Focus On The Economic Operation Of China'S Garment Industry

From January to February, China's clothing industry continued to recover its development momentum, with the growth rate of production, domestic sales, export and efficiency kept in a reasonable range, investment grew rapidly, and the operation quality and development vitality of the industry were steadily improved. However, the external environment is complex, the global epidemic is spreading and spreading, and there are clustering epidemics in many places in China. The unstable and uncertain factors such as the prospect of world economic recovery, international geopolitical crisis and trade environment risk have increased significantly. The adverse factors, such as weak market demand, rising costs, Limited Logistics and exchange rate fluctuations, have seriously affected the production and operation activities of enterprises, In particular, small and micro enterprises have more difficulties in operation, and the stable recovery of China's clothing industry still has greater pressure and challenges.

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　　 one Economic operation of clothing industry

　　 Production continued to pick up

With the increase of consumption demand during the Spring Festival and the "Spring Festival on the spot" initiative, China's clothing production continued to pick up, and the industrial added value achieved double-digit growth. According to the data of the National Bureau of statistics, from January to February, the industrial added value of Enterprises above Designated Size in China's garment industry increased by 11.3% year-on-year, 2.8 percentage points faster than that of 2021, and 11.9 percentage points faster than the average growth rate of 2021; Enterprises above the designated scale completed 4.138 billion pieces of clothing, up 1.40% year-on-year, 6.98% slower than that of the whole year of 2021, and 1.36% faster than the average growth rate of two years in 2021. From the perspective of the output of major clothing categories, the output of knitted apparel was 2.263 billion pieces, up 2.75% year-on-year, 1.0 percentage points higher than the average growth rate of two years in 2021; The output of woven clothing was 1.874 billion pieces, a slight decrease of 0.18% year-on-year, 2.16 percentage points lower than the average of two years in 2021.

Figure 1 production growth of clothing industry from January to February 2022

Source: National Bureau of statistics

　　 Domestic sales maintained a small growth

From January to February, driven by positive factors such as the implementation of consumption promotion policies and the promotion of consumption during the Spring Festival, the domestic clothing market in China was basically stable, the physical retail sales improved, and the growth rate of online sales slowed down. According to the data of the National Bureau of statistics, from January to February, China's total retail sales of consumer goods reached 7442.6 billion yuan, a year-on-year increase of 6.7%. The growth rate was 5.8 percentage points slower than that of the whole year in 2021, and 2.8 percentage points faster than the average growth rate of two years in 2021; Among them, the total retail sales of clothing goods of units above the designated size reached 175.64 billion yuan, a year-on-year increase of 3.7%. The growth rate was 10.5 percentage points slower than that of the whole year of 2021, and 1.3 percentage points faster than the average growth rate of two years in 2021. Over the same period, online retail sales of wearing goods increased by 3.9% year-on-year, 4.4% slower than that in 2021 and 3.1% slower than the average growth rate of two years in 2021.

Figure 2 the growth rate of clothing sales in the domestic market from January to February 2022

Source: National Bureau of statistics

　　 Export growth slowed down significantly

In spite of the adverse factors such as epidemic risk, price fluctuation of raw materials and rising cost, the international market demand and global supply chain have gradually recovered. China's clothing export continues to maintain the growth trend on the basis of the high base of last year, but the growth rate is obviously slowing down. According to the data of China Customs, from January to February, China's total exports of clothing and accessories reached US $25.46 billion, up 6.1% year-on-year. The growth rate was 17.9 percentage points slower than that of the whole year of 2021, and 1.6 percentage points slower than the average growth rate of two years in 2021. From the perspective of monthly export, the export of clothing and clothing accessories in January increased by 17% year-on-year, while that in February decreased by 8% year-on-year. In terms of export categories, the export value of knitted clothing and clothing accessories was 13.19 billion US dollars, an increase of 18.4% over the same period of last year. The export value of woven clothing and clothing accessories was 11.14 billion US dollars, with a year-on-year increase of 13.3%. The growth rate was 8.3% and 10.8% higher than the average growth rate in 2021; Due to the change of epidemic prevention and control situation in foreign countries, China's export of relevant anti epidemic materials fell sharply. From January to February, the export value of gloves made of plastic and vulcanized rubber reached 700 million US dollars, down 69.7% year-on-year, and the export value of chemical fiber protective clothing was 160 million US dollars, a decrease of 77.9% year-on-year.

