Opportunities and Challenges Brought to the Silk Export in Hangzhou under the context of “the Belt and Road Initiative”

夏翌恺 左玉玲

Abstract：Silk has been considered as one the three native special local products in China. The history of silk manufacture in Hangzhou can be dated back nearly four thousand years ago. China’s silk production center lies also in the province of Zhejiang， and its capital city Hangzhou is one of the “Six Silk Capitals”. Hangzhou has always been hailed as the home of silk. Yuhang， District of Hangzhou， is designated by the state as the ‘Silk Manufacture Base’. China International Silk Expo has been held in Hangzhou for four consecutive years. All the above factors fully explain that Hangzhou has exceptional advantages in developing silk industry. Superior quality of silk products makes it an important part of China’s silk export every year， and its products are exported to many foreign countries.

In recent years， the implementation of the strategy of ‘the Belt and Road Initiative’ has provided a better opportunity for the development of Hangzhou’s silk exports. For example： the establishment of the China （Hangzhou） Cross-border E-commerce Comprehensive Pilot Area， the improved economic and trade cooperation between China and other countries， the rapid development of infrastructure construction， etc. But in the meantime， the strategy also brought great challenges. Such as the difficulties in enterprise transforming and upgrading， the impacts of silk trade from other countries， and the impacts of competitions between chemical fiber producers and cotton product producers.

Based on the background of a special era， and the particularity of silk products， this essay firstly analyzes the current situations of silk export in Hangzhou， then studies the opportunities and challenges that Hangzhou silk is facing brought by ‘the Belt and Road Strategy’. Finally， on the basis of the above two factors， this article would propose corresponding strategies for the expansion of Hangzhou silk export， so that the silk industry can seize opportunities and meet the challenges in the era.

Key words： The Belt and Road Initiative； Hangzhou Silk； Export； Solutions

Introduction

In recent years， China proposed‘the Belt and Road Initiative’，and is committed to build an economically integrated community around the globe. In this context， the silk industry in  Hangzhou is facing unprecedented opportunities and challenges. In 2018， China ranked only the third largest silk export nation in the world， accounting for only 20.33% of the global silk exports， and China’s silk products in the global market shrank seriously， with the global share of exports shrinking down by 2.89% compared with the previous year. As a major silk export city in China，  Hangzhou’s export sales have been declining in recent years. In 2017， the silk exports in Hangzhou accounted for 22.67% of China’s total silk exports. But in 2018， affected by the adverse situation of international trade， the silk export in Hangzhou has been fatigued， and the export sales was in a remarkable decline. The Belt and Road Initiative was put forward not only to tackle the challenges of silk industry in Hangzhou and to promote the export of silk products in Hangzhou， but also to provide more information and suggestions for silk manufacturers to go global and meet the needs of this era better， so as to carry forward the traditional culture of the Chinese nation and to enhance Chinese influences in the international market. This article has certain practical significance in this regard.

一、Current Status of Silk Export in Hangzhou under the Belt and Road Initiative

As the origin of Chinese silk， Hangzhou has a unique environment in silk industry， and its silk production has been ranked the first in China for many years. However， with the Belt and Road Initiative， silk export in Hangzhou is in grim situations because of the effect from domestic and oversea markets， and the rising cost of interprovincial raw materials and labors.

（一）Introduction of the Belt and Road Initiative

The Belt and Road Initiative is the Chinese abbreviation of the Silk Road Economic Belt and the Twenty-First Century Maritime Silk Road， also known as The Belt and Road. It was proposed and advocated by China in the year of 2013. The Belt and Road Initiative encompasses the countries and regions along the Silk Road and the Maritime Silk Road， which has historically crossed the maritime coasts of China， Central Asia， West Asia， India and the Mediterranean Sea. The Belt and Road Economic Belt covers all countries in Asia， Europe and Africa， and constantly creates an active economic circle in Eastern Asia and establishes a developed European economic circle.

Over the past three years since Chairman Xi announced the initiative， this idea has become popular and cooperation among countries has flourished. It has become the most popular public interest products and the most promising platform for international cooperation. ‘One Belt， One Road” initiative is successful because it satisfies the urgent desire of partner countries for mutual benefits. One Belt， One Road initiative has become a common cause for countries around the world as trade protectionism and unilateralism rise.

