Orders Are Falling, And Garment Companies Are Still Overwhelmed.

The town of Taoyuan, Wujiang, is a famous town for export clothing in China. The garment production industry in the whole country has a current output of 600 million. There are more than 60 garment enterprises in the town, of which more than 20 garment export enterprises are in a larger scale. Orders have dropped, but most of Taoyuan's clothing enterprises are more busy and work overtime. How can this abnormal phenomenon happen? The reason lies in the labor market.

18%! This is the percentage of the cost increase of most garment export enterprises in Taoyuan town of Wujiang this year.

Such rapid and substantial cost growth has made the garment exporters who are originally in a low profit state overwhelmed. The garment processing industry of Taoyuan town is facing a shrinking situation.

Taoyuan town of Wujiang is China.

"This figure has dropped by 30%, and it will probably decrease next year.

As far as I know, some enterprises are going to stop production next year. "

Shen Hurong, general manager of Taoyuan garment industry association and general manager of Wujiang Shenghui Knitting Co., Ltd., told the Commercial Daily reporter.

More than raw materials are rising.

The term "inflation", a macroeconomic term, is the more common two words in the clothing business owners.

Shen Hurong said that he has been in business for more than 20 years and has seen more than five or six rise in price.

"But this year rarely happens. This price increase is more serious than ever. Silk and viscose have risen by 35-40%, and cotton yarn has increased by more than 50%.

They all went up in a very short time, and it's hard for them to digest. "

Shen Hurong complained.

In fact, the cost pressure of clothing enterprises is far more than the rise of raw materials.

Compared with exchange rate fluctuations and raw material prices, labor costs have risen to clothing in Jiangsu and Zhejiang provinces.

Fewer orders, abnormal business.

Orders have dropped, but most of Taoyuan's clothing companies are more busy and work overtime.

What caused this anomaly? The reason lies in the labor market.

Shen Hurong told the business daily reporter that there were more than 6000 workers in the town who were engaged in clothing production and processing, of which 60% were local workers in Taoyuan, including 20% new Taoyuan people who were married to Taoyuan, and the remaining 40% were workers from other fields. But this year, only about 3000 people are estimated.

There are two main reasons for the loss of labor force: on the one hand, part of the local workers tend to be aging.

On the other hand, due to the favorable factors such as the development of the western region, employment opportunities in the central and western regions have increased, and the proportion of many migrant workers choosing to return home has been on the rise.

Recruitment difficulties, the number of garment industry workers has dropped by 50%. Although export orders have been reduced, some processing enterprises have to send out orders that are too late to go elsewhere to further reduce the output value of garment processing industry in Taoyuan.

There are three kinds of mentality in enterprises.

Enterprises want to be bigger and stronger, but the current situation causes many enterprises to shrink back.

Shen Hurong said: "in the face of increased costs, it is not so easy for processing enterprises to raise prices. Most customers do not accept them, and orders are likely to be lost."

According to him, there are basically three kinds of ideas in the garment processing enterprises in Taoyuan town. One is to seek stability, such as his own Shenghui knitting, to stabilize himself first, and then raise the price of the new product appropriately.

In his view, blind expansion in the present situation is quite dangerous, and pformation is not easy for a garment enterprise that has been doing for more than 20 years.

Two is one.

"After all these years of business, there has been some accumulation in our hands. It is not a big problem to live a small life.

What should we do if we lose money in our hands? "Shen Hurong said. Most of the companies that want to close are considering more risk factors.

Three, some enterprises want to pfer the production workshop to the mainland. In order to reduce the cost of manpower and other costs in Taoyuan, the production workshop is located in the central and western parts of the factory. This is a way out. However, the cost is down, but there are some drawbacks. Shen Hurong told the business daily reporter that, according to past experience, it is relatively easy to manage the migrant workers locally, and the local workers are the key to the management.