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Pinghu, a county-level city in Jiaxing, Zhejiang province which currently produces 80 percent of down garments in China, is expected to generate over 35 billion yuan ($5.5 billion) in annual sales this year.

In a recent interview with Zhejiang News, two young entrepreneurs in Pinghu spoke about how the city's down garment industry is undergoing a comprehensive transformation.

From OEM to ODM

Zhang Yu, a Pinghu native born in 1995, is the general manager of Zhejiang Jackei Fire Clothing Co, an original design manufacturer (ODM) that supplies many famous clothing brands in China. Its annual sales revenue is expected to reach 200 million yuan ($31.38 million) this year.

"We focus on design and development of down garment for males. When we have delivered the samples, famous domestic brands such as Cabbeen, Bosideng, and Sanfu will come to pick their favorites and place orders," said Zhang.

Zhang added that the company was an original equipment manufacturer (OEM) for all kinds of clothes in the 2000s. But its change in business direction has allowed the company to offer much higher value-added and bargaining power for each product it sells.

To ensure product quality, the company established a team of 20 quality inspectors, all of whom possess more than eight years of garment manufacturing experience. Each of these inspectors are in charge of supervising every stage of the production. The company has also set up R&D teams for its factories in locations such as Pinghu, Guangzhou, Hangzhou which develop between 900 and 10,000 new garment models each year. Less than 10 percent of these models are selected for mass production.

In the early 2000s, Pinghu was home to around 1,200 garment enterprises which employed 180,000 workers and produced as many as 300 million pieces of clothes each year. It was the largest manufacturing base for the country's exported clothes.

However, over 95 percent of these garment enterprises were OEMs, which were hit hard in 2008 by the global financial crisis as well as the soaring costs of labor and raw material.

Zhang recalled that an industry-wide transformation took place in Pinghu in 2010, when hundreds of business owners, including his father who founded Jackei Fire, started to pivot to the ODM model.

A down clothing show at the final of 2021 China Pinghu Fashion Design Contest. [Photo/zj.zjol.com.cn]