Sportswear Giants Almost Stopped Growing In July! Be Alert To The Crisis Under The Recovery Of Domestic Demand

Stable and robust domestic demand has always been the focus of China's economic development. According to the normal development plan of the country, 2020 is only an ordinary year. The export will remain as usual, and the domestic demand will gradually increase according to the plan. However, the new crown epidemic makes all this different. China and all Chinese enterprises will rush into the domestic demand market. Before August 2020, even the whole year, exports will continue to decline, and domestic demand will become the only way for all industries to survive.

Since May this year, the new development pattern of "double cycle" has been mentioned many times. The decisive battle of domestic demand market in 2020 has begun. Back to the problem of China's domestic demand, foreign trade companies in general have conveyed these messages to the industry

There are too many orders in China.

Domestic orders are not profitable. ...

With the epidemic, the reduction of foreign orders and the severe situation of foreign trade in 2020, many enterprises will enter the domestic market, which will lead to more fierce competition in the domestic market.

Is domestic demand still weak? Sports apparel giant Baosheng almost stopped growing in July, and the domestic clothing industry's discount war intensified

Last week's July data from the General Administration of customs and the July sales data released on Monday by Baosheng International (Holdings) Co., Ltd., a Taiwanese sporting goods distribution giant, showed that domestic demand remained weak.

In July, Baosheng international recorded sales of 2.0126 billion yuan, a slight increase of 0.8% compared with 1.996.5 million yuan in the same period of last year, and a sharp slowdown compared with 5.2% in June. However, the company's first increase after the outbreak in May, with the growth rate of 8.1% less than one third of 25.6% in January. On the same day, the CPI data released by the Statistics Bureau increased by 2.7% year-on-year, higher than the 2.6% expected by the market. The CPI driven by food was unbalanced. During the reporting period, CPI for clothing fell by 0.5%, while CPI for housing, transportation and communications also recorded a decline of 0.7% and 4.4%.

The above data show that under the situation of the epidemic situation superimposed on the flood, the consumption of domestic residents is becoming more and more cautious, and the main expenditure is still concentrated on the essential consumer goods, while the pressure of discount on clothing and other non necessities is increasing.

Last week, data from the General Administration of customs also showed this trend. In US dollar terms, imports in July fell by 1.4% year-on-year to US $175.3 billion, which was lower than the 0.8% increase expected by the market. In June, imports increased by 2.7% year-on-year. The underperforming performance was also reflected in the social consumer goods data in June. When the market generally expected the total retail sales of social consumer goods to turn positive in June, it actually recorded a decrease of 1.8%, only slightly narrowed down from the 2.8% drop in May. On Friday, the Statistics Bureau will release the retail sales data for July, and the market expects a growth rate of 0.3%.

Due to the sluggish performance in July, in the first seven months of this year, the sales of Baosheng international still dropped by 10.5%, from 15.368.1 billion yuan in the same period of last year to 13.752.8 billion yuan. On Sunday, Baosheng's rival Anta sports (2020. HK) issued 12 billion yuan of bonds, which also worried some investment banks. According to the report issued by Citigroup, the RMB debt of up to 12 billion yuan may aggravate the cash flow pressure and financial risk of Fujian company, and open the negative catalyst observation of Anta sports. Only by maintaining the "sell" rating and the target price of HK $49.6, Citigroup believes that the current market is too optimistic about the 45% profit growth of the company in fiscal year 2021, and the bank's earnings forecast only increases by 18%.

As for Baosheng International Holding Company Yuyuan industry (Group) Co., Ltd., which is based on the global clothing industry vane, continued to perform in July, with sales down 19.4% to $654.4 million, and sales in the first seven months also fell 19.4% to $4740.9 million.

In recent years, sports products in the clothing industry are the main support industry category. Under the popularity, the sales of home wear and sportswear are better than other formal wear and casual wear. Therefore, the data of Baosheng international also makes the sales data of clothing industry in July not optimistic to some extent. According to customs data, China's footwear exports fell by 26.8% and 28.9% respectively in July and the first seven months.