（二）Summary of Silk Industry in Hangzhou

China is the first country of producing silk in the world， known as the “silk nation”， while  Hangzhou is an important silk production center and export base in China. Hangzhou is known as the silk capital， Huzhou is known as the origin of world silk， Shengzhou is known as the silk highland of China， and  Hangzhou is also known as the ‘Silk Capital’. The silk production can be dated back more than 4700 years. For many years， the yield of raw silk， satin productions and export sales were ranked the first in the country.  Hangzhou silk is famous for its superior weaving technology and high qualified products. There are more than 200 varieties of silk and tens of thousands of different patterns in  Hangzhou. The categories are mainly divided into 14 items， including silk， satin， cotton， spinning， crepe， quilt and Luo. Many  Hangzhou silk products have won national or provincial high-quality products award， with an excellent reputation in the international market. The Jiangnan region of China， especially areas like  Hangzhou as the center， had gradually become the center of silk manufacture in China since the An Shi Rebellion in the late Tang Dynasty. The silk production and export trade in Hangzhou has been flourishing， and the silk culture has been passed through to today.

（三）Current Development of Silk Export in Hangzhou

In recent years， under the influence of various factors such as the global economic depression and international trade policies of countries around the world， China’s national silk product export decreased significantly in the year of 2018， with the annual export sale of US $2.958 billion， over 16.9% decrease compared to the previous year. In the consecutive six years from 2012 to 2018， China’s silk export increased only in 2013 and 2017， but still fell by about 10.98% in total. （Data source： collected by Prospective Industry Research Institute）

Despite of the national policy support from the Belt and Road Initiative， the silk enterprises in Hangzhou  are trying to go globally. However， the export trade is still not very promising. In 2018， the export sale of silk products in Hangzhou was US $815 million， with a year-to-year growth of 0.9%， accounting for 27.6% of the national silk export sale. And in the meantime， the export of silk products in Guangdong Province went through a year-to-year drop of 32.1%， but Guangdong Province still occupied the first place in China’s Silk products export， which far surpassed Hangzhou， with the export sale reaching US $1.168 billion， accounting for 39.5% of the national silk export sale. （Data source： collected by Prospective Industry Research Institute）

Under this background， from January to September 2018， there were 82 silk enterprises counted by the Hangzhou  Silk Association， among which 20 enterprises operated at a 24.39% sales loss. The profit and loss offset each other， with a profit of 853 million yuan. From 2010 to 2017， the silk export in Hangzhou was also in a huge decline. In 2010， the export value of Hangzhou silk reached 1.353 billion US dollars. However， since 2015， there has been a significant drop. In 2016， for the first time， the export value of Hangzhou silk was less than 1 billion US dollars， with a decline of 14.48%. Since then， it has never restored its past glory.

二、Opportunities for Silk Industry in Hangzhou under the Belt and Road Initiative

Based on the geographical location， cross-border e-commerce， infrastructure， international economic and trade cooperation， and the popularity of silk products of Hangzhou， this part will analyze the potential opportunities that silk industry in Hangzhou faces in this context.

（一）Superior Regional Conditions

Hangzhou is an important province for silk industry， because it is located at the prosperous and rich region in the south of the Yangtze River. Its capital Hangzhou is known as the ‘Silk Capital’， Huzhou is well known as the birthland of world silk， and Shengzhou is known as “Silk highland of China”. The city of Hangzhou is located at the rich Hangjiahu Plain， which is a famous manufacture center for its excellent raw silk productions and silk processing. The unique natural geographical factors such as climatic conditions and soil texture make it the first choice for mulberry planting and sericulture. And furthermore， because it is located at the transition zone of the middle and north subtropical zone， Hangzhou has a warm climate， suitable humidity and sufficient sunlight need for mulberry growth， with four distinct seasons and sufficient rainfall.

In the strategic blueprints of the Belt and Road Initiative， Hangzhou also possesses a very prominent regional advantage. Hangzhou lies in the middle of the east coast of China and in the meantime， in the midpoint of the east coast of Eurasia.Hangzhou is on the crossroad of the North route of the Northwest Pacific Ocean （Northeast Asia） and South （the South Seas and the western world） routes. Since ancient times， Hangzhou has been the key area of China’s opening to the outside world. Hangzhou People had made great contributions to the development of the ‘Maritime Silk Road’. Nowadays， in the development of the Belt and Road Initiative， Hangzhou， taking Ningbo-Zhoushan as the center， is planned as the main hub of the coastal ports along the Maritime Silk Road. Jinhua-Yiwu will be the important development objects， and the key route of “the Belt and Road Initiative” will be established. Market expansions of The Belt and Road plans is based on the advantages of this foreign trade province.

