Textile Export Enterprises Deepen Terminal To Expand Export Profit Margins

External market demand is weak and domestic production cost has been raised.

Export enterprises are facing unprecedented challenges.

At the same time, the domestic market is beginning to emerge. How can those enterprises eager to make both domestic and foreign markets stabilize the international market share and grasp the growth opportunities of the domestic market?

In September 28th, the "2012 international textile and garment industry exchange activities" hosted by the Ministry of Commerce and the China Textiles Import and Export Chamber of commerce were held in Nanjing.

From the European Union, the United States, Southeast Asian countries, and Hongkong, China.

Leaders from other key industries and international famous brand enterprises gather together to solve the dual proposition of the construction of the export market and the brand marketing of the domestic market under the current situation.

"Internal and external troubles" forced pformation and upgrading of industries

Since this year, the continuous downturn of external market demand and rising domestic production cost have become the primary problems faced by China's textile export enterprises.

Ministry of Commerce

The deputy representative of the talks, Chong Quan, pointed out at the meeting that the deterioration of the European debt crisis is still affecting the pace of world economic recovery. Emerging economies are suffering from external demand, inflation pressure and economic growth.

The global economic recession has led to a downturn in international market demand, and China's textile and clothing exports have also been strongly impacted.

According to customs statistics, in 2012 1~8 months, China's textile and apparel exports totaled 162 billion 30 million US dollars, down 0.7% compared to the same period last year.

From a single month, except for March and May, other months all showed negative growth.

This has never happened in the past 10 years.

Although China is still the largest textile exporter in the world, the export share of China's textile and apparel markets in Europe and the United States has declined in the first half of this year, indicating that some orders have been pferred from China to other countries.

In addition to the comparative advantage of low cost labor and the serious inversion of cotton prices, China's textile and garment industry has been suffering from the structural contradictions and extensive management problems that have been developing rapidly for many years, which has become a major obstacle to the development of the industry.

Chong Quan said that the retail price of China's textile and apparel products abroad is usually 3~10 times that of the factory. Some enterprises lack the independent brand because of their lack of innovation capability, and are in a disadvantageous position in the international industrial chain and value chain.

Therefore, although enterprises continue to strengthen cost control in production and processing links, many enterprises are still facing losses and even forced to withdraw from the market.

Under the unfavorable situation of "internal and external troubles", the pformation and upgrading of textile enterprises has become the consensus of the industry.

Bao Ling, deputy director of the Ministry of foreign trade of the Ministry of Commerce, pointed out that China is a big exporter of textiles and clothing, accounting for 35.2% of the world's total exports in 2011.

China's textile and garment industry has its advantages, but it also faces challenges.

In order to enhance competitiveness in the international market, textile and garment enterprises need to focus on design upgrading, brand building and channel development, upgrading to the two sides of the industry smile curve.

Deepening terminal to expand export profit space

In the period of no obvious improvement in the external market, how can the textile export enterprises expand the profit margins of export? In addition to improving the added value of the products, Chen Hong, director general of WAL-MART global sourcing center, gives the suggestion that we should learn from the services provided by the importers for the retailers and conduct direct pactions with the terminal market.

"All along, domestic enterprises have attached great importance to the improvement of production technology, but they lack the attention to sales channels.

In 2012, 50% of WAL-MART's garments were produced in China, but only 2% were directly supplied to the United States, and importers took a large part of their profits.

Chen Hong pointed out that if textile enterprises want to jump over the links of importers and directly make terminals, they must clearly enhance their competitiveness from what aspects.

"I think suppliers should first deepen their understanding of the market, understand consumers and grasp the information of the industry.

WAL-MART's senior buyer would like to hear from suppliers about what our competitors are doing and what kind of products they sell better.

Secondly, the trend forecast and inventory management services provided by importers are also valued by us.

Many American middlemen are experts in product sales forecasting. He will tell our buyers which style has done much to help us control inventory effectively.

In this regard, I suggest that domestic suppliers reserve some stocks in the us to facilitate retailers replenishment.

The biggest challenge we have to buy in Asian countries is to deal with unsalable goods.

As far as I know, some suppliers who have long-term cooperation with WAL-MART have established stock bases in the southern or central areas of the United States. The textile products that are locally stored may only account for 10% of the sales volume, but they can deal with the replenishment needs of retailers in time. "

Chen Hong said.

Build brand and win the mouth of the domestic market

For textile export enterprises, the downturn in the international market has forced the company to turn its attention to the domestic market.

Wang Qinhua, vice president of China Federation of Commerce, pointed out that in 2015, the domestic consumer goods market will develop to the scale of 32 trillion yuan.

At that time, China will surpass the United States and become the largest consumer market.

But there are both business opportunities and competition in this market.

In 2011, among the top ten brands of clothing sales in China, foreign enterprises accounted for 61%.

In the process of market competition, China's textile and garment enterprises must take the brand as the core competitiveness, enhance brand awareness and strengthen brand management.

"A brand can not be shaped solely by advertising and celebrity endorsements. Enterprises should enhance their image from product quality and corporate reputation.

In the early stage of brand building, enterprises can first locate in regional brands, and strive for wider market share after long-term development.

Wang Qinhua said.

Some of the enterprises that have participated in this exchange have brand textile enterprises already in China.

When sharing the successful experience of developing the domestic market, they all think that building brand is not overnight. In this process, we need not only to play the long-term advantages accumulated by foreign trade enterprises, but also to innovate in product design and marketing methods: designing products from the needs of consumers, and expanding the popularity of brands by means of the influence of large department stores on the market and consumers.