Figure 3 export of China's clothing and accessories from January to February 2022

Source: China Customs

From the main export markets, China's clothing exports to the United States slowed down, while exports to emerging markets maintained a rapid growth. From January to February 2022, China's clothing exports to the United States amounted to US $5.93 billion, up 3.2% year-on-year, and the growth rate was 8.9 percentage points slower than the average growth rate in 2021; China's clothing exports to EU increased by 9.9% year-on-year, 1.5 percentage points faster than the average growth rate in 2021; China's clothing exports to Japan decreased by 9.8% year-on-year, and the decline rate continued to expand by 8.4% compared with the average decline rate of two years in 2021. Over the same period, China's clothing exports to countries and regions along the belt and road increased by 14.4% year-on-year, driving a growth of 3.1 percentage points. China's clothing exports to ASEAN and Latin America increased by 33.4% and 40.5% respectively on a year-on-year basis, while those to Australia, Britain and South Korea increased by 13.2%, 7.1% and 11.6% respectively; China's clothing export to Africa decreased by 9.6% year-on-year, while that to Russia decreased by 40%.

From the perspective of garment exports of various provinces and cities, Zhejiang Province has become the largest garment export province in China, and the exports of central and western provinces are showing a differentiation trend. From January to February 2022, Zhejiang, Guangdong, Jiangsu, Fujian and Shandong, the top five provinces of China's clothing exports, totaled 19.02 billion US dollars, a year-on-year increase of 10.1%, accounting for 74.7% of China's total clothing exports, an increase of 2.7% over the same period of last year. Among them, the export amount of Zhejiang clothing leaped to the first place, reaching 5.26 billion US dollars, with a year-on-year growth of 21.3%; The export value of Guangdong, Fujian and Shandong increased by 6.5%, 14.5% and 7.4%, respectively, higher than the national average growth; Only the clothing export of Jiangsu Province decreased by 0.1% year-on-year, accounting for 0.9% of the national clothing export. Among the central and western provinces, the clothing export of Xinjiang, Jiangxi, Hunan and Sichuan maintained a rapid growth, while that of Anhui, Hebei and Hubei provinces fell sharply, with a decrease of 18.9%, 62.4% and 48.8% respectively.

　　 Operation quality and efficiency are gradually restored

The economic benefits of the clothing industry have been steadily improved. According to the data of the National Bureau of statistics, from January to February, there were 13042 Enterprises above Designated Size (annual main business income of 20 million yuan and above) in China's garment industry, which increased by 389 compared with that of the whole year of 2021, and the operating income was 203.650 billion yuan, with a year-on-year growth of 12.19%. The growth rate was 5.68 percentage points faster than that of the whole year of 2021, and 14.99 percentage points higher than that of the two years in 2021; The total profit was 8.807 billion yuan, with a year-on-year increase of 4.95%. The growth rate was 9.46 percentage points slower than that of the whole year in 2021, and 10.05 percentage points higher than the average decline rate of two years in 2021. From the perspective of various sub industries, the operating income and total profit of woven clothing manufacturing enterprises and clothing manufacturing enterprises have maintained double-digit growth, while the operating income of knitting or crochet knitting garment manufacturing enterprises increased by 9.90% year-on-year, and the total profit decreased by 26.79% year-on-year.

The operation quality of the industry has improved, but the cost pressure is still great. From January to February, enterprises above Designated Size in the clothing industry suffered losses of 26.49%, 1.76 percentage points lower than the same period of last year; The turnover rate of total assets, notes receivable and accounts receivable were 1.15 times / year and 7.25 times / year, respectively, which increased by 7.66% and 9.18% year on year. Although the proportion of three fees decreased by 0.53 percentage points compared with the same period of last year, the operating cost increased by 12.77% year-on-year, which was 0.68 percentage points higher than the growth rate of operating income. The operating income per hundred yuan included cost of 84.64 yuan, which was 0.43 yuan higher than that of the same period of last year; The profit margin of operating income of garment enterprises above designated size was 4.32%, down 0.3 percentage points over the same period of last year and 0.86 percentage points lower than that of the whole year of 2021.

