Garment Enterprises Are Too Difficult Under The Outbreak: Inventory Backlog, Delayed Flight, Lack Of Money, Outage.

"Of every 10 sweaters, 7 are from Pu Yuan, and we are not buying them yet." On the afternoon of March 20th, the deputy secretary and mayor of the Tongxiang Municipal Committee of Zhejiang province visited the live broadcast room to bring goods to the Pu's sweater.

Huang Chunhui, the mayor of Shishi, has also changed his "anchor" recently, calling on everyone to wear this dress when he is spring, to see the people you want to see and become the most beautiful kids in the street.

Under the epidemic situation, a large number of garment enterprises have encountered a series of difficulties, such as overseas order cancellation, offline inventory, cash flow and logistics disruption. Some netizens laughed. "War" was the first half of China's war and half the battle for foreign countries, and for the textile and apparel enterprises whose exports were dominated by businesses, they were even more difficult to compete.

Butterfly Effect in global apparel supply chain

In mid March 2020, Adidas announced that it temporarily closed the Adidas and Reebok stores in Europe and North America, while European stores closed in March 18th, while U.S. and Canadian stores closed in March 17th.

Another sports giant Nike also announced the closure of all offline retail outlets in March 15th. Nike retail outlets in Canada, Western Europe, Australia and New Zealand have been closed since March 16th.

The continued spread of overseas epidemic is another serious impact on China's textile and apparel enterprises. According to the third survey conducted by the China clothing association, 46% of the surveyed enterprises reflect that domestic orders have been greatly reduced, while export orders are also facing decline or cancellation. Logistics is blocked and the pressure is huge.

"I was so anxious that I didn't sleep for three days. 1, February, China's epidemic situation is serious, factories can not produce, overseas customers rush orders, I panic. Now the outbreak of the epidemic in Europe and the United States, customers do not rush, start cancelling orders, or even postpone the order of -6 months in April, do not know what will happen next. Mr. Xu, head of a garment factory in Ningbo, told the China Economic Weekly reporter.

In the early years, the company mainly provided fabrics for brands such as Europe, Holland, VERO, MODA, Zara and H&M, and the fabrics produced were exported to European countries such as Holland and Germany, as well as Dubai, Australia and so on.

Mr. Xu told reporters that a piece of clothing had actually traveled half the world before it came to consumers. "Korean and Japanese clothing companies have ordered their fabrics in China and transported them to their own garment factories in Southeast Asia to make their garments. Finally, the finished garments were transported to European and American countries for sale, which is a microcosm of the globalization of the apparel industry chain." Mr. Xu said.

According to WTO's data, China has been the largest textile and clothing exporter in the world for a long time, and China's clothing exports account for more than 35% of the world's clothing exports.

However, since the outbreak of the new crown pneumonia outbreak, according to the statistics of the General Administration of Customs of China, the export volume of textiles and clothing in China in 2020 1-2 was 29 billion 835 million US dollars, down 20% from the same period last year. Among them, exports of textiles (including textile yarns, fabrics and articles) amounted to US $13 billion 773 million, down 19.9% compared to the same period last year. Exports of garments (including garments and accessories) were US $16 billion 62 million, down 20% from the same period last year.

An old clothing enterprise in Tianjin told China Economic Weekly: "the epidemic has hit us too hard. The cash flow on the account is negative. In order to keep up, some of our businesses went to the property department to ask for rent reduction. At the end of last year, several European orders were cancelled. No new orders have been received since the resumption of work. There are no customers in the shop. At present, we can only go through the stock by Taobao live. The original five partners are now left with me and another partner. "

Direct seeding, conversion and cooperative enterprises must learn to save themselves.

What should we do under the crisis?

Bai Ming, deputy director of the International Market Research Institute of the international trade and Economic Cooperation Institute of the Ministry of Commerce, told the China Economic Weekly that at present, the development of the new crown pneumonia epidemic in the world is still difficult to predict, and the challenges to foreign trade enterprises will not be completely eliminated in the short term. Foreign trade enterprises need both help and help from the state. On the one hand, it needs the support of the state to foreign trade enterprises, so that they can "live", including financial support, tax relief and other "combined boxing". On the other hand, foreign trade enterprises should also seek transformation and take advantage of the domestic market scale, industrial scale, industrial agglomeration and other advantages to actively expand the domestic market.

Under the crisis, many enterprises have adopted various self rescue measures to reduce risks by turning to online and domestic sales, or seeking cooperation.

For example, Humen's foreign trade enterprises are almost full of employees. The boss is a salesperson who promotes their products in the circle of friends and WeChat groups every day, and seeks to minimize losses through social networking tools.

According to the United States apparel, relying on the new retail tools such as e-commerce platform, micro mall and social software, the company creates three major business scenarios, which not only make the existing stock store value-added, but also provide consumers with a diversified shopping experience. Since the beginning of February, tens of thousands of "retail partners" have been developed at the WeChat side. At present, it has broken through hundreds of thousands of single transactions and over one million goods, and the momentum is further expanding.

Many enterprises in Dongguan have switched to protective clothing, respirators and other anti epidemic materials. Among them, Dai zipper has already provided zippers for many protective clothing enterprises, and has set up a special workshop for protective clothing zippers to support the war.

Red bean men's clothing has launched the activities of buying masks for clothing, and La Natsu Bell and other brands have played a "blessing bag" campaign, promoting the interaction between consumers and consumers through the introduction of different prices of blessing bags, so as to achieve a win-win situation in brand publicity and inventory clearance.

Guo Yan, a professor at Beijing Institute Of Fashion Technology, told the China Economic Weekly that after the outbreak of the epidemic, the national health industry will usher in explosive growth. Health and health will be the theme of people's future life. For the apparel industry, consumers will pay more attention to healthy and functional clothing products, thus greatly promoting the explosive growth of healthy clothing industry, functional clothing industry and civil protective products.

"In the so-called dangerous and organic environment, once the industrial transfer intensifies, China may lose its accumulated competitive advantage. Therefore, for garment enterprises, in addition to doing a good job in epidemic prevention, it is urgent to return to work as soon as possible. In addition, enterprises should create cost-effective products, pay attention to the quality of single products, enhance the cultural attributes of products, enhance the viscosity of customers, and do well in online operation, integrate online and offline, and realize products online, service online and design online. Guo Yan said.