Walking into the production workshop of Jieyang Puning Zengfa Textile Co., Ltd., double-sided circular knitting machines and racks filled with rolls of spinning yarn and spandex neatly divide the huge factory into rows of production lines.
Puning City, where this small and micro enterprise is located, is the county-level city with the largest total output value among Guangdong’s garment industry clusters. It has more than 6,000 textile and garment enterprises, 310,000 direct industry employees, and more than 300,000 industrial e-commerce employees. There are 3 provincial-level technological innovation professional towns, and the total output value of textile and clothing in 2021 will exceed 120 billion yuan.
Internal difficulties such as scattered industrial chain distribution, low value, and lack of leading brands, coupled with external impacts such as the impact of the current COVID-19 epidemic, surge in raw material prices, and unstable international situations, are severely testing this 100-billion-dollar textile base. Keeping people and orders, seeking change and innovation, small and micro enterprises that are the first to bear the brunt are staged an “icebreaker” in the traditional textile industry.
The development plan has been pressed on the “pause button”
The production workshop of Zengfa Textile is bright and dark. Where the lights are on, a worker is placing spandex on the machine track one by one, and then skillfully pulls out the almost transparent filament that is thinner than a needle, and quickly ties a knot. After the machine is started, the yarn feeding begins, one meter at a time. The cloth is produced in constant rotation.
In the production workshop of Puning Zengfa Textile Co., Ltd., double-sided circular knitting machines and racks filled with rolls of spinning yarn and spandex neatly divide the huge factory into rows of production lines.
However, in the darkness of the workshop, more machines were temporarily laid off. “We have a total of 108 machines. Due to insufficient orders, we have only opened about 40 machines now.” After resigning from his job in a printing and dyeing factory in 2019, He Xiaofan founded this textile factory the next year. In the first two years of starting a business, I still had some “sweetness”. Just when he was about to “run”, difficulties came one after another.
In the middle reaches of the textile industry, companies in the processing and manufacturing sectors such as weaving, printing and dyeing, and production are faced with the dilemma of being “attacked from the front and back.” The price of raw materials, which are the bulk of front-end production costs, is unstable. “Take spandex as an example. Last year, the price was as high as 80,000 to 90,000 yuan per ton, a record high, which brought huge cost pressure to the company.” He Xiaofan said. Weak back-end consumer demand and logistics disruptions caused by the epidemic have left traders with a lot of inventory, which will naturally further reduce new orders.
This “one increase and one decrease” has made it difficult for many midstream companies to bear. Coupled with monthly fixed expenses such as labor, rent, equipment depreciation, etc., they can barely maintain a balance of payments, and the resulting “common problem” in the entire industry chain ”——The slowdown in the return of funds has hit the biggest “weakness” of small and micro enterprises.
“Under normal circumstances, the payback period is about 40 days, or up to 2 months, but now it often takes 3 to 5 months. If we cannot accept this payback period, customers may not come to us.” He Xiaofan felt helpless about this.
Zhang Wenzhong, general manager of Puning Jiaxin Printing Co., Ltd., chose a conservative development path that was completely different from the original plan. In 2019, he moved the factory into the newly built Puning Textile Printing and Dyeing Environmental Protection Comprehensive Treatment Center. He ambitiously invested eight to nine million yuan in renovating a new factory building of nearly 3,000 square meters and purchased newly upgraded equipment. “Our production capacity has doubled. We originally wanted to go out of Guangdong Province to find new customers. Unexpectedly, the epidemic has put the ‘pause button’ on our plans.” Zhang Wenzhong said that compared to exploring new customers, he now prefers We tend to keep high-quality old customers who get their money back quickly to ensure that the company can still operate normally.
Also choosing to stick to old customers is Puning Mingsuan Garment Co., Ltd., a foreign trade enterprise specializing in underwear processing and sales. General manager Chen Yuhong originally managed his family’s clothing foreign trade company in Guangzhou. In 2017, he returned to his hometown of Puning and opened this garment factory, hoping to increase profit margins through self-production and sales. In the two years before the epidemic, foreign supply chains had not yet recovered, so many orders were returned, and orders for garments were also increased by about 30%. However, since this year, facing the turbulence of the world structure, Chen Yuhong expects that the order volume will decline in the future. “We have slowed down our production pace, and orders are currently only scheduled for the next two to three months.”
When it comes to countermeasures, Chen Yuhong chooses to wait and see for the time being. “It is a trend to switch from export to domestic sales, but the competition in domestic sales is fierce, and the product styles and sales models of the two are also different. The transformation requires a lot of time and cost; on the other hand, the current epidemic has not subsided, and it is difficult for us to go When developing new customers abroad, online channels are not suitable for us. After all, the clothing industry still needs to touch the physical goods in person, and offline negotiations will be more efficient.The trade transformation and upgrading base (underwear), the development of Chaoshan Underwear Industrial City, and the construction of a comprehensive textile printing and dyeing environmental protection processing center are important starting points to promote the innovation and development of industrial technology.
Along with technological upgrades, there are also equipment upgrades. In the “Key Technologies and Industrialization of High-Quality Super-Soft Seamless Knitted Garments Processing” innovation project jointly carried out by Puning Ruiyuan Technology and Donghua University, 11 underwear manufacturers have introduced more than 850 units (sets) of the world’s advanced wireless Sewing underwear production equipment, and establishing the National Textile and Garment Product Quality Inspection Jieyang Branch Center.
Large enterprises are leading the way, and small and micro enterprises are not far behind. In He Xiaofan’s factory, there are almost no traces of old machines. “All the equipment has been replaced with new ones.” Although a lot of investment has been made in updating the equipment, He Xiaofan did not hesitate much, “Just like a car has been used for a long time, there will be more problems. If the machines are not replaced, not only will more maintenance resources be consumed, It still cannot keep up with current production capacity requirements.”
With the use of new equipment, He Xiaofan’s factory not only continues to improve production efficiency, but also saves about 1/3 of the manpower. The government provides enterprises with preferential subsidies and policies such as technological transformation, equipment updates, and tax exemptions, which has helped He Xiaofan a lot. “The tax reduction and exemption alone is more than 290,000 yuan,” he said.
This year, with the establishment of the “Chaoshan Underwear Industry City”, Puning will also accelerate the transformation and upgrading of the 100-billion-dollar textile and apparel industry cluster, exploring a new development path for the upgrading of Guangdong’s traditional manufacturing industry under the epidemic.
</p
