“Recently there is good news and bad news. The bad news is that we received a loss-making order. The good news is that the gray fabrics sold were in stock for nearly ten years. The thing is like this. One of our foreign trade customers sold 15 pieces of fabrics from the factory. Ten thousand meters of inventory was sold to his customers, and the key to successfully selling inventory that was almost forgotten was the regular price, not the disposal price.” said a textile boss who specializes in imitation silk.
It is understood that the inventory that the textile boss said has been stored for ten years is satin chiffon, which should be considered the current seasonal fabric. Although these gray fabrics are old, their cost is not low. It is said that according to the then The raw material prices were sold at a loss of 2 cents per meter, but fortunately, the current raw material prices were enough to break even the capital.
So, did the textile boss make a profit or a loss?
It’s a loss even if you say it’s a loss, and it’s really not a loss even if you say it’s not a loss.
If we look at the cost side, the textile boss will definitely be losing money. After all, where the raw material prices were in the past, the cost of these inventories is still high. But according to the actual situation of the current market, this is definitely a good thing. At a time when orders are urgent and epidemics are recurring, it is amazing to be able to receive orders, and selling this order at the current raw material prices will not make a loss. , compared with the orders that are still being sold at a loss in the current market, being able to maintain capital is already very good.
Moreover, textile bosses who have stored inventory for nearly ten years have actually long since lost hope in these gray fabrics. Which weaving manufacturer currently has hundreds of thousands of meters of inventory of gray fabrics that have been forgotten for some years in the warehouse, and can now be sold? For the boss, it is like a “pie in the sky” thing. Even if it loses money, it is something to be thankful for.
So in the end, although there was a loss on the cost side, the textile boss did not lose money in a sense, and he also received a windfall. Not only can the inventory be cleared, but it can also be sold at a guaranteed cost.
However, don’t think that the inventory in your warehouse can also be sold at regular prices just because the textile boss has stored it for so long. Such things are still in the minority, and fabrics are constantly moving with the market. As for replacement and replacement, inventory has always been a long-standing problem in the textile market, which seems to be difficult to solve.
Inventory, how to prevent it!
Inventory backlogs have always been a worry for textile bosses even before the epidemic. Not to mention the drop in demand and sharp drop in orders due to the epidemic. They are reluctant to shut down factories and go out to produce inventories in vain. Let the inventory in the warehouse accumulate.
According to the inventory days of sample companies monitored by Silkdu.com, inventory has been at a high level in the past three years. The current inventory days are around 34.2 days. Although it has decreased compared with the previous two years, compared with the curve trend during peak seasons in previous years, this year The peak season only increases! Assuming that the market situation continues like this, inventories will continue to rise.
How to fundamentally solve the problem? Perhaps only by reducing production capacity and stopping production of inventory can the inventory be completely controlled. However, with the lessons learned in the past few years, many textile bosses have begun to appropriately reduce the operating rate and reduce the production of inventory.
Generally speaking, inventory has advantages and disadvantages. It is very advantageous to have some urgent orders when there is stock, and the textile boss can set the price himself. However, once the inventory is too much, it will only increase the pressure on the shoulders of the textile boss. After all, the market It operates in a constant state of renewal, and no piece of fabric will always be hot-selling.
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