The Impact Of The Epidemic On The Clothing Home Textile Industry Will Exceed The "SARS" Period.

The COVID-19 epidemic (hereinafter referred to as the "epidemic") has a great impact on the sales channel of the apparel home textile industry, and the business pressure will increase and the impact will exceed the "SARS" period, and the credit risk of the industry will increase. If the domestic economic activity is fully resumed in March, the central bank Peng Yuan is expected to reduce the rate of decline to 1-2 percentage points in 2020, which will exceed 5 percentage points. During the epidemic prevention and control period, on the one hand, the traffic volume of shopping malls, shopping centers and street shops decreased significantly or even closed. On the one hand, superimposed warm winter and seasonal factors brought great impact on the clearance sale of winter clothing and the sales rhythm of spring clothes. On the other hand, the delay in reemployment has brought more pressure on fixed wages, such as wages, rents, etc., all of which are adversely affecting the turnover efficiency and profitability of enterprises' inventories and accounts receivable in the industry, and the pressure of business increases. Considering that there is a big gap between the domestic and foreign market demand growth of the apparel home textile industry, there is a big gap between the growth rate of the domestic and foreign market in 2003, and the influence of the warm winter and the season change. The impact of the epidemic on the clothing home textile industry will exceed the "SARS" period. In view of the fact that the home textile industry is dominated by private enterprises, small and medium-sized enterprises are more and the financing ability is relatively weak, the central bank Peng Yuan believes that the credit risk of the clothing home textile industry will increase.

First, the SARS epidemic has led to a decline in the domestic short-term demand of the home textile industry, but has little impact on exports.

The SARS epidemic has led to a sharp decline in the short-term demand for home textiles in the domestic market, but has little impact on foreign markets and exports have maintained rapid growth. In 2003, the SARS epidemic took place mainly in Guangdong, Hongkong and other regions. It began to spread to the whole country and other countries and regions in February 2003. The provinces and cities represented by Beijing in March and April intensified. In April 17th, the conference was marked by the Political Bureau of the Central Committee of the CPC. Bundle. By analyzing the social retail sales volume and export data of China's apparel home textile industry during the period of SARS epidemic, we found that the impact of the SARS epidemic on the domestic market of garment home textile industry was mainly in the 3-5 month, excluding the influence of the Spring Festival. The growth rate of retail sales in the same month was 3.20%, 6.70% and -3.50% respectively, representing a decrease of 20.60, 4.10 and 11.40 percentage points compared with the same period in 2002, and June. Retail sales of hat and needle textiles rose to 16.40% year-on-year, up 2.3 percentage points from the same period in 2002. From the data of textile raw materials and textile products exports, the SARS epidemic had little effect on the foreign market of garment home textile industry, and the export volume increased 3-5, 25.70%, 26.70% and 27.40%, respectively, and maintained a high growth rate.

Two, 2019, domestic and foreign demand for garment market in China continued to be weak. This epidemic has a great impact on the sales channel of apparel home textile industry, and the business pressure will increase, the impact will exceed the "SARS" period, and the industry credit risk will rise.

In 2019, the retail sales of clothing, shoes, hat and knitted textiles increased by 2.90% over the same period last year, and the growth rate was 5.11 percentage points lower than that in 2018. From the perspective of residents, the per capita disposable income of urban residents in China increased by 5% in real terms in 2019, and the growth rate was 0.60 percentage points lower than that in 2018. The per capita consumption expenditure of urban residents increased by 4.60% over the same period last year, and the growth rate was unchanged from 2018. However, from the perspective of consumption structure, the proportion of consumption of housing, medical care, education, culture and entertainment services continued to increase, while clothing consumption decreased by 0.39 percentage points to 6.53% compared to 2018. Meanwhile, the natural growth rate of domestic population has been around 0.50% in recent years, and dropped to 0.38% in 2018. At the same time, the proportion of 15-59 years old population has been shrinking, and it has dropped to 65.26% at the end of 2018. From the foreign market, the total export volume of textile raw materials and textile products in China increased from 3.40% in 2018 to -2.20% in 2019, and the growth rate dropped 5.60 percentage points, mainly due to the negative effects brought by Sino US trade friction, the slowing global economic trend and the crowding out of the international market share of garment home textiles industry in Southeast Asia and so on.