（二）Establishment of China Cross Border E-commerce （Hangzhou）Comprehensive Pilot Area

In 2013， China became the world’s largest e-commerce country with the volume of e-commerce transactions exceeding 10 trillion. In the same year， Hangzhou， Hangzhou， was designated as the national e-commerce center. Under the cooperation of Alibaba group led by Mr. Ma Yun and the Hangzhou Municipal Government， on March 7， 2015， the first Comprehensive Experimental Zone for cross-border e-commerce in China was established in Hangzhou， approved by the State Council of China and headed by the People’s Government of Zhejiang Province. It was proposed that， in the pilot area， “six systems and two platforms” will be established， which integrates the flow of information， capital flow and merchandise flow for cross-border e-commerce.

The experimental area made a remarkable progress in around six months of pilot implementation. By the end of November 2015， statistics showed that the cross-border e-commerce trade increased sharply， from $18 million to $3.04 billion in 2014. In the meantime， it promoted the growth of the entire foreign trade economy in Hangzhou. From January to November 2015， the export of Hangzhou reached 39.9 billion US dollars， an increase of 3.8%.

As the capital of Zhejiang， Hangzhou has greatly promoted the foreign trade development in other regions and the entire province. The industrial structure of Hangzhou has been optimized， providing new and important channels for innovation and Entrepreneurship of the public， and providing precious opportunities for the development of small enterprises， and enhancing the competitiveness of all kinds of enterprises. In this context， silk enterprises in Hangzhou deeply benefited from the cross-border e-commerce models of B2B and B2C， which is more convenient for export and more frequent for foreign trade activities.

（三）Rapid Development of Infrastructure Construction

By the end of 2018，the one-hour traffic circle from Hangzhou to the major cities in the Yangtze River Delta and the two-hour high-speed rail traffic circle to all districts and cities in the province， has been basically established. The total mileage of the expressway reached 121，000 km， including 4421 km of highway. The cargo throughput of Ningbo-Zhoushan port has been the first around the globe for ten consecutive years， and the cargo container volume has risen to the second in China and the third in the world. Three airports， Hangzhou， Ningbo and Wenzhou， accommodated more than 10 million passengers per year.

In 2019， Hangzhou was chosen as one of the first batch of provinces for pilot projects to build a powerful transportation nation.Hangzhou officially released the construction plan for the implementation of the “four ports combination operation”， making full use of the advantages of the comprehensive hubs of “seaports， land ports， airports， and information ports”， strengthening the efficient connection of various modes of transportation and achieving organic integration， weaving a four-in-one comprehensive and three-dimensional transportation network， building a modern transportation logistic system， and realizing the optimization of transportation system， improvement of transportation efficiency and reduction in logistics cost.

Most silk products are exported by sea transportation， while some of the choice goods entails air transportation. Relying on the interprovincial highway transportation in all directions， the products manufactured by silk enterprises can be transported to major ports and airports conveniently， which greatly shortens the transportation time and cost. Meanwhile， multiple railway lines are available in Hangzhou to connect the countries along the Belt and Road Initiative economic belt. There are two international railway freight routes in Yiwu， Zhejiang. The “Yiwu Beilun Port” railway and sea joint transport class is listed as an ocean route， and the international railway transport class is used as an inland route， which is also the China-Europe Railway Express trains and China-Central Asia Railway Express trains.

