RMB Appreciation Continuously And Export Shoe Enterprises Going Where To Go

On September 25th, the renminbi continued to appreciate, and export enterprises' meager profits were vanishing.

Check RMB with cell phone every day

"For foreign trade enterprises, the change of exchange rate is directly related to the products.

The ninth consecutive trading day has been on the rise for eighth consecutive days.

In September 22nd, the central parity of RMB against the US dollar surged 113 basis points again, reporting 6.6997, breaking through the 6.7 pass in one fell swoop and entering the "6.6" era.

Shen Lu, manager of Humen Tianyi children's shoes factory, is very aware of Wang Zhenming's mood.

He told the "China Times" reporter that there are nearly 10 million pairs of leather shoes sold in Humen town every year, about 300000 of which are mainly engaged in foreign trade orders, and the impact of RMB appreciation on them can be seen.

Moreover, most export enterprises can afford to appreciate RMB 3%, and the appreciation of 3% will reduce their profitability by about 50%.

An authoritative report shows that more than 7 of the export enterprises can withstand the appreciation of RMB below 4%.

The reporter understands that foreign trade enterprises dancing on the tip of the knife do not have time to pay attention to the wonderful exchange rate war between China and the United States. They are busy with how to avoid the risk of RMB exchange rate.

What is commonly used is: postponing delivery orders and raising prices.

Run against the exchange rate

"Don't call me boss. If RMB revalues like this, I'm not as good as an ordinary worker."

Wang Zhenming reluctantly told reporters.

The price and the exchange rate race, Wang Zhenming seems to have returned to 2008.

"In that year, the appreciation of the renminbi exceeded 7 yuan mark, and even after the exchange rate reform reached a new high, we had great pressure every day.

The price is too high, the customer can not bear it, the order is lost, the newspaper is low, and the company loses a lot.

Every order of a foreign trade enterprise has to go through several processes. First, negotiate with foreign customers, confirm the conditions of price and delivery, then make the order to the factory, and then deliver the product.

Generally, this cycle will take at least 2 months. During this period, if the exchange rate changes, the loss is very serious.

Take an order of 1 million dollars, for example, when the contract is signed, the exchange rate of US dollar to RMB will be 1:6.8,2 months, the exchange rate will be 1:6.6, the difference will be RMB 0.2 yuan, but the profit will be reduced by 200 thousand RMB at once.

The total profit of such an order is about 3. 4 million RMB.

It is understood that in Dongguan, because the quoted price did not run over the RMB exchange rate, the final bankruptcy of the enterprises abound.

In general, large factories have a stronger ability to resist risks, but for most small and medium-sized enterprises, exchange rate is like a knife hanging on the head, and it is not known when it will fall.

Recently, there is a heavy report on the impact of RMB appreciation on export enterprises.

The total sample size is 1900, including export enterprises in more than 10 provinces and municipalities.

The report shows that the majority of export enterprises can bear the appreciation rate of RMB is less than 2%, which accounts for 39.7% of the total sample size, accounting for 33.8% of the 2%-4% appreciation, and 19.1% of the enterprises who can appreciate 4%-5%.

It is reported that the profit margins of small and medium-sized export enterprises in China are not high, especially textiles.

Wang Zhenming hopes that by October, the exchange rate of the Autumn Fair will be kept as stable as possible.

But now the exchange rate like a runaway horse still makes him feel nervous.

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How to avoid risks

In response to exchange rate changes, export enterprises are more active than others.

At present, there are only two ways to see and feel, one is to make an essay in time, and the other is to write articles on price. Two

Delay in delivery of orders is the simplest and most common method adopted by enterprises at present.

Li Jia, general manager of Wenzhou Jihua leather shoes export enterprise, told reporters that last month, the company signed a batch of orders with an American customer and delivered it within 3 months.

But what he never expected was that the renminbi began to appreciate continuously in September 13th. Now, if the goods are delivered immediately, the company may not earn any money, but the company has been dragging away, hoping to wait for the RMB exchange rate to fall back.

Although the delay in delivery may be the immediate solution, it is not a permanent solution after all. If the RMB continues to appreciate, the more the company will wait, the more it will lose.

If we do not want to wait for death, there is another way out for enterprises. That is to raise prices.

At the end of the international OEM chain, it is difficult to raise prices when squeezed under layers of pressure.

Li Guorong, Secretary General of the Wenzhou Hardware Chamber of Commerce, said that for the rapid appreciation of the renminbi, the measures to be taken by the enterprise are related to its size. Large enterprises will have specific plans, while small businesses are very passive and can only "follow the market".

He said that the export enterprises, if they need large quantities of orders for many years of cooperative customers, can scale down the purchasing cost of raw materials according to their original price.

If only one thousand or two thousand small orders are needed, the price will be raised by about 5%.

In addition, as far as possible to recommend new products to old customers, about 10% of the new price, European and American customers can still accept.

But for new customers, all prices are raised.

Huang Chun, general manager of toy export enterprises in Chenghai, Shantou, has adopted an innovative way to raise prices.

He told reporters that an electric toy car exported to the United States made less than 1 yuan in profit. But when he added a button on the same toy car, the cost did not increase, but the price increased by 10%. Most importantly, it was entirely acceptable to foreign businessmen.

Forced pformation of enterprises

The appreciation of RMB has exposed the loss of China's export enterprises' low cost competitive advantage (310368, fund bar), but also forced export oriented enterprises to enhance their innovative ability and increase the added value of products.

Liu Li, a Research Institute of the National Information Center, told our reporter that although the new round of RMB appreciation may be gradual, it seems to be even more frightening for the development of enterprises: enterprises may not be aware of the pain, but when enterprises want to pform, they have already lost their opportunities.

"Warm boiled frog" is precisely the reason for this.

Therefore, for export oriented enterprises, how to improve the profit margins of products will be a key issue in the future. Upgrading and upgrading of export products is very important.

Xue Xiaowei, director of Bao De, a large toy factory in Shenzhen, told reporters that one of their countermeasures is to increase the added value. Enterprises should concentrate on the production of high-class electronic toys such as voice and electric technology with high technology content and reduce their competitors. The two is to reduce costs and make manufacturing outsourcing in Southeast Asian countries such as India and Vietnam.

In October, the Canton Fair was about to open. Their enterprises decided to take a group of toys with high technology content to the Canton Fair to participate in the exhibition, hoping to attract foreign businessmen.

In terms of pformation and upgrading, Guangdong took the lead in action.

Statistics show that Guangdong's foreign trade growth is much lower than that of the Yangtze River Delta in the first half of this year.

The slowdown in foreign trade has affected the growth of GDP in Guangdong. In the first half of this year, Guangdong's GDP grew by 12.7%, which is lower than that of Zhejiang, a developed country with foreign trade.

The main reason is that Guangdong has been insisting on economic pformation in recent years, and the number and trade volume of low-end processing trade enterprises are being cut down.

Zheng Jianrong, deputy director of the Guangdong Provincial Department of foreign trade and economic cooperation, said that the appreciation of the renminbi will directly reduce the export earnings of enterprises.

"Judging from Guangdong, we have a calculation that if the total appreciation of RMB has reached 3%, the foreign exchange earnings from foreign trade will be reduced by 20 billion yuan, which means that the profits of enterprises will be reduced by 20 billion yuan."

He suggested that enterprises should speed up their pformation and upgrading, enhance the competitiveness of products and raise the price of the right to speak.

At the same time, we should make good use of the current financial instruments to avoid exchange rate risks, and entrust financial institutions to make long-term receipts for settlement, swap pactions and hedge pactions to avoid exchange rate risks.