Textile And Garment Industry Is Bound To Win The Fittest And Polarization.

Not long ago, 82 families Spin clothing The company announced its three quarter earnings report, of which 68 achieved profitability. From this point of view, the textile and garment industry seems to be getting out of the financial crisis.

"It was going to be a waste of time to prepare for a fake holiday." Xu Qiang, a manager of the workshop of a warp knitting enterprise in Changshu, Jiangsu, has almost no rest after "eleven", and is on duty even on weekends.

In the description of Xu Qiang, his company's situation this year is: in the first half of the year, the business is relatively light, the worst is 3~5 month, not only the order fell by 20%, the production line was not fully opened, the operating rate was basically 80%, however, the second half of the year, orders were obviously increased.

However, the data of the Canton Fair, which had just concluded, showed that the turnover of textile and clothing decreased by 15.5%. According to the order of large commodities, besides the increase in orders for household textiles and men's and women's clothing, the number of orders for other categories decreased significantly.

Editor in chief, Wang Qian, told reporters that the textile and garment industry is undergoing a process of survival of the fittest and polarization.

　 "Two poles" trend

After "eleven", Xu Qiang's company began to load at full capacity.

According to his prediction, this situation will last until the end of the year. The company's performance is likely to be unchanged from last year's forecast, although the overall domestic growth rate is not large. Exit Business has increased by about 20% over last year.

Because of its high technology content and productivity, and its unique product performance, warp knitting industry has been regarded as the highland in the textile industry. Xu Qiang is a large enterprise in the warp knitting industry. Therefore, in the overall downturn of the industry, their company is in relatively good condition. This is most fortunate for Xu Qiang.

But many companies are not so optimistic.

Located in the heavy silk industrial park of Nanxun District, Huzhou, Zhejiang, it is a medium-sized enterprise which mainly produces silk and fabric. It has a small reputation in the industry before 2008, and it can maintain a certain rate of growth every year. However, since the financial crisis, the company has been getting worse and worse. This year, the head of the company, Ms. Wang, also had the idea of "closing factories". She said that before the company had hundreds of silk machines, now even 50 units are not sold, they are not necessarily able to sell. "All kinds of costs are rising, the company has no profit at all, the interest on loans is high, inventory is large, orders are not sustainable, and this year's loss is a hard nut to crack."

This is a typical example of two typical enterprises. It is also a microcosm of the polarization of textile and garment industry this year, especially since the three quarter. According to the three quarter earnings report released by the textile and garment industry company.

Although 68 listed companies have made profits, only 43 have achieved growth in performance, while the rest of the companies have made profits but their growth rate has declined.

Another obvious phenomenon is that the upstream textile enterprises are mostly inferior to the downstream garment enterprises. Brand clothing The business is in good condition.

YOUNGOR (600177.SH), the first three quarter net profit in the textile and garment sector, is an example. This is a typical "diversified" company. In 2009, YOUNGOR's real estate business accounted for 42% of the company's overall revenue. In 2010, the contribution of YOUNGOR's real estate industry to total business revenue was as high as 47%, almost half of the total.

However, it was involved in the most stringent real estate regulation in the second half of 2010. In 2011, the total revenue of YOUNGOR fell by 20.49% compared with the same period last year, and net profit fell 34.03% year-on-year. YOUNGOR has repeatedly declared its return to its main business and said that clothing was the main business.

CICC's Research Report on YOUNGOR said that the performance of textile and garment sector increased by 30% over the same period last year. It can be seen that after the "return" main business, the growth of clothing business has obviously taken the lead now, and the two businesses that have sped up its investment and real estate have gradually faded away.

CICC's report also showed that YOUNGOR's own brand clothing business growth and recovery of the minority interests of the clothing sector were the main reasons; textile and garment foundry business continued to shrink; private brand clothing business revenue increased 13% in the first three quarters, accounting for 74% of the textile and garment sector revenue compared to 74% (51% in 2011).

