Five Bottlenecks To Test The Vitality Of Chinese Textile Enterprises

According to statistics, China

But in China

2008, this year will become the year of final examination for China's textile and garment industry.

RMB appreciation and American subprime crisis

In February 2007, the subprime mortgage crisis broke out in the US. This not only caused the violent turbulence in the global financial market, but also spread to many industries, among which the textile industry is one of the most important industries affected by it.

According to the export data in 2007, China's exports to the United States accounted for 14.3% of the total export volume, and exports to the EU, Japan and other countries accounted for most of the total exports.

But in fact, as the largest economic entity in the world, the depression of his economy to a large extent affects the other countries that depend on the US market.

Among them, the European Union and Japan, which are closely linked to the US economy, are affected to a certain extent.

According to recent data, Japan's GDP growth in 2007 was only 1.5%.

These economic impacts will also involve the textile industry.

This is verified by data statistics in the first two months of this year.

Customs data show that in January, China's textile and clothing exports increased by US $14 billion 984 million, an increase of 25.21%, of which 5 billion 575 million US dollars in textile exports and 9 billion 409 million US dollars in clothing exports, which increased by 33.63% and 20.71% respectively. In February, the export volume of textiles and garments was 10 billion 288 million US dollars, down by 8.5%, of which the export of textiles was 3 billion 794 million US dollars, down by 0.71% compared to the same period last year.

According to the latest news of the Ministry of Commerce, according to statistics from the Department of textiles and clothing of the US Department of Commerce (OTEXA), in January, the United States imported 1 billion 660 million pieces of textile and clothing from China, down 3.1% from the same period last year, the amount of $2 billion 590 million, down 7.7% from the same period last year.

The share of China's textile imports in the United States increased from 39.9% in the same period last year to 40.2% this year, and its share in total imports dropped from 35.3% in the same period last year to 33.9% this year.

This is the second consecutive month of negative growth in imports and exports of textiles and clothing in the United States.

Some experts say that the impact of its subprime mortgage crisis will have an impact on the export of Chinese textiles from several aspects: the decline of the US economy will affect the decline of consumption level. Textiles, as an important part of consumption in the United States, will naturally be affected. Recently, the United States has increased its trade protection measures to China, thereby weakening the competitiveness of China's textiles in the world. The economy of Japan and the EU, affected by the US economy, is affected by these countries' demand for Chinese textiles to a certain extent.

If the subprime mortgage crisis in the United States triggered a global recession on the US economy and affected the consumption of the United States and other countries, thus affecting the export of textiles in China, the accelerated appreciation of the renminbi would undoubtedly compress the profit margins of textile and garment exports, like a salt in the wound of China's textile exports.

At the end of 2007, the RMB exchange rate was 1 yuan to 7.3046 yuan, an increase of 6.9% over the end of last year.

This year, the appreciation of RMB has accelerated.

As of March 17th, the central parity rate of the RMB against the US dollar was 7.0815, the highest level since the exchange rate reform in third consecutive days, and has appreciated 14.52% since the reform. It has appreciated 3.15% over the past year.

"Do not belittle the change in the renminbi, which is the bulk of our export profits."

A head of Fujian's processing and exporting enterprises said that the profit of export enterprises has not been much greater between the appreciation of the renminbi and the depreciation of the US dollar.

Data show that China's textile industry overall average profit margin is 3.9%, coupled with the export tax rebate has been reduced, the appreciation of the renminbi will inevitably make textile and garment enterprises have not much profit margins have been further compressed.

In 2007, the relevant departments estimated that the sales profit rate of the garment industry will decrease by 1%-4%, if the value of RMB rises by 1%.

Despite the limited persuasion of data, the compression of profit space has been firmly placed in front of enterprises.

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The cost of raw materials increases and the price of finished products falls.

The rising cost of raw materials has become a major problem for textile and garment enterprises.

Cotton is the main raw material of textiles, and the change of cotton prices affects the nerves of textile enterprises.

According to the 2008 Research Report on textile and clothing released by the state authoritative department, cotton price is the main raw material of the textile industry, and its price trend has an important influence on the textile industry.

The cotton price will rise in 2008 from three aspects: the ratio of cotton to cotton, the ratio of cotton to substitute fiber and the ratio of grain and cotton.

In the first three months of 2008, the spot price of 328 cotton rose 5.67%, 5.87% and 6.99%, respectively, and the price is now close to 14000 yuan / ton.

In the process of textile processing, the cotton we need depends to a large extent on imports from the United States and other countries.

According to past experience, imported cotton has a price advantage compared with domestic cotton, and domestic enterprises are more inclined to use imported cotton to reduce production costs.

But in the first 3 months of this year, US cotton prices rose rapidly, and the price reached 89.75 cents / pound in March, an increase of 49.78% over the same period last year, much higher than the increase in domestic cotton prices.

