Investigation Report on Filament Weaving Industry in Fujian and Zhejiang

Recently, the vice president of the China Textile Industry Federation and the President of the China Long Silk Weaving Association Xu Wenying led a five-member delegation to Shaoxing County in Zhejiang Province, Xiaoshan District in Hangzhou City and Tongan District in Xiamen City, Fujian Province, Longhu Township in Jinjiang City, and Jinjing Township. The silk weaving industry cluster conducted a four-day survey and visited 15 parent silk weaving companies in-depth to understand the current operating conditions of the company and held discussions with leaders of the cluster.

Fila high-end entrepreneur salon held in Zhejiang

On July 19th, the second event of "China's high-end entrepreneurs' salon for the long-winding weaving industry" organized by Zhejiang Tiansheng Group kicked off. Xu Wenying attended the event. Wang Jiayi, vice chairman and secretary general of the China Long Silk Weaving Association, presided over the event. A total of 15 well-known entrepreneurs from the industry participated in the salon.

During the salon activities, entrepreneurs mainly exchanged the current difficulties encountered in the production, operation, and development of enterprises, and conducted lively discussions on how to get out of the predicament. Most entrepreneurs stated that the current lack of market demand at home and abroad is the bottleneck of corporate growth. In the first half of the year, the decline in raw material prices and low-price competition in the industry have become the fundamental reason for the difficulty of profitability. In addition, social responsibility for stabilizing employees in the workforce also exerted considerable pressure on normal operations. Since participating in Sharon is a leading company in the industry, it has a strong ability to resist risks. Although the current market environment is not ideal, most companies can still maintain profitability, especially in the production of medium and high-grade polyester silk fabrics, nylon fabrics, Sportswear fabrics and some intertwined products are in good operating condition. Entrepreneurs who are on the scene are not optimistic about the market outlook for the second half of this year and the first half of next year. They are generally concerned that orders have shrunk dramatically.

Characteristics of Fujian Long Silk Weaving Industry Cluster

During the visit to the area of ​​long silk weaving industry clusters in Tongan District of Xiamen City, Longhu Town of Jinjiang City, Jinjing Town, Fujian Province, we can feel that the Fujian long silk weaving companies have three distinct characteristics: First, the level of production equipment is high; The second is to focus on product development and positioning; the third is basic management.

High level of production equipment

In recent years, the level of textile machinery manufacturing in China has improved rapidly. In particular, water-jet looms are almost comparable to imported looms. Due to the rapid development of the filament weaving industry in the past two years, companies must produce high-quality and stable products in order to gain a foothold in fierce competition. Enterprises in the Fujian region are mainly producing fine nylon denier and high density products, and have strict requirements for the precise control of looms. Therefore, all the filament weaving companies in Fujian use the water jet loom from Toyota and Tsuda. The average price of imported water jet looms is 300,000 yuan/set, which is 3 to 5 times that of similar domestic looms. In the long-term specializing in the production of fine denier high density nylon fabrics, some have also introduced a pulp and pulp machine, the price of 7 million yuan / sets or so, from the former pulp and other processes to improve product quality to provide technical assurance. Other companies adopt advanced technologies that add air-changing devices to warping machines to increase the number of filaments added to the filaments, and better meet the needs of downstream garment design in terms of changing fabric style, quality, and quality.

In addition, in order to ease the pressure of employment, some companies began to introduce new types of automation equipment to reduce labor costs and improve efficiency. For example, Zhejiang Tiansheng Group's spinning factory adopts automatic cake conveying equipment and Fujian Xiangxing Group adopts fully automatic threading machines. Take threading as an example, this is a procedure that still needs to be completed manually in the weaving process. The automatic threading machine has completely changed the production method of this procedure. The workload of this set of equipment is equivalent to 8 times of manual wear, which greatly improves the production efficiency and reduces the labor. In addition, the device adopts the most advanced electronic digital identification technology to discriminate different types of warp fibers, which can minimize the errors in the threading process, and then improve the efficiency of the weaving process.

Focus on product positioning and R&D

The Fujian long-filament weaving industry cluster is distributed around China's garment production and distribution base Shishi. Outdoor leisure wear, business wear and sportswear products are relatively large. Therefore, Fujian Changsi weaving companies' product positioning is also more concentrated, mainly nylon sports, leisure and winter clothing fabrics. Because of its close relationship with the downstream market, Fujian Changsi weaving companies pay more attention to the real needs of the market and the performance of fabrics in terms of product development. The survey found that the more companies that study the market and adjust the R&D product structure, the smaller the operating pressure. For example, Xiamen Fusheng Textile Co., Ltd. and Jinjiang Nanfang Weaving Co., Ltd. have a high added value, although they have many product varieties and small quantities. With flexible production, companies regulate production according to market performance in their operations, thereby avoiding some market risks.

Good site management

In the workshop of the Fujian filament weaving enterprise, we were delighted to find that the average level of on-site management of enterprises was high, and most companies could achieve water-jet loom workshop floor surface water-free traces, clean drainage pipelines without secondary pollution, etc., and the average staff turnover rate. Up to 35~40 units/person.

Most enterprises have realized ERP management in production processes, such as Xincheng Group, Daihatsu Technology Group, and Jinda Yuanda Garment Weaving Co., Ltd., which display the instantaneous weaving efficiency of different workshops in different workshops through an electronic screen placed in a prominent position. And directly link production, efficiency, and other indicators with employee rewards, effectively urging front line operators to perform their duties with due diligence. The modern management has improved the production efficiency, and has ensured the employees' work enthusiasm while ensuring the quantity and quality of the products.