（四）Economic and Trade Cooperation between China and Other Nations

From 2013 when ‘’the Belt and Road Initiative ‘’was proposed till 2018， the total trade sale between China and the Belt and Road countries has reached around 6 trillion USD， with an average yearly growth rate of 4%. In 2017， the trade value in the Import and export between China and the Belt and Road countries reached 7.4 trillion yuan， with an increase of 17.8% compared with the previous year， of which， the export volume increased by 12.1%， reaching 4.3 trillion， and the import volume increased by 26.8% and reached 3.1 trillion yuan. In 2018， the trade volume increased by 16.3%， reaching 1 trillion and 300 billion dollars， of which the export volume was 704.73 billion US dollars， with a year-to-year increase of 10.9%； the import value is 563 billion US dollars， with a year-to-year increase of 23.9%； the total import and export volume of goods in 2019 remains on the rise， with a year-to-year increase of 3.4%， a total of 31544.6 billion yuan. Among them， exports reached 17229.8 billion yuan， with an increase of 5.0%； and imports reached 14314.8 billion yuan， with an increase of 1.6%. The balance between import and export is 2915 billion yuan. In regional trade， the volume of trade between China and European Union， has increased by 8%， and 14.1% to ASEAN countries. The total volume of imports and exports between China and the Belt and Road countries has increased by 10.8% in total.

As an important economic and trade center， Hangzhou has made outstanding achievements under the strategy of “The Belt and Road Initiative”. In five years from 2013 to 2018， the total volume of import and export trade between Hangzhou and countries and regions along the Belt and Road， reached 43388 billion yuan. In 2019， the total value of import and export trade between Hangzhou and the Belt and Road countries， exceeded the trillion yuan mark， which reached 1 trillion and 50 billion yuan by 16.7%. On March 23， 2019， China signed ‘’The Belt and Road Initiative ‘’ cooperation document with 123 countries and 29 international organizations. And Italy became the first G7 nation to join the Belt and Road Initiative， which signified that China’s international cooperation with other partners goes one step further.

（五）Enhancement of the Popularity of the Silk Products in Hangzhou

In recent years， Hangzhou has made large contributions to brand building， promotion of cultural heritages and upgrading and innovations of silk products. In 2008， there were four silk enterprises that won the franchise right of Beijing Olympic Games in China， among which the Cathaya Group， Wensli Group and Dali Group based on Hangzhou occupied three seats. In 2016， these three enterprises came up with unique and elaborate designs to make an amazing appearance with silk elements in the G20 Hangzhou Summit， and shone splendidly in radiant in the international market. It has accelerated the pace of marketization of Hangzhou silk on the international stage， furtherly deepened the docking work between Hangzhou silk and the international market and promoted the implementation of the strategy of “going out” and “bringing in”.

Many state-level institutions， such as the China Silk Museum， the National Silk Information Center and the Secretariat of the National Silk Standardization Technical Committee， were successively established in Hangzhou， Zhejiang Province. China International Silk Expo and China International Silk Forum have been held for several consecutive times， which has made Hangzhou silk famous both in domestic and foreign markets. Meanwhile， many derived activities concerning silk cultural are also competing to open， such as silk tourism， which attracts a great number of tourists.

In 2018， China Textile Business Association and several important units in the silk industry jointly established an accreditation committee， in the witness of the media， and officially carried out the selection of “Excellent Brands in the Silk Industry”. Dalifa， Jinshanta， Cathaya， Qichen and Wensli from Hangzhou have been selected as the top ten silk brands in China， occupying half of the market share with outstanding advantages.

三、Challenges the Hangzhou silk faces under the Belt and Road Initiative

This article holds that， in the context of One Belt， One Road Initiative， Hangzhou silk has many advantages as far as export is concerned. However， when the opportunity comes， it will no doubt bring about many challenges. The difficulties in transformation and upgrading， the impact caused by the silk trade of other countries， the difficulties in the development of small and medium-sized silk enterprises， the policy of moving the East mulberry to the west， and the competition of synthetic fibers such as chemical fibers， all indicate that there are still many problems for Hangzhou silk that needs solutions.

（一）Difficulties in Transformation and Upgrading

China’s silk industry， in general， has always been dominated by foreign trade exports， but in recent years， the industry has become increasingly depressed， and the export volume and profits of enterprises have declined sharply. In order to change the current grim situation of difficult management， many silk enterprises in Hangzhou have begun to seek transformation and upgrading. However， up to now， due to various difficulties dominated by cost crisis， it has not been able to make much progress.

