Orders Increase Profits And Reduce Textile Enterprises To Solve "Sweet Burden"

Order increase and profit decrease

"Orders for the whole year are full, and orders are not available."

Lu Bensheng, deputy general manager of cedar group, did not have the pleasure of anticipation, because "the growth of orders, while the price of raw materials rose sharply, led to a smaller profit margin."

The textile and garment enterprises that just experienced the shortage of orders during the financial crisis are facing the enormous cost pressure brought by the rising cotton prices.

This is undoubtedly a major test for the textile and garment industry of Qingdao, which has more than 1000 enterprises of above scale and about 200000 related practitioners.

At the Spring Fair of Qingdao, which just ended half a month ago, purchase orders and intent trading reached.

1 billion 798 million dollars.

However, the rising price of raw materials has made the order become a "sweet burden" for textile enterprises, and it is caught in a dilemma.

Lu Bensheng said that compared to large enterprises, the impact of higher raw material prices on small and medium-sized enterprises is bigger, some enterprises have to give up the order compression production.

"Two orders of small enterprises have greater impact, and some have stopped production and business."

The head of a textile enterprise with more than 700 employees in Jiaozhou said that the current situation of the enterprise was in a dilemma. On the one hand, orders could not be stopped. After all, it was necessary to maintain the operation of the enterprises and the expenses of the workers, but not to stop the work. On the other hand, the rising raw material prices and the increase of labor costs led to the smaller profit margins and even the possibility of losing money.

At present, enterprises can only reduce the scale of production and no longer blindly take orders.

The company produces underwear products, mainly exported to the Japanese market, the export price of a lingerie product produced is 11 dollars, and the increase of raw material prices will increase the cost by 20%.

However, Japanese customers will not accept the increase in the price of their products. The cost increase can only be digested by the enterprises themselves.

In view of the current market situation of textile and garment industry, the cost pressure driven by the rapid rise of cotton prices has been pferred to yarn, cloth, clothing production and other links.

Cotton prices rise is the main reason behind

"Compared with the beginning of the year, the average price has risen by about 30%."

Yang Weidong, general manager of the group, said that the price of ordinary cotton rose from 11 thousand yuan / ton in the beginning to last week.

15 thousand yuan / ton, or more than 20%; cotton yarn has increased even more, and the price of Xinjiang cotton yarn has risen from 24 thousand yuan / ton at the beginning of last year to 34 thousand yuan / ton last week, or about 40%.

"In a month, it can rise three or four times."

Reuben won helplessly to say, "had already been booked, the cotton yarn is going to start, and the supplier is up 1000 yuan per ton."

Yang Weidong analysis, cotton price rise is mainly caused by insufficient supply.

First of all, last year, the continuous low temperature in Xinjiang, the main cotton producing area of China, combined with other bad weather, led to a decline in production.

Second, it is now in a period of cotton shortage. Last year's cotton sold out, and this year's cotton will reach 9.

The month comes down.

In addition, India, the main source of cotton importing countries, has suspended cotton export registration, making the international supply and demand relationship of cotton more tense.

According to the analysis of the industry, under the cost pressure caused by rising cotton prices, textile enterprises will shift some pressure to the garment enterprises downstream of the industrial chain through the way of raising prices, which will lead to higher prices of clothing products.

The manager of a garment enterprise in Jimo said, "now, it is the production season of autumn and winter clothing in China. Under the pressure of raw material cost, the cost of garment manufacturing has increased.

Around 20%, under the pressure of cost, the retail price of autumn and winter clothing is expected to rise this autumn.

Textile enterprises seek breakthroughs

Despite the rising price of raw materials, textile and garment enterprises are hard to pass the rising part on to foreign distributors.

Faced with the predicament, textile and garment enterprises are seeking breakthroughs from their own.

The cedar group began to adjust its export market structure and expand the European and American markets on the basis of stabilizing the Japanese market. At the same time, it increased the research and application of new materials, improved the added value of products through technological innovation; moreover, in view of the fact that the major customers were well-known brands and the order prices were relatively high, the group chose the customers at home and abroad, and chose large customers to establish stable cooperative relations.

Yang Weidong introduced that as a productive enterprise, the development group focused on enhancing product structure and developing new materials. It will focus on technology brand and material brand, and develop products with high technology content.

"Some of Japan's large textile and garment enterprises are developing from the source of technology and materials, thus occupying high-end market.

"

Yang Weidong said that the group has begun to build its own brand and combine its own brand building with strengthening domestic sales.

With regard to the development of independent brands, the cedar group is very cautious.

Lu Bensheng said, "first of all, the construction of the market network needs a lot of expenses, and the training of the design team is not completed in one or two years. At the same time, the credit of domestic settlement is not good, and the enterprise needs to take a lot of capital risk."

For the sake of sound development, he said that the overall strategic positioning of the group is "OEM and domestic sales", and gradually develop its own brand.