Two days ago, the editor passed by a friend’s sales department and saw that he was busy loading trucks and shipping goods, so he chatted with him for a while and joked that his business has been good recently and he has made a fortune again. As a result, he replied helplessly, “What kind of money are you making? The profit from this truck of cloth is not enough to pay for refueling.”
2022Year5Month30Day24Starting from 9:00 p.m., oil prices across the country have increased for the 9th time, and oil prices in some cities have entered “9 In the “yuan oil” price era, on the day of the price adjustment, the editor made various complaints in the circle of friends. The background of the rise in oil prices is the soaring international oil prices. The Russia-Ukraine war has not yet ended. The European Union has recently reached “Compromise version“Russian oil embargo plan,On May 3131, international oil prices rose again, once exceeding 123USD span>/The sky-high price of barrels.
As prices continue to rise, what happens next is that money becomes less and less valuable, and at the same time it becomes more and more valuable.
Money is becoming less and less valuable
With the epidemic, productivity levels have dropped significantly compared with before the epidemic, but the various rescue measures taken by various governments have made more and more money in the market.
However, when the economic situation is not good, most companies have difficulty surviving and have no willingness to invest in expanding production. They prefer to keep funds in their hands, let alone take out risky loans to make risky investments. . But this has also resulted in a lot of hot money in the market having nowhere to go, and can only flow to some hard currencies, such as gold and commodities. The more valuable things are, the more they will rise. Then we will see the prices of various raw materials rise sharply. rise. For textile companies, the price of polyester yarn continues to rise.
Raw material prices have risen, production costs, freight and other links have also increased in price. Prices have naturally increased, but corporate profits have not increased. At the same time, due to the decline in productivity, corporate efficiency has become worse, residents’ income is not as good as in the past, and they consume fewer goods. Then the company will be unable to make any more money, there will be less room for funds to go, the price of raw materials will rise even more, and the money will become less and less valuable.
Money is becoming more valuable
The worse the economy, the more important cash flow becomes.
When the economy is good, everyone dares to consume and borrow money. At this time, even if a company owes money, as long as there is a steady stream of orders, neither banks nor customers will be in a hurry to make payment.
But this is not possible when the economy is bad. Banks and customers also want stability, and they are unwilling to do risky things. The difficulty of getting credit has greatly increased, but at the same time, the payment cycle has also become longer, making it increasingly difficult to collect. Therefore, if you don’t have enough cash flow on hand, it will be difficult to do business.
The longer the situation lasts, the more companies will have cash flow problems. At that time, they will have no choice but to sell their goods, or even go bankrupt and sell their assets at a low price. Then I discovered that the money that originally bought one meter of cloth could actually buy 2 rice cloth, 3 rice cloth, and the money was good too. become so valuable.
Who can survive it better
The current market is such that, except for some companies that have an absolute advantage in competition, a large part of textile companies are struggling to survive in the sluggish market.
Those who have orders cannot make money due to high costs, freight and the inability of consumers. Just like what was said at the beginning, “the profit of a truck of cloth is not enough to fill up with gas”; those who have no orders are even worse, and their funds cannot be used. It’s hard to be busy even if you want to, and you are consuming sunk costs in vain.
Then it’s a matter of comparing who can survive it better. If you can’t survive it, your “corpse” will become nourishment for others and a passer-by of the times; if you survive it, you will sit on a vast market, emerge from the cocoon and become a butterfly, with unlimited possibilities for the future. .
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