Although most textile machinery companies have continued the production trend of order-fire in 2010, the rising production costs at the moment have squeezed the profit space of textile machinery companies, and have also caused the textile companies' "happiness" to shrink dramatically. Many companies have reported that the continuous rise in raw material prices and labor costs has brought a lot of challenges and troubles to companies. The dramatic increase in the cost of raw materials, wages, and other factors of production has actually created a development problem for the textile machinery industry. Many business executives believe that the past large and thin production methods have reached a complete change.
Current situation - frequent fluctuations in raw material prices The frequent fluctuations in the prices of steel raw materials in recent months have caused headaches for many textile machinery companies. Mr. Chen from a textile machinery manufacturing company in Jiangsu told reporters that the increase in steel prices is not terrible. As long as the price can be stabilized for a period of time, the company’s production can still be expected, and the big product will increase accordingly. Customers can understand it. However, prices changed back and forth. Someone took the opportunity to stockpile raw materials and sell low prices, causing artificial tension. Since the product has a certain period of production, this fluctuation cannot be reflected in the price of the product. Enterprises can only digest it themselves, which intangibly increases the difficulty of the company's operation.
It is generally believed that the production cost element consists of raw materials, wages, and depreciation of fixed assets. On the basis that raw materials continued to rise last year, the labor shortage after the Spring Festival gave rise to a sufficient and necessary reason for rising wages. The rise in raw materials and wages further squeezed the already meager profits of the industry. This is somewhat helpless.
Li Chenghua, deputy general manager of Jiangsu Tonghe Textile Machinery Company, told reporters that the price of Baosteel's 45# roller steel was RMB 6,118/ton in January this year, and the price rose to RMB 6,767/ton after entering March, and the increase rate exceeded 10%. . “But this is not the most worrying thing,†said Li Chenghua, reluctantly. “The recent media coverage of employment shortages has increased job-seekers’ confidence and bargaining chips. Companies have to improve after the Spring Festival to retain workers. Workers' wages."
Yang Chongming, chairman of Chongqing Golden Cat Textile Equipment Co., Ltd., also expressed similar views: “Now the cost of labor increases too fast. The recent increase in wages for employees has reached 15% to 20%, even though the liquidity of workers is still very high. The increase in salaries for skilled workers and skilled workers is also not possible, and new workers are not able to immediately take over positions. The increase in the mobility of workers has not only affected the stability of product quality, but also prevented many production tasks from being carried out properly. ."
Indeed, in the past, the textile industry has made full use of the low value of the domestic labor force, and the products have a large price competitive advantage in both export and domestic markets. If the cost factors of raw materials, employment, etc. continue to rise, the greatest advantage of the cost-effectiveness of domestic textile machinery equipment will probably disappear. At the same time, the Fourth Session of the Eleventh National People’s Congress that has been held has already conveyed information that the per capita income of residents will continue to increase in the coming years. Everyone understands that increasing the wage rate and increasing the proportion of labor income in the distribution of national income are destined to become a reality.
Predicament - SME funding constraints Under the background of increasing inflation expectations and increasing production costs, the textile machinery industry has encountered real trouble. Some small and medium-sized manufacturing enterprises have even begun to worry about their own fate. These concerns are not worrying.
“Employment is not the issue that we are most concerned about.†The person in charge of a small and medium-sized equipment company in Jiangsu, who declined to be named, told reporters, “What we are most concerned about is how companies survive and how to survive. The central bank has repeatedly raised the reserve ratio. Banks are tightening and our loans are difficult.†Indeed, for small and medium-sized enterprises, the interest in bank lending is not high at all. Coupled with the implementation of macro tightening policies, business pressure is now even greater. However, these companies seem to be accustomed to relying on themselves. They are basically looking for relatives and friends to borrow. Mr. Zhang himself has a bank deposit of nearly one million yuan, which was originally stored on a regular basis. However, taking into account the need for funds at the beginning of production, he took it out temporarily and paid his own money to the company’s account.
