Survival Or Death? Survival Crisis Forced The Upgrading Of Private Enterprises

We are recording a history, a history of the development of Chinese private enterprises, a crucial history from "extensive" to "intensive", from "scattered" to "quality".

After visiting all parts of the country and launching the Shanghai Securities Daily's "survival difficulties and Countermeasures of private enterprises" in the three phase, we are more and more convinced of this.

In 2008, due to the constraints of various domestic and foreign factors, China's light industry led by the private economy encountered rapid deterioration of export situation and entered an unprecedented bottleneck period.

At the beginning of the year, thousands of enterprises went bankrupt in the Pearl River Delta and the Yangtze River Delta.

In recent years, the Shanghai Securities Journal once again explored the Pearl River Delta, the Yangtze River Delta and the Bohai rim region. The conclusion is that the export situation continues to deteriorate, the pressure of appreciation continues to expand, the tax rebate policy is adjusted, the monetary tightening and the cost rise are four main reasons.

Despite the fact that many enterprises are beginning to regard this year as the bottom line of "dead support", if the rumors of "abolition of tax rebate" have come true, enterprises will stop business or switch to production because of no profits.

However, unlike the beginning of the year, the atmosphere of a comprehensive reflection of the industrial pattern is the result of the pursuit of industrial upgrading under the pressure of the struggling private enterprises.

2008, it may be defined by history as "the first year of thinking change".

Mid year predicted that births and deaths will be set up this year. "Many of our textile enterprises are going to count until October, and the situation is no longer better. We must consider closing down."

Lin scale said.

According to reports, since the beginning of this year, Lin scale has received 2 orders for textile foreign trade, with a total value of only $10 thousand, a decrease of 90% compared with the same period last year.

"RMB has broken seven, and tax rebates have also been abolished.

How to do this business?

Is there any way out? "

Zhejiang Shaoxing Lin scale (alias) sits in his simple office, with a look of helplessness and bewilderment.

Lin Lin, 28, is one of tens of thousands of textile enterprises in Shaoxing, and is also a member of the "two generation" of private enterprises.

Two years ago, Lin scale, who was led by the forefathers to enter the textile industry, registered a Hongkong company and started her own textile export business in Keqiao, Shaoxing.

Shaoxing Keqiao is the location of China Textile City and one of the largest textile industry bases in China. The Keqiao textile index of China has become the vane data for the development of the textile industry.

Zhejiang province has 60% dependence on foreign trade, and Shaoxing textile industry is one of the important contributor.

Nowadays, in the Keqiao business district, large and small textile companies and shops are row upon row, but most of them are left behind.

A few textile companies visited by the Shanghai Securities Journal reporters only had two or three staff members chatting idly in the empty offices, and most of them talked and sighed when they talked about business.

"Many of our textile enterprises are counting on October, and the situation is no longer better. We must consider closing down."

Lin scale said.

According to reports, since the beginning of this year, Lin scale has received 2 orders for textile foreign trade, with a total value of only $10 thousand, a decrease of 90% compared with the same period last year.

"Chatting with business owners in the circle, it is found that there are a lot of people who do not have one.

The export situation has never been so bad.

Now it looks calm, but the great changes brewing under the deep water will soon appear. "

Lin scale said.

What he called "great changes" is the arrival of a comprehensive reshuffle of textile enterprises.

According to reports, since the beginning of this year, some enterprises that originally made textile foreign trade in Keqiao, Shaoxing have begun to pform, especially some foreign trade enterprises in India and Korea.

"It can be predicted that in 2008, the number of textile foreign trade enterprises based on Shaoxing will be eliminated by about 10%."

One Shaoxing people said.

Ding Li, a member of the Guangdong Academy of Social Sciences, said that at present, Guangdong's light industry manufacturing base Dongguan has already eliminated 10% of its enterprises in the process of shuffling.

The epitome of Dongguan in Shaoxing is being answered everywhere.

In the just concluded 2008 Canton Fair, a Guangdong foreign trade enterprise personage said, this year's Canton Fair only got 20 cards, to discuss cooperation buyers are few, this is not possible in the past.

According to China's Keqiao textile index and China Yiwu small commodity index and other important light industry index, in the first quarter, influenced by the export trade situation, the foreign trade prosperity of various trades was lower.

Besides textiles, the export impact of glasses, shoes and hats and bicycles is not optimistic.

According to the statistics of the national development and Reform Commission, the export value of textile industry in the first quarter of this year was 162 billion 600 million yuan, an increase of 11.1%, but the growth rate dropped by 4.8 percentage points compared with that of the previous year, and the profit of the chemical fiber industry even started to appear negative year-on-year growth.

In addition, the export growth of the whole light industry generally declined, and the delivery value of exports was 370 billion 400 million yuan, an increase of 3.4 percentage points.

As the largest province of foreign trade, the growth of Guangdong's export volume is lower than that of the whole country. The export of textiles, clothing and shoes has dropped sharply.

The last straw to abolish the tax rebate?

According to the calculation of some people, the textile industry's tax rebate rate is 11% after the two adjustment, but at present, the profit margin of enterprises is only about 10%.

If sales tax rebates of 11% are abolished, the profits of enterprises will be below zero.

This is what business owners call a "fatal blow."

Speaking of the reasons why business was so cold, Lin was very excited. He thought it was mainly because of the appreciation of the renminbi.

In April 10th this year, the central parity of RMB against the US dollar broke seven for the first time. For foreign trade enterprises, the exchange rate settlement in US dollar has increased by 5% since the beginning of this year. If the exchange rate policy is initially adjusted, the cost will increase by 15%.

