How Should Small And Medium Shoe Enterprises Deal With The Risk Of Export Orders Falling?

Abstract: according to the latest research report released by the relevant departments of the Ministry of Commerce, China's foreign trade enterprises, which take the US as the main export market, are likely to suffer the embarrassment of shrinking orders in the future.

For tannery enterprises with great dependence on foreign trade, the unpredictable situation of national policies, the pressure of environmental protection, the predicament of the market and the rising cost will make it difficult.

Banks should be vigilant in investing in the industry and avoid investment risks in time.

The relevant departments of the Ministry of Commerce issued the latest research report to remind governments at all levels and export enterprises to guard against possible rapid decline in exports due to the downward trend of the world economy.

According to the report, China's foreign trade enterprises, which take the US as the main export market, are likely to suffer the embarrassment of shrinking orders in the future.

This report is not optimistic about China's export environment.

The report believes that with the gradual follow-up of the subsequent impact of the US subprime mortgage crisis, the slowdown in the US economy is unavoidable, which will affect my goal of export and growth to a certain extent.

The Ministry of Commerce's export statistics for the first three quarters of this year show that with the slowdown of the US economy, the export growth of the US has shown a sharp downward trend.

Especially since the outbreak of the subprime mortgage crisis in July this year, the export to the US has dropped considerably in the third quarter.

In the first quarter of this year, my exports to the United States increased by 20.4% over the same period, down to 15.6% in the second quarter and only 12.4% in the third quarter.

At present, China's direct exports still rely heavily on the US market.

In the first three quarters of this year, China's exports to the United States increased by 15.8% over the same period last year. Exports to the US still account for 19.4% of China's total exports, after only 20% of the EU's total.

Central bank studies show that my exports to the US are closely related to the change in US consumption data, and the US economic growth slows by 1 percentage points, and my exports will drop by 6 percentage points.

At present, China's exports to the US are mainly consumer products such as electronic products, furniture, toys, footwear and clothing.

Analysis of China UnionPay letter: at present, the rising price of raw materials has become one of the bottlenecks in the development of many industries. This price fluctuation affects the normal operation of enterprises and increases the instability of business.

China's leather enterprises are also facing this kind of business crisis.

According to statistics released recently by the China Light Industry Import and Export Association, the average price of leather shoes exported to Europe was 1 US dollars in August this year, which is 7.31 US dollars / double, an increase of 16% over the same period last year.

But compared with the cost pressures faced by Chinese shoe manufacturers, the increase of less than US $1 obviously can not improve the predicament of enterprises.

It is believed that the current leather and footwear industries are in the stage of shuffling. In the first half of the year, the cost of raw materials has increased, while the export unit price has declined, and the profits of the industry have declined.

The current situation of leather making enterprises is very difficult.

The unpredictable situation of the national policy, the pressure of environmental protection, the predicament of the market and the rising cost will make the tanning enterprises swaying in the predicament.

Bank related financial institutions should be vigilant in investing in the industry and avoid investment risks in time.

1. The import and export profits of the industry declined, and the number of imported raw leather was 329 thousand tons, down 4.7% from the same period last year. The amount was 610 million dollars, up 7.4% from the same period last year.

In the first half of the year, the number of imported raw fur was 14 thousand tons, down 9.5% compared to the same period last year. The amount was 90 million dollars, up 20% from the same period last year.

Such data indicate that the price of raw hide and raw fur increased substantially in the first half of the year, and the cost of raw materials increased.

On the contrary, the export volume of fur garments, clothing accessories and other products in China was 5 thousand tons, up 6.8% over the same period last year, and the export volume was 220 million US dollars, down 35.6% from the same period last year.

In the case of sales growth, sales revenue declined, indicating that the unit price of finished products declined and industry profits declined.

The number of leather garments exported in the first half of this year was 10 million, down 29.2% from the same period last year, and the export amount was 400 million US dollars, down 37.8% from the same period last year.

Domestic leather clothing exports have been in a doldrums in recent years.

Such a situation has a certain relationship with the recession of the leather clothing market. Besides, it is directly related to the quality, design, brand and market development of domestic leather garment enterprises.

2, policy risks should not be ignored.

China's fur industry has just adapted to the rectification and clearance policy of Russia's main battlefield, and has also met the adjustment of the state's export tax rebate.

