As the global epidemic continues to escalate and global lockdown orders continue to escalate, many brands are currently suspending production and sales, and events are canceled or postponed around the world. Many major textile manufacturing countries around the world have been affected, and the cancellation of orders has made it difficult for many companies to operate. . Survey data shows: The expected turnover in 2020 has dropped by 10.5% compared with 2019, and the actual results may be worse…
Domestic: Many textile companies are on holiday
At present, many orders from domestic factories have been cancelled, which first affects domestic sales and export orders of ready-made garments, and the impact is then transmitted Upstream printing and dyeing, fabrics, and then weaving, weaving feeds back to spinning, and the entire industrial chain is affected.
Data released by the National Bureau of Statistics show that the profits of the textile industry fell by 59.3% in the first two months of 2020. The China Chamber of Commerce for Import and Export of Textiles predicts that exports will fall by around 20% in the first quarter.
No matter whether orders are canceled or reduced, life for these companies is relatively difficult. Most of them are labor-intensive industries. Nowadays, reducing labor costs is a general trend. Many companies are trying to reduce operating costs. And the phenomenon of being forced to “take a vacation”. As for when the holiday will last, it may be two to three months or longer. It all depends on the effectiveness of global epidemic prevention and control and the degree of economic recovery.
“In this current situation, domestic brand companies have already taken a break and paid 50% of wages. Some companies even directly let employees take a three-month vacation.” Companies can insist on not laying off employees. , is already the company’s greatest effort.
Anhui Chizhou Jiangnan Industrial Concentration Zone mainly undertakes industrial transfers in Shengze, Jiangsu, Jiaxing, Zhejiang and northern Zhejiang. A staff member in the concentration area said that some companies in the park have stopped production, and some are planning to take a holiday in a few days. Many companies are “mom-and-pop shops” and are preparing to lay off workers. Most of the employees are from Anhui, Sichuan, Guizhou and other provinces.
Recently, holiday notices from textile companies have frequently appeared on the Internet. At least they will reduce production and take turns to take vacations, and at most they will be on vacation for 3-5 months:
Cambodia: 91 factories applied to suspend operations, affecting 61,500 workers
April 2 , the Ministry of Labor pointed out to reporters that due to reduced demand in the export market, a total of 91 factories have applied to suspend operations so far, affecting 61,500 workers.
Monica Jiang, deputy secretariat of the Garment Manufacturers Association of Cambodia (GMAC), said that foreign markets are facing difficulties due to the impact of the new coronavirus epidemic. At the same time, about 70% of Cambodia’s clothing products exported to the EU and US markets are also affected.
He said that most factories in Cambodia have applied to suspend operations because buyers from the European Union, the United States and Canada are also affected by the new crown pneumonia epidemic. “Buyers told us to suspend the supply of products and keep the produced products in the factories. Garment factories in Myanmar, Bangladesh, Vietnam, Indonesia, and Laos are also facing the same problem.”
The Garment Manufacturers Association of Cambodia (GMAC) calls on all buyers of textiles from Cambodia to work together to overcome the difficulties.
“All parties in the global apparel supply chain are feeling the heavy burden caused by COVID-19. However, factories operate on slim margins compared to our customers (buyers), and those who bear this burden The capacity is much weaker. The burden of survival faced by our workers is huge and important. We call on companies to abide by the terms of the procurement contract and fulfill your obligations by picking up the goods on time, and pay attention to the goods that have been produced and are currently being produced of goods. This will allow us to continue to provide jobs for our 750,000 workers and give us the ability to continue paying workers’ wages to ensure the livelihoods of millions of Cambodians.”
Bangladesh: 18.4 billion orders were canceled, affecting 1.96 million employees
Bangladesh clothing manufacturers The Exporters Association recently stated that up to 2.6 billion U.S. dollars of clothing orders have been forced to be canceled, involving 966 clothing factories, approximately 828 million pieces of clothing, and affecting up to 1.96 million employees. With the further development of the epidemic, this This situation will continue to worsen.
