78.4% of Keqiao textile companies have reduced orders
Shaoxing Keqiao, China Textile City has been in business for half a month, and more than 80% of business households have opened their doors to welcome customers, but the gates have been left out. Before the epidemic, there were 100,000 people coming in and going out every day, and now there are only 10,000. A local industry survey report showed that 78.4% of textile companies indicated that orders were decreasing, and 64.8% reported that existing orders were cancelled by customers.
"Almost 50% of our company's business is in Europe. If the epidemic situation in these countries continues to spread, it is meaningless for us to start work. Now we are considering whether to adjust the ratio and focus on the country." A China Textile City owner said.
On the same day, information was uploaded from the "International Economic Situation Outlook" online video conference hosted by the China Development Research Foundation: At present, although the resumption rate in the Yangtze River Delta and the Pearl River Delta is as high as 90% or more, only about 30% of them actually work. Missing order.
In fact, order churn began when tariffs were levied in May and June last year. A textile company has a large customer in the United States. The order amount in 2018 was 1 million US dollars, and less than 500,000 in 2019, "directly cut more than half." Because China-US trade has imposed tariffs, and Southeast Asian countries such as Vietnam, Bangladesh, Cambodia, etc. are all zero-tariff, customers transferred orders to Vietnam. Vietnam's textile exports have steadily increased in 2019, and it is also the East Asian country with the brightest economic growth in recent years.
In February, due to concerns about the epidemic and limited traffic, purchasing managers and designers of some well-known brands in the apparel industry were unable to travel to China, and several brands have begun discussions about shifting production of new season goods to Turkey. Hadi Karasu, the head of the Turkish Apparel Manufacturers Association, estimates that about 1% of China's total order volume will be transferred to Turkey; the new orders transferred at that time have made Turkish sewing machines fully operational- ―The production capacity has reached 85%. If Turkey cannot complete technical upgrades such as digital transformation and increase production capacity, its textile industry will not be able to accept more orders.
開始 Since the beginning of March, a large number of European and American clothing stores have ceased to operate. The stock prices of almost all clothing companies, apparel-based department stores, and clothing e-commerce companies have suffered severe losses, and a large number of companies' stock prices have fallen below their net assets. The impact of global epidemic prevention and control on the total market demand has already occurred, and the textile industry is just a barometer with high sensitivity.
Chinese foreign trade companies that have just emerged from the first wave of domestic delayed production and resumption of work will face the second wave of pressure: delayed consumption, orders on hold or cancellation due to foreign epidemic control, have to press immediately Pause button. Plant rents and taxes have to be paid, workers' salaries have to be paid, some workers may be laid off ... China's nearly 50 million foreign trade employees are collectively under pressure. In 2019, the contribution of Chinese foreign trade enterprises to GDP is 10%.
The so-called Chinese play in the first half in January and February and the world's second half in March and April became embarrassed by the butterfly effect. In the economic and trade field, the global supply chain has been severely truncated due to the epidemic situation, and "the same cold" is the reality.
Careful export orders in the near future
With the intensification of the new crown epidemic overseas, the economies of many countries are facing the verge of collapse, and textile companies have also ushered in the largest number of withdrawals and discards in history.
布 is on the machine but cancelled
An industry and trade integrated enterprise that makes extra-wide home textile fabrics said: "Recent orders have been cancelled because of the large number of orders. Our recent general orders come from this customer, which has caused us a lot of financial pressure."
A designated supplier of a fast-fashion brand was helpless: "Recently, many brand apparels have been closed, and our orders have not been spared. We just received a new order some time ago, and the cloth is almost woven, but these days cancelled."
"At present, the domestic factories have basically resumed production. The orders from the previous year were put into overtime production after being put on hold for more than two months, and they were busy shipping. Suddenly receiving the news of the customer canceling the order, the loss was not small, because the company Generally, only 30% of the customer's deposit is charged, and the cost is out of reach. "Said a foreign trader.
"The demand for the global textile and apparel market is now declining, not just for the United States. The situation of overcapacity and shrinking orders may be more serious than last year." The trader looked sad.
In addition to cancelling orders, many companies also revealed that as many US and European companies began to enter the remote office and half-stop state, it has greatly affected the operation of logistics. "Now we have to confirm with the customer whether we can receive the goods and say hello in advance to avoid the situation of money and goods. Before the goods arrived in Italy, they were abandoned at the port, and the goods were detained by the shipping company." A foreign trade company Means.
A Zhejiang-based export company principally focused on the European men's jackets. Europe is becoming the new epicenter of the epidemic. The closure of multi-country routes has resulted in poor logistics and severely hindered export shipments. At the same time, the epidemic situation in European countries is still spreading, residents' lives are affected, local clothing consumer market demand is weak, and orders have dropped significantly.