The export rebate rate of leather and fur products decreased from 13% to 5%, making the domestic fur industry worse and worse, bringing new challenges to enterprises.

The development of fur industry is very bad this year, and many enterprises have already stopped production.

In addition, the increase of the RMB exchange rate has made the fur export enterprises suffer more losses in the process of settlement of foreign exchange.

As an industry that takes agricultural and livestock products as the main raw material, it thought that the state would support the fur industry, encourage the development of animal husbandry, and support the related industries of deep processing of agricultural products. However, the reduction of export tax rebate rate has greatly affected fur manufacturing enterprises.

The export tax rebate rate lowered in July 1st will have a great impact on the construction of leather, clothing, shoes, sporting goods and other industries. The tax rebate has not been set up for a pitional period, and has not yet fulfilled the contract business and has suffered heavy losses.

The export growth rate has dropped markedly. The structural adjustment of the new export tax rebate rate is relatively large, and the adjustment range is different.

The most affected industries are leather clothing, hardware and chemical industries. The export tax rebate has been reduced by more than 8 points. The export of general trade mode in these industries will be seriously affected, and directly lead to the loss of competitive advantages such as neighboring countries.

From 1 to April, the export value of the main commodities in China's leather industry was US $7 billion 120 million, an increase of 5.8% over the same period last year.

Except for leather clothing, fur clothing, foot basket volleyball, semi finished leather and finished leather, other main commodities increased year by year.

Before the import and export of leather as "processing trade", raw materials import is not taxed, export is not tax rebate, enterprises have no tariff burden.

However, this preferential policy for processing trade was abolished. Leather import and export began to be taxed according to the general normal trade tariff.

For leather semi-finished products, 5%-14% duty and 17% value-added tax are needed, so the export cost of leather products is increased.

The export tax rebate rate of footwear products has been pferred from 13% to 9%, and the export tax rebates for leather and other leather products have almost been abolished.

In Shandong, leather enterprises are mostly materials processing enterprises. The average profit rate of the whole industry is only about 4%. Reducing or abolishing the export tax rebate rate has the greatest impact on the leather industry export.

The export of leather industry will be reduced sharply, and enterprises lacking superiority will therefore be "closed".

Due to fierce competition, Chinese enterprises are unable to solve the pressure brought by cost increase by raising prices.

Enterprises with strong brands and independent brands have adjusted the structure of export products, improved product grades, and achieved a shift from low to medium to high grade, which has become an important reason for the rise of export prices.

For example, the average export unit price in Sichuan from January to August increased by 30% over the same period.

The export price of some men's shoes in Wenzhou Kangnai group has reached 45 US dollars / double this year.

However, for the majority of small and medium-sized shoe enterprises, in order not to lose their old customers, efforts to maintain a lower price will still be the way for these export enterprises to survive.

When bank credit tips are difficult to reverse in the short term, the ability to control cost becomes one of the main elements of competitiveness.

If we want to maintain stable profits and offset the increase in the cost of raw material prices, one way is to save the cost of production in other aspects of enterprises, and the other way is to pfer the cost brought by the rising prices of raw materials.

Leather enterprises have many difficulties in pferring costs to downstream industries through raising prices. The market structure of leather industry determines that leather enterprises do not have the pricing power, and the market has strong pricing power.

The disadvantage of small and medium-sized leather enterprises in this raw material crisis is obvious. The risk of small and medium-sized leather enterprises has increased recently. Therefore, commercial banks should avoid giving credit to them in order to avoid risks.

UnionPay analyst recommended the following measures: strengthen the pre loan review.

Before issuing loans, the banks carefully scrutiny the creditworthiness of the lender and the guarantor, and try to choose large, strong and good credit enterprises as the target customers of loans. We should have a detailed understanding of the market and product operation of the enterprises, and judge the size of the business risks according to the EU's policies.

Ways and means of guarantee are increased.

It is suggested that the shareholders of the decoration company should be provided with the credit guarantee for the borrower, or the mortgage guarantee or pledge guarantee with the shareholders' assets, so as to ensure the maximum payment when the risk arises.

Making use of the existing credit system.

Using the internal credit control system that banks already have, we should understand the borrowers' existing loans before lending, and try to disperse the risk of loans and prevent the concentration of risks.