The epidemic will cause a great impact on the offline sales channels of the apparel home textile industry, which will lead to a decline in the income and profit levels of the industry, the decrease of inventory and accounts receivable turnover, and the increase of operating pressure. The outbreak began in December 2019 and broke out in January 2020. In the late January, domestic provinces, autonomous regions, municipalities directly under the central government and the Xinjiang production and Construction Corps launched public health emergencies in response to the outbreak. On the one hand, the clothing and textile industry belongs to the traditional industries, mainly labor-intensive enterprises, with a large number of workers, and a large dependence on field offices. On the other hand, during the period of epidemic prevention and control, the traffic volume of shopping malls, shopping centers and street shops has been greatly reduced or even closed, which has brought great restrictions to the offline sales of clothing home textile industry. The factors that add warm winter and season change have a great impact on the clearance sale of winter clothing and the rhythm of spring dress sales. For clothing sales enterprises, the turnover pressure of inventory increases, and the inventory cost increases. At the same time, the discount rate will be greater, and the income and profit level of enterprises will be reduced, and the pressure of sales returns will be increased. For brand clothing enterprises, the ordering of franchisees or franchisees is reduced, and the risk of accounts receivable recovery increases. The sales of self run stores are blocked, which leads to a decline in profitability of companies, a decrease in inventory and accounts receivable turnover, and an increase in operating pressure. For garment production enterprises, the direct impact is the reduction of orders, the reduction of capacity utilization, the decrease of income and profit level, and the pressure on inventory and accounts receivable turnover. However, the impact of this epidemic on the layout of the online channel is more perfect, and the impact of the enterprises will be weaker than those with high dependence on the offline sales channels.

In order to ease the gap in supply of protective materials, some clothing and textile enterprises have gradually added new production lines such as protective clothing and masks, such as reporting birds and Jia Linjie to produce medical protective materials according to the requisition notice of the Shanghai Municipal Economic and Information Commission; the group of China International Group is listed as a key producer of national temporary collection and storage; Jin Hong Group assists the government in emergency production of respirators. Search for special medical products subsidiary. However, the scale, price and sales target of such products are mainly allocated and allocated by the government, which has limited contribution to the profits of enterprises, and the production of such materials has a certain short-term nature. After the outbreak, can the relevant production lines continue to be uncertain.

In February 25, 2020, the total number of new cases in the 26 places of the whole country was 0, and there were no new confirmed cases in a number of consecutive days. In the absence of any emergency, the epidemic prevention period will be concentrated in February. The economic activities will begin to recover in late February and March is expected to be fully reactivated. The incidence of the disease in Hubei will be prolonged.

Compared to 2003, China's garment home textile industry demand growth momentum is weak, this epidemic will further increase domestic and foreign market demand pressure of garment home textile industry. If domestic economic activity is fully resumed in March, it is expected that the incidence of the epidemic will decrease by 5 percentage points over the 1-2 month growth rate in 2020. Traffic control and reemployment delay in the prevention and control of epidemic situation inhibit the economic production, resulting in a large number of working population income loss, consumption capacity and consumption will be reduced, superimposing food prices and increasing consumer spending on medical protective equipment, and the demand for domestic apparel home textile market is squeezed. Compared to the 4 and May of 2003, it is now in the season of spring clothes and winter wear. Although the sales of online sales channels of clothing and home textile industry continue to increase, the channels such as large supermarkets, shopping centers and specialty stores are still the main selling channels, and the effect of the warm winter before the overlay is more severe. At the same time, due to the seasonal characteristics of the industry is more significant. After the epidemic is eased, the possibility of retaliatory consumption is not very high. In 2019, the export volume of textile raw materials and textile products in China grew by -2.20% year-on-year, far below the high growth rate of 26.80% in 2003. The industrial enterprises stoppage time caused by the epidemic is prolonged. Transportation, logistics and other supporting industries and large-scale commercial activities will have a greater impact on foreign trade activities, which will lead to a certain order transfer in the short term. On the whole, the impact of the epidemic on the garment home textile industry will exceed the "SARS" period.

It is worth noting that the economic impact of new crown pneumonia is still uncertain. First of all, our current understanding of the new crown virus is not complete. The development of the vaccine still needs a certain time. Whether the large number of personnel flow caused by the reemployment will lead to the fluctuation of the epidemic is still uncertain. If the outbreak of the two outbreak in China, it will have an inestimable impact on the domestic economy. Secondly, there is an increasing trend of the new crown virus epidemic abroad, such as Korea, Japan and Italy. If the new crown pneumonia outbreak in other countries, the growth of the world economy will be seriously affected, which will lead to the overall weakening of foreign market demand. Finally, in view of the impact of the epidemic, the Chinese government has introduced many policies and measures in stabilizing employment, reducing the burden of enterprises, stabilizing economic growth and maintaining the market environment of financial and monetary affairs. The effects of various policies and measures need to be further observed.

In view of the fact that the home textile industry is dominated by private enterprises and more small and medium enterprises, the industry in recent years has seen a slowdown in revenue growth and a decline in net profit. Among them, the industry's rich and precious birds have been defaulting on their bonds, and the market is more cautious about investing in the whole industry. Superimposed on this epidemic, the central bank Peng Yuan believes that the credit risk of garment home textile industry will increase, and the credit quality of SMEs will further deteriorate.