Reflection On Pformation Caused By The Rise In Clothing Consumption

With the grand concept of "12th Five-Year" opening year and China's accession to the WTO 10th anniversary, 2011 will soon become the past.

although

First look at a group of domestic sales data that show a significant downward trend:

According to the National Bureau of statistics, in 2011 1~10, the total retail sales of social consumer goods totaled 147357 billion yuan, representing the name of the year.

In the 1~10 months of 2011, the retail sales of clothing increased by 24.5% over the same period last year, down 1.31 percentage points from the same period in 2010, and the retail sales increased by 4.17% over the same period last year, down 8.16 percentage points from the same period last year.

The unit price of clothing sales increased by 19.52% over the same period last year.

In major clothing categories, except for sportswear sales increased by 11.51% over the same period, and sales of women's wear and denim clothing increased slightly, sales of other clothing categories showed negative growth.

Let's look at a set of export data that confirm that "the number of garment exports in China is near zero growth" is a foregone conclusion.

According to customs statistics, in 2011, 1~10 months, China's clothing and accessories exports totaled 127 billion 433 million US dollars and 24 billion 412 million pieces, representing an increase of 21.37% and 0.07% respectively over the same period last year.

The number of garment exports increased by 13.81 percentage points over the same period in 2010.

From monthly exports, the number of exports in July, September and October decreased by 0.94%, 3% and 10.30% respectively, and the monthly export volume growth continued to accelerate.

The average unit price increase of exports continued to rise, an increase of 21.59% over the same period last year, an increase of 17.45 percentage points over the same period in 2010, and the increase in monthly prices in more than 24% months after 6 consecutive months. The price increase in September and October dropped to 17.97% and 17.02% respectively.

Although export prices rose significantly at the end of the year, the increase in export unit prices directly led to a sharp rise in export volume throughout the year.

Whether domestic or export data are clearly manifested: the key word that runs through the industry throughout the 2011 is rising prices.

"Price increase" can be a trump card or a bad move. It depends on whether our industrial organism matches the market behavior of "price increase".

In other words, it is necessary to examine whether the price can still maintain the healthy operation of the industry.

We have always said that "11th Five-Year" laid a solid foundation for industrial scale. "12th Five-Year" should abandon the scale expansion and take the road of value development.

At present, the trend of "price increase" under the guidance of value development thinking is the expression of time maturity or the unilateral effect of wishful thinking?

It is dangerous to use price lever at will. Adam Simy's theory of value is very straightforward: the value of goods is often very small, and the value of small items is often exchanged for great value, such as water and diamonds, which is clothing and luxury goods in the clothing market.

On the other hand, it is understood that quantity and price can not be concurrently. In 2011, the behavior of collective price increase in clothing industry is just like enjoying the regular income brought by the expansion of the shop scale, enjoying the double harvest of the extra income brought by the price increase.

However, the contradiction between oversupply and demand will break out sooner or later, then price reduction or dumping of stocks will affect brand image and impact channel interests.

People in the industry have summed up in a brilliant way, "12th Five-Year" we are standing in the golden age of 10 years after the accession to the WTO, but our thinking is not "continuation" but "pformation".

Price increase in domestic market -- breaking the balance between supply and demand

Who will swallow the bad consequences of high inventory?

1 the increase in prices has created more inventories, which will create a subtle and inestimable "Butterfly Effect" for the investment, physical supply and market demand of the garment industry next season.

According to the statistics of China Business Information Center, sales volume, quantity and average price of major large-scale retail commercial clothing increased by 23.65%, 4.97% and 17.80%, respectively, in 2011 1~9. The sales volume of clothing increased by 5.33 percentage points over the same period in 2010.

According to the statistics from the China Business Information Center on the major retail businesses in China, the sales volume of clothing in the two months of the Spring Festival and the May 1 golden week all showed negative growth, and then dropped sharply for 3 consecutive months.

In the 1~10 months, the retail sales of clothing increased by 24.5% over the same period last year, down 1.31 percentage points from the same period in 2010, and the volume of retail sales increased by 4.17% over the same period last year, down 8.16 percentage points from the same period last year.

The unit price of clothing sales increased by 19.52% over the same period last year.

