Fabric Products,Fabric Information,Fabric Factories,Fabric Suppliers Fabric News It’s so heartbreaking! Raw material prices are skyrocketing. If you don’t have enough funds, can you survive?

It’s so heartbreaking! Raw material prices are skyrocketing. If you don’t have enough funds, can you survive?

In 2020, most bosses are still worried about customers’ outstanding balances, saying that life is very difficult. In the blink of an eye, 2021 is here, and the turbulent market conditions still fail to re…

In 2020, most bosses are still worried about customers’ outstanding balances, saying that life is very difficult. In the blink of an eye, 2021 is here, and the turbulent market conditions still fail to restore the “vitality” of textile bosses!

In the first month of 2021, in the WeChat Moments of textile practitioners, colleagues invariably posted the same news – due to the recent price limit of raw materials, please inquire in advance when placing orders. Price, the quotation shall be based on the day, hope new and old customers will know. The contents are similar, as if they were discussed in advance.

Has the market gotten better? Is business going well? In fact, not many people know the truth, but most people are already queuing up to buy the materials. It may not matter what the facts are. The most important point is that the market will always have the final say on price.

Competition in the industry favors powerful players

If you sell cloth, it will be difficult without financial support. Survive! Of course, it’s not just sufficient funds, but also the ability to control the product is equally important! There is also the need to find reliable customers, otherwise they will not be able to collect the money they owe, and it will be in vain.

One year, many people were making a fabric called super soft, and the market was particularly good. The main raw material was polyester, 75D144F flat yarn. Before August 2020, the price of this kind of flat sand was 6,700 yuan per ton, but by mid-November, the price had increased by three to four thousand yuan. If you are making orders, you may need all cash to get the goods, and the financial pressure is self-evident.

Do you think fabric suppliers will be very profitable? For large-scale fabric manufacturers that have been producing a single product for a long time, their profits are actually very thin. The products they sell are concentrated in the hands of a few fabric suppliers, and the prices they sell are generally relatively reasonable, so their profits are still limited. So as you follow along, you will find that in terms of profit distribution, it is actually monopolized by upstream raw material production companies. But it is not a complete monopoly because its price also changes with the market.

The manufacturing companies we just talked about about ultra-soft products need to purchase raw material sand lines in large quantities. Factories with a little bit of financial strength will invest money in raw material reserves. After all, the shipment volume of each machine is more than one ton, and the production capacity is too scary. If the raw material yarn is not prepared in advance, production will stagnate. If the machine is down for one day, you will lose one day’s money.

The number of machines in the factory is more than 20, which means that the daily shipment volume is about 20 tons. If calculated as 6,700 yuan per ton, 20×6,700=134,000 yuan! If the quantity of 20 units is used as the premise, the daily raw material cost for polyester yarn alone is nearly 130,000. You can imagine what kind of funds are needed to support the production of super-soft products in order to ensure that goods are shipped every day.

The dilemma of the sales supplier

The first is the issue of rent. Nowadays, store rents in every local market are very outrageous, and the price changes every year, and will only rise but not fall. The store in Keqiao sells for RMB 600,000 to 700,000 per year, while the store in Guangzhou sells for over 1 million. This is normal.

The product also needs to go through a post-processing link, such as dyeing, brushing, ironing and shearing, etc.! This has to mention the role of the dyeing factory. In recent years, the country has paid special attention to environmental protection and has shut down many small dyeing factories. In 2018, there were many dyeing factories in Zhejiang. All of them ceased production due to insufficient environmental protection, resulting in increasing dyeing costs.

The production capacity of each dyeing factory is limited. For example, the shipment volume per day is 70 tons, but the quantity entered into the warehouse on that day is more than 100 tons. , then a quantity of 30 tons cannot be shipped normally. However, the dyeing factory will still accept the goods in order to make money, which leads to some small customers who have no say in the dyeing factory, and their orders are often far away.

Because dyeing factories must protect those customers who have been doing goods and dyeing in their factories for a long time. These people are not only large in number, but their payment must also be guaranteed. So those who do small quantities of goods , you can only watch helplessly as others ship goods, while your own goods are piled behind! Is there a solution to this problem?

Yes! In order to survive, some small customers either form a group to form a relatively large volume, or form an affiliation with a large factory, so as to increase the enthusiasm of the dyeing factory. The cost of this approach is unknown.

Even so, the cycle is still greatly lengthened. It takes at least 7 to 10 days to take the gray fabric to the dyeing factory for production, and two days to ship it to the customer. But it is difficult to settle your money at once. Your downstream also needs capital turnover, and the payment collection cycle is nearly two months.

That is, if you ship it to him today, the value of the volume is like 20,000, and it will be lent to the downstreamThere is no interest on the customer’s money for two months, and they have to worry about not being able to get back the money they borrowed. One customer per day is calculated at 20,000 yuan, and there are 1.2 million in two months and 60 days. After investing 1.2 million in two months, you will gradually get your money back. Do you think you can still hold on?

This does not include quality problems in the production of goods, the shortage of goods caused by customers not picking up the goods after placing orders, and the problem of customers’ payment arrears! The losses caused by these, if out of control, may be in vain!

If you don’t have enough funds, can you support it? </p

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Author: clsrich

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