In order to fully understand the impact of the COVID-19 epidemic on the production and operation of garment enterprises in our province and the progress of their resumption of work and production, the Guangdong Garment and Apparel Industry Association, together with the Guangdong Fashion Designers Association and the Guangdong Fashion Industry Economic Research Institute, held a joint meeting in February From the 28th to March 4th, industry research was carried out through questionnaire surveys, on-site visits, telephone and WeChat communications, and the “Cloud Forum” of the Guangdong Garment Conference. The situation is now summarized and analyzed as follows:
As of March 4, the association has received a total of valid questionnaires from 273 companies, 8 industrial clusters and 6 professional clothing markets, of which companies above designated size account for all the feedback companies 71.3% of the total, production companies and brand companies accounted for 49.3% and 50.7% respectively, domestic sales companies and export companies accounted for 68.5% and 31.5% respectively.
Resumption of production and operations
As the impact of the epidemic gradually deepens , while Guangdong’s garment industry is experiencing a huge impact, it has begun to think about the comprehensive recovery of the industry after the epidemic and the long-term plan for industry development. Recently, various parts of the province have started to resume work in phases and in batches. Among the companies participating in the survey, 68.5% have gradually resumed work, and the number of workers who have returned to work accounts for 37.8% of the number of workers under normal production conditions. In addition, 31.5% of companies are waiting for approval to resume work and recruiting workers due to government restrictions on avoiding epidemic risks. Most companies are expected to fully resume work in mid-to-late March, and about 10% of companies predict that they will not be able to fully resume work until April.
The garment industry generally reflects that in the process of resuming work, it is faced with many difficulties and urgent needs such as unsynchronized resumption of work by upstream and downstream enterprises in the supply chain, reduced orders, obstacles to workers returning to work, poor transportation and logistics, and lack of protective resources. Solved puzzle.
1. From the perspective of enterprise size, the proportion of large and medium-sized enterprises resuming work is significantly higher than that of small enterprises. The resumption rate of large and medium-sized enterprises reached 87.5% and 85.7% respectively, while the resumption rate of small enterprises was only 56.8%.
2. From the perspective of enterprise types, the resumption of work of production enterprises is generally better than that of brand enterprises. 77.8% of manufacturing companies have resumed work, and the resumption rate is 21.1 percentage points higher than that of branded companies. Some companies have only resumed work for their management or in the form of online offices, and the production workshops have not yet resumed work. At the same time, due to the backlog of inventory in the warm winter, brand companies have increased their online retail efforts and increased operating income through WeChat, social marketing and other methods to offset the negative impact caused by the basic stagnation of offline sales.
3. From the perspective of sales channels, the resumption ratio of domestic sales companies and export companies is close, 66.0% and 69.6% respectively, with about 30% Enterprises have not resumed operations due to various factors.
4. From the perspective of the proportion of the number of workers who have returned to work, 35.8% of the companies have returned to work accounting for 70% or more of the normal number of workers, and 22.2% of the companies have returned to work. The number of workers who have returned to work accounts for 50% to 70% of the normal number of workers, 31.1% of the companies have the number of workers who have returned to work accounting for 20% to 50% of the normal number of workers, and 11.1% of the companies have the proportion of workers who have returned to work less than 20%. With the epidemic under effective control, some companies, with the support of the government, have brought back workers from other provinces to work through chartered cars, chartered flights, bonus subsidies, etc., and actively resumed production. Among them, the proportion of brand companies with a return to work ratio of 70% or above is 13.7 percentage points higher than that of production companies.
5. Judging from the resumption of work of industrial clusters, the 8 industrial clusters participating in the survey have begun to gradually resume work, with an average resumption rate of about 70%. The resumption of work of enterprises above designated size is relatively good. The government where the cluster is located actively assists enterprises in preparing for resumption of production, builds confidence in industry development, and assists in purchasing protective equipment. Production-oriented industrial clusters responded to delays in resuming work due to the delay in the professional market. By then, the cluster production companies would have no orders and would not be able to resume production under protective conditions. Therefore, we hope to promote the timely exchange of information between the upstream and downstream of the industrial chain, promote the interaction between cluster production companies and the professional market, and help Enterprises receive help in promoting production and promotion.
6. Judging from the resumption of work in professional markets, 5 of the 7 representative professional markets participating in the survey have resumed work, including Baima Clothing Market, Hongmian International Fashion City, and Guangzhou Textile Exchange. Park, Xintang Clothing Trade City, New China Building, and the Zhongda Cloth Market led by Guangzhou International Textile City have not yet resumed operations. Thirteenth Bank, Meiyi City, and Hongmantian Clothing Wholesale Market are also waiting for government notification. Xintang Clothing Trade City, which features e-commerce sales, took the lead in resuming work on February 20. The resumption of work in the professional market is of particular significance to the recovery of the entire industry and is the most important first step in the resumption of production in the garment industry. At present, companies and designers are eagerly looking forward to the opening of the Zhongda Cloth Market. Fabric accessories are in the upper reaches of the industrial chain. The lack of raw materials directly affects designers’ design of products, and clothing companies are unable to resume production.
Guangzhou Hongmian International Fashion City opens.
Guangzhou Baima Clothing Market is open.
7. Some clothing companies have switched to producing anti-epidemic materials. After the outbreak, Guangdong clothing companies responded quickly to the government’s call, including Florence, Transit Lai, Evo Clothing companies such as , Binbao, etc., relying on the advantages of their original clothing production equipment, have switched to producing masks, protective clothing and other epidemic prevention materials to promptly solve the urgent needs of the front line of the epidemic.
