Since this year, foreign trade textile enterprises face grim situation of textile and clothing export, such as decreasing export orders and less demands on market purchases. In order to cope with export crisis, more and more enterprises begin to adopt different methods of adjusting product mix.
An insider said, “I feel that, currently, the recovery of global markets is not obvious. Although the export of our company has not changed much, the export volume slightly decreases and we raise the prices due to the increasing labor cost.” Although the situation of textiles and clothing export is not optimistic, he is still confident of the future situation. He said, “There are three reasons why I am confident of our future situation. The first reason is the devaluation of RMB, the second reason is the increasing of export rebate rate and the third reason is our nation’s national preferential policies on exports. These aspects bring competitive advantages to enterprises, but export situation requires some time to turn better.”
Another insider expressed during media interview, “Currently, we have greatly adjusted the ratio of medium and high-end products and have decreased high-end products. We do so, just hoping to receive more orders. In the past, we mainly focused on high-end products, but now pay more attention to the output balance of medium-end products and high-end products. Now our medium-end products account for 70% of total products, while high-end products only 30% of total products. But previously, the high-end products took up nearly 70% of all products. The reason why we make such a decision is that the orders of high-end products are relatively small, but we have to ensure that the sales amount reaches one million dollars to cover the expenses of factories. So we would rather receive substantial but relatively inexpensive orders. The labor efficiency can also be improved by fewer varieties but larger output of products, thus reducing the operating cost. Another reason is that global economy is not quite good and the demands on high-end products become fewer.”
Instead, under this circumstance, some enterprises of manufacturing fabrics, like cotton knitting fabrics and polyester knitting fabrics, give up the sales of low-end products, but greatly increase medium-end and high-end products. They think, during global economic downturn, although consumers prefer to buy inexpensive products, they still have to adjust product mix, because some competitors provide so lowly pricing product. So in case of being knocked out of the market, they adopt different strategies, and such strategies are now good for their development.
