Trends Of Clothing Business

"Bangladesh made" customer costs reduced by 30%

"Low labor costs, low rental costs and low raw material costs" have all been added to China.

The industry seems to be different now.

Adidas global CEO Haina said that because of the increasingly high wage standards set by the Chinese government, Adidas hopes to partially withdraw from China and move to cheaper labor areas.

Facing domestic clothing and

Adidas's global rival Nike also made the same decision on the high production costs of the industry. As early as in March 2009, Nike announced that it would stop its sole footwear factory in Taicang, Jiangsu.

Not only that, many domestic enterprises have begun to shift their productive forces to foreign countries.

A factory of tens of thousands of people in Guangdong will move 50% of its capacity to Vietnam in 2015 or 20% to India or Sri Lanka, leaving less than 30% of China.

Today, the "overseas foundry" trend has been blown off the line, as the fast fashion industry's Internet business enterprise.

Recently, from the beginning of autumn and winter this year, the origin of the tags on the shirts of fan ksin pin (hereinafter referred to as customers) is no longer the China of the same color, but "Made in Bangla" (made in Bangladesh).

In fact, since last year, customers have been testing the overseas garment manufacturing market, looking for another way out of "made in China" and becoming the first online clothing brand in China.

As one of the largest e-commerce clothing brands in China, all customers use OEM mode, and factories are mainly located in the Yangtze River Delta and the Pearl River Delta region.

But since last year, customers have started appearing "Made in Bangla" products.

According to Liu Hao, deputy general manager of fan first production center, since last autumn and winter, Fan Ying and Nantong new high printing and dyeing Co., Ltd. have invested in Bangladesh's foundry factory, placing 210 thousand shirts in Bangladesh factory.

This year, some casual pants will also be produced in Bangladesh.

In 2013, products such as down garments and sweaters are also expected to make trial lists overseas.

Liu Hao said.

In addition to having a lower labor advantage, Bangladesh will

As the pillar industry of the country, the industry has a complete set of perfect textile industry chain.

In the production of basic products such as shirts, casual pants and sweaters, Bangladesh's textile technology is excellent and the cost is about 30% lower than that in the domestic market.

In terms of quality, the surface accessories of all customers in overseas processing factories are provided by domestic suppliers designated by customers. In the early, middle and late stages of production, all customers will send quality inspectors to supervise the local factories in Bangladesh. Before entering the domestic warehouse, the products must be tested with the same quality inspection products as the same standard in China.

Liu Hao said that at the beginning of the cooperation between the two sides, a small number of shirts would have small quality problems, such as the washing up of the labels, the shortage of spare parts and so on. After continuous on-site supervision and factory improvement, the qualified rate of Bangladesh products was over 95%.

With the deepening of cooperation and further improvement and improvement of Bangladesh textile facilities, we will consider the use of Egyptian cotton or Pakistan cotton in Bangladesh.

The consistent operation of weaving, dyeing and finishing to garments, thus shortening the pportation and production cycle of surface accessories, and improving the efficiency of the entire supply chain of garments.

After China's accession to the WTO, it has entered the stage of globalization and fully integrated into the world trade system.

Because China has a large number of cheap labor force and foreign capital influx, but now, this situation has changed, and the rapid rise of all kinds of costs in China has made the "made in China" dividend advantage no longer.

For example, in the past, sweaters in China were mainly produced by manual or semi-automatic production, because they were cheaper and better.

Now China's domestic wage increase has surpassed productivity growth. The average wage of Chinese garment workers is about 1~2 dollars per hour, and the rate of increase is accelerating.

For most e-commerce enterprises that are still in a state of loss, it is a pressing matter of the moment to seek a manufacturing base that enriches cheap labor and has a lower cost.

In fact, many production bases of domestic and foreign manufacturing enterprises have shifted from coastal areas to the west, and even Southeast Asia, especially Vietnam and Bangladesh, are increasingly favored by European and American businessmen.

In Bangladesh, the minimum wage standard of the garment industry was greatly raised in 2010. The daily wage of garment workers was only about 1.5 dollars per month, compared with 3000 Tucca (about 43 US dollars) per month, which is much lower than that of China.

Its exports to the European Union, ASEAN (China, Japan, South Korea), Canada and other countries enjoy preferential policies such as tariff free and quota free.

As a popular fashion brand, the price of all guest products is very low. The price of 29 yuan, 69 yuan, and 99 yuan has attracted a large number of users, but such a low price also brings great pressure to the profits, so the customers are still at a loss.

Investors invest money in an enterprise. Losing money is definitely not an end.

A temporary loss can be said to be a market layout and a future profit, which is acceptable to investors.

But if losses are long and investors are slow to see the possibility of losses, investors with limited patience will not hesitate to change managers.

But at the beginning of this year, fan CEO Chen said publicly that all customers will raise gross margin by 10~15 percentage points to 40% this year.

As a garment enterprise, the gross profit margin should reach 40%, which is very difficult. Besides, the customer is still in a state of deficit.

Turning profit into profit is the first priority.

In the first half of 2012, Chen expressed hope in many public occasions that he would make profits in the year.

In addition to relying on cheap labor and preferential policies in Southeast Asia to effectively reduce the cost of products, on the other hand, for the online clothing brand, the gradual deterioration of the electricity supplier financing environment also makes the investment concept of investors gradually rational.

After the crazy electricity price war, investors are rational thinking.

Now, investors not only demand the scale effect of e-commerce enterprises, but also impose strict requirements on their profit models, profitability and upstream and downstream control capabilities, which makes it difficult for e-commerce enterprises to seek external financing.

In order to maintain market competitiveness, e-commerce enterprises must strengthen their management and management capabilities, optimize their product structure, and reduce costs through various means to raise gross margin.

The advantages and disadvantages of overseas OEM is the trend rather than the mainstream.

Despite the cost advantages of overseas OEM, overseas OEM has both advantages and disadvantages.

To seek overseas foundry production, enterprises must rely on scale effect to effectively reduce production costs, which puts forward certain requirements for the supply chain management capability of enterprises.

Chinese textile enterprises put factories in Southeast Asia, such as Bangladesh, facing the problems of how to ensure product quality, technical level of overseas processing personnel, import and export tariff collection, lack of supporting facilities, shortening the pportation production cycle of accessories and garments and so on, which are factors that enterprises need to consider.

Therefore, insiders pointed out that China's manufacturing industry is shrinking, but it is far from "lost". Tariffs and pportation costs will still keep most domestic enterprises' orders in China.

In this regard, Liu Hao, deputy general manager of fan first production center, said that the enterprises made in China are still the main force of the cooperation between customers and customers.

This has led to the fact that many brands in China are still dominated by domestic production, but seeking overseas foundry production is a trend of strategic development.