For companies, the biggest fears are two things: the agreed order falls through, and the money owed cannot be recovered! This matter has recently been brought to the forefront by Kingfa Technology!
Crying! The 6.8 billion big order was gone, and there were 34 million more bad debts!
Not long after Kingfa’s 6.8 billion mask order from the United States ended, but according to the semi-annual report released by Kingfa, it was obviously not only the United States that suffered losses in the first half of the year. A Shandong company paid 34.4 million yuan for Arrears topped the Goldman bad debt preparation ranking list.
It is understood that Shengquan Group has been deeply involved in the health industry for many years and has been involved in the mask industry chain. , as early as April 3, the civilian masks of Shandong Shengquan New Materials have completed the EU CEEN149 certification.
As for the sudden orders for nearly 300 million masks from the United States, it was inevitable for Jinfa to seek foreign aid. As for whether Kingfa Technology really approached Shandong Shengquan for OEM work and paid a deposit of 34 million yuan, however, the order from the United States was eventually rejected, resulting in no refund of the 34 million deposit, and Kingfa could only admit that it was unlucky.
Regarding the 100% bad debt accrual incident of this 34 million yuan account receivable, Jinfa has not explained. There is no information yet on whether it involves legal proceedings. The cause and effect of the matter. We don’t know.
The risk of orders to the United States has increased, and the share is shrinking!
For Kingfa Technology, it can be said that it suffered a big loss this time! For some companies engaged in foreign trade, if their business encounters these situations this year, it can be said to be “making matters worse”.
After all, under the epidemic, many export-oriented companies’ orders have been canceled, and their market share has shrunk significantly. In addition, the current Sino-US trade dispute has not improved, and some people have described “China-US relations.” Entering a new Cold War era,” the risk of orders from the United States is increasing.
High tariffs, overseas epidemics, and tense bilateral relations brought about by the trade war have forced American fashion companies to reduce their contacts with Chinese suppliers. According to the second quarter survey of the American Fashion Industry Association, 29% of fashion company executives said that they purchased more from Vietnam than from China this year, compared with 25% last year.
If trade tensions between the United States and China continue to escalate, American fashion companies are likely to further significantly reduce purchases in China. However, fortunately, on August 25, there was still good news at the national level. Message:
In terms of diplomatic rhetoric, it is equivalent to progress in the resolution of the dispute. But fundamental differences remain unresolved.
However, no matter which direction Sino-US trade goes, the environment is still not easy for foreign trade textile workers this year. At present, the entire textile and apparel industry chain is in a cycle of weak demand and excess surplus, and textile bosses are also waiting for signals that the market will improve.
“If the market wants to get better, it still depends on terminal demand. However, domestic textile and apparel demand is relatively weak, and overseas demand is difficult to see a significant improvement. Recently, the overseas new crown epidemic is still continuing. As the epidemic continues to spread, many stores are closed, and demand naturally rises slowly!” said Mr. Wang from a foreign trade company.
“The best time for the market this year was when the domestic epidemic was over in the first half of the year and the foreign epidemic had not yet begun. That was the peak period. We had many foreign orders and we were all rushing to But once the overseas epidemic broke out, many orders disappeared and the market became uncontrollable. So far, our year-on-year sales have shrunk by 40%!” Liu, a foreign trade boss who mainly specializes in women’s fashion fabrics always said.
As the “Golden Nine and Silver Ten” approaches, where can textile people find confidence?
Looking at the current overseas markets, the impact of the epidemic on overseas economies has not completely dissipated. On the contrary, the economies of many countries are suffering unprecedented impacts.
In the second quarter of this year, the real GDP of the United States fell by 32.9% at an annual rate, the largest decline since records began in 1947. According to relevant data, as of August 17, a record 45 companies with assets of more than US$1 billion and 157 companies with liabilities of more than US$50 million have filed for bankruptcy.
For today’s foreign trade market, textile bosses are more worried about the trade war. Industrial Transfer.
Because my country is a major manufacturing country, my country’s manufacturing industry plays a decisive role globally. The title of “World Factory” has been recognized globally. Because of this, Being envied by other countries, they began to suppress manufacturing in China.
In recent years,The share of China’s textile and apparel products in the markets of major developed countries continues to decline, while apparel imports from Vietnam and Bangladesh have shown double-digit growth. It can be seen that the share of China’s textile and apparel in traditional export markets such as Europe, the United States, and Japan is being replaced by competitors such as ASEAN, India, and Bangladesh.
Fortunately, the productivity of textile materials has not yet become a climate in these countries, so many yarns, All fabrics are imported from China. “This year we still have a lot of export orders to Vietnam and Cambodia, and their terminal customers are from the United States.” Mr. Liu said.
In August, the placement of foreign trade orders has recovered compared to the previous period. It is said that demand from South Africa, Brazil and other countries has recovered slightly, and many customers in European countries are on vacation. Therefore, as usual, orders cannot be placed until mid-September.
In short, whether it is domestic trade or foreign trade, the market demand for clothing still exists. The foreign trade market is very likely to be better in the fourth quarter than in the third quarter, but at present It’s not yet time to “sing and dance”, but for textile bosses, tight times have not eased: various operating costs are rising year by year, sales prices are pushed to the extreme by customers, and payment recovery is slow… The market is still moving forward in crisis.
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