Export Warming Variables

Recently, a clothing company in Nantong responded that they had suffered losses through trade settlement by foreign credit sale companies, and urged foreign trade enterprises to be vigilant against foreign trade traps set by foreign credit sale companies.

Last year, a British customer of a clothing company in Nantong recommended a credit sale company called CEFL. The British company, which is known as "China Export Finance Ltd.", claimed that the seller could sign a credit sale contract with the buyer and seller, and after the buyer confirmed the payment, the seller could deliver a set of documents of the goods to CEFL, CEFL would immediately give the seller 80% of the payment, then CEFL would pfer the goods to the buyer, and the buyer could take the goods accordingly, and after the buyer paid all the goods to CEFL, the CEFL would pay the remaining 20% to the seller.

Through this mode, the seller can recover most of the money quickly, and the buyer can get the space for capital circulation by first taking the goods and repaying the bill, and CEFL can get 1% service charge as a third person.

At first glance this trade

Under the influence of the international financial crisis, with the increasing risk of trade, more and more companies hope to have a trade settlement with small risk and quick return of funds.

Credit sale mentioned above is a good idea.

Though wishes are beautiful, reality is cruel.

Credit sale companies, because of their own business risks and integrity problems, will inevitably have no escape funds, disguised bankruptcy, and collusion with customers. Therefore, the vast number of foreign trade enterprises should be cautious when choosing settlement methods, so as to avoid the final two goods being empty.

As the international market continues to slump, the international trade frictions will increase.

According to the investigation, under the influence of the international financial crisis, foreign-related disputes in Nantong textile and garment foreign trade enterprises have the following characteristics: first, the diversification of disputes.

In addition to traditional export contracts and disputes over the sale of goods, there are settlement fraud.

The two is the quantitative development of disputes.

From the past several thousand to tens of thousands of dollars of disputes, up to now, most of them are tens of millions of dollars in commercial disputes; with the subsequent impact of the international financial crisis, foreign enterprises' ability to pay has declined, and the phenomenon of default has increased.

At the same time, national diversification is involved.

The countries involved include developing countries such as Iran, Thailand, the Middle East, and developed countries such as Britain and Russia.

Relatively speaking, there are few trade disputes with Japan.

Warmer six

Since the beginning of this year, the export of garment industry in Nantong has shown a trend of recovery.

However, due to the increasing pressure of the six "rate (force)", there are more variables for warming up, and the foundation for recovery is not yet solid.

The profit margin of orders declined.

"There's an order, no one does it; someone does it, no money."

This is a popular phrase of clothing export enterprises in Nantong this year.

According to the statistics provided by Nantong customs in May, in 2010 1-4, Nantong accumulated a total export of US $3 billion 870 million 320 thousand, an increase of 24% over the same period last year, of which $1 billion 291 million 550 thousand was achieved in textile and apparel products, an increase of 12.8% over the same period last year, accounting for 33.4% of the total exports of the city.

From the statistical analysis, there is no change in the pattern of Nantong textile and garment export in the whole city of three, but the growth rate of export is only half of the increase in the whole city. It is the recovery after the international financial crisis fell into the valley in 2009.

In 1-4 months, clothing exports amounted to US $788 million 420 thousand, an increase of only 3.1% compared with the same period last year, while the export of other household textiles was 369 million 120 thousand US dollars, an increase of 40.5% over the same period, much higher than that of clothing.

Inflation has increased.

Since the beginning of this year, the prices of raw materials and accessories for textile and clothing have increased significantly. In February 2010, the average price of 328 cotton in China has risen to 14904 yuan / ton, up 32.9% from the same period last year, which directly increased the cost of textile and garment industry in the downstream.

In addition, the cost of energy, hydropower and various raw and auxiliary materials has also increased significantly.

According to the price department statistics, the price of raw and auxiliary materials for textile and clothing in 1-3 months is: the raw and auxiliary materials such as cotton increased by 34.8% compared to the same period last year; metal materials, wires and other materials grew by 30.2% compared to the same period last year; the chemical raw materials used in the textile industry grew by 5.5% compared to the same period last year; the energy grew by 23.5% compared with the same period last year.

The price increase of the raw and auxiliary materials is not driven by the purchasing power of the terminal. It is driven by the rising price of raw materials, which shows the characteristics of the import price increase. The purchase price and purchasing power and consumption power of the market have not been substantially improved, but the passive price increases from the cost increase, which is at the expense of the profits of the enterprise, and has hit the limit of the enterprise.

Exchange rate fluctuations.

Due to the fact that the global economy has not entered a substantial recovery, the US and the EU have been making frequent difficulties in the renminbi. The appreciation of the renminbi is expected to increase. In June 25, 2010, the exchange rate of RMB against the US dollar dropped to 6.8, and in July 1st it fell below the 6.79 mark and the new high since the exchange rate reform.

The next step is to continue to appreciate. As a labor-intensive industry, the clothing industry is hard to resist.

According to the investigation and analysis of the Nantong clothing trade association, the fluctuation of the RMB exchange rate per percentage point has a 4.5% degree impact on the net profit of the industry, while the average net profit level of the current garment industry is only 3-5%.

If the exchange rate has an appreciation of two points, it may still be "struggling" for the labor-intensive clothing industry. If the appreciation of the exchange rate reaches 5 percentage points, it will definitely be "fatal".

After the financial crisis, although the export rebate rate of textile and clothing was raised by 5 percentage points, the appreciation of the renminbi just hit the export favorable policies issued by the government during the financial crisis.

Labor costs rise.

From January 1, 2010 onwards, the state began to implement the full circulation of migrant workers' pensions. First, the labor intensive textile and garment industry was more difficult to recruit. Two, it was more difficult for enterprises to survive on the edge of migrant workers' pension policy.

"Recruitment difficulty" has become a common problem of labor-intensive enterprises. Although Jiangsu province raised the minimum wage standard in 2010 and increased employment wages, the employment cost increased by more than 12% this year.

In fact, the textile and garment industry in Nantong was earlier than 20% in Jiangsu province. Even so, the clothing trade enterprises generally did not have enough employment, and the opening rate of the machine was 85-90%.

General orders for export enterprises are full, but they can not be processed. Outward processing is also very difficult.

Interest rates are expected to raise interest rates.

Recently, the interest rate of commercial banks has been low, and the expected pressure of bank interest rate increase has increased the financing cost and financial cost of textile and garment industry.

Adjustment of tax rebate rate.

The export tax rebate rate is like wind vane and leverage. Once the export situation is better, it is expected that there will be some adjustment. Recently, the state has abolished the export tax rebate rate of the "two high one low" industry. With the global economy rising gradually, the textile and garment export tax rebate rate will inevitably be reduced, which will lead to a decrease in the export income of textile garments.

To sum up, in 2010, during the post financial crisis era, textile and garment export enterprises are faced with many variables and pressures. They should calm down to cope with the complex international and domestic markets, enhance their confidence index in difficulties, and strive to "expand the market, adjust the structure, grasp management, promote balance, reduce costs and promote efficiency".

At the same time, it is suggested that the relevant departments of the state should continue to firmly uphold the important position of maintaining the stability of the RMB exchange rate, continue to firmly control inflation, continue to firmly support the export of textile and clothing, ensure that the real economy will not be seriously affected, maintain the international competitiveness of Chinese textiles, and truly consolidate the economic foundation for the textile and garment industry and even the whole national economy to pick up better.