Firstly， the demand for silk goods in the international market has declined， and the number of orders received by silk enterprises in the industry has been on the fall. Secondly， high-cost raw materials， rapidly rising labor costs， increasing interest rates， lack of funds and other adverse factors all lead to the difficulties of industrial transformation. Raw materials account for the highest cost in the silk industry， but the price of cocoon and silk is unstable all the year round and fluctuates greatly， which makes the production situation of enterprises more and more difficult. Take the year of 2011 as an example. At the beginning of the year， the price of cocoon was only 1200 yuan / Dan， but by the end of the year， it had risen to 1800 yuan / Dan， with a growth rate of up to 50%. In contrast， the price of silk sales did not increase correspondingly， resulting in the price of cocoon and silk being hung in a state of inverted for a long time. Enterprises dare not sell， consumers hesitate to purchase， and orders are difficult to be confirmed. In the meantime， the wages of the first-line workers in the silk industry rose from 2400 yuan / month last year to 3000 yuan / month， an increase of 25%. The transaction volume of enterprises is decreasing， but the cost of labor and production is rising. The pressure of insufficient capital makes the transformation nearly impossible.

In addition， the profit of silk enterprises has also been affected by the appreciation of the RMB （renminbi） and has been shrinking. The rise of various costs makes many silk enterprises unable to carry out transformation and upgrading to deal with the changes in the silk market. Furthermore， the existing equipment that most enterprises own is too backward to meet the technical requirements of transformation or upgrading. And a great number of new equipment for most enterprises is a huge cost. With tens of millions of investments in purchase of new equipment， many enterprises will face a shortage of capital chain.

（二）Impact of Silk Trade on Other Countries

As the first country in the world to invent knitting technology and the country of silk origin， China has maintained the world’s first silk production and export volume for many years. In 1984， China’s silk and satin exports accounted for 40% of the world’s total export， and raw silk exports accounted for 90% of the world’s trade volume. However， with the continuous development of silk trade in other countries， the dominance of China’s silk export in the world has been strongly impacted.

In 2018， the European Union became the world’s largest silk export region， and the market share of export trade in the world expanded again， reaching 33.75%， 3.27% higher than the previous year； India ranked the second largest silk export country in the world， accounting for 22.48% of the global market share， slightly lower than the previous year， only 0.4% lower； while China is the third largest silk export country in the world， accounting for 20.33% of the global silk exports， China’s silk export share has shown a very serious shrinkage， with a decrease of 2.89% compared with the previous year.  （Data source： collected by Prospective Industry Research Institute）

In 2018， China， as a large silkworm breeding country with a long history， ranked first in the world with an absolute predominance of US $499 million among the silk goods exports subdivided under the silk commodity structure. However， during the same period， the silk export is expanding in Brazil， India， Turkey， Malaysia and many other countries， especially Australia， which had the highest growth rate. The export volume of Australian silk goods increased by 602.05% compared with the previous year.

As for the export of silk products， the EU is the only region in the world to achieve export growth. In 2018， the export volume reached 4.05 billion yuan， an increase of 5.04% compared with the previous year， accounting for 36.2% of the global export of silk products. However， China’s export volume for the whole year fell sharply by US $1.816 billion， down 24.39% compared with the previous year.

（三）Difficulty in the Development of Small and Medium-sized Enterprises

In the current market， majority of the small and medium-sized silk enterprises are private enterprises. Facing the pressure brought by the unpredictable market， it is urgent to expand the scale of enterprises. However， the backwardness of technology， capital， talent， management and other aspects has greatly blocked the development of small and medium-sized enterprises.

Generally speaking， the well-known large multinational companies will invest 5% of their total income in R & D for core technology every year， but a large amount of money investment often fails to generate corresponding profit in a short period of time， usually it takes 5-10 years for enterprises to start to make profits in general. Small and medium-sized silk enterprises are originally small in scale， unable to attract a great number of investments， thus leads to limitations of business insights. Many small and medium-sized enterprises stick to the existing market and try to keep a distance from the large multinational companies to minimize competition. The result of the vicious circle is that， for small companies， the innovation technology is seriously lagging， the market occupied by large companies is growing， and the living space for small and medium-sized companies is constantly compressed.

Most of the high-level personnel with expertise would choose those well-known large enterprises when they seek employment. Small and medium-sized enterprises are unable to attract innovative experts and keep the existing ones. The continuous outflow of talents from technical departments and management departments leads to the lack of strict control， which leads to the lack of innovation and strength of some small and medium-sized enterprises. In 2008， more than 10，000 silk enterprises shut down in succession. Until now， the trend of closure is still grimmer and grimmer， and the small and medium-sized enterprises which survive are also struggling.

