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The Impact Of High Cotton Prices On Garment Enterprises Will Finally Become Apparent At The End Of The Year.

2010/10/18 11:38:00 42

According to the law, the price rise of cotton will drive the price of cotton yarn up, which will eventually lead to the rise in the price of the final garment.

In fact, some of the recent Autumn prices have just gone up.

In the wholesale clothing market in Hangzhou, the wholesale price of shirts has increased by five or six yuan, and the jacket has risen by 10 yuan within two layers, such as if cotton padded clothes and large cotton padded clothes have risen nearly 20 yuan.

Clothing sales business in Hangzhou and other places, "agent"

Brand clothing

Prices are up 15% compared with the same period last year. "

It is understood that

cotton

It accounts for about 40% of the total clothing cost. According to the calculation, the price of cotton is up by 5%, and the profit of garment processing enterprises will drop by 2%.

But in the interview, enterprises clearly indicated that they would not bear the burden of rising costs in the future.

For example, Li Rugang, chairman of Ningbo YOUNGOR Clothing Co., Ltd. once said, if a retail price of a shirt is now 400 yuan, of which the cost price is 15 yuan. If the cost is now turned up again, if the price rises by 10%, then a shirt will rise by 40 yuan, then the retail price of the shirt will rise to 440 yuan and 450 yuan.

Therefore, clothing manufacturers will not bear the cost increase, but will raise the price of clothing to cope with the rising cost.

The head of the clothing association said, "cotton prices will rise by 50%, and the retail price of clothing should be increased by at least 30%. Enterprises will be able to digest cost pressures."

And garment companies can easily pfer.

Cost pressure

Compared to the downstream textile enterprises, the survival is obviously more difficult.

Cotton prices continued to soar, leaving many export oriented Zhejiang textile enterprises in a tight encirclement.

Textile enterprises in Zhejiang mainly produce fabrics and garments, though they seldom purchase cotton directly. However, the purchase price of semi-finished products such as cotton yarn is driven by the price of cotton, which also makes the enterprises feel the cost pressure obviously.

Industry analysts pointed out that cotton prices rose 1% per cent, the gross profit margin of enterprises will drop by 0.53%.

At present, many textile enterprises in Keqiao and Xiaoshan of Zhejiang are very cautious about their orders.

Some textile enterprises have indicated that they dare not take the orders recently. Some of the big and thin bills have simply not been answered.

Because, for example, a batch of fabrics ordered last month will be delivered next month, but the price of cotton yarn has gone up again, and now the goods must lose money.

Hangzhou Yongxiang Textile Co., Ltd. responsible person, cotton accounted for 75% of the total cost of the enterprise. Last year, the company sold a lot of cheap cotton at a price of 14000 yuan / ton. At present, there are still 2000 tons of cotton in stock, and the business can be maintained until the end of the year.

But once the inventory is used up, only the new cotton which reaches up to 25000 yuan per ton will be lost immediately.

It is understood that after December, a large number of enterprises in Zhejiang may have to use new cotton, and cotton prices continue to rise, many enterprises may be involved in limiting production, or even shutting down cars, this situation may gradually appear.

According to the analysis of the industry, because the cotton will be used up by many enterprises at the end of this year, and the high price of new cotton will be used, the high price impact of cotton will really show up.