According to the current exchange rate conversion, even if tariff and sliding tax are not included, the price of US cotton is higher than domestic cotton price.

The loss of imported cotton will aggravate the contradiction between supply and demand of cotton in China. Therefore, domestic cotton prices will continue to rise in the future.

The report shows that because cotton accounts for 65%-70% of the cost structure of cotton spinning enterprises, the rise of cotton prices in the future will produce obvious pressure on the production and operation of cotton spinning enterprises.

But in the environment of most consumer goods and cotton prices in the domestic market, the price of clothing products is declining.

According to figures released by the National Bureau of statistics, the total consumer price level (CPI) rose 7.1% in January, up to a new high since 1997.

Clothing prices fell by 1.9%.

In February, the consumer price level increased by 8.7% compared with the same period last year, and clothing prices dropped by 1.4% over the same period last year.

Among them, clothing prices fell by 1.6%.

In addition, the implementation of the new labor law and the current pressure of inflation have accelerated the rise of labor costs in the textile and garment industry.

"In this way, our profits have been built up by the rising prices of raw materials and the decline in clothing prices."

"In recent years, our company is losing money," said Mr. Zhuang, a veteran brand clothing company.

It is hard for one to work hard.

"If we can't recruit workers, we'll have to close the door."

Xu boss of a trousers enterprise in Jinjiang, Fujian, says they will lose more if they do not start work.

In recent years, with the pfer of textile and garment industry to the central and western regions, many enterprises that have migrated to the past have created employment opportunities for local migrant workers.

Anhui is the largest exporter of labor force in the country. It is also a relatively prominent area to undertake the pfer of textile and garment industry.

In recent years, governments at all levels in Anhui have seen the advantages of resources such as labor, geographical location and pportation. They have been attracting investment, and are planning to pfer some labor-intensive industries from coastal areas.

Textile and garment enterprises are an important target for investment.

After the efforts of the government and the clothing manufacturers, many brands came to Hefei, Anhui. There are many famous enterprises such as nine herding kings, spell makers and so on.

"We have finally ended the history of working outside the home and not taking care of our families and children."

Ms. Zhang and her lover have been working in Guangzhou for 5 years. During these 5 years, the children are their parents' care. "The consumption of Guangzhou is high. Apart from the couple's renting out houses, there are many other expenses, but also for the family to spend. In the next few years, there is not much money left."

They are very happy to work in their hometown.

And their turning job behavior makes Zhejiang, Fujian, Guangdong and other textile and garment industries more developed areas some enterprises can not recruit skilled workers.

According to media reports, there are only 2 million artificial gaps in Guangdong alone.

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In order to let their employees return to enterprises, some enterprises have issued a policy of "bring back one employee and reward 800 yuan" to the intermediary company.

The employment pressure in these areas has promoted the development of intermediary companies. Nowadays, a large number of recruitment information appears on their publicity columns, but there are few applications.

In addition, the land use problem of textile and garment enterprises in coastal areas is also a major bottleneck for them.

Zhejiang, Fujian and Guangdong are the provinces with a large number of textile and garment enterprises in China.

In the increasingly low profits of textile and garment industry, many enterprises have gradually left the labor-intensive industries and shifted their focus to high-tech industries such as IT industry with high added value after digging into the first pot of gold.

In Wenzhou, Zhejiang, in 2007, the Wenzhou municipal government issued a civilized stipulation that the land used by garment enterprises was not approved, and they could not enjoy preferential policies such as taxation, low interest loans and so on.

Shishi is a county-level city in Fujian province. Due to the rapid growth of garment enterprises, the land use of enterprises is tense.

Some enterprises have sold the land price in the suburbs to 400 thousand yuan per mu when bidding for land.

In the suburbs of Hefei, capital city of Anhui Province, the price of land per mu is about 70 thousand yuan.

12 billion stocks will give birth to the tail cargo market.

According to relevant media, in 2007, China's clothing inventory was about 12 billion, equivalent to about 20% of the total production.

12 billion, according to China's population 1 billion 300 million, each person has an average of nearly 10.

In the words of one industry, China's clothing inventory can be used by the world population for one year.

A large number of clothing inventory also produced a clothing industry around the stock - tail cargo processing company and tail cargo handling market.

It is understood that only in Fujian Shishi, there are hundreds of companies specializing in handling clothing tail cargo.

Clothing brand discount stores and foreign trade shops specializing in handling tail goods all over the country are also everywhere.

In Beijing, the "Tian Lan Tian Wei market" and "Tiantongyuan tail goods market", which specialize in clothing business, are also booming.

It is understood that the Taobao City, which is mainly made up of tail cargo, will also open in the near future. It is the first operation of Beijing's "tail goods factory shop" business mode, with the concept of "tail cargo" as the main theme, Taobao city for investment promotion, and the investment scene is very popular.

