Upgrading And Transformation Of Chinese Textile Enterprises

In this paper, we will analyze the feasibility and necessity of textile industry transformation in China. Since 2008, the overall growth trend of China's textile industry has been worrying. According to the author's understanding, many small textile enterprises in Zhejiang, Jiangsu and other places have been overburdened and have to close down. It can be seen that the negative impact of the US economic crisis on China's textile industry can not be ignored. On the other hand, China's textile industry is becoming more and more powerful. The severe situation not only tests the business vision of China's textile enterprises to foresee the crisis, but also tests their ability to adapt to market changes. In this paper, we will deeply analyze the current situation of China's textile industry, demonstrate the necessity and feasibility of upgrading and transformation of China's textile enterprises, so as to give some enlightenment to the domestic textile enterprises in difficulties. Xu Wenying, vice president of China Textile Industry Association and President of China Cotton Textile Industry Association, pointed out that the market environment China's textile industry has been facing since 2007 is not optimistic. Compared with 2007, the situation of China's textile industry in 2008 is more severe. It is mainly reflected in the following aspects: 1. With the increase of various costs, the profits of textile enterprises have been declining. Due to the continuous appreciation of RMB and the rising prices of raw materials and energy, the profit space of Chinese textile enterprises has been compressed. The adjustment of various policies has brought pressure to textile enterprises. The implementation of tight monetary policy, reduction of export tax rebate rate, restriction of energy conservation and emission reduction policy, and cancellation of tax rebate for imported new textile machinery equipment make textile enterprises encounter difficulties in export and financing. China's textile enterprises are facing severe challenges in the international market. Since the beginning of this year, China's textile enterprises have generally reflected difficulties in export, reduced profits, business problems, and even bankruptcy in many places. Affected by the U.S. subprime mortgage crisis, the foreign demand market of China's textile enterprises has shrunk seriously, which is undoubtedly a fatal blow to some enterprises that have been relying on the foreign demand market for a long time. Affected by the above factors, the performance of China's textile industry has declined significantly. According to the industry research report released by China's No.1 textile network, from January to August this year, the profit of textile enterprises above Designated Size in China reached 73.96 billion yuan, a year-on-year increase of 3.19%. The profit growth rate decreased by 5.17 percentage points compared with the first may of this year, and significantly decreased by 33.79 percentage points compared with January to November last year, which is the lowest growth rate since 2001. according to the conjecture of relevant personnel of Guojin securities, the profit growth rate of textile industry in the fourth quarter will continue to decline, and the annual income growth rate is close to 10%, and the total profit is likely to show negative growth. The way to survive depends on self-improvement the appreciation of RMB, the increase of production costs, various macro-control policies and the rapid shrinkage of foreign demand market have undoubtedly brought serious impact on China's textile enterprises. But we should face it squarely: whether it can adapt to the changes of external market environment, the fundamental reason lies in the enterprise's own management. The root cause of the industrial crisis is the defects in the management of China's textile enterprises: 1. The basic management of enterprises is weak and the efficiency is low. Textile enterprise is a typical labor-intensive enterprise, which is accustomed to rely on more labor. Its internal work process, information level is not high, and the basic management is weak. With the growth of business volume, the trend of multi frequency and small batch customization of customer orders is strengthened, which is easy to cause the increase of error rate in the processing link, makes the business process more complex, and increases the cost burden of enterprise management, which undoubtedly dilutes the profit space of the enterprise. In addition, this year's rising raw materials and transportation costs, for the profit of textile enterprises is even worse. It is in urgent need of improving the basic customer management and improving the enterprise's basic quality and service. 2. It is difficult to ensure customer loyalty and stability due to insufficient attention to customers. At present, most of China's textile enterprises rely on foreign trade business and big customers, focusing on production and logistics management, and the business system is relatively weak. In this case, it is easy to take price as the main means of competition, homogenization is common, and the profit is meager. At the same time, we have to face all kinds of risks such as the change of business personnel and the loss of customers. Most enterprises are lack of accurate customer and business information, lack of grasp of business dynamic trend, customer relationship can not be maintained, let alone get more value from customers. This phenomenon will inevitably lead enterprises to be unprepared in the face of changes in the international market, customer orders reduced, profits decreased, staff loss, customer loss, into business crisis. 3. The mode of processing and production leads to poor market competitiveness, which makes it difficult to consolidate one's living space. Due to the lack of understanding of the downstream market and the whole industrial chain, the processing and production enterprises in the upstream of the industry are more vulnerable to the violent impact of market shocks. It is difficult to make timely response and business adjustment as downstream enterprises do. Without channels, brands and market awareness, it is more difficult to participate in the competition of other businesses. All of these lead to poor risk resistance ability of enterprises and are in a weak position in the market competition environment. In view of the above understanding, the author believes that under the current situation, it has become an urgent task for China's textile enterprises to adjust ideas and improve management in order to become self-improvement. change ideas and enhance the core competitiveness of enterprises for a long time, China's textile industry has focused on production and processing, relying too much on labor force and production equipment, and enterprises lack of their own innovative productivity and management methods; in terms of information construction, hardware informatization is given priority to, and software informatization development is relatively insufficient. In the new situation, textile enterprises are required to turn to software information construction, and strive to improve the management concept and method, so as to achieve "both soft and hard". the informatization of textile enterprises started earlier, and the earliest