In recent years, it has become a phenomenon for many textile companies to set up factories in China and move to Southeast Asia. China’s manufacturing industry, originally known as the “world’s factory”, has been affected by multiple unfavorable factors such as rising costs of raw materials and wages in recent years, as well as the appreciation of the RMB. The outflow of non-state-owned manufacturing industries has become a trend. Among them, Southeast Asia has relied on cheap labor costs Gain the favor of investors. Some people even predict that Southeast Asia will take away a large number of textile orders from China. However, to this day, how much impact has Southeast Asia brought to China? Especially this year, this phenomenon seems to be changing!
Vietnam’s textile and clothing exportsincreased sharply, but there is still86%!
As far as we know , Vietnam’s textile and garment industry has gradually improved since the second quarter of 2017. It is estimated that Vietnam’s total foreign trade exports in 2017will be 310billion US dollars, of which textiles and clothing accounted for 259.1billion US dollars.
Quoting Vietnamese official sources, Vietnam’s textile and clothing exports are expected to grow by 10% this year compared with the same period last year, and 2018 will It will maintain a rapid growth momentum, with exports expected to reach 335-340billion US dollars. It is understood that many Vietnamese textile and apparel companies have signed large export orders for the first half of next year, and buyers are very confident in the product quality and delivery capabilities of Vietnamese companies. In addition to stabilizing traditional markets such as the United States, the European Union, Japan and South Korea, Vietnamese local companies have also developed emerging export markets such as China, Russia and Cambodia.
But on the other hand, currently , China, Bangladesh, Sri Lanka, Myanmar and Cambodia have formed price competition with Vietnam, but local Vietnamese companies lag far behind in terms of product supply and high-skilled workers, investment in new technologies, and automation processes. According toVISTA‘s analysis, Vietnamese local enterprises must speed up86%of cloth production For clothing, domestically produced cloth cannot meet the requirements of foreign buyers, and there are various taxes and fees, while imported cloth is tax-free for processing and export. In addition, labor costs in Vietnam’s textile and garment industry continue to rise. Adding up various expenses, the total cost reaches 2.5 of other regions. times.
Comments: Therefore, the current situation of Vietnam’s textile market is that there are orders for clothing, but fabrics There is a big gap in the gray fabric! At present, gray fabrics have to be imported from neighboring countries such as China.
The market demand in the United States and Europe is stagnant! The focus of Indonesia’s textile and apparel exports is gradually shifting to Asia
According to official statistics, from January to October 2017, Benefiting from the surge in demand in Asian markets such as Japan, South Korea and China, Indonesia’s clothing exports have rebounded, but demand in the US and EU markets has stagnated.
According to statistics, In October 10, Indonesia Textile and apparel exports increased by 15.1% year-on-year, respectively 8月和9month has grown18.3%and3.8%. In January-10, Indonesia’s cumulative exports of textiles and clothing (in U.S. dollars) increased year-on-year 5.5%, compared with a 4.4% drop in the same period last year “>. The main reason for the increase in Indonesia’s textile and apparel exports is due to the sharp increase in labor costs.��Relatively fast, export growth ranks first >. In the third quarter, my country’s exports to ASEAN increased 10.7%year-on-year, since 2015has achieved double-digit growth again since the first quarter of 2015. The structure of export commodities has gradually returned to normal, with exports of fabrics and yarns increasing and clothing declining. According to statistics 1month~In September, the total exports of textiles and clothing to ASEAN were 248.8 US$100 million, an increase of 2.1%, of which fabric and yarn exports increased respectively5.2%and 11.6%, clothing declined 4%.
The labor cost cannot match the delivery time, and the market attracts orders to return
Different from the widespread news of the outflow of orders from China’s manufacturing industry in the past few years, some foreign brands and even Southeast Asian countries have discovered the risks of China’s manufacturing industry“Okay”. According to Nikkei Chinese website, Japan’s UNIQLO’s brother brand GU will place additional orders for clothing production in China. Although GUCurrently places most of its production operations in emerging market countries with lower wages, in the future it will be closer to consumption locations Japan’s China will carry out additional production and build a system that can put the product on the market in 30days. Although Japanese clothing companies have been promoting “de-Chinaization” in production, side effects such as extended delivery times and excess inventory caused by production in other countries are becoming increasingly obvious.
Some calculations show that China’s labor costs are those of Vietnam2times, Bangladesh’s 4 times. But for GU, the time from placing an order to the goods being put on the shelves is fasterin China than in Southeast Asia. 1~2weeks, it is obviously more important to avoid product outages in peak seasons and increase sales. This can also reduce the number of price reductions due to excessive inventory. situation.
Returning to calm after the outflow boom, China’s manufacturing industry has advantages
Although there are absolute limitations to investing in the textile and garment industry in Southeast Asia and other regions Labor cost advantage, but while enjoying the dividends of Southeast Asian workers, we also have to bear the risks of worker management!
From the local political situation in recent years Instability, incomplete industrial chains, limited ability to undertake large-scale textile equipment, low labor productivity, and cultural differences often lead to frequent investment risks. Some textile companies that have migrated to Southeast Asia have thus led to reduced investment efficiency or even investment failure.
In recent years, as Vietnamese workers The gradual reduction of dividends, coupled with the management risks caused by cultural differences, and China’s manufacturing industry also has many unique advantages, such as mature e-commerce industry advantages, complete industrial chain advantages, industrial agglomeration advantages, scale advantages and Policy advantages, etc., are attracting companies to return.
In addition, China’s textile industry has a long-term The industrial advantages formed allow us to respond faster to meet customer needs. Previously, many manufacturing orders flowed from China to Southeast Asian countries, such as Bangladesh and Cambodia, which are rich in labor resources. However, as the outflow boom returns to calm, many companies have discovered that there are many problems in the local manufacturing industry, such as obvious deficiencies in completing orders with tight delivery times or orders with high labor complexity. “What comes and goes”, although some low-end manufacturing orders are flowing out of China, the added value of China’s manufacturing industry is constantly increasing.
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