European Clothing Orders Pfer Westward To &Nbsp; Textile And Garment Enterprises Urgently Need Upgrading.

As the weather gets warmer, China's textile export industry has not cooled.

Following the pfer of orders to Southeast Asia in 2008, some European fashion brands are now beginning to "West withdraw" and find suitable manufacturers around their borders. Many countries and regions around them are becoming new fashion manufacturing centers. This undoubtedly throws cold water on clothing orders companies in China.

In view of the westward shift of the European brand clothing production line, Zhao Yumin, director of the international marketing department of the Ministry of Commerce, pointed out that "as China's labor costs continue to increase, competition with Southeast Asian countries has no advantage, and now the gap with the European and American countries is getting smaller and smaller, coupled with the continuous upward movement of China's domestic industry chain, the pfer of orders to the rest of the world is an inevitable trend."

Zhang Xian, Secretary General of the China Textiles Import and Export Chamber of Commerce, also believes that the westward shift of orders is the result of the joint action of the domestic and international environment. If Chinese enterprises want to realize the sustainable development of the characteristic economy, it is no longer feasible to win by simply relying on cheap products, and we must rely on industrial pformation and upgrading.

European order return

"The volume of orders has been declining during the past two years, down 20% last year, and this year is even less optimistic, which has dropped by about 60%."

As a 80% order business from Europe.

Compared with Shun Kang dress, Fujian Shishi enterprise is in a more dismal situation.

Two years ago, I was still doing the garment processing industry. Now the telephone has been informed that the person in charge has changed to the electronics industry.

The original person in charge of the company said: "at the beginning, there was no way, the profit was too thin. In 2006, making a set of European outdoor clothing can earn two hundred or three hundred yuan RMB. By 2009, the worst time was only a few cents. Sometimes, in order to win customers, some orders did not make money, even if it did not agree with customers, the price could not be done at last."

"The cost performance made in China is no longer satisfying."

French fashion brand Jean Charles recently moved overseas production to Hungary, and its production leader, Lopez (CelineLopes), said in an interview with reporters.

In this regard, the reporter visited H&M, ZARA and other European international brand stores located in Dongzhimen, Beijing, and found that there are many different places of clothing. Besides Vietnam, Kampuchea and Indonesia, European countries such as Spain, Turkey, Morocco and Bulgaria are also listed. Once the "MadeinChina (made in China)" one country's unique vision has disappeared.

"Foreign origin products account for about 90%."

ZARA, a staff member in the store said.

As a labor-intensive textile industry, cheap labor costs were once the "trump card" of competition between Chinese garment manufacturers and other countries. This "ace" began to be unstable in 2005, and it was even insignificant after the rise of manufacturing in Southeast Asia in 2008. Now, cheap manufacturing seems to be getting farther and farther away from China.

According to relevant statistics, over the past five years, China's national payroll index has been growing at an annual rate of 15%.

According to the French Fashion Institute - Institutfrancaisdelamode (IFM), the monthly salary level in China's coastal areas in 2011 has surged from 240 euros in 2005 to 400 euros.

According to a garment processing enterprise in Fujian, an ordinary garment mechanic now has a salary of 1800 yuan, which was 1500 yuan last year, and only 1200 yuan in 2010. The wage increase of the workers in these two years is basically around 25%.

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"Now we have to compete with foreign countries for price competition. We really have no advantage."

Yin Guo Xin, chairman of CHENFENG group, known as the world's largest OEM factory, said: "in terms of labor costs, we are not the same as Southeast Asia. The labor cost of Vietnam is only about half that of China. In terms of pportation costs, we are less than the European countries. It takes only 3 days to travel to Turkey, and we take at least 45 days for shipping."

Yin Guoxin also admitted to reporters that 90% of the company's customers came from the United States and Japan, and Europe did not even reach 10%, so its impact on its own enterprises was not large. Orders for this year and February increased steadily, but the increasing labor cost and the cost of raw materials still made the enterprises feel a lot of pressure.

"Rising cost is an influential factor in the pfer of orders, but it is not the only factor. In the past two years, the unemployment rate of European and American countries has remained high. The EU countries urgently need the return of manufacturing industry to solve the domestic employment problem, which is also an important reason."