Enterprises are currently resuming work. Main problems faced
The survey results show that expanding product sales is the issue that clothing companies are most concerned about and urgently need to solve. Clothing products have seasonal characteristics, and the warm winter in 2019 has caused a large number of Winter clothing stocks are unsaleable, and the impact of the epidemic has led to a backlog of spring stocks. Delays in resuming work and production will continue to affect summer sales, and companies are under great pressure on liquidity. Companies hope that the government and associations can integrate resources to launch online and offline consumption promotion activities to help companies use multiple channels Expand sales at low cost.
1. Poor supply and sales, inventory backlog, and tight funds. 71.2% of the surveyed companies reported that upstream and downstream companies in the industry chain are currently starting operations Out-of-synchrony has resulted in insufficient supply of raw materials and auxiliary materials and poor sales channels; although transportation and logistics have improved, 45.2% of the surveyed companies still reported that the supply chain was blocked due to inter-provincial and cross-regional transportation and logistics barriers; 54.8% of the surveyed companies This reflects the inventory backlog and tight liquidity problems caused by stagnant sales in offline physical stores and delayed orders and defaults.
2. Market demand is sluggish, orders are decreasing, and the situation is grim. The survey results show that overall 34.2% of companies reported that orders have decreased due to factors such as market closures, sluggish demand, canceled orders or reduced order quantities due to the epidemic. Among them, export-oriented companies have a greater impact, with 65.2% of export companies reporting that exports Orders are down.
3. Online sales are currently an important step in promoting the resumption of production, but many small, medium and micro enterprises lack e-commerce experience. Brand companies with existing e-commerce channels have made up for the lack of offline sales by expanding online channels. For example, Yinman has achieved 65,000 customers in a single day through new retail. However, small, medium and micro enterprises in professional markets such as Baima generally report that it is difficult to adapt to the online sales model in a short time because they do not have e-commerce professionals and operational experience before and are worried about operating costs. They hope that the industry can provide a series of targeted solutions. Services empower enterprises and help them quickly enter the online market at low cost.
4. The shortage of workers and the difficulty in purchasing protective equipment are still the two major problems facing the resumption of industrial work. The survey results showed that 67.1% of the surveyed companies reported labor shortages and difficulties for workers to return to work. 54.8% of the surveyed companies reported that there are problems such as difficulties in purchasing epidemic prevention supplies and a lack of professional guidance. In particular, the pressure of epidemic prevention and control has become increasingly prominent after the resumption of work.
5. Enterprises that switch to producing anti-epidemic materials are concerned about the implementation of government policies. The government has formulated a series of subsidy policies for the technical transformation, equipment purchase, and loans required for the production of anti-epidemic materials. Enterprises hope to promote implementation as soon as possible and are concerned about issues such as national procurement and storage after the epidemic is over.
Some suggestions on promoting the recovery of the clothing industry
First, further take effective measures to promote the supply and marketing of the industrial chain smooth. Currently, enterprises in the industry are still facing problems such as worker shortages, poor supply and sales in the industrial chain, weakening consumer demand, and reduced orders. While effectively preventing the epidemic, clothing brands and large enterprises must strengthen cooperation with labor exporters, suppliers, and purchasers. And communicate with supporting enterprises in the industrial chain to seek win-win cooperation and practical solutions. Small, medium and micro enterprises must pay close attention to the progress of the epidemic, actively formulate response plans to the impact of the epidemic based on their own actual conditions, revise production plans, strengthen risk awareness, and effectively control and manage cash flow. It is hoped that the government will promote the orderly resumption of work in fabric and accessories shopping malls as soon as conditions permit, so as to bring the industrial chain back to normal order as soon as possible.
Second, expanding sales and vigorously developing fashion consumption are currently important ways to promote the recovery of the clothing industry. Under the influence of the epidemic, consumer lifestyles and consumption patterns have undergone tremendous changes, and offline store sales have stagnated. Enterprises should actively deploy new online retail and promote online marketing through live video broadcasts, mini-program e-commerce, community marketing, etc. The backlog of inventory has truly formed a new pattern of online and offline integrated development. Online sales will become normalized and become a trend. We should provide support to small and micro enterprises without e-commerce experience and help them develop the online market at low cost and in a short time.
Third, strengthen confidence in the development of the industry and actively adapt to the general trend of the new round of industrial revolution. While the epidemic has disrupted the normal rhythm and order of the industry, it has also given the apparel industry huge space for strategic development. In my country’s new round of “re-industrialization” process, the application of new technologies such as the Internet, big data, Internet of Things, artificial intelligence, and 5G communications will bring about new channel changes, with personalization, fashion, branding, and intelligence. The new round of textile and apparel industry will face another development opportunity. The COVID-19 epidemic has accelerated market changes. Enterprises and brands must actively adapt to the general trend of the new round of industrial revolution. How to reshape new development advantages, enhance core competitiveness, and formulate a digital strategy that is in line with the actual situation of the enterprise from the four dimensions of industrial chain, supply chain, capital chain, and service chain will be an important issue for enterprises to rethink when resuming work and business. question.
In the process, the application of new technologies such as the Internet, big data, Internet of Things, artificial intelligence, and 5G communications will bring about new channel changes and a new round of textile and apparel industry oriented toward personalization, fashion, branding, and intelligence. We will face another development opportunity. The COVID-19 epidemic has accelerated market changes. Enterprises and brands must actively adapt to the general trend of the new round of industrial revolution. How to reshape new development advantages, enhance core competitiveness, and formulate a digital strategy that is in line with the actual situation of the enterprise from the four dimensions of industrial chain, supply chain, capital chain, and service chain will be an important issue for enterprises to rethink when resuming work and business. question. </p
