Clothing Market Analysis: The Business Efficiency Of The Industry Continues To Decline, And The Export Presents The Trend Of Both Quantity And Price

1. China's clothing production decreased slightly to 24.472 billion pieces in 2019

In 2019, China's clothing industry is under pressure and facing difficulties. It adheres to the supply side structural reform as the main line, actively promotes transformation and upgrading and pragmatic and innovative development, and generally maintains a basically stable development trend under the increasing pressure of production and operation.

According to the data of the National Bureau of statistics, from January to December 2019, enterprises above Designated Size in China's garment industry completed a total of 24.472 billion pieces of clothing, a year-on-year decrease of 3.28%, and the decline rate was 0.09 percentage points lower than that of the same period of last year. By the end of January to June 2020, enterprises above Designated Size in China's garment industry have produced 9.602 billion pieces of clothing, a year-on-year decrease of 13.69%, and a decrease of 6.6 percentage points compared with the first quarter.

(Note: due to the change of the number of Enterprises above the designated size, the statistical caliber of the year-on-year growth data is different, and the year-on-year data are the production data of Enterprises above the designated scale in the same year).

2. China's clothing industry operating efficiency declined, enterprise losses increased

Since 2019, the overall economic weakness, poor performance of clothing export and domestic market, and high manufacturing costs, order transfer, weak ex factory price growth, inventory growth and other factors have led to the serious compression of the profit space of clothing enterprises. The growth rate of benefit indicators of the clothing industry shows an obvious downward trend. The pressure on enterprises' profit increases significantly, and the improvement of operation quality is more difficult.

According to the data of the National Bureau of statistics, from January to December 2019, there were 13876 Enterprises above Designated Size (annual main business income of 20 million yuan and above) in the clothing industry, with a cumulative operating income of 1601.033 billion yuan, a year-on-year decrease of 3.45%; and a total profit of 87.283 billion yuan, a year-on-year decrease of 9.75%.

As of January to June 2020, there are 13145 Enterprises above Designated Size (annual main business income of 20 million yuan and above) in China's garment industry, with an accumulated operating revenue of 577.634 billion yuan, a year-on-year decrease of 16.39%, and a decrease of 7.07 percentage points compared with the first quarter; the total profit of 23.532 billion yuan, a year-on-year decrease of 27.34%, a decrease of 16.16 percentage points compared with the first quarter; The profit margin of operating revenue was 4.07%, down 0.62 percentage points over the same period of last year.

In 2019, the number of loss areas and total losses of the industry increased significantly compared with that of 2018, 13876 garment enterprises above Designated Size had 2225 loss making enterprises, accounting for 16.03%; the total loss of loss making enterprises reached 7.922 billion yuan, an increase of 40.39% compared with the same period in 2018.

3. The quality and efficiency of China's clothing operation is under pressure continuously, and the pressure of clothing export is increasing

In 2019, the main quality and efficiency indicators of the clothing industry showed a year-on-year decline trend. The proportion of three fees for garment enterprises above designated size was 8.91%, increased by 0.2 percentage points compared with the same period in 2018; the profit margin of operating income was 5.45%, down 0.38 percentage points compared with the same period in 2018. The turnover rate of finished products was 14.51 times / year, with a year-on-year decrease of 3.78%; the turnover rate of current assets was 2.26 times / year, with a year-on-year decrease of 5.44%; and the turnover rate of total assets was 1.35 times / year, with a year-on-year decrease of 3.57%.

Note: the turnover rate of total assets in 2019 is 1.35 times / year.

Affected by the downturn of international market demand, the rising trade friction between China and the United States, and the increasingly fierce market competition, China's clothing export has declined significantly, and the international market structure and domestic regional layout have been adjusted rapidly. According to the statistics of China Customs, from January to December of 2019, China's clothing exports showed a trend of falling both in volume and price, with exports of clothing and accessories of 153.453 billion US dollars, a year-on-year decrease of 3.74%, 29.843 billion pieces, a year-on-year decrease of 2.98%, and an average export unit price of $3.96/piece, a year-on-year decrease of 1.98%.

As of January to June 2020, China's total export value of clothing and accessories reached 53.644 billion US dollars, down 19.42% year-on-year, 0.76% lower than that in the first quarter.