Euro Debt Crisis Defeat China’s Textile Export
Author: Nov 24, 2011 10:58
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168tex News: When the Euro debt crisis becomes worse and worse, it is unavoidable for textile export enterprises to suffer from a price cut thing. “The European buyers’ offers are low, so we had to negatively accept it”, a textile enterprise manager told the journalist. And the call of industry transformation has been aroused again.
Distinct Influence by the Euro Debt Crisis
“The oversea economic situation is very important for companies like ours that engaged in purely textile exportation. For the influence of Euro economy recession, it is hard to do business with European countries, not to say the quantity of each order, but also the unit price is very low. And many European buyers are still waiting.” Manager Li told the journalist.
The general manager of a textile trade company said “A buyer proposed a demand to reduce several hundreds of goods on each items, once he get back to Europe. It is hard to imagine previously”.
While the vice president of Jiangsu Shuntian Group, Cao Xiaojian put forward such a set of data. Comparing with that of last year, the oversea orders slumped sharply, and the unit order quantity shrank rapidly. On some kind of item, oversea orders have been reduced by 70%.
In front of such a situation, Manager Li explained to the journalist: “Cheap and fine is the present mind of foreign buyers. For the foreign market is slack, many foreign families are controlling charges. It seems that foreign buyers are not so enthusiastic about high quality product any more.”
“Therefore, we had to lower down production cost, otherwise there will be no business to do.” Mr. Li said, some of his business friends have already closed down for good.
Manager Yang said, “We feel tired this year. Now small mills are here and there, interacting with each other to get business. ”
China textile enterprises are racking one’s wits about cutting the price. The threaten from Made in India and Made in Vietnam has arrived quietly. Vice president of The U.S. National Textile Association, David Brown said, “In India, manufacturers reflected a labor shortage to complete the increasing orders. And the Vietnam enterprises said, since the beginning of the year, the orders have increased over 20%. Most of them are transferred from that of China.”
Some Chinese enterprises concede, for the production cost is increasing, on the middle and low class or common product, many countries have already possessed the replacement production capacity. The previous orders that obtained by cost advantage of the Chinese enterprises have been transferred to countries that have more cost advantages.
However, there is also some good news. Cotton price has dropped from 31 thousand Yuan/ton to 20 thousand Yuan/ton currently. It is a relief to the Chinese textile enterprises that strapped in difficult positions.
Enterprise transition is extremely urgent.
In the canton fair that have just finished, vice minister of commerce, Fu Ziying put forward the current deep drawback of the Chinese textile and garment industry. Now garment export is still OEM oriented, among the total exportation, ODM garment export takes a part that is less than 10%。Price advantage is weakening, demographic dividend vanishing, RMB appreciation pressure is increasing, international marketing channel lacks, high value-added chain control ability is weak, and also international competitiveness lacks.
Manager Li said with a smile, to the word now, China textile and clothing enterprises should accelerate “going out” steps, strengthening the cooperation with world-famous brand sales, and striving for oversea marketing channels and systems.
President of Vietnam textile and clothing association, Li Guoen said, “Now the labor cost of China is increasing, by contrast, if set up plants here, the Chinese brand garment made here and transported back to China, the labor cost that saved is enough to balance out the freight cost.”
President of CNTAC, Du Yuzhou recently said, in the face of an even complicated economic and industrial environment both at home and abroad, China textile industry should do some adjustment on three aspects. Namely, continue to integrate in globalization, developing new markets, grasping new technology revolution opportunity, and deepening industrial mechanism reform.
Du Yuzhou said, in order to cope with the change of the new situation, on one hand, textile industry should continue to integrate in globalization, participating more actively in the competition of international market, on the other hand, the industry should develop new markets, make full use of opportunities brought by the new technology revolution. Meanwhile, as for enterprise transition, textile industry should also actively promote the mechanism or system reformation.
But, vice president of CNTAC, Wang Tiankai confessed that, currently, China textile enterprises are still lag behind in the channel of international marketing, which greatly weakened the competitiveness in the international marketing.
In his opinion, the future decade is a key period of China, from a big textile country marching toward a strong textile country. And the internationalization of textile industry is the paramount chain. But now China textile industry internalization is still in its initial phase, and its speed of development is too slow.
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Editor: Candy From: 168Tex.com
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