As the end of the year approaches, what should I do with the large amount of inventory?
“Recently, a manufacturer is selling 5 million meters of 75D pearl chiffon…” said a trading boss.
The price of fabrics is low this year, but there are really not many sales, and sales of millions of meters at low prices are even rarer. If the unsold gray fabrics cannot be sold, can they be put away and sold next year?
But the textile boss doesn’t think so. After so many years of business, where has the money gone?
All the money is spent on inventory.
As we all know, the textile market has been tepid in recent years, and inventory elimination has become a very difficult matter for textile companies of all sizes. Although textile bosses have continued to curb the problem of overcapacity this year, it is impossible to have any excess inventory.
According to the inventory days of sample companies monitored by Silkdu.com, the current inventory of local companies is around 35.4 days. Since there is no peak season this year, the destocking situation in September and October is not ideal. Most of the fresh blanks are sold immediately. , even if there is inventory, it is always coming out and not being digested, and because this year’s profits are so low, many bosses are producing under the pressure of losing money, and may not make any money even if they have orders.
After a year of busy work, it seemed like all the work was in vain. Not only was there no money coming in, but the inventory problem was still a big problem. Naturally, the textile boss had no choice but to make this decision.
Are receivables so easy to collect?
Time has come to November. The end of the year has also reached the most worrying moment for textile people. Accounts receivable have begun to be collected one after another. It is common for textile and garment enterprises to have tight capital chains this year. The process of collecting payments is not smooth. 10 bosses Nine people said that this year’s payments are too slow, and the account period for both domestic and foreign trade has been extended, taking at least 3 months.
It is said that the goods are sold, and they will definitely not be receivables. They are basically paid in cash. 5 million meters is not a small amount. It is understood that the cost price of 75D pearl chiffon is 2.2 yuan/meter. The textile boss loses money per meter. If you sell the goods for 0.1 yuan, assuming all are sold, no matter whether it is a loss or not, more than 10 million yuan in cash will be received.
It’s the end of the year, and there are a lot of things that need money, and there are still a lot of receivables floating around. Businesses thrive on profits, but survive on cash flow.
If I don’t sell my goods, I will really change my career next year!
The inventory on hand cannot be liquidated immediately, and there is only some hope of selling it at a low price. It is difficult to collect payment due to the current market situation. If the textile boss does not have some cash in his pocket at the end of the year, will it be possible to change his career next year?
In today’s textile market, no matter how much inventory there is, no matter how many orders there are, there is no sense of security as having cash in your pocket. Inventory will always be just inventory, and only cash is king.
In today’s world, you can’t actually make money whether you sell goods or sell them normally. You just lose a little by selling goods, but you sell them. Normal sales depend on whether the cloth can be sold. In a short period of time, the price war will still be there. It exists, and it is even more difficult when fabric prices rise. For textile companies with regular regular customers, they are not worried about orders, but for textile companies with unstable customer groups and unable to collect payments in time, Selling goods is the last hope for survival next year.
No one would want to throw away the inventory made with white banknotes, but there is really no way to do it now.
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