Branding and innovation: tools for fighting adversity

By concentrating on building up its brand and product quality, it finally wrestled a share in the competitive sports market - and not just because of its prices.

The process of winning the trust of consumers is time-consuming, and there need to be concrete cases that prove to customers that "I can and I am trying to improve," Xu said.

The company's efforts appear to be paying off. Peak Sport labels have made appearances on NBA courts and the company has formed partnerships with the Houston Rockets and Miami Heat. It products are sold in over 30 countries, with robust sales in the Middle East and Eastern Europe.

Xu said the company is actively tapping the North American market, and it will continue to seek a differentiated position and concentrate on moving in that direction.

Zuo Xiaolei, chief economist at Galaxy Securities, said China's manufacturing sector still has huge room for growth, as long as Chinese manufacturers can keep updating their technology and improving their products, just as the Germans do.

"Look at manufacturing in Germany. They have retained such vigor for decades, all because of their technology and innovation, " she noted.

Zuo has also called for more financial and policy support, along with less government intervention, in enterprises' upgrading and transformation process.

"Let the market work its magic and guide the enterprises," she said.