The rapid increase of raw materials, wages, and other factors of production has caused textile machinery companies to fail to understand. At the same time, downstream textile companies are also experiencing the severe test of rising raw materials and labor costs, which is bound to reduce the purchase of textile machinery and equipment. Previous marketing strategies of puerile have encountered new challenges.
Some textile companies in Hebei have only enough inventory for cotton production for one month. Compared with before the Spring Festival, cotton prices have risen not only, but also the number of cotton has decreased significantly.
According to a research report released by the Cotton Research Institute of the Chinese Academy of Agricultural Sciences on March 4, the cotton planting area is expected to show modest growth in 2011, but the percentage increase will not exceed double digits; High cotton prices, credit contraction and rising costs have combined effects. It is expected that a batch of cotton spinning enterprises will cease production or close down in 2011.
Relevant persons estimate that under the weight of cost, the scale of investment in technological transformation funds in the textile industry may be reduced compared to last year. In addition to the pressure of survival for some small and medium-sized enterprises, the unprecedented good days of the textile machinery industry in 2010 may no longer continue.
Problem-solving - do a good job in improving products Faced with labor shortages, rising raw material prices, rising CPI and many other external factors, how will textile machinery companies respond, and how can they live happily?
Yang Chongming told reporters that companies want to make money, nothing more than two ways, first, to improve product efficiency, and second, to strengthen cost control, both companies will certainly survive better. The answer seems to be very simple, but it is much more troublesome to do. For business-oriented companies, corporate products have high gross margins, and even with modest scale, earnings can maintain a high level; for cost-control companies, the savings of these companies is surprising. Others spend 7 yuan to rent a square meter of factory buildings, they will spend 3 yuan to rent a square meter; other factories have to have a few managers, they may be a general manager on the full; and workers' wages are also relatively low , Retaining workers basically rely on ideological work...
However, the cost-saving companies save their prescriptions, and by 2011, it seems that they are not very useful.
Yang Chongming said that it is indeed possible to reduce production costs by strengthening management and starting from the finest points. However, these measures were used as early as the financial crisis. Considering the savings, there is not much room for profit improvement. Therefore, strengthening cost control does not have much effect.
“However, at present, companies should take the road of improving product efficiency and increase the added value of products. It should still be feasible. Everyone is aware of the cost of major road freight, so it is difficult to increase product prices and make product profits thin, even not to make money. New products are not the same, and sometimes it is difficult for customers to know how much their costs are, so manufacturers can earn higher profits. Only by doing high-end products, will they always occupy and lead the market.†Yang Chongming said.
It is time to change the product structure and improve product quality. However, research and development of new products also require investment. When cost pressures and surviving pressures strike, how many companies can persist in persisting?
When talking about how companies can solve cost problems, Li Chenghua said: “The prices of raw materials and labor, especially labor prices, have risen since then, and the possibility of a decline is not great. It may become a normal form of development in the future. Tonghe Company slightly raised the price of finished products, somewhat eased the pressure brought about by rising production factors."
Compared with some small and medium-sized equipment companies, Meng Tian, ​​deputy general manager of Hengtian Heavy Industry Group, appears to be optimistic. In his view, although the raw materials are still rising, he believes that in the future, the country’s macroeconomic policies will generally be based on stimulus. Under cost pressure, the company will make more efforts in the creation of products on the basis of reasonable price increase to increase profit margins. He pointed out that at present, the company has adopted mechanisms such as strengthening tracking and cost accounting for major projects, strengthening the risk prevention of corporate operations, and further tapping the potential of the company's savings by reducing the scrap rate and competitive bidding for projects.
It is not difficult to see from the history of foreign textile development that with the continuous advancement of urbanization, the rising cost of raw materials and labor is an irreversible trend. The only thing that we are grateful for is that although some emerging textile countries such as Pakistan and Vietnam have seized a lot of markets in the textile and apparel production sector, these countries have not yet formed a real impact on the Chinese textile machinery manufacturing industry in the textile machinery production sector. If domestic textile machinery manufacturing enterprises can actively face the reality of the rising cost factor, it will be a good thing to adjust the product structure of the company as soon as possible and smoothly realize the upgrade and transformation of the company.
