Rising Pressure Of Garment Enterprises Cost Rising

"We raised about 10% quotations." In August 24th, the head of a garment export company said that the reason for the rise was that the enterprises themselves had already been unable to digest the rising cost and the pressure of RMB appreciation.

Ningbo Chinese fir Li Qiming, vice president of Limited by Share Ltd, said that the rising cost of garment enterprises this year is indisputable. "The shortage of migrant workers has not been completely alleviated, labor costs have risen by about 10%, and the cost of accessories has also risen. These factors will inevitably lead to rising costs. He said.

The price of long cotton was 22 thousand to 23 thousand yuan per ton at the end of last year, and now it has risen to 29 thousand yuan per ton, and the fine cotton is about 15 thousand yuan per ton, and now it is up to 19 thousand yuan per ton. In addition, for export oriented enterprises, the appreciation of the renminbi is also a factor that can not be ignored.

In the forward market, the appreciation of the RMB against the US dollar is expected to remain stable. In the evening of August 20th, the US dollar exchange rate for overseas non deliveries in the overseas market for RMB appreciation was 6.6718 yuan a year, compared with 6.7902 at the spot closing price. It shows that the market thinks RMB appreciation is in the range of 1% to 2% a year later. Since this year, clothing The rising cost of enterprises is very obvious, and export enterprises themselves can hardly digest these pressures.

Will the increase in quotations lose part of the market?

For this worry, Wang said that even if orders were transferred, it would be partial and not large. "After all, the cost increase is global, and China's cost remains competitive." However, some retailers and purchasers abroad have some complaints.

In order to solve the increasing procurement cost in China, some American clothing Retailers are shifting the production lines of many products to other production bases. But for larger brands that need mass production, only China can meet its supply, so prices are rising unstoppable.

Li Qiming pointed out that foreign buyers proposed to shift production bases to cheaper countries such as Vietnam and India, but this is not so simple. These garment processing enterprises in China's coastal areas have the technology and experience of factory management, which are difficult to be replaced simply because of their accumulated experience over the past twenty or thirty years.

As for foreign buyers' complaints about the quotations raised by Chinese OEM enterprises, two of them said that this is more of a "game" process, and foreign buyers attempt to "lower prices". "They don't have to complain, they can simply place orders or buy other people's things." Li Qiming said.