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PRD: Profits Are Low, Orders Are Not Readily Available.

2010/7/19 19:34:00 35

Order Profit

Toy industry: increase in trade volume and profit margin reduced by 10%


Yesterday morning, Xiao Senlin, chairman of the toy company of Dongguan, one of the independent brands in China, was busy with the promotion of the mascot of the Asian Games.

Although it was nearly dusk, the workshop was still brightly lit.

The workers are busy working.


Xiao Senlin said his business this year

Order quantity

An increase of around 50%, coupled with the domestic market, is relatively satisfactory in the first half of this year.

Statistics from the General Administration of customs also showed that in 2010 1~3, toy exports increased by 21.8% over the same period last year, basically a resumption of growth.


Xiao Senlin said that the toy industry's exports increased by at least 30% this year, while his export orders increased by 50% this year.


However, the increase in export volume does not mean that the days of the enterprises are getting better.

Xiao forest admitted that the toy industry's profit this year dropped by about 10% compared with last year.

"This is also the situation for most of this year's exports."


Statistics show that the cost of raw materials and labor in Dongguan has increased by 20% recently, and the authorized processing profit in Europe and the United States is getting smaller and smaller.

"Toy exports are on the brink of life and death."

Someone in charge thinks so.


Clothing industry: low profits, orders can not easily pick up.


In the first half of the year, foreign trade in Dongguan's clothing and accessories increased by 27.1% over the same period, an increase of 38.9% over the previous month and an increase of nearly 40% over the previous year.


Yes

Garment industry

People believe that although the volume of clothing trade in Dongguan is increasing, the profit situation is not optimistic. At the moment, many garment manufacturers are reluctant to accept orders for foreign trade.

"First of all, it is affected by the economic environment, and some enterprises have difficulty in financing. Secondly, the cost of hiring workers is increasing. Even if orders are increased, enterprises are afraid to hire large numbers of workers.

Third, the rising price of raw materials has also increased the economic burden of garment manufacturers to a certain extent.


Chen Yaohua, chairman of Dongguan textile and Garment Association, told reporters directly that if we look at the order, this year's Dongguan clothing and textile enterprises are very good days, but for some enterprises to reflect the low profit argument, Chen Yaohua does not fully agree.

He told reporters that we can not simply understand the decline in the profits of the whole industry, for example, the same products, foreign customers in the quantity of a large number of orders, in order to increase the number of customers, will naturally reduce the profit a few orders; some enterprises began to pay attention to management costs, it seems that the export unit price is decreasing, but scientific management leads to cost reduction, profits generally will even increase, which is not surprising in the current Dongguan.


Practice of reducing burden Town Street


In view of the fact that many enterprises reflect the rise of export volume and the decline of profits, some towns have begun to support enterprises in a targeted way.


The reporter learned from the Tangxia foreign trade and Economic Cooperation Bureau that in the month of 1~6 this year, the Tangxia contract utilized foreign capital of 108 million 460 thousand US dollars, an increase of 64% over the same period last year.

Since the decentralization of power in the town of Jian Zheng, since July 1st, it has involved the processing procedures for enterprises to process raw materials and pfer funds. The Tangxia foreign trade and Economic Cooperation Bureau has approved the power of examination and approval. Enterprises do not need to go to Dongguan Municipal Economic and Trade Bureau to reduce the time of issuing permits.

This not only reduces the link but also saves some costs for the operation cost of enterprises.


In addition, with the improvement of export tax rebate rate, Houjie's export situation has improved.

To help export enterprises make good use of the export tax rebate policy and speed up the return of funds, since June 1st, Houjie National Tax Bureau has established a "high-speed export 500 strong" enterprise that month to declare the high speed road for tax rebate in the month, from the "300 strong" 14 export enterprises to 23 households.


Expert interpretation: strengthening internal management, pricing power for external competition


The volume of export trade rebounded sharply.

Profit margin

But it is declining. For many enterprises in Dongguan, this is a problem of happiness.

In the long run, it is a fatal problem.


Zhou Tianyun, an economist and vice president of Zhongshan University's international business school, thinks that the appreciation of the renminbi mentioned by the enterprises has an impact on the profits of the enterprises, but it is definitely not the main reason, because the exchange rate of RMB against the US dollar has fluctuated less than one percentage point this year.

In fact, the drop in profits is the inevitable outcome of the world factory losing the pricing power of international trade.

There will only be more and more enterprises, and the competition will become more and more intense. In order to seize the market share, it is the real reason why everyone will compete to keep the price down.

Zhou Tianyun believes that in order to ensure stable profits, Dongguan export enterprises can only enhance internal management and raise profits and strive for pricing power. Of course, it is not so easy to strive for pricing power. They must have their own brands and R & D teams, such as Foxconn's OEM enterprises, so as to have their own core competitiveness in their peers.

In addition, in export trade, if we want to grab market share and gain long-term profits, we will inevitably lose sight of it.

She believes that as a world factory in Dongguan, there is a very good policy idea for changing cage and changing birds and upgrading industries, but the key is to pform the enterprises as soon as possible.

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