Rising Labor Costs Force Local Textile Companies To Explore Productivity

The appreciation of the renminbi and the sharp rise in labor costs have made the cheap advantage made in China fade away. On the 2011 China Textile Market Forum held on 19, the reporter learned that not only did European and American enterprises begin to transfer to Southeast Asian industries, but also some local textile and garment enterprises in China tried to move manufacturing business to Southeast Asian countries.

The rising cost of manpower is a common problem faced by all industries in China, and the situation is more severe for the labor-intensive textile industry. Data show that the per capita wages of textile enterprises in the southeastern coastal areas of China have increased by about 20%. According to Zhou Haijiang, chairman of the red bean group, the group's wage level was raised by 49.6% in 2010. Even in wages Under the rising situation, many enterprises still have difficulties in recruiting workers.

Some garment enterprises that have completed primitive accumulation such as YOUNGOR and Shanshan Group have expanded to real estate, finance and new energy industries. Others have insisted on fighting in the main textile industry to try to reduce costs, such as the relocation of low-end processing and manufacturing businesses.

Tianhong Textile Group is one of the largest suppliers of core cotton textiles in the world. Hong Tianzhu, chairman of the company, said at the Forum: "cost is always the core issue of the textile and garment industry. Our textile enterprises can do some targeted industrial transfer according to their own conditions, such as to Southeast Asian countries."

Tianhong textile is the beneficiaries of capacity relocation. As early as 2006, it invested and built factories in Vietnam. Now it is preparing to build second factories to transfer more manufacturing business to Vietnam. Based on the convenience of raw materials import, low labor costs and favorable local tax incentives, the profits of Tianhong Vietnam factory are even more impressive than that of domestic factories.

China Textile Information Center insiders told reporters that this year's textile clothing The days of enterprises are not good. Besides the soaring cost of raw materials and the rising cost of labor, "no order" or "afraid to take orders" is the biggest worry of textile enterprises in recent years. "It is very common for European and American buyers to turn their orders to Southeast Asian countries. Now many local enterprises are also considering investing in factories in Vietnam and Bangladesh, and they are responsible for R & D, design and other businesses in the country."

Insiders suggested that the location of enterprises relocation in different industrial chain links should be different from the perspective of concern. For cotton spinning enterprises, cotton resources are the key to choose the investment place. For garment enterprises, there must be sufficient supply of local resources.

The above China Textile Information Center personage said that before the European and American countries will be backward textile processing links transferred to China, now China's textile industry fundamentals have changed, engage in low-end manufacturing is difficult to survive. And the textile industry chain of Southeast Asian countries is constantly improving and enjoying many preferential policies. China's textile enterprises can appropriately handle the lower end processing. Manufacture Give them to themselves, and turn to the high end of the industrial chain.

Zheng Yonggang, chairman of Shanshan Group, told reporters: "in the first 20 years of reform and opening up, the main dividend is earned. The labor force is the main body of competition, so our country has become the world's factory. Now, we are not only the world's factory, but also the largest consumer market in the world. In the context of the gradual decline of demographic dividend, how to realize the new development mode of textile enterprises is a topic of common concern for the industry.

Hong Tianzhu said that economic recession is the process of survival of the fittest, while brewing progress and innovation. Under the background of global economic slowdown, how to make use of this economic cycle and use two or three years to work hard to accomplish internal innovation and upgrading is a challenge for Chinese textile and garment enterprises.