The Survival And Death Of Textile Enterprises Under Epidemic Situation

Under the pressure of cash flow, due to the continuous epidemic situation and the difficulty of resuming work, the textile industry has been closed for nearly 2 months due to the epidemic. A number of small and medium-sized enterprises have begun to approach the red line of survival. Tight funds, high inventory, recruitment difficulties, small orders, "four mountains" in textile enterprises, if we can turn over after the epidemic, and survive the cold winter, then the spring of textile industry in 2020 will not be far away.

Tight capital and high inventory:

The textile market in 2019 has been very mild. The weaving Market is basically in a tired inventory stage last year. These inventories could have been consumed by the market in the years to come, but now it seems impossible. The fabric is stored in warehouse for a long time. On the one hand, it occupies a large amount of working capital. On the other hand, the fabric itself is also easy to damage. And under the outbreak of the production and shutdown, all the facade rents and factory rents of the enterprise are indispensable. There are, of course, social security, machine depreciation and so on. Long term "out of nowhere" is the test of cash reserves of company accounts, of course not every textile company can persist for a few months.

A textile boss has counted out an account for Xiaobian, taking 100 looms as an example. The annual rent needs 12-20 yuan. In that month, how much rent should be more than 10 thousand, plus other basic expenses such as depreciation of machines. Because they belong to small businesses, they do not enjoy preferential treatment for rent reduction of state-owned enterprises. After returning to work in March 1st, it will be 2 months' rent. Coupled with manual labor and normal production, the general factory needs 30-40 workers. There are at least one hundred thousand wages a month. Therefore, at least two hundred thousand of the losses will be lost.

Recruitment difficulties:

Although the spread of new crown pneumonia does not depend on household registration, in order to restrict the flow of personnel and reduce the risk of transmission, it can only be registered as a household registration standard, and the regulations are not allowed to return to local employees until the commencement date. It must be known that it is difficult to find workers under 45 years old in textile factories. A textile company with an annual sales of more than 50 million said: "at present, our office personnel are all in place, but workers like rolling workers, dyeing workers and merchandisers have not yet arrived. The capacity estimate can only be restored to 30%. There will be great gaps in employment every year, and now there is no way to recruit workers. Many roads are closed, and people can't get out at all. It is estimated that when they return to work, they will have to go to battle in person, and there will be no way to work overtime."

An enterprise in Ping Wang District also revealed: "we submitted an application, and it has been reviewed. The latest estimate of 20 should be able to resume work. Our foreign customers have already placed the order with us, but we can not start now. The whole market has been disrupted because of the outbreak. It is expected that the dyeing factories, weaving factories and finishing factories will be busy and even burst after the construction starts.

In order to block the spread of the epidemic, it is still a while for employees from Hubei, Anhui, Henan and Zhejiang Wenzhou to leave their posts. It is estimated that the staff will be in place and the market will operate normally at least in March.

Order less:

As we all know, the textile printing and dyeing industry has a special peak season. Generally speaking, after the Spring Festival is the most prosperous season. Before the Dragon Boat Festival, factories basically have no orders to do. That is to say, after the Spring Festival, it is the best production time for printing and dyeing enterprises. If this time does not start, the order will be seriously lost.

It is understood that at present, textile enterprises can not produce many orders after returning to work, most of which are not completed until some years ago, and a few of them are received during the holidays. Domestic enterprises basically did not receive orders, and most of the enterprises in China stopped working. Foreign trade enterprises indicated that they had negotiated orders with customers, and received a few new orders, but the delivery date was hard to give a definite answer. The orders which were not delivered before the year were also affected in export. Most enterprises do not have many lists, and they can maintain about 20 days after starting, but if the capacity is limited, the order maintenance time will be extended.

How do we climb over the four mountains?

The government has made great efforts to help enterprises.

The impact of the epidemic on China's textile industry is an indisputable fact. Against this background, local governments have introduced policies to support enterprises to tide over difficulties.

For example, Zhejiang issued the "leading group on prevention and control of pneumonia in Zhejiang's new coronavirus infection" to support small and micro enterprises to tide over difficulties. "Opinions" pointed out that we should speed up the implementation of new small and micro enterprises to reduce burdens and reduce the cost of electricity, gas and logistics for small and micro enterprises, and effectively lighten the burden of enterprises. The price of industrial electricity was adjusted in time according to the state policy, and the price of industrial water and natural gas were all reduced by 10% for a period of 3 months.

In Guangdong Province, a number of financial departments jointly issued the notice on financial services and security and stability during the period of epidemic prevention and control. The notice requires all financial institutions (enterprises) to establish a "green channel" for financial services such as credit and exchange for related enterprises, so as to effectively solve the liquidity demand of related enterprises. Banking financial institutions can reasonably take measures such as postponing repayment of loans, extending renewal loans, lowering interest rates, reducing overdue interest and other measures to help enterprises tide over difficulties. Local financial institutions should, according to the actual situation of enterprises affected by the epidemic, increase loans, leases and factoring as appropriate, slow down or reduce rent and interest, and help enterprises to reduce costs.

Textile enterprises should do well the work plan after resuming work, increase the industrial design and technological innovation of products, and enhance their competitive power. Take this opportunity to develop online marketing and share e-business learning and application, turning challenges into opportunities. For enterprises in the long and in-depth textile industry business model iteration, refining consumer groups and gradually achieve C-TO-B personalized customization and sales services, to achieve upgrading. Prepare for the "retaliatory" demand after the outbreak.