Measures To Cope With Foreign Trade Downturn In Textile And Garment Industry

In the first half of 2012, foreign trade was sluggish.

The investment of enterprises is not reduced, and the consumption of the market is getting warmer. However, the price of clothing brought by inflation has become an obstacle to continuing to stimulate domestic demand.

China's cheap labor force has always been an important factor for foreign labor-intensive industries to invest and build factories in China. In particular, clothing enterprises are more sensitive to labor costs, and ordinary enterprises will control labor costs between 20% and 30%.

At the same time, the clothing industry is also an important support for China's national economy. It plays an irreplaceable role in providing employment or contributing to GDP.

China's apparel industry is the world's largest garment producer and consumer country.

But in recent years, with the advantage of cheap labor in China no longer obvious, the withdrawal of foreign garment enterprises' production lines has begun to become more and more intense.

Made in Bangladesh: customer cost reduced by 30%

"Low labor costs, low rental costs and low raw material costs" have all been added to the Chinese apparel industry.

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, and 20% will go to India or Sri Lanka. China has only less than 30%.. Now, the "overseas foundry" trend has been blown from the line to the Internet as a fast fashion industry.

Fan said recently that since the beginning of autumn and winter this year, the origin of some of the shirts on fan's brand is no longer the same as China.. Bangladesh has the textile industry as the pillar industry of the country, and has a complete set of perfect textile industry chain besides its low labor advantage.

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.

China's manufacturing cost advantage no longer

As domestic labor costs continue to rise, Nike and Adidas have announced the closure of their own factories in China.

At the same time, China's clothing brands of increasing scale efficiency are also exploring the way of overseas foundry.

As far as van customer service is concerned, it has moved some shirts orders to Bangladesh since last year.

This year, products such as sweaters, casual pants, down garments and so on are expected to make overseas trial orders.

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 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.

While domestic brands are seeking the way of international production, the Chinese garment industry is facing a gradual decline in the era of "made in China".

Not only Nike,

Such foreign capital enterprises "fled", and domestic enterprises began to shift their productive forces to foreign countries.

Fan Ke Cheng CEO mentioned that when he inspects the foundries in the south, he found that the layout of some enterprises in China is changing quietly.

"A factory of tens of thousands of people will move 50% of its capacity to Vietnam in 2015, and 20% will go up to India or Sri Lanka, and China will have less than 30%".

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