（四）Trend of Moving Mulberry from East to West

Due to the rapid economic development of eastern regions such as Jiangsu and Zhejiang， and the sharp rise in land and labor costs， China implemented the strategy of “moving the East mulberry to the west” in 2006， gradually transferred the main cocoon production areas from eastern Zhejiang， Jiangsu and other provinces to the central and western regions， which promoted the development of the National Silk Industry and brought a huge impact to the silk industry in Hangzhou.

The silk industry in Hangzhou is at a significant disadvantage in terms of physical and geographical conditions， production costs， and national policies. The climate and annual rainfall in Guangxi， Sichuan， Guizhou and other regions are very suitable for mulberry planting. In some regions， the average annual amount of silkworm rearing reaches 7-8 batches， even 12-14 batches. The amount of rearing and purchasing is incomparable to Hangzhou.

Meanwhile， with the rapid development of industrialization and urbanization， the price of land， water， electricity and artificial labor in Hangzhou has increased significantly， which is much higher than these in the central and western regions. In contrast， the central and western regions are rich in resources and low in various costs， and the benefits of silk processing and manufacturing are high.

In addition， in order to promote the strategy of moving the East mulberry to the west， the state has provided many supporting policies and financial supports for the development of mulberry planting and sericulture in the central and western regions. In the second year of the implementation of the strategy， the cocoon production in the central and western regions increased by 6.8 percentage points compared with that in 2000， accounting for 54.3% of the national total. Since then， the scale of silkworm production in the central and western regions has been continuously improving， and the status of silk industry in Zhejiang， Jiangsu and other places has been greatly challenged.

（五）Impact of the Competition with Chemical Fiber， Cotton and other Products

In current international market， the trend of fast fashion is rising， silk is constantly replaced by all kinds of artificial fibers， and chemical fiber， cotton， wool and other fabrics begin to show a strong development.

Silk production is a rather complicated process of operation. And the whole silk industry’s production process includes cocoon， drying， sorting， cocoon cooking， yarn reeling， reeling drying yarn printing and product inspection. Take Zara， a famous fast fashion clothing brand， as an example. The average delivery time is usually two weeks. The time-consuming and labor-consuming of manufacturing process make silk obviously unable to meet the high demand， and the price is often too high， which is not favored by clothing businesses or public consumers.

Statistics show that in 2018， the output of chemical fiber reached 50.1109 million tons， an increase of 7.68% than last year； the national cotton planting area reached 50.285 million mu， an increase of 2.364 million mu than last year， an increase of 4.9%； the total output of cotton reached 6.096 million tons， an increase of 444，000 tons compared with the previous year， an increase of 7.8%. However， as the number of silk enterprises in China has always been in a decreasing trend， statistics show， in 2018， the raw silk output of Silk Enterprises above Designated Size in China was only 86，500 tons， down 7.3% compared to last year； the output of interwoven fabrics with silk and silk content higher than 50% also decreased significantly. In 2018， the annual output was only 516 million meters， down 14.14% compared to last year. With the rising cost of silk raw materials， the comprehensive competitiveness of silk products continues to decline， and a variety of low-cost synthetic fibers become the first choice of clothing production materials.

四、Strategies for the Development of Zhejiang Silk Industry under the Belt and Road Initiative

According to the challenges Belt and Road Initiative brought and the grim situation of silk export in Hangzhou， this part puts forward the following practical strategies for enterprises to cope with challenges by analyzing the characteristics of products and enterprises.

（一）Enhancements of the Added Value of Products

Silk enterprises should not be only limited to the production of silk， but also include various processes such as design， processing and promotion. They should take silk manufacturing as a leading role and a center to lead the development of related industries.

As the country of origin of silk， China has a long history of silk culture and silk road. Such a profound background is enough for Hangzhou silk enterprises to attach cultural values to their products. A single product cannot grasp the interest of international consumers， and culture， as an enduring element， will never eliminated. During the 12th Five Year Plan period， the integrated development mode of “culture + product” has gained a lot. The silk museums and cultural and creative parks invested and constructed by silk enterprises have been widely praised， and silk industrial tourism and cultural tourism are in the ascendant. In the silk processing technology， enterprises can inject traditional folk crafts such as Shu brocade， song brocade and Yun brocade， integrate intangible cultural heritage projects and traditional crafts into clothing productions， and organically integrate historical and cultural elements of silk and modern market demands. In addition to silk clothing， enterprises can also apply advanced technology to the production of silk related products， such as silk ornaments and silk gift boxes.