Domestic trade market recovery under the crisis: payback cycle than in previous years to extend double! Over 60% of assets and liabilities of filament printing and dyeing

Different from the fixed payment mode in foreign trade market, the payment cycle of domestic trade market is more variable. Therefore, under the influence of the epidemic situation, this year's payment cycle of traders is twice as long as in previous years. "Last year's market is not as good as the year before last, and the customer's payback cycle has slowed down. Some monthly orders are paid back for at least three months, and this year is longer."

"My clients are mainly trading companies in Shanghai. Their orders are guaranteed this year, but the payback period is very slow, because his clients are in the European and American markets. They pay us slowly. Generally, it takes six months to collect the money." General trader Wu Yi said.

Another main autumn and winter clothing fabrics manager Wang said: "at present, the customer's payment is still relatively slow. In the past, orders generally took three months to collect money. Now it takes about half a year. But this year, it's not easy for everyone. So in order to maintain the relationship with old customers, we also acquiesce to this rule."

For the textile market in 2020, many traders have repeatedly extended the payment cycle for their old customers. Now, the common payment collection cycle in the domestic market is 3-6 months, and some even the balance of last year has not been settled.

It can be seen that in the environment of overcapacity and shrinking demand, traders can only expand the proportion of credit sales again in order to expand sales channels or retain original customers, thus increasing their own receivables.

Meanwhile, according to the data of the National Bureau of statistics, from January to June, the asset liability ratio of 33000 Enterprises above designated size was 56.4%, which was roughly the same as that of the same batch of enterprises in the same period of last year, slightly increased by 0.4 percentage points compared with the first quarter of this year.

　　 ? ?

The asset liability ratio of most sectors of the industrial chain was flat or decreased compared with the same period of last year, while the debt ratio of a few industries increased. In the same period of last year, the debt ratio of textile machinery industry, textile machinery industry and wool industry increased by 58.9%, 1.9% and 1.9% respectively, higher than those of textile machinery industry, textile machinery industry and wool industry. The debt ratio of textile industry and textile industry decreased by 8.0% and 1.0% respectively in the same period. Although the asset liability ratio of chemical fiber, filament weaving and printing and dyeing industry is flat or decreased compared with the same period of last year, it is still higher than 60%. There is a certain operational risk pressure, which needs to be paid attention to.

　　 ? ??

Under the background of large cycle, domestic demand is sluggish and needs time to recover

At the beginning of last year, Wang Xing, founder of meituan, said: "2019 may be the worst year in the past 10 years, but it will be the best year in the next 10 years." It's now more than half of 2020. When I look back at this sentence, I think it's quite right. I believe many textile people will have more identity.

Although the textile industry has experienced a rapid recovery in the past ten years, it has experienced a relatively short period of time. As soon as the machine rings, the beautiful scenery of "ten thousand taels of gold" seems to have happened yesterday.

But this year, can be called the whole textile industry's difficult time! Terminal demand continues to languish, so that many textile enterprises bear enormous pressure. The terminal demand is divided into domestic demand and external demand, and the domestic demand level is divided into real estate domestic demand (home textile) and clothing domestic demand.

However, the domestic demand driven by real estate is currently in a low cycle. In the fourth quarter of 2018, the real estate showed a negative growth. Since 2020, the decline of real estate has been continuing, and the demand for home textile driven by real estate has decreased significantly. In the whole economic cycle, real estate is at a low point at present, so the textile domestic demand (home textile) driven by real estate is also in the low cycle.

Another aspect of domestic demand is clothing domestic demand. With the increase of economic downward pressure, terminal consumption is slowing down, the replenishment cycle of the whole clothing enterprises has ended, and the overall demand for clothing is stable. Under the background that the terminal consumption demand has not been greatly increased while the textile enterprises' production capacity has been greatly expanded, the oversupply will inevitably lead to intensified competition among textile enterprises.

To sum up, the boost of domestic demand can not be achieved in a short period of time, it needs time and patience. Epidemic situation, domestic demand environment, in 2020, all textile enterprises will end up fighting hand in hand, continuous and fierce competition, no pity.