According to Wang Qian's analysis, in fact, it is not the order problem of large enterprises, but the transfer of low-end orders. The small and medium-sized enterprises used to do foundry work. Compared with some other countries in Southeast Asia, their competitive advantage is becoming weaker and weaker.

High cost and order transfer

The weakening of the competitiveness of enterprises is not related to the soaring cost of raw materials and labor costs in recent years.

Data analysis from the Canton Fair shows that there are seven "outstanding problems affecting export transactions". Two of them are: the transfer of low-grade products to the new textile and garment industries in Southeast Asia; the domestic cotton prices are higher than the international market 4000 yuan / ton, which directly affects the price and competitiveness of products. {page_break}

Xu Qiang told our reporter that the cost of labor alone increased by about 15%.

At present, a Bangladesh sewing operator pays a monthly salary of 48 yuan (about 300 yuan), while the monthly salary of this type of work in China is 2500~3000 yuan.

In addition, since 2011, China's cotton prices have experienced a round of roller coaster prices, resulting in the widening gap between domestic and foreign cotton prices, and a large proportion of cotton textile products in textile exports, because the price of raw materials is too high, resulting in a sharp decline in export volume.

The head of an export garment company in Nantong told reporters that since this year, the organic cotton produced by the company had to be imported from India, with a maximum savings of 2000 yuan per ton.

In view of cost considerations, a responsible person from a well-known men's clothing company told reporters in the first half of this year that the company is considering moving the garment design part to Italy, and is also ready to move some of its production and processing business to Europe. It is possible to build its own overseas center in Italy by 2015.

However, the industrial transfer caused by production costs also raises new concerns. Friends of nature and other 5 environmental organizations recently reported that labor intensive clothing processing links can create a large number of jobs, low energy consumption and less pollution emissions, are slowly moving out of China, and dyeing and finishing is further concentrated in China, this link is capital intensive, water consumption, high energy consumption, a large amount of pollution emissions.

In this regard, Wang Qian believes that although industrial transfer is the trend of the times, due to the limited population in Bangladesh, Vietnam and other countries, clothing production capacity is also limited, compared with China's huge production and exports, the total amount of transfer is limited.

The chairman of a Shanghai enterprise has just participated in the Canton Fair. He is one of the leading exporters of garments in China. He told reporters that the company did not hand over orders for more than 3 months, while the normal annual clothing enterprises in hand orders in general to 6 months. He said that this downturn is likely to last two years. Because of weak external demand, since the second half of last year, the company had to cut prices by 10% to ensure exports.

Information from the recently closed Canton Fair also shows that the proportion of short and medium orders in 86.6% months is 86.6%, an increase of 0.3 percentage points.

　 Inventory worries

Although compared with the textile industry, the downstream garment enterprises are slightly better than others, but they also have their own problems, namely inventory.

Flush statistics show that only from the first half of this year, the total inventory of more than 80 listed companies in the textile and garment sector amounts to 67 billion 166 million yuan.

Especially popular leisure. Clothes & Accessories Sportswear is also unable to escape the torture of high inventory. Some of the high-end brand clothing companies are much better.

However, many enterprises also realize that the simple and extensive expansion methods such as large volume, large circulation and low price are no longer applicable now. The market is not static. The past successful mode is hard to duplicate now.

As a result, many enterprises began to try different ways of operation and product line adjustment.

For example, some enterprises try to break the single product structure and expand product category. In the past few years, the male trousers expert, nine herd king, has gradually reduced the proportion of men's trousers business, and has launched various men's clothing products.

More enterprises are working hard to expand channels. For example, domestic Down Jackets 03998.HK launched its first flagship store in Europe to launch its overseas market in London. Many sports brand is to expand the domestic two or three line, or even the four or five line market to get a wider range of consumer groups.

Xu Qiang is very optimistic about the situation next year: "at present, our products have already opened the market in the UK, and next year's exports will definitely not be worse than this year. The worst days are over, and the future is getting better and better.