Zhang Xian further analyzed.

Some industry insiders pointed out that European order pfer also has its own market demand.

Because fashion trends are changing, some European fashions.

Bianchi, designer of Italy underwear brand LaPerla, told Reuters in an interview: "the cost of producing garments in Turkey and Tunisia is higher than that in China, of course, but considering the salary increase in China, the cost is not much higher, and Turkey and Tunisia are much closer to Italy, which is more convenient for us and better quality control." (GiovanniBianchi)

Low end orders shift to big trend

Some people in the industry have said that China has skilled technical workers and good industrial environment, and the pfer of foreign orders is only temporary and partial.

Under the influence of this kind of thinking, many enterprises think that as long as they can carry on for another year, their days will be better, but the actual situation is not as optimistic as expected.

According to the relevant data, last year, the number of textile and garment exports in China declined sharply, up only 0.5% over the same period last year.

In February this year, despite the low base, textile and garment exports still failed to restore nominal growth, and the downward trend was obvious.

Exports were down year-on-year, the ratio fell, textile and clothing exports were 9 billion 710 million US dollars, down 7% from the same period last year, and the ratio fell by 54.9%.

Zhang Xian also sympathizes with the situation of enterprises. But he also said that although the number of orders has declined, China's export share still accounts for more than 40% of the European market. This shows that the overall competitiveness of China's textile industry has not declined, and the current order pfer is only a new process of division of labor in the world market in the process of China's relatively low cost advantage and the abandonment of the low end from the middle to the high-end.

Zhao Yumin also believes that the growth rate of processing trade in China has declined in recent two years, and some of them are also intended to be adjusted by the state.

In view of the current technological level and cost of Chinese enterprises, it is no longer suitable to do the middle and low end orders.

European orders are small and demanding, which is not cost-effective for many Chinese companies.

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Yin Guoxin also said that since 2009, his company has given up low-grade clothing processing, attacking high-end orders.

When some small and medium-sized enterprises complain incessantly, the order volume of enterprises this year has not declined, but has increased by 12.99%.

In this regard, Yin Guoxin concluded: "the era of price competition has gone forever, enterprises must change their thinking, start from quality and category, and make efforts to the high-end market, and do products that others can not do, this is the way out for enterprises in the future."

In addition to CHENFENG group, small businesses like Shun Kang dress in Shanghai have begun to act positively and export to domestic market, turning from foreign production to foreign brands.

"Good models only have good orders, and products can be done well so that we can get the lead and win more bargaining power."

Mr. Lin, the head of the business, said that it has been nearly six years for enterprises to do their own research and development. Although there is no obvious profit, they believe it is only a matter of time.

Transformation and upgrading problems

The severe industrial situation has made many enterprises realize that the old road has not been able to work. Transformation and upgrading is an inevitable choice for enterprises to survive in the fierce international competition.

However, pformation and upgrading require a lot of capital, and enterprises with no pformation can be eliminated. Most enterprises are in a dilemma.

"The pformation and upgrading must be done at the high end and brand, but in fact, the order of high-end products does not meet the needs of all Chinese garment manufacturers, which will inevitably lead to a lack of food and clothing for some enterprises.

No order, no funds, pformation is impossible, this is the plight faced by many small and medium enterprises, especially micro enterprises, and is also a difficult problem faced by our country in the process of industrial upgrading.

Zhang Xian said.

In this regard, Zhao Yumin also pointed out that in foreign countries, textile exports have introduced protective policies and preferential policies, so the pformation and upgrading of enterprises is necessary. It is also necessary for the state to give some support.

For example, the government can reduce some intervention in the industry, actively provide trade facilitation, help enterprises improve productivity, eliminate some policy barriers from the aspects of export tax rebate, logistics, raw materials and so on, and reduce the increase of paction costs caused by human factors.

After two consecutive months of decline, the textile and apparel export data released in the first quarter of March showed that textile and clothing exports finally rebounded in March, and exports were US $18 billion 790 million in the same month, an increase of 13.4% over the same period last year.

Many people in the industry and experts believe that although the current foreign trade situation is grim, enterprises can go out of their own way in developing new products, developing new markets and building their own brands.