Labor costs are high, textile and garment export companies are experiencing difficulties

At the Canton Fair that is being held, the mentality of the traditional textile and garment export enterprises is one word: difficult! Demand for the debt crisis in Europe and the United States has been drastically reduced, and it is not a day's work for the brands in the domestic market. Many companies do even if they lose money, just to retain old customers. It is understood that some of the SMEs at this session of the Canton Fair may not be able to reach the next session.

After consecutively participating in the 40-year Canton Fair in 20 years, Mr. He, owner of the Shenzhen textile export enterprise, closed the company that had operated for decades. He calculated an account for reporters, orders were reduced to less than one-tenth of the original, labor costs rose to more than doubled two years ago, laborious. If the evacuated staff rent out the factory buildings as an office building, they will earn more than one million yuan each year, and be free from worry and effort.

Today is the last day of the 110th Canton Fair. In the third period, traditional products such as textiles, clothing, shoes and bags are on display. Before the launch, the head of the Shenzhen delegation told the reporter that products with low traditional added value suffered the most internal and external shocks, and the transformation and upgrade were also the most difficult. A group of companies faced the possibility of closure, and large enterprises reduced their booths. Session.

This year is very difficult but it will be even harder next year for some of the traditional textile and garment export enterprises to continue or stop there. This is a problem.

In the interview, companies generally reported that this year is very difficult. Looking back at the Canton Fair, it will be even harder next year. The US subprime mortgage crisis, the European debt crisis, the global lack of a strong buying market, the high production costs of domestic artificial raw materials, and the rapid rise in exchange rates, “are now much more difficult than in the 2008 financial crisis”, they all spontaneously heard.

Wei Taisi is the leading exporter of textile products in Shenzhen. The chairman of the company, Zeng Xiangjin, said that business is bleak and customers are having a hard time. European and American chain retailers generally reduce orders by more than 20%, and even cancel orders after orders, or postponements. The goods date; order profit is diluted, the money on the book counts, the real fall into the pocket is close to zero, the company's factory is in a state of maintenance. However, the cost, especially the labor cost, is already too high to bear. Even if it is so, it is still not available. Please do not provide enough workers. Even if you arrive, it will be difficult to deliver on time.

“Take towels as an example. Only labor costs accounted for 60%.” There are also cash flows that plagued him. “Banks are hard to blame. Take 10,000 yuan as an example. All costs are added together. Almost the same, does not include the cost of time and manpower. "In short, it seems that everything is not satisfactory. Zeng Xiangjin began to envy some of his peers who had closed the factory to rental days. Before the subprime mortgage crisis in 2008, when the reporter saw Zeng Xiangjin, he was highly motivated and he was sure to have more than 30% annual growth in export business.

The expansion of the domestic sales tree brand is not difficult to do domestic sales, the slogan proposed in the 2008 financial crisis, for most of the traditional textile export enterprises, is still a vision.

"It must be done in a definite manner, but it is not dare to make big money. At least it must be ensured that it will not be lost. Exports have been difficult enough." The attitude of the person in charge of Shenzhen Nantianhui's company, Bi Weijun, represents a lot of people's opinions.

Bi Weijun introduced that for textile and apparel products, the products for the domestic market are not like those for electronic products, but they only change the issue of power supply voltage. The styles, colors, fancy patterns, and materials used in textile and clothing are different in different markets, and they go high in foreign markets. There is no reason for the products of the route to go back to China as bargains for sale, and to sell a good price in the country, the design and marketing model is the biggest problem. “The internal team must develop a dedicated team to do the design and the brand must be promoted externally.”

