Recently, waves of cold air have arrived in Hangzhou. Down jackets, duvets and other products in shopping malls have become the “darlings” of consumers, and the down market is gradually recovering.
The market demand has surged, and it should have been a ” “Prosperous” scene, but behind it is not so “beautiful”. Down processing enterprises are operating at full capacity, textile raw materials are in short supply, and production capacity cannot keep up. Export containers are hard to find, sea freight rates are rising, and there is a large backlog of goods. Financial pressure and risks are intensifying. Faced with this situation, companies are focusing more on the domestic market – converting exports to domestic sales.
Down companies are operating at full capacity, and orders are too late to be produced
Hangzhou Asijia Home Textile Co., Ltd., which focuses on the domestic market, has more than 50 offline physical stores, concentrated in East and North China. In this area, physical sales still account for about 90% of total sales revenue. “The counters have been out of stock, and my phone has been buzzing with calls.” Jia Jing, the company’s general manager, said that it was too late to place the order, which has lasted for three months.
“The entire market is in short supply of yarn and gray fabrics, and coupled with the surge in orders, there is no time to produce quilt covers and quilt shells.” Jia Jing said that thanks to the vigorous development of non-physical store sales models last year, he received a lot of orders A large group purchase order, and by coincidence, hot orders from TV shopping and live broadcast sales were also gathered together. Because of the epidemic, the factory was cautious about stocking up. I didn’t expect that there would be so many orders. The stocking was insufficient and the factory couldn’t produce it even if it was running at full capacity. Take the order volume for quilt shells made of 80-count fabrics. Just one order amounted to 12,000 pieces. However, There are still 30% of orders that cannot be completed and can only be produced slowly one after another. Sales are always out of stock.
For sporadic and urgent orders, they can only find other processing factories to rush the work, but other factories are also operating at full capacity, and orders come at the last moment, but they are basically rejected.
“Some home textile processing factories in India and Brazil are still unable to operate normally due to epidemic prevention and control. Overseas orders continue to flow back to China. Domestic home textile processing production orders are full. Compared with overseas orders, domestic demands are higher. , these factories are unwilling to take scattered orders.” “A few days ago, I ordered a batch of fabrics to make a new spring and summer four-piece set. Two days later, they were out of stock. They said they would not be available until after the Spring Festival. The goods cannot catch up with the new spring and summer models, so we have no choice but to increase the number of old models.” Jia Jing said.
“Order volume surged in the second half of last year. Compared with export orders in 2019, export orders increased by 20%-30%. It was too late to make orders. The factory was operating at full capacity. Orders for March and April this year have been scheduled. “Zhu Zhiliang, chairman of Zhejiang Samsung Down Co., Ltd., said that taking into account the funding cycle and risks, they will also evaluate orders and choose some more reputable brands to cooperate with.
In addition to the unavailability of orders, the prices of fabrics and down raw materials have soared. “The price of fabrics on the market now has increased by about 10%-20% compared with the same period last year, and the price of down has increased even more.” Zhejiang Lanbo Home Furnishing Hu Yajun, general manager of the Co., Ltd., said that the price of down last year was a “roller coaster”. The price at the beginning of the year was very low. They were worried about the lack of orders in the second half of the year, so they signed a lot of orders. Later, the price of down rose, and many orders were made at a loss.
According to statistics from the China Down Industry Association, since the fourth quarter of 2020, the industry market has begun to recover rapidly, and the price of down raw materials has risen sharply. The price of 90 white duck down per kilogram was 200.4 yuan at the beginning of May last year. By the end of October, it had risen to 325.9 yuan, a price increase of more than 60%.
Sea freight has more than tripled, and containers are hard to come by.
Under such circumstances, foreign trade companies are facing a greater impact.
Zhejiang Wanxiang Bedding Products Co., Ltd., which exports to Europe, the United States and Japan, 90% of its business is foreign trade orders. According to the manager of Wanxiang’s export department, prices in the shipping market have soared across the board since early December 2020. Containers are hard to come by, and sea freight has skyrocketed.
“The biggest contradiction now is that you have space but no lockers. This is not the case of one or two shipping companies, no matter how big or small. This is basically the case for all shipping companies.” Shi Hongxia, export manager of Zhejiang Wanxiang Bedding Products Co., Ltd., said that in order to get the company’s goods out of the warehouse as soon as possible, she and the shipping company swipe the cabinet barcodes on their mobile phones every day. Basically, they have to swipe At around ten o’clock in the evening, sometimes after the barcode is swiped, the driver has to immediately arrange for the driver to “grab” it out, spend money to find a place to store it, and wait for the port area to open before asking to go to the factory to load the cabinets. Occasionally, if there is a barcode and no cabinets, we have to do everything possible. Spending money to buy cabinets has become a common problem in the freight logistics industry.
Not only that, sea freight is also rising all the time. Wan Xiang needs to pay for the sea freight himself when he goes to Los Angeles in the United States and Hamburg in Germany. She said that in the past, the most expensive sea freight for large containers from Hangzhou to Hamburg was only more than 3,000 US dollars, but now the European baseline guaranteed shipping price has risen to more than 10,000 US dollars, and the sea freight is more than three times higher than before. , these difference costs must be borne by the enterprise. In order to develop the business in the future, the enterprise still has to make this large difference in sea freight. She lamented, “I have been doing import and export for 18 years, and 2020 is the most tiring and complicated year.”The domestic sales transformation of the industry has become more active and urgent. Leading companies take the lead in the domestic market, bring high-quality down products, exert demonstration and brand effects, and cultivate the domestic down market, which is conducive to a virtuous cycle of the industry and also helps the international and domestic dual cycles of the down industry. ”
Yao Xiaoman emphasized, “Under the current background of the global spread of the epidemic, the foreign trade export situation is extremely severe. Foreign trade companies need to position themselves well, expand sales channels, build operation teams, and use their own advantages and new Internet sales Model, make up for the shortcomings of domestic sales, and walk on two legs to improve the ability to resist risks. ”
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