Cashmere king Erdos threads it away around the globe

By ZHANG YU and YUAN HUI in Ordos, Inner Mongolia (China Daily)

Updated: 2017-07-25

Erdos products at a shop in Hohhot.PROVIDED TO CHINA DAILY

Erdos Group has already made a major impact on the world stage and now it plans to expand its international operation from its Ordos headquarters.

The world's largest manufacturer of cashmere products has about 30 percent of the global market from its base in the Inner Mongolia autonomous region.

With more than 40,000 staff, the Chinese conglomerate is valued at about 70 billion yuan ($10.4 billion) with a sales revenue of more than 40 billion yuan annually.

"We are still building our brand up and we will go even further," said Zhang Meirong, general manager of the group's cashmere operation. "There are excellent international opportunities out there in Europe, the United States and Japan."

Up to 70 percent of the world's cashmere comes from China, according to Zhang, at 8,400 metric tons. Garments made from the fabric are usually warm and soft, and can be expensive.

But with large herds of goats, Inner Mongolia has become China's epicenter for the industry with 60 percent of the country's cashmere coming from the region.

"Cashmere from the goats here is pure white," Zhang said. "They boast great properties in terms of thickness and length, good enough to make high-quality clothes."

"It makes very good clothes," she added.

Founded in 1979, Erdos Group, also known as the Inner Mongolia Erdos Group Co Ltd, is now a sprawling company involved in energy projects and metallurgy.

But its core business is still cashmere processing and production, although the past few years have been challenging as international brands moved into China.

Workers on production lines at an Erdos Group's factory in Ordos. PROVIDED TO CHINA DAILY

"We have certainly met these challenges in recent years," Zhang said. "The competition and shrinking market forced serval brands to close. But we have managed to expand our business by making the right moves," she added.

Last year, the group upgraded its labels and diversified to help satisfy different consumer trends.

The 1436 fabric line, which was launched a decade ago, uses fiber less than 14.5 micrometers thick and more than 36 millimeters long. It is the cornerstone of the company's luxury cashmere operation.

Still, the old Erdos brand has been split into four labels, 1436, Erdos 1980, Erdos and Blue Erdos.

Erdos 1980 is tailored toward the more affluent, mature customer with classic designs.

As for Erdos, it tends to target well-educated middle class clients who look for quality and fashion.

Finally, Blue Erdos has been rolled out for a younger market, featuring simple designs at affordable prices.

"From that division, we have yielded good results with sales volume increasing by 15 percent to 20 percent annually for three consecutive years," Zhang said.

To cater for rising demand, the group has increased its production.

More than 10 million cashmere products will be manufactured this year, while the company now has a design studio in Milan, Italy, as well as the US.

"About 50 percent of our products are exported to European countries and the US," Zhang said. "We also export to Japan."