Foreign Trade Manufacturing Enterprises Encounter Embarrassment

In the first half of this year, China's foreign trade manufacturing enterprises were faced with the embarrassing situation of low-end "being eaten up" and "high-end not going". Foreign trade manufacturing enterprises, which have low bargaining power and small profits, have begun to turn to the domestic market hard.

As the US economy may fall into a "weak phase" in the second half of the year and the escalation of the debt crisis in Europe, China's exports will be more impacted.

Low end manufacturing industry Order Accelerated loss

The import and export data released by the General Administration of Customs in the first half of the year show that in 1-6 months, the total value of China's imports and exports was US $1 trillion and 703 billion 670 million, of which exports were US $874 billion 300 million, an increase of 24% over the same period last year. In June, the export growth rate in January was 17.9%, declining for 3 consecutive months, indicating that export growth continued to decelerate under the slowdown of external demand.

From the major developed economies, the US unemployment rate reached 9.2% in June, rising for 3 consecutive months. The high unemployment rate has limited the purchasing power of the American people. EU debt crisis has not yet eased, the second half is not optimistic. This will have an impact on China's exports. At present, the price advantage of China's export commodities has been weakened due to the appreciation of the renminbi and the rise in domestic costs. The phenomenon of "being replaced" has begun to spread, and orders for low-end processing industries are accelerating to flow outwards.

Shandong's new century for skiing clothing, bladder and plastic products Packing Fan Guangxin, general manager of the products limited company, told reporters: "our enterprises are labor-intensive enterprises. Fewer and fewer workers are doing this line, and the quantity of orders has gradually decreased. Many European and American orders have been transferred to other countries such as Vietnam, Pakistan and India."

Liu Peng, general manager of Shanghai Peng Wu commerce and Trade Co., Ltd., who is engaged in luggage and garment processing export trade, also said: "it is expected that the low-end processing products such as clothing and luggage will accelerate the pace of transferring to Southeast Asia and Africa." Liu Peng, for example, said: "for example, Bangladesh, labor costs only 600 to 700 yuan a month, China needs at least 2000 yuan, but the local is now constrained by the chemical industry is not developed, raw materials are relatively simple, if there is no such restriction, Bangladesh's competitiveness in this industry than China. At least 20% of the orders were lost because we did not make money.

The loss of orders in Chinese manufacturing industry is seen as a medium and long-term change brought about by the change of China's population structure. Ye Tingqing, general manager of hainait Co., Ltd., Shenzhen, said: "last year, the cost of a skilled worker was about 2500 yuan per month, and this year it has increased to 3500 yuan, and it is still very difficult to recruit people."

Lu Bo, a researcher at the international trade and Economic Cooperation Research Institute of the Ministry of Commerce, believes that the loss of orders in Chinese manufacturing industry will become increasingly prominent in the future.

Foreign trade is not easy to sell domestically, {page_break}

The decline in the bargaining power and the decline in order profits have led many foreign trade enterprises to do so. For the domestic market 。 Reporters at a sales show in Shanghai found that almost all enterprises are foreign trade and domestic sales at the same time, and most of them belong to the situation of foreign trade being sold domestically. However, domestic sales are not so simple. Most of the domestic enterprises are facing the problem of slow repayment and difficult accounts. "It is very slow to make domestic funds back, and it takes at least 3 months to recover funds. Companies that have no strength can't afford to do so. Fan Guang said.

Huang Xingkang, chairman of Shanghai intercontinental Metallurgical Machinery Manufacturing Co., Ltd., said: "the reputation of domestic enterprises is not as good as that of foreign countries. Arrears are common. My company has an annual output value of 200 million yuan RMB, and now it has 100 million yuan in arrears, and the financial cost is so high. I will lose 5% in arrears in one year."

Not only is the money slow, but also how to sell it is the direction for foreign trade enterprises to fumble for domestic sales. In the industry's view, foreign trade as long as the service is done well, and domestic marketing is more emphasis on the market, which are two completely different concepts. Lu Bo pointed out that enterprises that normally do foreign trade only need to have orders to organize production, engage in simple processing, do not consider the sales situation and market demand, so the overall risk is not great; and domestic enterprises must grasp a series of links in procurement, production, processing and sales, and at the same time, pay attention to market demand at home and abroad. In this highly competitive domestic market, these inexperienced foreign trade enterprises want to occupy a place, which is very difficult.

Brand and channel are undoubtedly the two stumbling blocks in the process of export to domestic sales. Reporters interviewed found that most businesses are currently restricted to selling on Taobao. Although the channel of e-business B2C costs a lot of money than traditional channels, there is hardly any brand and consumer loyalty.

Xia Jinbao, general manager of Shanghai Ken Yi Textile Co., Ltd., who specializes in commercial gifts, told reporters that now we must turn to the brand in the domestic market. We should start with the online shopping mall, and gradually turn to cooperate with some stores. At present, we have arranged with all customers and hot winds to shop, from the OEM to the creation of our own brand.

Experts suggest: speed up transformation will have a way out.

Nowadays, Chinese manufacturing enterprises are facing the awkward situation of "dilemma" of foreign trade and domestic sales. At the crossroads, Chinese enterprises must take the road of value upgrading. Only by accelerating structural transformation can we break through the bottleneck.

Compared with foreign products such as Bobbi, Apple and other foreign products opened in China, the added value of Chinese products is not high, and is located at the edge of the international industrial chain. China is a factory in the world, but it is not a world-class factory. China's product image and product quality need to be improved.

Chen Dongqi, vice president of the Macroeconomic Research Institute of the national development and Reform Commission, analyzed that before the global financial crisis, China's SMEs did not rely on technological innovation, but mainly relied on low labor costs, low price and quantity competition, and lack of global brand competitiveness. This requires enterprises to have an international perspective, and launch an international road map for manufacturing capital, and at the same time, it is urgent to promote the development of drilling, intensive, deep and detailed development, and enhance the brand of enterprises.

Yu Yihong, a professor at the school of management at Fudan University, also believes that low cost, price war and vicious competition are the main paths for China's manufacturing industry over the years. But in the long run, compressing costs is not the most promising and promising way for the future development of China's manufacturing industry. Instead, value innovation takes into account more cost and higher added value.

Zhou Dewen, President of Wenzhou SME Development Association, suggested that small and medium-sized manufacturing enterprises should be guided to join forces. Only when we join forces and form strength can we upgrade the brand and upgrade the quality of products. "Every industry has a leading enterprise that can integrate small and medium-sized enterprises in the industrial cluster with capital, brand and even sales channels, even if it can not become an aircraft carrier, it should also become a giant enterprise."