After winter comes to Dongguan, a slight chill hits. The export of the clothing industry has a hint of warmth.
Recently, the Dongguan Textile and Garment Industry Association disclosed data for the first three quarters of this year on its official Weibo. According to customs statistics, Dongguan’s exports of clothing (clothing and clothing accessories, the same below) from January to September this year totaled 27.06 billion yuan, of which private enterprises China’s export share reached more than half, reaching 54.9%, exceeding the export proportion of foreign-funded enterprises.
The total amount exceeded 27 billion yuan, and private enterprises accounted for 54.9% of the export volume, exceeding the proportion of exports by foreign-funded enterprises
In the face of the growth data of clothing exports, Bai Yun, secretary-general of Dongguan Textile and Garment Industry Association, reminded that trade barriers and labor costs are still one of the main constraints on Dongguan’s clothing industry.
Exports increased by 2.9% in the first three quarters
According to statistics from the customs department, Dongguan City exported 27.06 billion yuan in clothing (clothing and clothing accessories, the same below) from January to September this year, an increase of 2.9% over the same period last year (the same below). The data for the first three quarters generally showed a red trend. However, affected by the general environment, exports in September were 3.34 billion yuan, a year-on-year decrease of 14.8%.
Among them, general trade exports account for more than 60%. In the first three quarters, Dongguan exported 16.8 billion yuan of clothing in the form of general trade, an increase of 7.5%, accounting for 62.1% of Guangdong Province’s total exports of clothing in the same period (the same below); processing trade exports were 10.14 billion yuan, a decrease of 4.1%, accounting for 37.5%. Exports under special customs supervision amounted to 120 million yuan, an increase of 41.8%, accounting for 0.4%.
In terms of data on export regions, exports to the EU, the United States and Hong Kong are mainly concentrated, with the three markets accounting for a total of 73%. Specifically, in the first three quarters, Dongguan City exported 7.17 billion yuan of clothing to the EU, an increase of 22.7%; exported 6.39 billion yuan to the United States, a decrease of 1.7%; and exported 6.2 billion yuan of clothing to Hong Kong, an increase of 5.1%.
Regarding the data of the three major export markets, Bai Yun, secretary-general of the Dongguan Textile and Garment Industry Association, believes that among the market share of clothing exports to Europe and the United States from January to September this year, the main reason for the decline in exports to the U.S. market is still affected by trade barriers and the U.S. economic downturn. The influence of factors such as the general environment.
The export growth rate of private enterprises is close to 8%
Dongguan’s economy is known as the representative of the “export-oriented economy” due to its heavy reliance on foreign-invested enterprises. In the structure of garment export companies in the first three quarters of this year, subtle changes are taking place in the data.
According to data disclosed by the Dongguan Textile and Garment Industry Association, Dongguan private enterprises exported 14.86 billion yuan in clothing in the first three quarters, an increase of 7.9% compared with the same period last year, accounting for 54.9%. The total export volume of foreign-invested enterprises was 11.92 billion yuan, a decrease of 2.3%, accounting for 44.1%.
“This change is caused by many reasons.” Baiyun said that the proportion of private enterprises in total clothing exports exceeds that of foreign-funded enterprises. To a certain extent, it is due to Dongguan’s years of industrial transformation and upgrading, as well as “machine substitution”, industrial automation, etc. Promoted by positive factors.
Baiyun believes that the current garment industry still faces a variety of challenges, and the adverse effects of labor costs and the decline of land dividends will continue to exist. Fortunately, Dongguan’s clothing companies and government departments are making positive changes. Measures such as “machine substitution” and “formulation of Dongguan clothing standards” will have a profound impact on Dongguan’s clothing industry.
Industry Observation: Inventory crisis embarrasses apparel companies
According to Baiyun and many people in the clothing industry, production and operation costs, trade barriers, inventory and other factors have always troubled Dongguan clothing companies in recent years.
According to the “2013 Pearl River Delta Manufacturing Salary Report” released by Zhitong Talent last year, the overall salary increase rate of Pearl River Delta manufacturing companies in 2013 was 11.9%. Professional and technical personnel and front-line service personnel had the highest salary increase rate, and Dongguan had the highest salary increase.
Analysts believe that the biggest problem faced by the labor-intensive garment industry and the processing manufacturing industry is the continued rise in labor costs and rising raw material prices. The superimposed effect of these factors has greatly increased the operating costs of enterprises, putting great pressure on processing trade enterprises that already have small profit margins.
At the same time, the operating pressure on clothing companies also comes from inventory, which affects the decline in profits. Analysts believe that the inventory crisis in the apparel industry lasted from 2012 to 2014, and 2013 was dubbed the “most difficult year in history” for the textile and apparel industry. As of September 22, among the 43 listed companies in the textile and apparel industry that have announced performance forecasts for the first three quarters, the total net profit limit is 4.215 billion yuan, only 4 companies have forecast increases, and 6 companies are expected to suffer losses.
Dongguan’s garment enterprises are also facing the impact of external factors such as trade barriers when exporting. In recent years, technical regulations in export markets have been continuously upgraded, resulting in increasing technical cost pressure on enterprises. Following the implementation of the world’s most authoritative and widely influential ecological textile standard (REACH), the European Union has recently updated the content of the Biocide Regulation (BPR) and expanded the scope of biocides. Analysts believe that this regulation will affect the export of 10 categories of products such as textiles, shoes and clothing, with an export value of approximately US$2 billion.
What cannot be ignored is the rise of labor-intensive manufacturing in Southeast Asia and other regions. Cambodia, BangladeshThe cheap labor force in countries such as Latin America and Vietnam and the tariff advantages of exporting to European and American markets are narrowing the gap with Dongguan in design, technology, marketing, etc. These countries and regions are bringing fierce competition to Dongguan’s garment industry.