can even be traced back to 15 years ago. During the 10th Five Year Plan period, most enterprises began to devote themselves to the single application of informatization. The information technology such as CAD system, automatic monitoring, automatic control and e-commerce are widely used by many textile enterprises. Today, the single application of information construction in textile enterprises has been very common. According to a survey conducted in 2007, nearly half of enterprises have adopted CAD and other drawing software in product development, and management software such as office automation (OA) / collaboration software, ERP, CRM, purchase, sales and storage software has also begun to be applied in textile enterprises. The basic financial management and business management means of most enterprises have begun to take shape systematically. Most textile enterprises are in the transition stage from single application of information software to comprehensive application. more than ten years of exploration and practice of information technology have greatly improved the management level and business ability of enterprises; more and more textile enterprises in China have gradually realized the irreplaceable role of informatization in promoting the development of enterprises, and further promoted the informatization construction to the height of enterprise development strategy. According to the author's understanding, some leading textile enterprises have established long-term plans for information construction according to their own situation, hoping to promote the formation of enterprises' comparative advantages and enhance their competitiveness through continuous management improvement. Information construction has become an important strategic way for textile enterprises to upgrade and transform. CRM promotes the upgrading and transformation of textile enterprises it has become the consensus of textile enterprises to promote industrial upgrading and transformation by information construction. In this regard, the author understands that, following ERP system, well-known enterprises in the industry have begun to substantially increase the investment in CRM system construction in recent two years. CRM has become a new direction of textile enterprise management breakthrough. in order to further see the trend of information management construction in textile enterprises and confirm the application effect of CRM in textile enterprises, the author specially visited MyCRM, a professional CRM manufacturer in China. In 2006, MyCRM has taken the lead in cooperating with industry leaders such as Youngor and Jiangsu Lianfa, and achieved success. Focusing on the promotion process and effect of CRM in the industry, the author had many exchanges with the relevant persons in charge of Youngor, Jiangsu Lianfa group and MyCRM industry consultant, and reached a consensus on the application results and development trend of CRM in the industry from the aspects of enterprise management demand, information construction and it service trend of textile industry. first of all, after the implementation and application of CRM, the business management ability of the enterprise has been greatly improved, the efficiency has been improved, the cost has been saved, and the profit has been gained for the enterprise. Before the application of CRM, order management needs a lot of manpower and material resources, which is inefficient and difficult to ensure the accuracy. It is difficult to control the efficiency and cost of error correction. After the implementation of CRM, the workflow is greatly simplified, the business operation is standardized, the processing cycle is shortened, and the management cost is reduced in order confirmation, production release and delivery, which greatly improves the business processing efficiency and brings direct economic benefits to the enterprise. Secondly, CRM can help enterprises integrate sales and production, link enterprise production with market demand, realize production on demand and improve inventory turnover. Through CRM system to manage customer resources, understand customer dynamics, strengthen the real-time business interaction with customers, improve the disconnection between enterprise production and market, and reduce the blindness of enterprise production. In order to meet the demand of enterprises, CRM can make the enterprises adapt to the market demand more flexibly and more effectively through the fixed order management. Thirdly, help enterprises to tap customer value and enhance competitiveness. Through the application of CRM system, enterprises have a more accurate grasp of customer needs, the response speed of customer service has been improved, the service quality can also be effectively supervised and improved, and customer satisfaction has been significantly improved. This has won the loyal customer for the enterprise, has won the stable customer source and the order for the enterprise's long-term development. Based on the integration of CRM for sales and production, Youngor has realized the capacity reservation management. Under the relatively saturated capacity, through the CRM system, combining the short-term benefits of the enterprise and the long-term value of customers, it guides the efficient and orderly production, ensures the satisfactory service for high-value customers, effectively supports the managers' sustainable development business strategy, and brings higher input and output to the enterprise, Excellent customer relationship, win business relationship. among the customers of MyCRM, some enterprises not only use CRM themselves, but also extend this scientific management mode to partners, strengthen collaborative work for the upstream and downstream of the industrial chain, and receive positive response from other units. Customers have begun to be attracted by the considerate service mode constructed by enterprises. In the next round of competition that may come at any time, CRM enterprises have grasped the opportunity and accumulated the ability which is difficult to be copied by competitors. in the interview, the author found that many managers are coincidentally concerned about the new economic era and the development of information technology in the future. With the popularity of e-commerce, a number of business cases such as PPG, vncl, Jordan and so on have brought inspiration to us. With the help of new technologies, we can expand sales channels and realize profit growth, so as to make industrial extension possible. From the long-term development point of view, the combination of CRM management method and e-commerce can help enterprises consolidate the market, promote brand, and obtain higher profits. The author thinks that this may become a new trend of industry management innovation. Postscript: there are two Zen sayings about change: "the only thing that remains unchanged in the world is change" and "responding to changes with constancy". In the face of market changes, the fundamental reason why Chinese textile enterprises are worrying is that they have not established their own "unchangeable" advantages. In my opinion, this "unchanged" is the construction of textile enterprises themselves. It will be the only way for Chinese textile enterprises to upgrade and transform by establishing their own "unchanging" advantages through the application of CRM system.