"If the exchange rate rises to 6 yuan to 6.5 yuan this year, the exchange rate will be greatly increased."

Lin scale said.

China's textile exports have been holding down prices for a long time, and vicious competition. There are few opportunities for single enterprises to raise sales prices to deal with exchange rate risks, and this is also the reason.

"We have raised the unit price by about 5% this year, but sales have been very difficult. How can we continue to raise prices?"

Lin scale said.

Another reason for bad business is a decrease in demand.

The economic recession triggered by the US subprime mortgage crisis is emerging.

"Americans buy shirts for a dozen, and now buy two or three pieces at a time. This demand change is there."

A market person close to foreign trade enterprises told the Shanghai Securities Daily reporter.

However, according to the introduction of the textile business owners, the US demand is still one of the largest markets in terms of the proportion of the order negotiation.

"It may be our price they don't approve, or have better products and prices than we do."

Lin's face is puzzled.

In addition, the financing pressure brought about by tight money and the reduction of gross profit margin caused by the increase of raw materials and labor costs are all reasons for the pformation of traditional manufacturing industry.

But in contrast, an important tax policy adjustment may become the last straw of pressure on many foreign trade enterprises, which is the cancellation of export tax rebates.

"We have learned from many sources that the cancellation of export rebates related to textiles has become an inevitable trend, or that it will be announced within the next year.

This is the biggest blow to us. "

Lin scale said.

The so-called export tax rebate refers to the export of goods to refund their domestic production and circulation related taxes and fees, but also internationally used to encourage export of one of the national tax policies.

Since 1994, China has promulgated relevant regulations for the first time, and the adjustment of export tax rebate rate has become the vane of China's export situation.

In mid 2006, China's exports continued to rise sharply in the face of increasing frictions in international trade such as RMB appreciation and anti-dumping. Therefore, in 2006 and 2007, the Chinese government lowered the export tax rebate rate for two times in related fields. On the one hand, in order to alleviate the pressure of appreciation, it also intended to guide enterprises to think about upgrading and pformation from high pollution, high energy consumption and resource-based industries.

Since then, the export growth of textiles and other industries has steadily declined.

By April of this year, such a fall has even reached the brink of forcing businesses to collapse.

According to the calculation of some people, the textile industry's tax rebate rate is 11% after the two adjustment, but at present, the profit margin of enterprises is only about 10%.

If sales tax rebates of 11% are abolished, the profits of enterprises will be below zero.

This is what business owners call a "fatal blow".

Because of this, the trend of export tax rebate policy has become a sensitive topic in the market this month.

Chen Deming, Minister of Commerce, said that China's exports would fluctuate by one percentage point, which would affect employment of 18 to 200 thousand people.

However, according to the first quarter trade report released by the Ministry of Commerce in April 30th, China's total export growth in the first quarter has dropped by 0.9 percentage points.

Shanghai economic and Trade Commission information shows that "the growth of foreign trade in the first few quarters of this year is not optimistic. It may be the most difficult year in the past ten years."

The textile industry is secretly circulating, and the abolition of export tax rebates is a foregone conclusion.

The head of the State Administration of Taxation has also made a statement in the near future. The export tax rebate policy should encourage exports of this export, and the export should not be exported, so that China will take more initiatives in international trade.

Market participants speculate that the "two high and one capital" industry must be in the "no export" list. At present, industries with large export volume, labor-intensive and low technology textiles, clothing, bags, toys and other industries can not escape "adjustment".

However, the Ministry of commerce also pointed out in the foregoing report that "because of the limited space to increase the cost of digestion, the export tax rebate rate of light textile products may affect the export competitive advantage of these industries to a certain extent, which needs great attention."

Industrial upgrading, Huashan natural insurance, a way to rely on domestic demand and expand the domestic market has become a new idea for many enterprises to pform and upgrade industries.

Another route is to open up the "blue ocean" outside the traditional industries.

An expert who has always been concerned about the private economy in Zhejiang says that at present, the entrepreneurial ability of the young generation of private businessmen is rapidly improving. They are good at combining traditional industries with information technology, or sensitive to capture business opportunities under the new economic situation.

Survival or death?

This is a problem for the light industry private enterprises in 2008.

Relying on a large number of cheap labor, raw materials, at the expense of natural resources, coupled with the maximum price reduction mode of growth of entrepreneurs, they can no longer produce cheap cloth, shoes, lighters, clothing, toys, dyestuffs smoothly to all corners of the world need cheap products.

These entrepreneurs who have created a myth of China's private economy, where are they going?

If the entrepreneurs at the beginning of the year are still waiting for help from the government in the confusion and wait-and-see, by the middle of the year, they have begun to settle down to think about the future.

A big China economic debate related to industrial upgrading and mode innovation has come from various economic hub of Pearl River Delta, Yangtze River Delta and Bohai rim, from functional departments to corporate citizens.

And the successful cases of industrial innovation are endless.

Also said that Shaoxing, the same textile production, Heng Mei Group in Shaoxing has been repeatedly mentioned by the small and medium business owners.

In the central area of Keqiao, the Shaoxing Textile Research Center building is very eye-catching. This is the Research Institute established by Heng Mei Group for innovative textile products.

Reporters found the relevant sales personnel of Heng Mei, who told us that the textile products of Heng Mei's own brand have set up distributors in many parts of the country, such as Zhejiang and Beijing.

Bigger domestic