Current situation - frequent fluctuations in raw material prices The frequent fluctuations in the prices of steel raw materials in recent months have caused headaches for many textile machinery companies. Mr. Chen from a textile machinery manufacturing company in Jiangsu told reporters that the increase in steel prices is not terrible. As long as the price can be stabilized for a period of time, the company’s production can still be expected, and the big product will increase accordingly. Customers can understand it. However, prices changed back and forth. Someone took the opportunity to stockpile raw materials and sell low prices, causing artificial tension. Since the product has a certain period of production, this fluctuation cannot be reflected in the price of the product. Enterprises can only digest it themselves, which intangibly increases the difficulty of the company's operation.
It is generally believed that the production cost element consists of raw materials, wages, and depreciation of fixed assets. On the basis that raw materials continued to rise last year, the labor shortage after the Spring Festival gave rise to a sufficient and necessary reason for rising wages. The rise in raw materials and wages further squeezed the already meager profits of the industry. This is somewhat helpless.
Li Chenghua, deputy general manager of Jiangsu Tonghe Textile Machinery Company, told reporters that the price of Baosteel's 45# roller steel was RMB 6,118/ton in January this year, and the price rose to RMB 6,767/ton after entering March, and the increase rate exceeded 10%. . “But this is not the most worrying thing,†said Li Chenghua, reluctantly. “The recent media coverage of employment shortages has increased job-seekers’ confidence and bargaining chips. Companies have to improve after the Spring Festival to retain workers. Workers' wages."
Yang Chongming, chairman of Chongqing Golden Cat Textile Equipment Co., Ltd., also expressed similar views: “Now the cost of labor increases too fast. The recent increase in wages for employees has reached 15% to 20%, even though the liquidity of workers is still very high. The increase in salaries for skilled workers and skilled workers is also not possible, and new workers are not able to immediately take over positions. The increase in the mobility of workers has not only affected the stability of product quality, but also prevented many production tasks from being carried out properly. ."
Indeed, in the past, the textile industry has made full use of the low value of the domestic labor force, and the products have a large price competitive advantage in both export and domestic markets. If the cost factors of raw materials, employment, etc. continue to rise, the greatest advantage of the cost-effectiveness of domestic textile machinery equipment will probably disappear. At the same time, the Fourth Session of the Eleventh National People’s Congress that has been held has already conveyed information that the per capita income of residents will continue to increase in the coming years. Everyone understands that increasing the wage rate and increasing the proportion of labor income in the distribution of national income are destined to become a reality.
Predicament - SME funding constraints Under the background of increasing inflation expectations and increasing production costs, the textile machinery industry has encountered real trouble. Some small and medium-sized manufacturing enterprises have even begun to worry about their own fate. These concerns are not worrying.
“Employment is not the issue that we are most concerned about.†The person in charge of a small and medium-sized equipment company in Jiangsu, who declined to be named, told reporters, “What we are most concerned about is how companies survive and how to survive. The central bank has repeatedly raised the reserve ratio. Banks are tightening and our loans are difficult.†Indeed, for small and medium-sized enterprises, the interest in bank lending is not high at all. Coupled with the implementation of macro tightening policies, business pressure is now even greater. However, these companies seem to be accustomed to relying on themselves. They are basically looking for relatives and friends to borrow. Mr. Zhang himself has a bank deposit of nearly one million yuan, which was originally stored on a regular basis. However, taking into account the need for funds at the beginning of production, he took it out temporarily and paid his own money to the company’s account.
The rapid increase of raw materials, wages, and other factors of production has caused textile machinery companies to fail to understand. At the same time, downstream textile companies are also experiencing the severe test of rising raw materials and labor costs, which is bound to reduce the purchase of textile machinery and equipment. Previous marketing strategies of puerile have encountered new challenges.