Under the dual impact of the Sino-US trade friction and the new crown pneumonia epidemic, a carpet exporter from Shandong felt great pressure on the United States. The person in charge of this company said that the United States is currently suffering from an increasingly severe epidemic, the exhibition is postponed, and the tourism industry is stagnant. The company ’s demand for carpet products for local hotels and conference centers and other places has fallen sharply, and new hotels should have been postponed. Or the suspension of work, the carpets of the conference venues to be updated will not be changed, and the market share that was originally affected by the Sino-US trade friction is once again compressed.
At the same time, despite the high resumption rate of export textile companies, most enterprises still face difficulties such as shortage of workers, asynchronous resumption of work between upstream and downstream enterprises in the industrial chain, and lack of protection resources.
There is great uncertainty in the current development trend of the global epidemic, and the stable operation of the market must go through a longer recovery period. Therefore, the confidence of export textile enterprises has been frustrated.
Can't stand it anymore
Filament weaving enterprises have also started a "price war"!
In the case of high inventory and low demand, textile bosses will generally face inventory pressure and financial pressure. Grey fabrics in warehouses have already occupied a lot of funds, and manual wages, hydropower, and rent must be paid in cash. This situation Next, if the grey cloth is not monetized, unless there is a big business and there is no pressure on capital, the company will not be able to support it, and sufficient cash can ensure the healthy operation of the company.
With the suppression of these two mountains, the phenomenon of dumping in the market has continued one after another, and even the best-selling simulation silk in recent years is difficult to "survive." A person in charge of a professional manufacturer of artificial silk said that by the end of 2019, the price of 100D chiffon was 2 yuan / meter, and now it has dropped to 1.8 yuan / meter. In March of previous years, the price of grey fabrics increased and queued to get goods, but in March, the price of grey fabrics dropped and a large number of goods were sold.
This series of withdrawals and discards has also worried the textile boss, and he asked his soul: "Is there any beginning in this year's textile business?"
Properly adjust the proportion of domestic and foreign trade
With the outbreak of foreign epidemics, the textile and apparel industry has basically stagnated in Europe and the United States, and the textile foreign trade people have been severely impacted. During the visits, many cloth owners have stated that the proportion of domestic and foreign trade will be appropriately adjusted in the future to slow the epidemic. Impact.
A person in charge of a company that mainly made orders in Italy and South Korea said: "Although we have not received notice of cancellation of orders for the time being this year, the volume in the first quarter has been significantly reduced compared to last year. Next we will develop domestic trade. Now the domestic epidemic situation It's basically under control, and it is a good opportunity to be alive. "Similarly, a boss who exports fabrics made of silk fabrics also revealed:" The unit volume has been reduced by 20% compared with last year, and the current order can reach the end of April. Next, we will consider a little bit more domestic trade, but domestic trade also has disadvantages. The customer's repayment is longer than foreign trade, and most of them are 3 months or more. Therefore, domestic trade is not easy to do. It's difficult. "
It is true that it is a good policy to shift the focus of the business to the domestic situation when the epidemic situation in foreign countries has not been effectively controlled, but the boss of the cloth also needs to understand that the domestic market is already less abundant and the industry competition is very fierce. The more the boss pays attention to his product quality, this way he has enough strength to win in the competition.
Started construction, shifted from two shifts to three shifts
Guarantee sufficient cash flow
It is said that cash flow is the "life and death line" of an enterprise. When new orders are difficult to sustain, many cloth owners think that for the company, there is no order, that is, no account is received, but the labor and rent costs are difficult to offload. If you have a loan, you have to repay the loan and interest every month. Therefore, it is necessary to reduce expenditures next.
"Next we may appropriately reduce production to ease the pressure on capital and inventory." A factory director doing imitation memory frustrated. "Now the raw materials have fallen very badly. We have not received new orders. We can only produce some conventional varieties, but we use raw materials that were previously stocked at high prices. Therefore, we choose to stop half of the machines next month and inventory production. Too much can't be sold, but it takes up our liquidity (the raw materials are all traded in cash). "
負責(zé) Another person in charge of the dyeing factory also revealed that the working hours of employees may be adjusted appropriately, from two shifts to three shifts. Reduced worker time and wages can reduce labor costs.
From the current market situation, the startup rate of various factories is slowly rising, but destocking is slow, and new orders are not smoothly delivered. Next, the market will have an overcapacity situation, and low-price competition is imminent. Therefore, when the market is uncertain, it is wise to choose strategies such as reducing production or adjusting the working hours of workers to reduce expenses.
When the market is in a downturn, many manufacturers will consider reducing production and vacations. In July and August of last year, many weaving and dyeing factories took high-temperature vacations, but this year is likely to be ahead of schedule. In the case of unsustainable orders, many manufacturers will consider reducing production or even holiday. In the short-term, it is recommended that varieties with larger stocks go along with the market, and the transaction can be appropriately profitable; prices of lower-stock varieties can be temporarily stabilized, and the principle of production according to order, use-and-use, and strict inventory control is adhered to.