Furthermore， the mode of “goods + services” is also an important way for silk development. Especially when each enterprise can’t decide the level of the product itself， the thoughtful service system will bring better favor to the market and higher added value to the product. At present， the first mock exam of most silk enterprises is only in the production and selling， neglecting the service links. Enterprises should carry out a series of service works at the same time of sales， such as product consultation， customization， after-sales， design concept introduction， etc.

Of course， technological innovation is still a key breakthrough in increasing added value. Enterprises with sufficiently conditions shall eliminate backward equipment. Only advanced equipment can meet the needs of production process. Most of the investment is not profitable in a short period of time. Enterprises need to abandon the old ideas and take a long-term sight. At the same time， they should vigorously introduce high-tech talents. It is necessary to refine and design these high-tech talents， but even small jobs such as mulberry planting and silkworm breeding need to be carried out by professionals. Only by selecting good varieties and fine breeding process can we ensure the high quality of raw materials. The complex and meticulous production links and additional technical costs are the added value of silk products.

（二）Establishment of Brand Strategy

Brand reflects the core competitiveness of an enterprise. Nowadays， the international market is in the transition period from commodity consumption to brand consumption. Consumers obviously favor the quality of high-end brand products. However， at present， in Hangzhou and even in the national market， the middle and low-end silk brands are still dominant， the high-end products are less than 5%， and the expensive raw materials do not match the price position of the brand completely.

Therefore， some silk enterprises with obvious strength should not be limited to simple production and sale of silk， but should optimize products structure， build brand， make product innovation and transformation， and produce world-famous high-end products. Hangzhou silk enterprises should reduce the sales mode of processing with supplied materials and samples， and gradually complete the one-stop production and sales service with their own brands. Small and medium-sized enterprises may， through agency， joint venture or acquisition of existing silk brands， integrate their resources and channels， make their brands more famous and stronger， or independently create silk brands， learn the concept of famous brands in early stages， and innovate their own brand culture when their strength is sufficient.

Advertising and fashion show are important ways for all clothing industries to improve their brand awareness in the world. Silk enterprises should not only be satisfied with the small and stable expenses earned by processing and other businesses， but also learn to invest rationally. Brand belongs to intangible assets. Once formed， the reuse of intangible assets does not need any cost， and the product value under the brand will be far advanced. Brand is also a symbol of the business reputation for an enterprise. Consumers will trust more when they recognize the brand. For Hangzhou， a strong silk province cannot be realized only through huge trade volume. Only when many silk brands in the province are well-known in the world， can the transition from a large silk province be completed.

（三）Strengthening Enterprise Management

In the first place， enterprises must realize that weak industry management is formed over a long period of time. Therefore， to solve the problem， we must start from the basic level， strengthen every bit， and take a long-term plan.

According to their own scale and characteristics， enterprises must formulate matched enterprise rules and regulations based on actual situations. The system needs to be sufficiently refined and complete， including the production， processing， design， operation and other aspects of silk products， in order to avoid the management vacuum phenomenon at a certain level. At the same time， because the market is always in a state of change， the business products and business scope of the enterprise are also constantly changing， the management system of the enterprise must also keep pace with the times， maintain reasonable adjustments according to various factors， modify and improve.

A high-quality management system must be fair and open. In many large enterprises， employees approximately are relatives and friends of superior leaders. These nepotists must be treated equally in front of the system. If cronyism is employed， the management system will only play the opposite negative role. In addition， the strengthening of industry management requires not only a fine system， but also professional management talents. The management of many enterprises is often promoted by different subordinate departments through excellent performance. However， the technology industry is not specialized. Even if the performance of a salesperson is outstanding， the process of managing silk production is usually unsatisfactory. The real need of excellent enterprise management is to fulfill their duties and refine the division of labors. The fundamental duties of managers must be to understand the responsible departments of their subordinates.

In most enterprises， middle-level managers are often in a very awkward position. The contradiction between the superior’s orders and the subordinate’s work needs often make them lack skills. The enterprise must pay attention to the importance of middle-level managers， who are the key link between the preceding and the following in an enterprise. They are not only a member of a large team， but also the responsible person of the group. The senior leaders of an enterprise must keep communication with the middle-level leaders， coordinate the integration of the whole and part of the work， and the whole enterprise management is based on the unity of the top and the bottom.

