Production Costs Rise To Hit Hubei Textile And Garment Industry

The impact of the financial crisis on textile and garment industry is increasing.

Reporters learned from the relevant departments, only Hubei Wuhan area closed in October, clothing enterprises have reached 232, central China's important cargo distribution center of Wuhan Hanzheng Street even appeared 1 yuan a piece of clothing abnormal phenomenon, this undoubtedly to Hubei clothing industry sounded the alarm.

Before that, China's textile and garment industry was affected by factors such as RMB appreciation, tightening of processing trade policy, rising labor costs, and rising prices of raw materials, and the financial crisis sweeping across the globe caused heavy losses to Chinese garment industry, and exports were seriously affected.

Although the country has introduced new favorable policies recently, analysts believe that whether textile and garment enterprises can survive the cold winter depends more on how to strengthen "self rescue" and increase innovation to upgrade industries.

The textile and garment industry in Hubei is no longer one of the pillar industries in China. It plays an important role in providing employment, solving the problems of agriculture, rural areas and farmers, and promoting the construction of rural urbanization.

Statistics: the number of Chinese clothing practitioners reached 100 million; only in 2007, there were more than 30 thousand garment enterprises in Guangdong Province, with clothing export value of about 200000000000 yuan.

According to the representative of Han style clothing and the creator of one of the ten major brands of Chinese women's clothing, Fu Jie, chairman of Wuhan Giovanni fashion company, Hubei garment manufacturing industry mainly concentrates on Wuhan, Huangshi, Xiantao, Qianjiang, Tianmen, Ezhou and other places, and there are more than 7000 garment enterprises, while Wuhan accounts for more than 6000 and about 700000 of the garment workers.

In the mid 90s of the last century, the Han style clothing, led by Taihe, was once a hot spot in the Chinese clothing industry. Wuhan once became the three largest brand of women's clothing production base in China. It once owned many famous brands such as Taihe, China, Britain, Asia, and zhe Mei.

However, the fashion industry in Hubei is no longer in business, and businesses are closing down. Women's wear is changing. Men's wear and children's wear are almost completely annihilated.

In the knitting industry, there are no more than 10 enterprises with a certain reputation in China.

In the past, many garment enterprises based on shopping centers and brands have gone back to their old businesses.

In fact, not only the shrinkage of Hubei's textile and garment industry has been seriously affected.

According to the information of the China National Business Information Center, clothing sales in many shopping malls all over the country appeared negative growth in 9 and October this year.

It is understood that the impact of the textile and garment industry has come from many aspects: first, the appreciation of the renminbi has led to a sharp contraction in export trade profits, coupled with the impact of the financial crisis, and the sharp decline in consumer demand has led to a global slide in the volume of export trade and a decline in the purchasing power of the domestic market.

For example, the turnover of garments in the 105th Canton Fair was 70% lower than that in the same period last year. In the 1-8 months of this year, Guangdong's clothing exports dropped by 48%, of which Shenzhen dropped by 68%.

Besides, an important factor is the rising cost of production factors.

The decline in the growth rate of CPI caused by the decline of economic indicators has not been pmitted to the prices of raw materials consumed by textile and garment enterprises. The consumption prices of water, electricity, oil and other materials have remained high, and the economic downturn has affected the selling prices of products immediately, resulting in a sharp drop in profit space.

Fu Jie combined with his business to account to reporters: in 2008, the rise of raw materials made the raw materials of enterprises increase by 20% compared with the same period in 2007, and spent more than 11 million yuan a year. Because of the increase in labor costs by 30%, more than about 10000000 yuan was spent over the past year, and the total expenditure of these two items was about 20000000 yuan a year. Although the sales volume of the enterprises increased by 30%, the brand added value increased by 10%, but the annual profit was still significantly lower than that in 2007.

Because Hubei's more than 7000 textile and garment enterprises are mainly concentrated in the field of foreign trade and raw materials processing, many rely on low price, low-grade design and low profits to survive, and the ability to resist operational risks and market risks is poor, so enterprises have to close down and close down.

Data from relevant departments show that in October, the number of business failures in Wuhan has reached 232.

Innovation is the "warm clothing" for the winter. Although the financial tsunami may lead to a longer winter in the clothing industry, some entrepreneurs are still confident about this.

Fu Jie said that experiencing the baptism of winter is beneficial to the healthy and orderly development of the industry. It can promote the survival of the fittest and become a turning point in the garment industry. There is a good opportunity in the crisis.

Fu Jie believes that the key to the development of enterprises in adversity is to "be good at themselves". Innovation is the warm clothing for the winter. If we want to improve our internal strength and pay close attention to the cash flow of enterprises, we must not blindly invest.

In view of the future of the industry, Fu Jie believes that our country has a huge market of 1 billion 300 million people. With the improvement of living standards, especially in rural and small town markets, it is necessary for the clothing industry to seriously study, plan and implement, guide consumption, and strive to develop this market area for industrial upgrading.

It is understood that Wuhan Giovanni fashion company has set up 4 R & D centers in Paris, Milan, Shanghai and Wuhan. Recently, it signed a contract with GUCCI, the world famous brand designer, and formally invited the famous international design master to join the Giovanni design team to make Giovanni the top brand in Paris.

It is heartening to note that the executive meeting of the State Council has made clear that the export rebate rate of textiles, clothing and some light industrial products will continue to be appropriately raised, and all sorts of unreasonable charges involved in light textile enterprises should be cleared and cancelled, and the "real pfer" policy for the margin of textile processing trade accounts will be suspended.

Analysts said that with the cooperation and support of other fiscal policies for textile industry financing, the textile industry is expected to enter a faster growth path with higher starting point.