Textile Industry: Reshaping The Value Chain In Ten Years

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In the uncertain era, the international evolution of China's textile industry has gradually begun to determine. A clear signal is that we used to export cheap and beautiful products, but now Chinese garment enterprises are exporting business Experience.

August 31 was a day of "anxiety and happiness" for Anta Vice President Zhang Tao.

On that day, Zhang Tao stepped on the platform of Columbia University Business School in New York, and the audience was from many countries in the United States transnational CEO students.

What Zhang Tao wants to express is that "emerging Chinese companies have a strong influence on global business pattern ", which teaches management, brand, channel, supply chain and other business methods. Previously, Chinese enterprises were taught.

Professor Liao Jianwen of CKGSB believes that "in recent 10 years, emerging Chinese companies have undergone transformation and upgrading in many aspects, especially many enterprises have changed from low-end cost advantages to brand driven business development strategies."

In Liao Jianwen's view, Anta's visit to Columbia University is a representative of the impact of Chinese emerging enterprises on the global business landscape through the concept of "creating in China". It is also the export of successful transformation samples of Chinese enterprises to the United States against the backdrop of China's economic rise. Chinese enterprises will face more competition from international enterprises in the future.

Anta is not an individual case.

On October 31, Sun Huaibin, director of the China Textile Economy Research Center, told reporters that "the domestic market has been internationalized. Some of our national and local brands have actually fought hand to hand with international brands in the domestic market." To Sun Huaibin's satisfaction, some Chinese clothing brands have entered Paris, Milan, London, New York Tokyo and other fashion capitals in the world.

Golden Decade

This is a precious golden decade. As expected before, despite many uncertainties, China's textile industry has achieved very certain growth.

Recalling the changes of this decade, Sun Huaibin's feeling is "no danger".

From the quota period to the quota limitation in the post quota era, and then to trade liberalization; From trade friction to anti-dumping, and then to trade protection; From the subprime crisis to the financial crisis, and then to the debt crisis; From the rise of labor costs to the fluctuation of raw material prices to the appreciation of the RMB, China's textile industry is still "flourishing".

In 2002, "three major economic indicators of China's textile industry, namely, gross output value, profit and export, all hit a record high" - this news shows the textile transcript of a year after China's accession to the WTO, which is the most encouraging news among the "Top Ten News of China's Textile Industry" that year. In 2005, "the textile industry continued to maintain the momentum of accelerated growth in the first year of the post quota era, and various economic data reached a new high". This news once again proves the strong competitiveness of China's textile industry.

According to the data, China's total textile exports reached 206.5 billion US dollars in 2010, an increase of 75.72% over the export of 117.5 billion US dollars in 2005, the first year of the cancellation of global textile trade quotas, and an increase of 268.75% compared with the 56 billion US dollars in 2000 before joining the WTO.

This number is still climbing. According to the statistics of China Customs Express, from January to September 2011, China's textile and clothing exports totaled US $186.139 billion, up 24.26% year on year. Among them, textile exports reached 70.904 billion US dollars, up 25.9% year on year; Clothing exports reached US $115.235 billion, up 23.3% year on year.

The change of quantity also drives the change of quality. At present, China's textile exports account for more than 30% of the global market share. It is understood that in 2010, China's textile and clothing exports accounted for 32.71% of the global market. Compared with 2000 before China's accession to the WTO, China's share of 15% of global trade doubled.

"China's textile industry has sufficient endogenous power, and its own industrial adjustment and upgrading has enabled us to maintain a relatively high and strong international competitiveness." Sun Huaibin said, "Under the complex and volatile international environment, we can still maintain a relatively high growth, which shows that our accession to the WTO has brought more opportunities to the textile industry in general."

Growth ceiling

The deterioration of the international trade environment is a reality that Chinese textile enterprises have to face.

The data shows that from 1980 to 1989, China's anti-dumping cases accounted for 4.6% of the total number of anti-dumping cases in the world; From 1990 to 1999, it reached 13.2%; From 2000 to 2009, China's anti-dumping cases accounted for 26.3% of the total number of anti-dumping cases in the world, including 34.7% from 2005 to 2009.