（四）Relying on E-commerce Platform

In recent years， Hangzhou has always maintained the leading position of e-commerce in the country. According to the data statistics of Case Study Institute， in 2014， Hangzhou ranked the first among the top 100 e-commerce counties in China. As the e-commerce capital in China， Hangzhou has the earliest cross-border e-commerce comprehensive pilot area in China， and in 2019， Hangzhou officially announced that it would focus on cultivating 103 home appliance business platforms in 2019-2020.

With such abundant e-commerce resources， Hangzhou silk has a unique advantage in relying on the export of e-commerce platform. Silk enterprises can choose different platforms according to the B2B or B2C e-commerce model， such as Alibaba international station and Amazon， to display their products. The Internet has freed the products from the shackles of space and gained the attention of more overseas buyers.

In addition， as the future trend of e-commerce， the C2B model needs to grasp the market， provide customized services， and meet the personalized needs of customers. When setting up the territory of entering e-commerce， enterprises must use a special team to correspond to the corresponding market， different regions have different customer groups， and the demands for product categories are also different.

Small and medium enterprises can derive lessons from the successful experience， such as Wensli Group in the cross-border e-commerce sales of silk， there are more than 120 teams， each of which is composed of 2-5 people， with clear division of work in order receiving， platform operation， after-sales service， etc. In the information times， the diversified Internet marketing mode can certainly provide an open national market for many unknown small and medium silk enterprises and enhance regional competitiveness.

（五）Strengthening Investment Cooperation at Home and Abroad

Hangzhou silk enterprises can take advantages of frequent foreign cooperation in coastal areas to invest in the external market. In fact， many countries in the world welcome the investment of Chinese silk enterprises. For example， Pakistan cotton textile association once said in the cooperation talks that since there is almost no silk production in the country， the silk products in the market are mainly imported from China. However， the silk industry is an important market all over the world. Some domestic cotton spinning enterprises in Pakistan have expressed their willingness to switch to silk products. However， due to the lack of technology， raw materials and other aspects， they are eager to obtain the support and investment of Chinese silk enterprises.

Hangzhou silk enterprises can make full use of the background of capital globalization. In some countries with rich land resources and human resources and low-cost investment， Hangzhou silk enterprises can build their own branches or factories， or invest in foreign enterprises directly， so that they can carry out the steps of processing with supplied materials， then increase the competitiveness of their products. However， in the process of foreign investment and cooperation， enterprises must establish relevant systems to protect their own property rights and patents.

In terms of the technology of silk clothing， each country has its own characteristics， such as the top kimono and Sari made of silk in Japan and India， the hanbok and order made of native silk in North Korea and Vietnam， and the unique Thai silk in Thailand. In order to promote the diversity of products， Hangzhou silk enterprises need to strengthen cooperation and learn from enterprises of other countries to improve themselves.

Conclusion

Hangzhou， known as the silk palace， has thousands of years of silk producing history. Hangzhou silk is favored by domestic and foreign markets for its complete varieties， high quality and advanced manufacturing technology. Under the background of one country’s ‘’the Belt and Road Initiative’’， Hangzhou silk enterprises should not only give full play to their advantages but also prepare themselves to meet the disadvantages and challenges. Seizing the opportunities can make Hangzhou silk maintain its cultural heritages and promote international trade. In order to ensure the market trend of Hangzhou silk in the new era， Hangzhou silk enterprises should improve in many ways， make product innovations， increase added value for products， vigorously promote brand strategy， improve the visibility of silk in the world， pay attention to internal management， ensure accurate joints， make full use of the Internet to attach the new mode of organic integrations to silk， and establish new sales channels； Rationally carry out exchanges and cooperative investment among international silk enterprises， and expand the world silk market. Hangzhou silk enterprises must use one belt， one road and all relevant policies of the state， strengthen their own strengths and make their products competitive internationally， and achieve the goal of increasing export volume.

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Acknowledgements

I would like to express my gratitude to all those who helped me during the writing of this thesis. I am particularly indebted to Professor Zuo， who gave me kind encouragement and useful instructions all through my writing. Finally I wish to extend my thanks to the library assistants who supplied me with reference materials of great value.