zero-tariff rate. As such, footwear products are entitled to zero tariffs and Hong Kong companies can benefit from this arrangement when accessing the Chinese market.
It is important for overseas companies looking to enter the Chinese footwear market to take note of the relevant standards that apply.
Under the Standardization Law of the People’s Republic of China, implemented in 2018, standards are categorized as national standards, industry standards, local standards, association standards and enterprise standards.
The national standards are subdivided into mandatory (GB) and recommended (GB/T). The industry standards are recommended. Overall, footwear falls into the light industry category, represented by the standard codes of QB and QB/T respectively. Local standards are recommended, while enterprise standards apply internally within any given company.
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