Sun Huaibin admitted that although promoting free trade under the conditions of globalization has become a mainstream, trade barriers have not been eliminated with the promotion of trade liberalization, but have become increasingly fierce.

A semi annual report released by the World Trade Organization (WTO) on October 27 this year pointed out that economic pressure is inducing the governments of the Group of 20 (G20) to seek protectionism and protect the domestic market in the wrong way. The report found that, although all member countries firmly committed to limiting protectionism at the last G20 summit, the situation of trade restrictions did not improve, and countries did not take further action to restrict trade.

It can be predicted that, in addition to trade remedy measures, technical barriers to trade and green barriers will become obstacles for Chinese textile enterprises.

"After the total cancellation of quotas, China's textile competitiveness has been highly released, which has triggered some countries' dissatisfaction with us, and has risen to the government level. Therefore, in this context, it is not uncommon for various trade frictions and trade barriers to appear." Sun Huaibin said.

Sun Huaibin said that this shows that our strength is growing. "The stronger you are, the more people will stare at you. The more people will stare at you, the more likely it is to cause trade frictions and trade barriers. So we should face up to this problem and despise it."

"Behind the trade barriers are the interests of different countries, nations and social groups, so we should learn how to legally and reasonably avoid such diversified interests. In addition, we should regulate our own trade behavior to respond, which is also a test for us." Sun Huaibin said.

More importantly, if Chinese textile enterprises want to win in the new international environment, they must rely on quality, not quantity. "Chinese textile enterprises should strengthen the adjustment of industrial structure, cultivate independent brands with international influence, actively promote the international operation of textile enterprises, and improve the distribution of China's textile industry in the global value chain," said relevant experts.

New internationalization

Five years ago, Hong Tianzhu decided to invest in Vietnam.

As one of the top 10 enterprises in China's cotton textile industry, Hong Tianzhu, Chairman of the Board of Directors of Tianhong Textile Group, has been thinking about how textile enterprises can build their future core competitiveness.

For Hong Tianzhu, the international transfer of cotton textile industry is an important path. So far, the scale of Tianhong in Vietnam has reached 40 million spindles. "In fact, Tianhong's profits in Vietnam and its overall operating income exceed the domestic scale."

Li Guoen, chairman of Vietnam Textile and Garment Association, said: "Now China's labor costs have been rising. In contrast, when we come here to open factories, Chinese brand clothing is produced here and then shipped back to the mainland of China for sale. The labor production costs saved are enough to absorb the corresponding transportation expenses."

In response, Du Yuzhou, president of the China Textile Industry Association, said, "How to create a world famous brand? Only when the ability to allocate resources across borders is strengthened, can we be qualified to create the so-called world famous brand. Now we have enterprises that have begun to do so, such as Tianhong, which has already started transnational operations. But I hope it is not only a transnational enterprise, but also a transnational industry chain."

Relevant experts said that China is a major producer and exporter of textiles and clothing. Cultivating and expanding the export of private brand clothing is the only way to improve the competitiveness and economic benefits of China's textile and clothing industry, and also the only way to transform China from a major producer and exporter of textiles and clothing to a major producer and exporter of textiles and clothing.

"Anta is not the Nike of China, but the Anta of the world." Ding Shizhong, chairman of Anta's board of directors, said that the internationalization ambition of Chinese textile enterprises is reflected.

However, Wang Tiankai, Vice President of China Textile Industry Association, admitted that the international marketing channels of domestic textile enterprises are still very backward, which has seriously weakened the international competitiveness of China's textile industry.

In Wang Tiankai's view, the next decade is a critical period for China to move from a textile power to a textile power, in which the internationalization of the textile industry is the most important link. "But now the internationalization of the domestic textile industry has not yet formed a climate, and the process is still too slow."

"It is impossible to build a textile power behind closed doors, and domestic enterprises still need to participate in international competition to become stronger." Wang Tiankai said that building a textile power requires a number of international textile enterprises with first-class brands, first-class talents, first-class marketing capabilities, first-class scientific research capabilities, and first-class resource allocation capabilities. Now, although some domestic leading textile enterprises have begun to achieve sales channels in Europe, America and other developed countries, the effect is not ideal. "In general, it is because the international marketing channels of enterprises are too backward and their capabilities are not strong."