When visiting the market, cloth bosses always said that the market this year was not good and they were under a lot of pressure. But to what extent, they themselves cannot express it intuitively.
Therefore, the editor came up with the idea of summarizing and calculating the information obtained from the market, so as to better understand the problems that weaving companies are facing. What is it.
It’s not that I don’t know, but I’m shocked
In terms of companies accepting orders, from the research Judging from the situation, the current order volume of textile companies is 70-80% less than last year, and the good order volume is basically the same as last year. Considering that some large manufacturers have been relatively little affected, the current order volume is calculated as 6-6% of last year. 70%.
In terms of the loom operating rate, the loom operating rate for those with high loom is more than 80%, and the loom operating rate for those with low loom is less than half. On average, the loom operating rate of the overall weaving enterprises is 7 About 10%, which is about 10-20% lower than the same period last year.
In terms of the number of looms, water jet weaving in 2017 Before the machine rectification, the number of water-jet looms nationwide was approximately 400,000. Over the past few years, the number of water-jet looms in Jiangsu and Zhejiang has dropped by more than 100,000, but the planned increase in water-jet looms in peripheral areas has exceeded 200,000. , but considering that the growth rate has slowed down due to the epidemic in 2020, not all 200,000 units have been put into production. Therefore, the peripheral loom production capacity is counted as an increase of 150,000 units, and the three-year production capacity growth rate is counted as 10%.
On the demand side, according to data from the National Bureau of Statistics, national cloth production was 69.105 billion meters in 2017 and 57.558 billion meters in 2019, with production capacity declining by 16.7%. Therefore, according to the demand in 2019, the overcapacity of water-jet looms is as high as about 30%.
If calculated according to the above data, the average increase rate of gray fabric inventory of weaving enterprises is currently 2-3 days/week.
In terms of profit margin, gray fabric itself is an industry with low profits. Unless the market is particularly good, the profit of conventional gray fabric is only about 5%, and this year’s situation On paper, the profits on paper fluctuate around 2%-5%. However, because the inventory of gray fabrics on the market is too high, many weaving companies maintain capital or even sell fabrics at a loss in order to collect funds. Therefore, the average profit rate of gray fabrics on the market is 2%.
If a company owns 100 water-jet looms For a weaving company, with an operating rate of 70%, the production capacity is calculated as 70 units. Assuming that a water-jet loom can produce 200 meters of cloth a day, the cloth that can be sold in a week is about 70,000 meters, and the accumulated cloth inventory It’s about 28,000 meters.
Although these 28,000 meters of cloth are in inventory and are not a loss, they are piled in the warehouse and cannot be converted into cash. The actual loss is not much different, and the remaining week The profit from selling about 70,000 meters of cloth is about 1,400 meters of cloth.
So for weaving companies, from the perspective of working capital, a weaving company with 100 water-jet looms has an operating rate of 70%. After receiving orders of 50-60% last year, the funds deposited on gray fabrics every week are about 26,600 meters of cloth, which is nearly 100,000 meters of cloth in one month.
Of course, the above is only based on the editor’s knowledge The rigor of some data derived from the estimated situation needs to be verified. It is also affected by various factors such as payment collection and gray fabric types, and is for reference only.
But through these data, we can also see what kind of pressure weaving companies are facing now! Everything in the market seems to make sense…
Everything is to survive
Selling goods
The first is to sell goods. From the above data, we can see that a textile company with 100 looms adds an average of 28,000 meters of cloth in stock per week, which is 112,000 meters per month. These cloths cannot be cashed in in a short time. , which also precipitates a large amount of liquidity.
From March to now, for at least four months, the average inventory accumulation of weaving companies has exceeded 440,000 meters. Some companies have strong financial strength and can survive, but there are always companies with tight capital chains. It’s time to buy raw materials, employees have to be paid, and what should I do if I don’t have enough cash on hand? Then you can only make a fuss about the inventory in the warehouse.
Few weaving companies really want to sell their goods, and some are just forced to do so.��
Making low-end products
Then high-end machines are used to make low-end products. In fact, the reason is very simple. Under the current situation, weaving companies are basically “fed”. It is good to have orders. But those machines that were left open had to do something. There are also 70 machines. If the cost of cheap cloth is 1 yuan/meter, the weekly inventory is worth 20,000 yuan, and the cost of expensive cloth is 3 yuan/meter, even if the production efficiency is different, the cost required is the same as that of the cheaper variety. More than times.
With the current market situation, it will be difficult to sell high-end products or mass-market goods. If the epidemic situation gets better after the epidemic, both types of fabrics will be the same. There is no big difference, so low-end products that can take up less capital are also the choice of most textile companies now.
Reducing operations or even closing factories
In the end, various reasons were found to reduce the start of operations or even close the factory. When the average income of each industry and region is released, netizens will always comment on themselves as being “stalled and averaged”, and this is also the case now.
The performance of companies in the market may be good or bad. The average can only represent the overall market, but every company has its own difficulties, even if it is “averaged” The future life of enterprises will be so difficult, not to mention some enterprises that are not performing well in the first place. According to the “80/20 rule”, enterprises that are not as good as the “average” are the majority in the market.
Nowadays, the market generally expects that the global epidemic will be difficult to control before the fourth quarter, and the market will hardly get better. Weaving companies will still have at least two or three months of hard times. Pass. For these “averaged” companies, how to reduce costs, how to split a penny into two parts, and how to survive until that time is the top priority at this stage.
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