Figure 4 main benefit indexes of clothing industry from January to February 2022

Source: National Bureau of statistics

Investment increased significantly

According to the data of the National Bureau of statistics, from January to February 2022, the completion of fixed assets investment in China's clothing industry increased by 46.2% year-on-year, 42.1 percentage points faster than the whole year of 2021, 62 percentage points faster than the average growth rate of two years in 2021, and 9.9 and 25.3 percentage points higher than the overall level of textile and manufacturing industries.

Figure 5 growth rate of fixed assets investment in clothing industry in 2022

Source: National Bureau of statistics

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　　 two Key development direction of garment enterprises

Since the beginning of 2022, the epidemic situation has returned in many places, which has a certain impact on economic growth and market consumption. In this context, focusing on user value, strengthening the internal force, brand building, channel construction, digital construction and rapid response mechanism innovation, to constantly enhance the core competitiveness to cope with external pressure and uncertainty, has become an important development focus of clothing enterprises.

　　 Stimulate the vitality of flexible organization

Continuously improve the flexible organizational efficiency, break the internal organizational barriers, continuously promote the rapid decision-making of the retail front-line, the business units to fight together, and the functional units to improve the efficiency. The whole staff of the enterprise focuses on creating value for customers and providing products and services that surprise consumers. At the same time, timely adjust and optimize the performance appraisal incentive system, effectively stimulate the enthusiasm of employees from the system guarantee level, and ensure that the organization is full of vitality.

　　 Cultivate brand leading force of new consumption

In terms of consumer groups, we should pay more attention to the lifestyle of young consumers, the consumption market space brought by the three child policy, and pay attention to the corresponding consumption demand of the aging population; In terms of product innovation and creative design, it pays attention to the integration of advanced technology, fashion trend, multi culture and cross-border integration in product design, so as to meet the new consumption demands of health function, natural comfort, fashion creativity and environmental friendliness; In terms of brand operation and management, based on people's consumption and lifestyle, especially in the case of repeated epidemic situation, relying on new digital technology, we will continuously improve the level of full link operation, rapid response, content marketing and community marketing, and explore innovative consumption patterns.

　　 The digital driving force of upgrading commodity supply

The intelligent management system of commodity is constructed to drive the process of commodity development with data, and the whole chain of goods supply in the core links of design, production, logistics and marketing can be opened. On the design side, it improves the analysis ability of terminal operation platform data, captures popular trends and insight into consumer demand. Digital empowerment improves the accuracy of product development and provides products that meet the current consumer demand; At the production end, we should promote the quick reaction mechanism of commodity design and R & D and supply chain linkage, continuously improve the flexible production and supply system, realize rapid development, proofing and production, and quickly provide consumers with products with leading fashion and leading quality, reduce inventory and increase inventory turnover.

　　 Optimize the market reach of three-dimensional coordination

At present, China's Internet e-commerce platform has entered the era of comprehensive competition, with more and more traffic growth bottlenecks and new entrants in the industry, resulting in the customer acquisition cost of major Internet platforms increasing year by year. In this regard, clothing enterprises are constantly optimizing multiple sales models and increasing omni-channel access with consumers. First, they are constantly improving the retail channels such as offline stores, shopping centers and department stores, so as to improve the shopping convenience of consumers, comprehensively enhance the sense of shopping experience, and create a more open customer interaction atmosphere; The second is to fully embrace new retail. While promoting the proportion of traditional e-commerce business, actively explore new channels of social retail. Through new traffic platforms favored by contemporary young people such as station B, Shuo Yin, Kuaishou and xiaohongshu, we can create novel and interesting interactive content, accurately reach different groups of people, and provide consumers with surprise fashion products through all channels.

(source: China clothing association)