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    Low Order Clothing And Textile Industry In Mainland China

    2014/9/22 14:50:00 22

    GarmentsTextile IndustryOrders

    Here world

    Clothing and shoes

    Xiaobian of the network introduces the low order orders of China's garment and textile industry.

    As the cost of human resources continues to rise in mainland China, foreign buyers are looking for low-cost manufacturers in other regions.

    Spin

    The industry has therefore found that some orders have been gradually pferred to other foreign procurement locations.

    According to the report of the China Cotton Association, small and medium-sized manufacturers in mainland China responded to the sharp reduction in orders in the first quarter of this year, while large manufacturers claimed that the orders were full. This change is most damaging to small manufacturers of low technology, while orders are concentrated in large enterprises.

    According to the survey report of Guangdong clothing and apparel industry association in March this year, only 22.3% of the 4600 local manufacturers of Guangdong's main export production base in China said they had enough orders, and more than 66% of manufacturers said that the number of orders received could only support three months' capacity.

    The study also revealed that 574 of the 4674 local manufacturers in the province reported a total operating loss of 573 billion 400 million yuan, representing an increase of 13.2% over 2012, but the largest province in China's textile and clothing exports. Guangdong's overall revenue is still profitable, with a total profit of 25 billion 800 million yuan, an increase of 19.95% over the same period last year.

    According to the ConvergEx Securities Group report, one of the problems faced by mainland Chinese manufacturers is the minimum wage. At present, the minimum wage in mainland China is about $0.8 per hour, while in India it is $0.28.

    Other factors that affect the cost increase include the appreciation of the renminbi and the soaring cotton and energy prices.

    Peripheral procurement

    In addition, according to the 2013 report of McKinsey consultants in the United States, the importance of peripheral procurement to some European and American clothing brands is increasing, forcing them to seek closer manufacturers from mainland China.

    As a result, the number of large scale textile enterprises in mainland China has shifted to some overseas businesses. The most recent case is the Cole group of Zhejiang, which invested 218 million US dollars in the construction of cotton yarn factory in South Carolina.

    A spokesman for the Cole group said publicly that this is the first overseas plant of the company, marking the beginning of the company's strategy of helping to avoid rising costs in mainland China. The reason behind this change is that the United States has a certain level of labor and low power costs in the region.

    Cole group is not alone. The Shanghai Tianhong Textile Group Co., Ltd. listed on the important cotton yarn supplier listed in Hongkong, set up factories in Turkey last year to provide better service for European customers. However, the company still focuses on Vietnam and has been operating since 2006.

    Hong Tianzhu, chairman of Tianhong textile, said at a recent investor meeting that Vietnam will become the main production base of Tianhong Group. As the members of the p Pacific Partnership also include the United States, it is expected that the company will make profits after becoming a TPP member in Vietnam.

    The net profit of Tianhong textile in 2013 was 860 million yuan, an increase of 77% compared with the same period in the previous year.

    At the company's investor meeting in 2013, President Hong Tianzhu attributed it to the growth of Vietnam's capacity because of its 5 factories in Vietnam.

    Ensuring leadership status

    However, in addition to these changes, according to the McKinsey Co's report on the results of the 2013 visit to 29 major global purchasing managers, China is still the most important source country for garment manufacturers in the world. 72% of respondents said that although China would pfer part of its orders to other Asian countries in the next 5 years, China would still be the largest purchasing market.

    Take the German brand Adidas as an example. Even if the factories in mainland China were shut down in 2012, and orders were pferred to neighboring countries such as Vietnam, Kampuchea and Bangladesh, the garments made in China still account for 4% of the global garment products.

    A spokesman for adidas said that Adidas has only 10 manufacturing equipment in the world, highly dependent on foreign purchases, and altogether works with 1214 factories in the world and 339 factories in mainland China, and China will continue to maintain its position as the most important foreign sourcing market in adidas group.

    Value added service

    At the same time, large textile and garment enterprises in mainland China focus on retaining high-end foreign customers through value-added services, including raw materials for research and development.

    Shanghai Jialin Jie textile company and Shenzhen Huafu color spinning Limited by Share Ltd are two examples.

    Jialin Jie, a well-known chemical company with DuPont, is famous for developing advanced sports functional fabrics. Jia Linjie serves high-end customers such as Nike and Icebreaker. In 2013, he registered in Shenzhen with an income of RMB 896 million 400 thousand yuan.

    The advantage of Huafu is its premixed fiber blended yarn. The company has a notable customer base, including Zara, Hennes&Mauritz and Uniqlo. In 2013, Huafu reported a net profit of 200 million yuan in Shenzhen, up 120.7% from the previous year.

    An analyst at Guotai Junan Securities of Shanghai believes that China will no doubt continue to lose low orders to other countries, and many small manufacturers will go bankrupt, but it will also force the upgrading of the textile industry in mainland China, which is not necessarily a bad thing.

    Enterprises in mainland China will continue to offer R & D, marketing and

    Design

    The case of high value services can be seen in the luxury fashion industry.

    In the top brand Summit Forum held in Shanghai in March by CEIBS, MichelGutsatz, consultant of McLean investment adviser, said that a new business model was emerging in the luxury fashion industry, namely, "mainland China design, Italy manufacturing".

    He cited Italy's top brand Anteprima as an example. The design center has 2 design offices in Hongkong and Milan, and produces flat weave and leather products in Italy, while other products are produced in Italy with raw materials from Italy.

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