Textile printing and dyeing went through a long period of suffering in April, May and June, when textile companies were preparing for autumn and winter fabrics. There was a slight improvement in July. According to common sense, printing and dyeing factories are about to usher in order production, which will alleviate the embarrassment of the past few months. Just when most printing and dyeing factories feel that the market is picking up just like this hot summer, there are printing and dyeing factories that cannot bear it and have no choice but to suspend production and take holidays, which has to be lamented. Take a look at the detailed report below
On July 9, 2020, a printing branch factory in Shaoxing, Zhejiang issued a notice and decided to start from July 11, 2020 to August 10, 2020. By the end of the day, holidays will be taken in rotation, and the holiday period is tentatively scheduled to be one month. Whether the holiday will continue after that will be notified separately based on the order situation.
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We all know that when a printing and dyeing factory is forced to There will be long vacations in rotation. Even when the order quantity is small, the machine must be turned on for production. During the off-season, the cost of dyeing factories is the highest. Even if the printing and dyeing factory is well-managed, the cost will rise significantly in the off-season.
The notice is very clear: orders have dropped significantly and production tasks are seriously insufficient. In order to reduce further losses, save energy consumption, and focus on production, we have to take a holiday!
As the off-season approaches in this special year, it is even more difficult for textile and fabric companies. It is difficult to make a breakthrough in the export market. Domestic sales demand has decreased, factory inventories have increased, follow-up orders have been insufficient, and production cuts and holidays may become a common phenomenon for many manufacturers.
Data show: benefits continue to decline
According to data from the National Bureau of Statistics , from January to May, the country’s 33,000 textile enterprises above designated size achieved operating income of 1.55211 billion yuan, a year-on-year decrease of 17.2%; total profits were 54.6 billion yuan, a year-on-year decrease of 24.5%; the operating income profit margin was 3.5%, lower than the previous year 0.4 percentage points over the same period. The profits of more than 80% of the links in the industrial chain fell by more than 10%, and the profits of more than half of the links still fell by more than 30%. Driven by anti-epidemic materials, the profitability of the industrial textiles industry has increased significantly. Total profits from January to May increased by 189.1% year-on-year, and the operating income profit margin reached 12.2%.
The operation quality of textile enterprises has declined. From January to May, the loss ratio of textile enterprises above designated size reached 32%; the total asset turnover rate and finished product turnover rate were only 0.9 times/year and 10.4 times/year respectively, which were 20.6% and 24.7% slower than the same period last year; the ratio of three expenses It was 7.3%, 0.3 percentage points higher than the same period last year.
Data source of efficiency indicators of textile enterprises above designated size from January to May 2020: National Bureau of Statistics
The COVID-19 epidemic has caused the global economy to fall into recession. Insufficient international market demand will remain the norm in the second half of the year, and the export situation of the textile industry remains severe. However, the domestic epidemic prevention and control situation is gradually improving, residents’ living and production order has accelerated, and the national “six stability” and “six guarantees” policies have helped residents maintain employment and income. The continuous accumulation of various positive factors will provide more opportunities for the textile industry. It provides favorable conditions for supporting domestic demand and provides important guarantee for enterprises to resolve various risks and challenges.
Reference for some information: Industrial Economics Research Institute of China Textile and Apparel Industry Federation</p