"Actually, can you name a famous domestic luggage brand? There are only a handful of them." Bi Weijun's peer failure to sell domestic products is mostly a failure. A Dongguan colleague pushes for the domestic market in Hong Kong. Tens of millions, the determination is not great. As a result, the market responded coldly and the company was on the verge of life and death. “Don’t say that the newly-developed domestic brands are the second-tier brands in Europe and America. There are hundreds of years of development history in the local area. There are excellent designs and quality, and there are mature distribution channels. However, it is difficult to develop the Chinese market. The characteristics of the industry are: Chinese consumers. You don't care about prices, but only big names, absolute first-line big names."

Zeng Xiangjin is now very envious of Fu Anna who started later than them. “When we export well, they are focused on opening up the domestic market and have also taken a difficult time. But now, people’s domestic markets open hundreds of stores every year, and small and medium-sized boards are listed. They don’t care about cash, and export problems can be The domestic market has been defusing.” Only recently has the domestic market been started, and there has been excessive competition. “The market is complicated and the channel for the 'tuition' is too high.” In fact, in order to be a domestic market, Vitas has invested no less than 20 million, while the profitable days have yet to come.

At the Textile Brands and Innovation Forum held within the Canton Fair two days ago, the International Fashion Federation Darfurson pointed out that the trend of European and American fashion apparel brands is that the production of many national brands has been moved from low-cost zones to their own countries. Production efficiency has been More important than price advantage. And even if it is a price advantage, Chinese manufacturing will not be strong. Deputy Minister of Commerce Fu Ziying pointed out that the problem of China's textile exports is also the lack of innovative design capabilities. The proportion of self-owned brands in exports is less than 10%. It also faces the lack of marketing channels in the international market and the high value-added control of enterprises in the industrial chain. Weak, bargaining power is not strong and other challenges.

Losing money also serves only to reduce the demand for retaining old customers, and the spending power has weakened. In response to changes in the local market, most European and American buyers have reduced their orders, while the requirements for styles have increased. In this regard, export companies adopt flexible ways to meet the needs of buyers.

Bi Weijun said, “Only attending the Canton Fair, the company has developed more than 300 kinds of new products. Customers who previously purchased a product for US$10 are now less than RMB8. We changed materials, changed internal structure, and used artificial leather PU. More and more, now more use of fabrics, woven materials, nylon materials, to reduce costs. This can basically offset the decline in profits caused by *** appreciation."

Shenzhen Meilian Fashion Group also adopts a tolerant attitude toward buyers. Cai Bin, deputy general manager, introduced that for old customers and some potential new customers, “For example, if we give each other 10 styles, one or two models are losing money, or the other party’s four orders are inside, one or two are clearly visible. We are at a loss, but we still have to lose money to maintain the normal operation of the factory, the workers have to work, to maintain their relationship with the elderly, and look forward to more orders coming in. About 30% are such maintenance orders, further dilution Profit."

Aiming at the emerging markets in South America and opening up the domestic market with large investments, low efficiency and numerous difficulties, earning sight of small and quick money is a favorite choice for many companies.

Cai Bin said that he intends to develop a group of high-quality small customers. Perhaps only two small orders a year, each with less than 5,000 pieces of clothing, but the payment is timely, the product requirements are not harsh, the factory production costs less, fewer accidents, very Easy and real. And Bi Weijun also introduced that the company tried to do some fashion products, such as IPAD, IPHONE personality holster, personalized mouse, personalized U disk, design and manufacturing are using the original production of luggage resources, do not add too much input, the product was It takes time and effort to launch customers to respond enthusiastically and steadily.

Zeng Xiangjin said that the development of emerging markets, such as Brazil, Argentina, Mexico and other South American countries, although their purchase volume is not as large as Europe and the United States, the grade is not so high, but the local political situation and economic stability, the relative ease of supply requirements, product production Easy, it is a good choice.

It is hoped that the policy will be stable and create a good business environment for enterprises. It is a wish expressed by many export companies. An exhibitor who has participated in the Canton Fair for 20 years told reporters that changes in the exchange rate and the reduction of orders are a macro-environmental issue, and “policy-oriented changes make it easier for companies to persist in branding.”