Some textile companies in Hebei have only enough inventory for cotton production for one month. Compared with before the Spring Festival, cotton prices have risen not only, but also the number of cotton has decreased significantly.
According to a research report released by the Cotton Research Institute of the Chinese Academy of Agricultural Sciences on March 4, the cotton planting area is expected to show modest growth in 2011, but the percentage increase will not exceed double digits; High cotton prices, credit contraction and rising costs have combined effects. It is expected that a batch of cotton spinning enterprises will cease production or close down in 2011.
Relevant persons estimate that under the weight of cost, the scale of investment in technological transformation funds in the textile industry may be reduced compared to last year. In addition to the pressure of survival for some small and medium-sized enterprises, the unprecedented good days of the textile machinery industry in 2010 may no longer continue.
Problem-solving - do a good job in improving products Faced with labor shortages, rising raw material prices, rising CPI and many other external factors, how will textile machinery companies respond, and how can they live happily?
Yang Chongming told reporters that companies want to make money, nothing more than two ways, first, to improve product efficiency, and second, to strengthen cost control, both companies will certainly survive better. The answer seems to be very simple, but it is much more troublesome to do. For business-oriented companies, corporate products have high gross margins, and even with modest scale, earnings can maintain a high level; for cost-control companies, the savings of these companies is surprising. Others spend 7 yuan to rent a square meter of factory buildings, they will spend 3 yuan to rent a square meter; other factories have to have a few managers, they may be a general manager on the full; and workers' wages are also relatively low , Retaining workers basically rely on ideological work...
However, the cost-saving companies save their prescriptions, and by 2011, it seems that they are not very useful.
Yang Chongming said that it is indeed possible to reduce production costs by strengthening management and starting from the finest points. However, these measures were used as early as the financial crisis. Considering the savings, there is not much room for profit improvement. Therefore, strengthening cost control does not have much effect.
“However, at present, companies should take the road of improving product efficiency and increase the added value of products. It should still be feasible. Everyone is aware of the cost of major road freight, so it is difficult to increase product prices and make product profits thin, even not to make money. New products are not the same, and sometimes it is difficult for customers to know how much their costs are, so manufacturers can earn higher profits. Only by doing high-end products, will they always occupy and lead the market.†Yang Chongming said.
It is time to change the product structure and improve product quality. However, research and development of new products also require investment. When cost pressures and surviving pressures strike, how many companies can persist in persisting?
When talking about how companies can solve cost problems, Li Chenghua said: “The prices of raw materials and labor, especially labor prices, have risen since then, and the possibility of a decline is not great. It may become a normal form of development in the future. Tonghe Company slightly raised the price of finished products, somewhat eased the pressure brought about by rising production factors."
Compared with some small and medium-sized equipment companies, Meng Tian, ​​deputy general manager of Hengtian Heavy Industry Group, appears to be optimistic. In his view, although the raw materials are still rising, he believes that in the future, the country’s macroeconomic policies will generally be based on stimulus. Under cost pressure, the company will make more efforts in the creation of products on the basis of reasonable price increase to increase profit margins. He pointed out that at present, the company has adopted mechanisms such as strengthening tracking and cost accounting for major projects, strengthening the risk prevention of corporate operations, and further tapping the potential of the company's savings by reducing the scrap rate and competitive bidding for projects.
It is not difficult to see from the history of foreign textile development that with the continuous advancement of urbanization, the rising cost of raw materials and labor is an irreversible trend. The only thing that we are grateful for is that although some emerging textile countries such as Pakistan and Vietnam have seized a lot of markets in the textile and apparel production sector, these countries have not yet formed a real impact on the Chinese textile machinery manufacturing industry in the textile machinery production sector. If domestic textile machinery manufacturing enterprises can actively face the reality of the rising cost factor, it will be a good thing to adjust the product structure of the company as soon as possible and smoothly realize the upgrade and transformation of the company.
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