Why do we generate so much clothing inventory?

The blind production of garment enterprises is the main cause of clothing inventory.

The number of garments produced by garment enterprises every quarter is determined according to the quantity of orders per quarter, which is generally increased on the original basis.

The purpose of this way is to sell some good clothing styles that will meet the demand for goods.

If the sale is not good, the garment enterprises will not only be faced with the fact that the increase of production can not be sold out of stock, but also the danger of dealers leaving orders to enterprises.

In this case, some garment enterprises still take risks and increase production in order to get enough profits.

In addition, this year, Anhui, Hunan, Guangxi and so on suffered an unusually severe winter. Due to the slippery ice and snow roads, the North-South roads were not smooth, resulting in the new clothing of some garment enterprises not being delivered to the destination on time, and backlog in the storehouse, forming the stock.

Experts from a clothing association talked about the problem of stock formation. The problem was that the current housing and food prices rose, the stock market was bad, and many investors were trapped, so they had no time to take into account clothing consumption, resulting in a large number of new products that could not be sold, which was also a major factor leading to the fall in clothing prices.

According to expert analysis, the most important thing for Chinese garment enterprises to get rid of in a small profit environment is to solve a large number of inventory problems first.

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Follow the trend of plagiarism and homogenization

A store employee had done a test in the store. He cut out the labels and logo of several brands, and then asked the customer to decide which brand of clothing was corresponding to the brand, and the result was more than 80% wrong.

A customer told the staff that the styles were almost the same and could not tell which brand.

The threshold of clothing enterprises is relatively low and investment is low. Several sewing machines plus a workshop have become an enterprise. These enterprises do not have enough capital and strength to start product development and design at the beginning of their business. Then they have gone such a shortcut. If a brand clothing sells well in the market, they will send professional buyers to the market to plagiarize and copy, and quickly put into production, which is an important reason for the serious homogenization of market products.

According to the law of market economy, the price of the market is determined by the relationship between supply and demand. When the purchasing power of the people is constant, the price of the product will rise when the supply of products in the market is less than the demand; when the supply exceeds the demand, the price of the product will fall.

This trend of clothing enterprises has led to a far greater demand for clothing in the same market, and the final outcome is price reduction.

It is understood that more than 50% of China's garment enterprises do not have specialized R & D institutions, and 80% of their products are plagiarized from other corporate brands or specialized clothing design books.

For clothing enterprises, such as Italy, Milan, France, Paris and other places of clothing and fashion industry, why can one of their garments be worth the price of dozens of domestic garments? An important reason is that the technology content is high, others can not copy and imitate.

According to the figures, some foreign brands' R & D design fees can account for more than 20% of sales revenue.

This is exactly what Chinese clothing enterprises can not compare with.

The fashion trend of Chinese garment enterprises is not only manifested in the following aspects of design style, but also in advertising, hiring spokesmen and even promoting sales.

In the aspect of advertising, some garment enterprises earn money in the OEM stage, and begin to pform to brand operation.

They see that some enterprises display their brand vision in advertising, so they spend huge sums of money in advertising on major TV stations when they are not in line with business management, sales channels and product development.

In the domestic garment industry, the image spokesman is an initiative for enterprises to build brand, but there is also a trend of follow suit.

People in the industry laughed, and the size and size of stars in Hongkong and Taiwan were almost the same as clothing companies.

In Jiangsu Changshu and Fujian Shishi and other places, the billboards on both sides of the garment industry base have almost become the publicity poster of the stars.

However, if the image spokesperson is hired properly, it will play a positive role in building the brand and even promoting the products. For example, Chen Daoming hired Mr. Luo and Andy Lau asked him. Their temperament has something to do with the brand that the enterprise wants to build, and plays an important role in the growth of the brand.

However, some brand names are far different from the taste styles of clothing. They not only fail to have positive effects, but have negative effects.

For example, a clothing brand of Shishi, a product of young people aged 20 to 45, has a relaxed and natural style, but the age of the spokesperson invited by the company is more than 50 years old.

The end result is that although the brand has done a lot of advertising, it is useless.

Clothing brand promotion activities followed the wind.

At this time of the season, there is a big storm in the clothing market in all parts of the country.

When journalists enter the clothing market, they are all eye-catching promotional banners, and the slogan "full court half off" and "seasonal jumping price" are heartbreaking.

Reporters found that some clothes were very low discount, and some of the discount has reached ninety percent off.

A clothing store owner said he did not want to sell the discount so early, but other businesses had already begun to make a seasonal storm and had to follow suit.

Some businessmen think that if others discount, you can't sell if you don't play.

The industry believes that for the increasingly developed textile and garment industry, homogenization of disorderly competition will trigger a reshuffle of the whole industry.

Only by making more efforts in technology, brand and innovation can enterprises win the lead in this battlefield without smoke.