Market performance and business survival

As we all know, the domestic industrial economy has been sluggish this year, and the industry with the highest degree of marketization, the textile industry, is facing enormous pressures on production and sales. Although the filament weaving industry benefited from the stable development of the market space left by the slacking of the cotton textile industry in the first three quarters of 2011, the market was clearly cold from the fourth quarter. Half of 2012 has already passed and the market as a whole has not shown signs of recovery. Most companies are worried about the future.

Insufficient demand and simultaneous decline in prices of finished raw materials affect sales together

During the survey, companies said that the impact of the European debt crisis on the international market continues, and that export-oriented companies have been forced to turn to domestic sales. However, at present, the demand for the downstream garment market in China is still seriously insufficient. The inventory of apparel companies is in serious shortage, the number of orders has been significantly reduced, and it is difficult for weaving companies to accept orders.

According to the company, sales are not good because there is no market and products cannot be sold; second, because prices are too low, selling is also a loss. In the first half of the year, the price of raw materials continued to drop, driving down the prices of finished products. Some products with long weaving cycles, such as thick shade curtains, had a weaving cycle of 3 months, which made them no profit. The drop in raw material prices has greatly dampened the confidence of operators in the weaving industry and increased the difficulty in judging the trend of the market in the later period. In addition, when the year is good, the scale of water-jet looms has expanded rapidly, resulting in competition incentives in the industry, and weaving companies are competing to reduce prices. When prices fall below the bottom limit that companies can afford, companies can only choose to give up sales.

The contradiction between starting and inventory

From the point of view of field visits, the operating rate of long-staple weaving companies averages around 70%, which is a low level. The company's conscious reduction in its operating rate was mainly to ease inventory pressure, but according to our observations, despite the company's conscious choice to stop, inventory pressure is still increasing. At present, inventory in the past two months is quite common, and some companies with large scales and high starting rates are at a higher level.

The company stated that knowing that inventory pressures and capital risks increase but cannot reduce the main reasons for start-ups, one is that in order to stabilize the workforce, it is more difficult to recruit one worker, and it is more difficult to train a worker. Once a large-scale production shutdown occurs, it will inevitably face the problem of the loss of the workforce, even if the market Fortunately, it is difficult for enterprises to recover in a short period of time. Second, due to the bank’s loan supervision, too much parking will seriously affect the bank’s confidence in corporate lending. Once the banks no longer lend or reduce lending, the company’s capital turnover will be In the face of difficulties, the amount of loans that will be worked so hard will also be lost. This is tantamount to a drastic salary increase for companies, and the chain problems that companies face will be even more serious. It can be said that companies do not dare to stop production and can only properly choose to produce some conventional products with higher added value as inventory. After all, such products are more likely to be sold when the market recovers, but this is an adventure and a bet, even if it wins eventually. Will be black and blue.

Labor conflicts appear, companies respond passively

As we all know, since the implementation of the "Labor Contract Law" for the past four years, the rights and interests of employees have been effectively guaranteed, and the relationship between labor and capital has also been greatly improved. However, in this visit, some companies have reported that due to the lack of specific provisions on the liability for compensation for work-related accidents in the Labor Contract Law, such as the fact that although the time on the way to and from work is part of the working hours, it is determined how to determine The time has not been clearly stipulated and judicially interpreted, resulting in the lack of protection of the company by the relevant laws in the compensation of employees and increasing the burden on the company.

In addition, as workers' wages and related expenses continue to rise, the labor cost of enterprises has grown faster. To this end, some companies began to introduce automated production equipment to reduce labor, but also improve production efficiency and stabilize product quality. However, the capital investment in the introduction of automation equipment is relatively large, and the equipment depreciation period is longer, especially in the current market environment, increasing the difficulty of corporate capital withdrawal and credit pressure.

Uninterrupted interest expenses coexist with difficult to recover accounts receivable

During the visit, we learned that companies still face the problem of “financing difficulties and financing expensively”. High interest expenses increase the company’s financial costs. At the same time, although enterprises can receive some orders in a difficult market environment, they are still inevitably caught in the embarrassing situation that the purchase price is difficult to recover. The printing and dyeing factories, garment factories, and sales businesses downstream of the weaving mills have defaulted on payment in a progressive manner. However, most spinning plants do not accept arrears. This has caused the weaving mills to be caught in the middle of the capital chain, and the shortage of funds is serious.

Expert advice on business development

Safeguard funds chain

The capital chain is the lifeline of the company. Under the current market environment, enterprises should not blindly maintain production or even follow suit to expand investment. Attention should be paid to the normal circulation of capital chain and cash flow, ensure the survival and development of enterprises, and increase the market competitiveness of enterprises.

Focus on product development and market research

Products that are recognized by the market are good products. Companies should spend more effort on researching market demands and actively develop new practical products that meet market demands. In order to win market share.

Multiple perspectives on market trends

Enterprises are seeking for survival and development in the industry, in the entire industrial chain, and even in the entire international and domestic environment. Therefore, in the current market environment, companies must study both the international market and the domestic market. They must not only study the upstream raw material market but also pay attention to changes in downstream garment processing, commercial sales, and consumer spending. They should also respond to oil and cotton. Minor changes in the related industries such as cocoons and cocoons must be given sufficient attention.

Affected by the European debt crisis, the global economic recovery is slow, and the industrial manufacturing industry is experiencing difficult survival. However, according to the economic data from the National Bureau of Statistics for the period from January to May, the overall economic operation of the filament weaving industry is still stable. At present, the long-filament weaving industry is in the middle of the summer season, but looking at the future of the entire industry, we should fully recognize the industry's potential for development and potential for substitution. We must overcome our immediate difficulties with confidence and meet new opportunities. And challenge.