Soaring Costs Urge Enterprises To Increase Prices And Reduce Pressure

In addition to clothing enterprises, other shoe enterprises are also generally troubled by the rising cost.

"Now raw material The price is rising sharply. Raw materials at home and abroad are rising, and the cost of clothing is also rising. This problem is very difficult“ Recently, Chen Lingmei, chairman of Shenzhen winner Clothing Co., Ltd., told reporters that the company is the "leading leader" of high-end women's wear in China. What makes Chen Lingmei feel tricky is not only the cost of raw materials, but also the rising labor cost.

The reporter learned yesterday that in order to ease the cost pressure, many domestic brands of clothing have raised the sword of "price increase" this year. At present, the retail price of brand clothing has generally increased by 10% - 15%. Some clothing enterprises said that they will continue to raise prices in the second half of the year, and some industry insiders predict that the wholesale prices of clothing products in autumn and winter this year will rise by 10% - 15%.

Collective "price increase" of clothing brands

　　 Price increase It has become the mainstream of this year's clothing industry. Yesterday, the reporter consulted the latest financial and quarterly reports of several listed companies, and found that many clothing brands have made price hikes this year.

In the field of sportswear, Tebu (01368. HK) released its semi annual report yesterday, showing that the average selling price of footwear products increased by 6.6% and that of clothing products increased by 13.9%. After the price increase, the average price of Tebu shoes is 85.7 yuan; The average price of clothing products is 52.5 yuan. Two other brands, Li Ning and Anta (02020. HK), also raised the prices of their products in the first half of this year: Anta's financial report showed that in the first half of this year, the average selling price (wholesale price) of Anta footwear products increased by 2.0% to 96.9 yuan, and the price of clothing products increased by 7.1% to RMB 49.6 yuan. Li Ning also announced in June this year that the average retail price of footwear products increased by 7.8% in the fourth quarter of this year, and the retail price of clothing products increased by 17.9%.

In the field of leisure clothing, Haitong Securities research data also shows that Youngor launched new products from January to May this year, with an average price increase of 15-16%, resulting in an increase of 4-5% in sales volume, an increase of about 20% in sales amount and more than 50% in gross profit.

"Price increase" provides a guarantee for the major garment enterprises to maintain their performance. Special step scale sales volume As a result, the overall revenue in the first half of the year increased by 22% to RMB 2 billion, the gross profit rate increased by 2.1% to 40.7%, and the operating profit margin increased by 2.4% to 22.2%. Anta semi annual report also showed that the company's first half turnover increased by 22.6% to 3.453 billion yuan, net profit increased by 25% to 760 million yuan, and gross profit rate increased by 2.2% to 43.7%. Anta explained that one of the main reasons for the increase in turnover was the increase in the average selling price and the number of sales.

Soaring costs force enterprises to increase prices and reduce pressure

Behind the collective price increase in the clothing industry this year is the substantial increase in raw materials and labor costs. Recently, Chen Lingmei, chairman of Shenzhen winner Clothing Co., Ltd., pointed out in an interview with our reporter that the company's labor cost and fabric cost have increased significantly this year, and the pressure has increased suddenly.

"The salary has just been raised once again. On average, each worker has been increased by 200 yuan a month. Now, the monthly salary of workers is more than 2000 yuan, and they have to cover food and housing.". Chen said it would be difficult to retain skilled workers in Shenzhen if such a level was not reached. On the other hand, the price of raw materials has risen sharply, "the price rise of imported fabrics has exceeded 30% this year.".

Other clothing enterprises are also troubled

According to the Tebu semi annual report, staff costs increased from 81.318 million yuan in the same period of last year to 95.345 million yuan, an increase of 17.2% over the same period last year; The sales cost of raw materials was 537 million yuan, an increase of 18.7% year-on-year. Anta's expenditure on raw materials in the first half of this year was 287.2 million yuan, an increase of 51.6% over the same period of last year, and the direct wage expenditure was 144.9 million yuan, an increase of 20.6% over the same period of last year.

Some people in the industry pointed out that in addition to the above-mentioned increase in basic cost pressure, some fashion and fashion brand advertising marketing and publicity expenses are also increasing.

In addition to the means of price increase, some enterprises said that they can digest the pressure by making high-end brands. Chen Lingmei, chairman of Shenzhen winner Clothing Co., Ltd., said that the company's brand clothing, a set of clothing sold to about 5000 yuan, some dresses even sold to tens of thousands of yuan a set, "there is a large profit margin to digest the rapidly rising production costs.".

It is reported that the sales target set by the company this year is to increase by 42%, which has been completed according to the original plan in the first half of the year. Some industry insiders suggest that the best way for clothing enterprises to reduce pressure is to adjust the product structure.

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Cotton price increase dilutes profits of Guangdong garment enterprises_ break}

In fact, the international cotton price of upstream raw materials has soared sharply this year, which is the important reason for the price rise of the whole textile industry. Since the end of last year, the international cotton price has been in the rising channel, and the rising tide of cotton price has rapidly transmitted to the raw material field, the processing field and even the clothing industry and consumer terminal.

According to China's cotton price index, the standard cotton price has risen from the average price of 12831 yuan / ton in 2009 to 18165 yuan / ton in July this year. Guangzhou customs also said that since October last year, the price of cotton, chemical fiber and other textile raw materials has risen rapidly. As of June 30, this year, the domestic 328 grade cotton spot index was 18309 yuan / ton, up 42.6% over the same period last year.

According to the statistics of Qingdao Customs, in the first seven months of this year, Shandong Port imported 739000 tons of cotton, worth US $1.31 billion, an increase of 65.1% and 1.3 times compared with the same period last year; The average import price was US $1776 per ton, up 39%.

The fierce rise of cotton and other raw materials at home and abroad, coupled with the pressure of RMB appreciation, has made the profits of domestic textile and garment enterprises diluted again and again.

In a circular, Guangzhou Customs pointed out that in the first half of this year, Guangdong's textile and garment export enterprises still face two major pressures: first, the pressure brought by the slow appreciation of RMB has never been weakened. Guangdong textile and garment enterprises are mainly small and medium-sized enterprises, and are very sensitive to the appreciation of RMB. At a time when the profit margin is approaching the break even point, the textile and garment enterprises in Guangdong still face two pressures, If the appreciation of RMB is restarted or even accelerated, most small and medium-sized enterprises will have no profit to seek. Second, the rising trend of raw material prices has not fallen back. "As a labor-intensive industry, the profit of textile and garment industry has been relatively low. Due to fierce competition, textile and garment enterprises are hard to pass on the rise of raw material prices to consumers, which further reduces the profits of enterprises.".