In major clothing categories, except sportswear sales increased by 11.51% over the same period, women's wear sales increased by 1.74% year-on-year and cowboy clothing sales increased by 1.68% over the same period, sales of other clothing categories showed negative growth, including sales of jackets, cold clothing, leather clothing, trousers, cashmere and sweaters all down by 10%.

It can be seen that the increase in prices has led to the "false prosperity" of the amount growth, and the price increase has begun to significantly inhibit the growth of consumption.

Further speculation, it can be said that the increase in prices has created more inventories, which will create a subtle and inestimable "Butterfly Effect" for the investment, physical supply and market demand of the clothing industry next season.

2, the fourth quarter of CPI accelerated, and how much longer did garment CPI go up? PPI has already been leveled off, and the chorus of the terminal price rises in the clothing industry will soon lose its voice.

According to the National Bureau of statistics, the clothing price index rose to 101.3 in 1~9, and the clothing consumer price index rose to 101.6,9 months. The consumption price of clothing clothing increased by 3.2% over the same month.

Garment factory prices also hit a record high. In 1~9, clothing manufacturers' factory prices rose by 4.3% over the same period last year, 5.3 percentage points higher than the end of 2010. In September, the producer prices of clothing producers increased by 4.5% in the same month.

The apparel purchasing managers index is still sticking to above 50 in the Chinese Manufacturing Purchasing Managers' index, but the trend of the downward trend has no way to hide. Under the background of the obvious callback of China's economic growth, it is hard for the clothing industry to be independent. In October, the CPI fell to less than 6. In the last quarter of 2011, the decline of CPI accelerated, and how much longer the beautiful curve of garment CPI's uptrend could be maintained. PPI has been leveled off.

3 the news of the new season's orders will still pass the news that the unit price of the brand enterprises has increased by 20%. Is this the prelude to "consumption upgrading", or is the wishful thinking that the brand pays consumers to pay for the cost risk?

Price is ultimately determined by the balance between supply and demand.

In the weaker domestic demand market in 2011, did the supply of clothing market in China go down sharply?

According to the statistics of National Bureau of statistics, 1~9 months ago, enterprises of above scale in China completed 18 billion 324 million garment production, an increase of 9.48% over the same period last year, an increase of 8.76 percentage points lower than that in the same period of 2010.

Among them, 9 billion 592 million knitted garments and 8 billion 732 million knitted garments, respectively, increased by 10.71% and 8.15% over the same period in 2010.

According to the National Bureau of statistics, in 2011 1~8, the total output value of the garment industry in China (above 20 million yuan and above) reached 848 billion 278 million yuan, up 29.26% from the same period last year, and the total sales value of industrial production reached 827 billion 439 million yuan, up 29.7% over the same period last year.

The growth rate slowed by 0.73 and 0.52 percentage points respectively compared with the beginning of the year.

According to the National Bureau of statistics, in the first three quarters of the year, China's garment industry above Designated Size Enterprises actually invested 157 billion 931 million yuan, an increase of 40.53% over the same period last year, an increase of 7.57 percentage points over the end of 2010. The number of construction projects, the number of new projects and the number of completed projects increased by 8.57%, 4.02% and 27.79% respectively.

The apparel industry actually completed 32.47% of the total investment in the textile industry, which is basically the same as the end of 2010.

Starting from the fourth quarter of 2010, the number of new projects in the garment industry has slowed down and the industry investment has tightened.

4, the benefits generated by the movement of low priced goods are much greater than the limited price raised by single goods. However, the curing mode of marketing has made the response of industry supply consistently slower than the market demand.

According to the National Bureau of statistics, the supply of China's garment industry showed a trend of narrowing in 2011, but the pace of supply narrowing was not as fast as demand narrowed.

It is not difficult to understand that the clothing market is a fully competitive market. In such a market, the total supply is greater than the total demand.

But everything is in order. In 2011, this excess supply really created a hot word in the industry -- inventory.

It is not only cotton enterprises shouting "go out of stock", but also the clothing enterprises are suffering from inventory.

Statistics of Enterprises above Designated Size in the National Bureau of statistics show that the annual turnover rate of enterprises is about 5.6 times. The annual average turnover rate of clothing and clothing listed companies is only 2.4 times, and the annual turnover rate of ZARA can reach 11 times.

