In recent years, business has been really difficult! The black swan of the epidemic has never stopped, the memory of the sharp rise and fall of raw materials is still in the mind, and the annual environmental inspections have been carried out as scheduled… Various emergencies have damaged the confidence of textile bosses. Some companies are still struggling to move forward, while others are overwhelmed. Faced with heavy debts and IOUs, they ultimately fail to survive and have no choice but to declare bankruptcy.
suddenly! Two more textile and garment companies in Shaoxing went bankrupt
Nearly 70 people are still owed wages.
On September 26, 2021, the administrator of Shengzhou Jiayuan Clothing Co., Ltd. filed an application with the People’s Court of Shengzhou City, Shaoxing, Zhejiang Province, saying that based on the current assets of the debtor, its property is no longer sufficient to pay off bankruptcy expenses. The administrator now requests the court to declare Shengzhou City Jiayuan Clothing Co., Ltd. went bankrupt and ended the bankruptcy proceedings of Shengzhou City Jiayuan Clothing Co., Ltd. According to public information, Shengzhou Jiayuan Clothing Co., Ltd. was established on July 26, 2001, and its operating status is cancelled. Its business scope includes production and sales of: clothing, ties, silk shirts, knitwear; wholesale and retail: textiles raw material.
Also last month, in Shengzhou, Shaoxing, a textile and clothing company was liquidated and nearly 70 people were owed wages.
Sanmen County Rainbow Garment Co., Ltd. applied to the Shengzhou City People’s Court for bankruptcy liquidation of Shengzhou Rujia Garment Co., Ltd. on the grounds that Shengzhou City Rujia Garment Co., Ltd. could not pay off its due debts and its assets were insufficient to pay off all debts. After review, the Shengzhou City People’s Court issued a (2022) Zhejiang 0683 Poshen No. 4 civil ruling on March 29, 2022, ruling to accept the bankruptcy liquidation application for Shengzhou Rujia Clothing Co., Ltd., and designated Zhejiang Tianyu on the same day Accounting Firm Ltd. serves as the administrator.
After investigation by the administrator, as of March 29, 2022, Shengzhou Rujia Clothing Co., Ltd. still owes employees wages and compensations that should be paid to employees according to laws and administrative regulations (the above are collectively referred to as employee claims), totaling RMB 137,496.30. Yuan (see the list of employee claims for details).
Poor management does not mean that you are not doing your job properly!
Liquidity is becoming less and less available
Some people say that these companies are definitely not doing their job properly. Indeed, taking the textile and garment industry as an example, many well-known companies have closed down not because their main business is not good, but because they have too many desires that will eventually harm their health, such as building ships, building docks, buying mines, engaging in real estate, and playing in finance. …In the end, everyone was exhausted physically and mentally in an unfamiliar field, which eventually affected their main business, ranging from huge losses to bankruptcy or even running away.
However, some bosses who are not doing well are not doing their jobs properly. They are also working diligently and hard-working to run the factory. Especially in recent years, when fortunes have been bad and they have encountered problems such as poor market conditions or poor capital circulation.
It is not just bosses who are on the verge of bankruptcy who have the problem of tight capital chains. In the past two years, it can be said that 70% to 80% of bosses have encountered financial tightness at one time or another, especially companies with a relatively large proportion of business. During a discussion on enterprise production conditions, a cotton industry group in Zhengzhou said that some spinning mills in Henan have changed from single holidays to double holidays, or have stopped working for a few hours in the morning and afternoon, or even shut down the entire workshop. At present, many small factories shut down for three to five days after one week of production. They use the remaining funds to purchase raw materials and then carry out production. If the finished products cannot be sold, they can only take a holiday, and then slowly sell them through price reduction and other methods, which ultimately leads to an increase in working capital. Come less and less.
In addition to reduced profits, high inventory and longer payment terms are also the most important reasons for textile companies’ capital turnover difficulties. A Keqiao printing and dyeing company in Shaoxing, which declined to be named, revealed that due to the epidemic, the company’s foreign trade market this year is not good. In addition, the price of raw materials has increased sharply, and the purchasing power of foreign consumers is currently limited, which has affected the company’s foreign trade orders. “Because the textile industry uses a lot of petroleum products, when the price of petroleum increases, the price of textile raw materials will also increase. It is not easy for our company to maintain an operating rate of about 70%. We maintain basic operations at a loss every day. We hope to survive this period. time, stabilize employees, and shoulder social responsibilities.” said a staff member of the printing and dyeing company.
Since the three-year epidemic, textile companies have been particularly under pressure, because almost all downstream companies sell on credit, but purchase raw materials in cash. In this way, as long as there is a problem in one link of the downstream production chain, weaving companies will basically be Don’t even think about receiving money. Therefore, how to alleviate the financial pressure next is to reduce inventory, reduce production, sell goods at low prices, etc., and secondly,The payment will be recovered immediately. The receivables cannot be collected, and the pressure is still on the company.
</p