Bangladesh is the second largest clothing exporter in the world, second only to China. Currently, there are more than 4,600 clothing manufacturing factories in Bangladesh, employing 4.1 million people. It mainly receives orders from Europe, America, Australia and other regions. Data shows that Bangladesh’s total exports from 2018 to 2019 were US$40.5 billion, of which clothing accounted for 84.21%, and more than 60% of the clothing was exported to EU countries.
Vietnam: Half of textile companies may go bankrupt
Due to the coronavirus pandemic Due to the epidemic, many importers from the United States and the European Union have stopped orders for Vietnamese textile and apparel products for three to four weeks. Vietnamese textile and apparel companies are facing increasing difficulties, from shortages of raw materials to declining demand in some export markets, which It could put half of the industry out of business.
Than Duc Viet, general manager of Vietnam’s leading textile manufacturer, said the U.S. market accounts for 40% to 45% of the company’s exports, followed by the EU at 33% to 40%.
Many Vietnamese are very pessimistic about the development prospects in 2020. Because demand has decreased, many companies in Vietnam are even considering temporarily laying off some workers.
The expected turnover of the global textile industry in 2020 will drop by 10.5% year-on-year
From March 13 to 25, the International Textile Manufacturers Federation ITMF investigated the impact of COVID-19 on global textile value The conference was attended by 34 companies from around the world on the impact of the chain, especially on current orders and expected turnover in 2020.
Worldwide, orders are currently down 8%. The expected turnover for 2020 is down 10.5% compared to 2019.
The actual data may be even more pessimistic! Companies and national organizations that responded earlier between March 13 and 16 are not (yet) directly or indirectly affected.
Responses received later (from March 17) were negative in all regions. It can be assumed that after March 16, more and more governments in Europe and North America introduced new regulations restricting public and commercial life almost every day. With all these restrictions in place, “offline” consumption of textiles and apparel in retail stores, industry stores, retail stores, etc. has dropped significantly. This appears to be causing major brands and retailers to significantly cancel and/or postpone orders.
Suggestions for domestic textile enterprises
“This year is destined to be the most In an unusual year, how to survive tenaciously and hard is the biggest problem that needs to be faced at the moment.” Many textile companies think so. In such a severe situation, textile enterprises can pay attention to the following points to have hope of survival:
Pay attention to government industries Relevant support policies
In order to reduce the impact of the epidemic, the country has introduced a series of policy measures to promote the resumption of work and production of enterprises and reduce the burden of corporate financing, social security, taxes and fees. All regions have also When launching active support or exemption policies, companies should strengthen communication with local government functional departments, pay attention to relevant industry support policies, and rely on and make good use of these policies to tide over the epidemic difficulties.
Focus on key areas and seize market opportunities
Major epidemic events Triggering changes in people’s consumption concepts, textile and apparel companies must seize the opportunity of rising demand for sanitary textiles and sports and health-related products in the post-epidemic period, increase market share in fields such as industrial textiles and sports functional clothing, and make up for other textile Clothing sales and exports have declined.
Improve online transaction capabilities and expand sales channels
When offline consumption is restricted , it is expected that online business will see significant growth, which can offset part of the negative impact of the epidemic to a certain extent.
Pay attention to changes in overseas markets and respond to export risks
It is recommended that enterprises pay close attention to changes in overseas markets and actively Use the relevant businesses of insurance, guarantees, banks and other insurance financial institutions and other professional risk management institutions to protect your own interests. If a risk loss occurs without effective risk avoidance, the company must recover the loss as soon as possible through itself or relevant means according to the loss situation.
Continue to promote industrial reform and focus on long-term development
The epidemic has brought The impact is short-term. While companies are paying attention to immediate difficulties, they should also focus on long-term development. Strengthen the company’s own construction, further build its own brand, improve its research and development capabilities, develop new technologies and functional new products with core competitiveness, build market brands, and develop into the high-end market. </p