Epson will leave Shenzhen. Why can't the manufacturing industry survive in big cities?

Recently, the news that Epson will leave Shenzhen came out. Combined with the closure of Shenzhen factories of Samsung, Olympus and other Japanese and Korean companies and Huawei's move to Dongguan, it can be seen that manufacturing is really difficult to survive in big cities.

First of all, many rumors about Epson's imminent withdrawal from Shenzhen are not true. Epson China also issued a statement in official website, as shown in the following figure:

In fact, it is not unusual for manufacturing industry to survive in big cities, which can be said to be a well-known history.

For example, when the manufacturing industry flourished, big cities were full of manufacturing industries. However, with the information revolution and the rise of internet technology, it is increasingly difficult for big cities to accommodate manufacturing.

The captain once stayed in an advanced domestic manufacturing enterprise in Shenzhen. From the strategic layout of the company, even if the company is headquartered in Shenzhen, even if a large part of the company's business is arranged in the suburbs of Shenzhen, there are still many businesses planning to move to Dongguan.

So we naturally have questions: why is it difficult for manufacturing to survive in big cities?

The answer is also simple: because the cost is too high.

First of all, the labor cost is high.

People who come to big cities tend to be more hardworking and naturally demand higher returns. One of the main reasons why many manufacturing industries are constantly moving to backward areas is that the labor cost there is lower.

Of course, you may think, how much lower can the labor cost be?

Let's do a small calculation: suppose a factory has 10000 workers, and the cost of a big city is 1000 yuan higher than that of a small city in one month, then it will be 1000 million yuan higher in one month.

Because manufacturing is a labor-intensive industry, it will naturally have higher requirements for labor costs.

Secondly, business-related costs are high.

The most direct thing is the rent that everyone can think of. Besides that? There are many more.

For example, environmental protection restrictions, big cities have higher requirements for environmental protection, because big cities have passed the stage of sacrificing the environment for development. These requirements are all costs for enterprises.

For example, products exported to Europe usually meet a standard: RoHS. This standard is an environmental protection standard. And what is the greatest significance of this standard? Besides environmental protection, it is to protect the competitiveness of European products.

RoHS alone is an environmental protection requirement, which leads to the whole industrial chain of many domestic manufacturing industries running around it. As long as there is a problem in one link, you may face a huge fine.

So generally speaking, the manufacturing cost in big cities is too high, and it can only be gradually transferred to small cities or even more backward areas, which is also a fact that the real world is staged every day.