Dream Of Cheap Jeans Ends In China

clothing

The overall profit margin of the processing industry is less than 5%.

In terms of current exchange rate, after deducting the rising cost of raw materials and labor costs, it is close to zero profit.

The haze of the debt crisis has continued to spread, with high unemployment and consumer confidence in Europe and America.

However, as the largest garment exporter in the world, the cheap advantage of Chinese cowboy clothing exports is shrinking due to the rising cost of OEM.

Chinese consumers are accustomed to contribute 15% of total clothing purchases.

In the past, a Levi 's ordinary five bags of jeans, China's purchase price of about $25~30, while in Eastern Europe, it needs to pay more than $10 purchase price.

Cheap labor and mature industries have become the reasons why many international cowboy brands choose Chinese foundry.

Guangdong Zengcheng Xintang, Shunde Junan, Zhongshan great Chung, Kaiping three port is China's four largest denim Town, has long undertaken a large number of Levi 's, Lee, Wrangle and other international brand OEM orders.

Among them, the safety of jeans industry originated from the pfer of garment industry in Hongkong, about 90% of the enterprises undertake foreign trade orders processing, and more than 50% of the export volume is exported to Europe and the United States.

However, in the last two years, more than 100 cowboy processing enterprises went bankrupt.

Ouyang Gaofu, general manager of Junan celebrities, said that the overseas orders in excess of 2/5 at its peak were obtained from Wenzhou garment buyers.

Nowadays, the boss of Wenzhou has run away, resulting in a lot of small and medium denim factories closing down.

The fluctuation of cotton prices in 2011 and the rise of labor costs have further worsened the living environment of the foundries.

Ouyang Gaofu explained that at the beginning of 2011, the average cotton cloth jumped from one yard to 20 yuan to 30 yuan. After that, cotton prices fluctuated until the latter half of the year. An average pair of jeans increased by an average of 3 yuan to 5 yuan, and the middle grade even increased by 5 yuan to 8 yuan.

The increase in human cost has increased the cost by about 1 yuan to 1.5 yuan.

Junan, another cowboy production manager Liu Jingcai said that the purchase price of European and American orders in 2011 was almost flat, and the profit margin of jeans processing industry was less than 5%. At the current rate of 6.3 dollars, after deducting the rising cost of raw materials and labor costs, and so on, it was almost close to zero profit.

According to customs data, the export growth rate of textile products has been higher than that of garment products since 2010, and the total export growth rate of garment products in 2011 reached 18.4%, which is only 1/2 of the textile export growth.

Insiders pointed out that some textile fabrics were exported from China to Southeast Asia, and then sold to Europe, America, Japan and Korea.

In fact, some people in the European apparel market research have found that 90% of the mythologies made in China have been broken, and Chinese made products have dropped to about 70%.

However, Pan Jianyue, director of global marketing, believes that China is already close to Japan and South Korea's high-end products, whether it is fabric or water washing technology. There is still a gap between China and other countries in supporting the industry. The order of high-end products will still fall on China's hands. Giving up part of the low end orders is more conducive to the integration of resources in the Chinese cowboy industry.

According to the survey of The NPD Group of Port Washing N.Y., sales of jeans under $25 dropped by 5.3% to $3 billion 990 million, while jeans sales at $50 increased by 11.1% to $3 billion 160 million, while sales of jeans sold for more than 50 US dollars increased by 13.4% to 1 billion 500 million dollars.

Such as Lee brand, this year's market share has reached 20%, the proportion in the first 5 years has been 13%.

Pan Jianyue said that the national garment export is still growing at a rate of 20%. This round of shrinking European and American markets will not have a big impact on the high-end jeans, and will eliminate more weak design enterprises in the next 5 years.