At present, in order to cope with the rising cost, domestic clothing brands are busy raising prices, but everyone knows that the "high priced goods" that can not be sold are not only worthless, but also have a large amount of inventory cost, so that the benefits generated by the movement of "cheap goods" will be far greater than the limited price raised by single goods. However, the curing mode of marketing has made the response of the industry supply slower than the market demand.

Export price rise -- zero growth in quantity

Is helpless, but also the starting point of pformation and upgrading.

Export volume and amount of clothing and accessories in China in 1~9 2011

5 the number of exports of the top 5 countries (regions) of the two largest exports to the US and China's Hongkong has dropped sharply, and exports to major European countries have also seen two digit or nearly two digit negative growth.

In 2011, the near zero growth of garment export volume in China is a foregone conclusion.

According to customs statistics, in 2011, 1~9 months, China's clothing and accessories exports totaled 115 billion 235 million US dollars and 22 billion 224 million pieces, representing an increase of 23.26% and 1.22% respectively over the same period last year.

The amount of clothing exports accounted for 60.42% of the textile export volume, an increase of 2.95 percentage points from the first half.

The number of garment exports increased by 13 percentage points over the same period in 2010.

From the monthly export point of view, the number of exports in July and September decreased by 0.94% and 3% respectively, and the monthly export volume growth continued to decline.

The average unit price increase of exports continued to rise, an increase of 22.35% over the same period last year, an increase of 18.79 percentage points over the same period in 2010. After a month's price increase of more than 24% in six months, the price increase in September dropped slightly to 17.97%, and the increase in export unit price directly led to a large increase in export volume.

In 1~9 months, China's exports to all continents increased by two digits.

Asia is still the first continent in China's clothing exports, accounting for 34.20% of total exports, down 0.26% from the same period in 2010.

Followed by Europe, an increase of 26.78% over the previous year, accounting for 33.91% of total exports.

Third, North America, exports grew by 13.67% year-on-year, accounting for 20.73% of total exports, representing a 1.75% decrease over the same period last year.

China's exports to Latin America increased by 55.94%, accounting for 5.45% of total exports, representing an increase of 1.14% over the same period last year.

Regional situation of garment export in China in 1~9 2011

In 1~9 months, the volume of clothing exports from the mainland to the EU, the United States, Japan and China continued to grow, and the export volume increased by 27.67%, 13.68%, 24.16% and 4.26% respectively over the same period last year.

The export volume of these traditional markets was 75 billion 960 million US dollars, accounting for 65.92% of the total clothing exports of the country, an increase of 20.84% over the same period last year, pulling 14.01 percentage points of clothing exports.

The total export volume for emerging markets such as Latin America, Africa, ASEAN and Russia is 17 billion 750 million US dollars, accounting for 15.40% of the total garment export volume of the whole country, an increase of 38.30% over the same period last year, pulling 5.26 percentage points of clothing exports, and the growth rate of exports to emerging markets is obviously larger than that of traditional markets.

However, from the quantity of exports, the number of exports of the top five countries and regions in the mainland to the United States and China's two largest exports in Hongkong has dropped sharply, falling to 6.05% and 14.81% respectively, and exports to Europe, such as Spain and Italy, have also seen two digit or close to two digit negative growth.

The amount of the top 20 clothing exporters (regions) in 1~9 2011

6 our lack of voice in the international supply chain and the slight increase in the small processing fee can cause a great stir. What we hope is that the humble export mode has finally begun to be abandoned voluntarily.

In 2011, China's growth in global exports was due to the passive or passive abandonment of low value-added orders, the adjustment of the export product mix, the increase in the proportion of exports of higher value added products, and the hard price increase.

The hard price increase has pushed the pfer of orders that had already been strongly shifted out of China's will.

The closing of the 110 Canton Fair, the turnover of textile and clothing hall decreased by 12.6% compared with the 109 session, and the turnover volume of exports to Asia, Europe, the United States, Australia and Africa fell by 5.54%, 15.91%, 17.84%, 3.3% and 1.52% respectively, of which the rate dropped to 31.65% for the United States.

This is a disturbing answer to the Canton Fair as an export barometer.

Our country should be afraid of being the biggest exporter and producer of clothing in the world. The right to speak in front of the international supply chain is so short that a slight increase in the small processing fee can cause a great stir in the national garment export industry.

