How a sleepy farming hamlet in rural Jiangsu became China’s thriving lingerie capital – ASEAN/East Asia

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In a house just off a wheat field in Tiaohe village in China’s eastern Jiangsu province, Geng Juan presses a small gauze triangle against a long black string and runs the two pieces through a sewing machine.

She then attaches the string to the end of the triangle, makes a few snips and adds it to the pile of G-string thongs growing on her workbench.

“This one looks disgusting,” she said. “But the pink silk gown I made this morning was really beautiful.”

Villagers like Geng, 30, turn out anywhere up to 2,000 items of racy underwear a day and are at the heart of the transformation of Guanyun county, a former agricultural hub that has become the country’s biggest producer of lingerie.

It’s a 3 billion yuan (US$471.1 million) industry supporting more than 500 manufacturers and satisfying demand not only overseas but also in China.

Today Guanyun accounts for 60 per cent of all lingerie products sold online in China and supplies retailers in the United States, Europe and Southeast Asia.

“Our products are sold everywhere and sometimes worn by celebrities,” said Lei Congrui, general manager of Midnight Charm, a major lingerie producer in the area.

It’s a long way from a decade ago when Guanyun was just another impoverished county that young people left in search of work in more affluent cities like Shanghai, Nanjing and Suzhou.

Back then the county was better known for growing wheat and rice, and annual personal disposable income was 9,010 yuan.

IN THE BEGINNING

The transformation began when a number of entrepreneurs sensed an opportunity in the market.

Li Jiabao, founder of Yiji Trading, was one of the early entrants.

In 2009, he was a struggling toymaker, chasing payments from retailers, when a client asked if he could make lingerie.

He decided to give it a shot, sourcing the basic materials in a wholesale market and hiring tailors to do the sewing. He delivered the products on time and the business took off from there.

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He charged 10 yuan for each item, with about half of it profit, and as the orders flowed in, he could barely keep up with demand.

By the end of that year, when the global financial crisis hit many businesses’ bottom lines, Li had a bulging bank account.

“I had 300,000 yuan for the first time and I knew I could count on the business to get rich,” he said.

He bought two four-storey buildings for offices, warehouses and workshops, and enlisted a legion of workers like Geng to sew the items.

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In all, it could take just a week to go from receiving the design to getting a marketing photo of a sample from a modelling agency to mass production.

Of course I feel tired all the time and my neck aches, but I come here to make money, not to have fun

Geng Juan

Soon, Li was producing more than 3,000 kinds of items, sending out at least 10,000 units a day to 300 or so domestic retailers and 50 overseas clients.

Lei, from Midnight Charm, was another first mover.

He opened his online shop and factory in 2009 when he was in the first year of law school. He started out copying popular styles online, including those of international brands, and soon went into the business full-time.

Lei, 27, said that at least 80 per cent of his orders, or 1.5 million units, were sold overseas, with half of the sales coming from the US.

BACK TO BASICS

Not surprisingly, the profits attracted other players and Guanyun became a lingerie-making powerhouse, with at least 50 manufacturers each generating annual revenue of more than 10 million yuan, according to Lu Xijuan, the director of the county’s e-commerce office.

But while the business is new, most of the production is done in small village workshops rather than modern factories.

Li said he had around 30 workshops, each with seven to 20 workers sewing from early in the morning to late at night.

In one workshop, Geng works 16 hours a day, seven days a week, earning 8 fen (or about 1 US cent) for each thong she makes.

She has been doing the job for about two years and makes nearly 4,000 yuan per month on average.

“Of course I feel tired all the time and my neck aches, but I come here to make money, not to have fun,” Geng said.

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She said she needed money because her family had spent 400,000 yuan building a two-storey home in the village and was saving to buy another.

“I have a son. Nobody would marry him if he didn’t have a flat in the county centre,” Geng said.

In another workshop, Chen Ming, 30, earns 80 fen for every see-through, spaghetti-strap top she sews together.

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Chen was working away from home in Ningbo, Zhejiang province, two years ago when she moved back to the village to be closer to her eight-year-old son.

She earns about 2,000 yuan a month less than she made at her previous job, but she said she was prepared to take a pay cut because she could see more of her son.

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“I go to work after sending him to school,” Chen said. “We have lunch and dinner together. I work between meals and tuck him in after I get off work. The workshop is just 10 minutes away from my home and I can take care of my parents and child while still keeping a job.”

Wang Jin, 26, said she liked the sewing work because it “was not boring”.

“Life is not dull and we chat all the time,” Wang said. “I don’t work overtime so the workload is fine.”

The companies’ proprietors have dismissed suggestions that they run “sweatshop factories”, saying the sewing workers make a decent salary.

“Some with good sewing skills can make 5,000 to 8,000 yuan a month,” Midnight Charm’s Lei said. “Sewing workers are in high demand – how could we treat them badly? [If we did,] they would change their employer immediately if they got a better offer.”

UP THE VALUE CHAIN

Keeping workers happy was critical to the companies’ and county’s goals of expanding the business internationally and seeing it thrive in the broader high-end lingerie marketplace, the executives said.

The lingerie business is booming and the competition is fierce

Lu Xijuan, county e-commerce director

The lingerie now is sold so cheaply that even a top-quality item seldom fetches more than US$5 from an overseas customer.

“The lingerie business is booming and the competition is fierce,” said Lu, the county e-commerce director. “From the government’s point of view we hope to upgrade the industry from low-end products to higher quality ones and build some big brands.”

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That view fits with Beijing’s plan to increase the country’s competitiveness in the global market by producing higher quality goods to cope with rising labour costs in China.

China’s economic boom was initially propelled by its cheap labour supply that made it the world’s factory after it opened up to the West. Many other countries have since moved into low-end manufacturing.

To learn how to build international brands and make high-end products, the county has organised for a group of Guanyun manufacturers to visit to France this year.

The county also plans to have a 113-hectare (279-acre) “lingerie fun town” up and running by 2020, bringing together production, showrooms and raw materials suppliers.

WIDER HORIZONS

Lei said he had already started shifting his focus to the international market to take advantage of growing overseas demand.

“Many make enquiries at 2 or 3am,” Lei said of his overseas customers. “They want to know the size of the goods and how we delivered them. We talked with them online via translation software.”

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Lei said lingerie to be sold domestically is mostly made to a standard size, meaning one size will fit a wide range of women. Pieces made for the Western market come in a range of larger sizes.

Lei started to design his own products in 2013 for overseas customers. In 2015 he began to produce for some international brands.

When Lei saw a price war in Guanyun eating deeply into profit margins – even causing some manufacturers to lose money – he refocused on his overseas business with a revised strategy that emphasised quality over quantity.

Despite halving his workforce as he reduced production capacity by 30 per cent, he still made the same amount of money, he said.

The entrepreneur seeks to meet demand by buying land for a factory that could be online by year’s end.

But the appetite for his items is also on the up at home.

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Yiji Trading customer service specialist Liu Feng said young people, including high school students, were increasingly buying lingerie.

“They all want to know whether their body can fit in the sexy attire and whether the goods can be delivered without being marked as lingerie on the cover,” Liu said.

“Many students buy our products and they will even send us pictures of them in the items to show they look really sexy.”

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