We began to pay attention to the operation and layout of emerging markets outside Europe, the United States and Japan, and opened a door to China's independent brands.

We began to think about the way of export, trying to run from "chasing orders to running" to "running the world with orders".

We began to pform our identities from those who sell physical labor to those of super value.

We have begun to explore new industrial functions, not only the service providers of the international market, but also the integrator of international resources.

If the price rise of domestic demand is "superficial and dangerous", the price rise of export products can be said to be "fully exposed to problems and alluding to future hopes".

Price effect: short-term prosperity

Whether the appearance can change the truth mainly depends on the direction.

7 in the face of weak international and domestic demand, the good operation and quality of the industry is created by enterprises with sales income of more than 20 million yuan. These enterprises account for only 10% of the total number of garment enterprises.

According to the statistics of the National Bureau of statistics, in 2011 1~9, there were 10305 Enterprises above Designated Size in China's apparel industry, totaling 922 billion 118 million yuan in total industrial output value, 876 billion 280 million yuan in main business income, and 48 billion 2 million yuan in total profits, up 28.75%, 30.13% and 40.11% respectively.

In the 1~9 month, 1327 enterprises were losing money, with a loss of 12.88%, narrowing by 2.06 percentage points from 1~2 months earlier, and the deficit of loss making enterprises increased 20.35% over the same period last year, an increase of 1.93 percentage points over the beginning of the year.

The number of employees reached 3 million 406 thousand and 300, an increase of 53 thousand and 300 over the first 1~2 months, an increase of 7.10% over the same period last year.

The average gross profit margin and profit margin of the industry reached 15.52% and 5.48% respectively, which increased by 2.32% and 7.67% respectively compared with the same period in 2010.

The total assets contribution rate and net assets yield rate increased by 8.56% and 9.42% respectively compared with the same period last year.

The three fee ratio was 7.88%, down 3.53% from the same period last year.

Industry profit growth slowed down significantly.

Judging from the above indicators, it seems that the apparel industry has maintained a good growth rate in the face of weak international and domestic demand, and has achieved a marked improvement in profitability.

However, the above data are created by enterprises whose sales income is more than 20 million yuan, and these enterprises account for only 10% of the total number of garment enterprises.

It is not difficult to find out that the gap between the enterprises above the scale and the enterprises below the scale is very large.

The enterprises above the scale of 9.23% of the total enterprises have completed 70.66% of the total industrial output value, 70.57% of the main business income and 70.56% of the total profits, and have absorbed 52.86% of the labor employment.

The total industrial output value, export delivery value, main business income and total profit of Enterprises above Designated Size reached a two digit increase over the same period in 2010, while all the enterprises under the regulation had a negative growth. Except for the delivery value of export decreased by 4.42% compared with the same period last year, the other indexes dropped by about 10%.

8 with the revival of small and medium-sized enterprises, there may be another price war. Once the terminal price falls, it will not be the SME group itself, but the entire interdependent industrial chain.

The average industrial gross output value, the average export delivery value of enterprises, the average main business income of enterprises and the average profit of enterprises are four times of 25.82 times, 21.90 times, 25.71 times and 25.79 times of the four indexes of the enterprises under the above scale respectively.

The four indicators of per capita gross industrial output value, delivery value per capita, per capita business income and per capita profit of Enterprises above designated size are 2 times of the four indicators of the enterprises under the regulation.

Even if the survival state of small businesses may not be largely shut down, the statistics of Enterprises above designated size can not fully reflect the development trend of the industry.

Small and medium-sized enterprises are the foundation of industrial development. If large enterprises are carriers and warships, then small and medium-sized enterprises are water.

We can see that under the scale of the commencement of operation, the data of enterprises show that although the energy efficiency of manpower, material resources and capital of SMEs is relatively low, the combined profit margins are not obviously low. Small businesses have the way of survival for small businesses, and flexibility and low cost are difficult for big enterprises to compete.

But it can be said that the profit growth of most small and medium enterprises in 2011 came solely from the increase in prices. The price increase in 2012 will be suppressed, and even with the revival of small and medium-sized enterprises, the price war will appear again. Once the terminal price falls, it will not be the SME group itself, but the entire interdependent industrial chain.