Christmas order "micro-profit" Dongguan export industry pro-transformation test

After completing the last batch of Christmas orders, Zhao Liang continued to drive around the country. He often set his own goal to increase the proportion of domestic sales from 30% at the beginning of the year to 60% at the end of the year. Although he did a lot of Christmas. The product is processed, but this year he did not make extra money.

Zhao Liang is the general manager of Dongguan Zhuoyi Toys Co., Ltd., and like many export-oriented enterprises such as toys, clothing, lighting, etc., he feels that the profits of export sales are getting thinner and thinner, the appreciation of the renminbi, the rising prices of raw materials and the improvement of labor costs. The pressure is getting bigger and bigger. "Some factories fail to make a loss, we must seek transformation." On December 21, he said in an interview with the reporter of "Daily Economic News."

Thinner than paper


As the general manager of Guangdong Huari Lighting Co., Ltd., at the moment when the lighting export situation has obviously improved, Yue Peng has watched as his company's export profit is disappearing a little bit, and he is worried. Half of Huari Lighting's products are sold overseas, and this year's complicated foreign trade situation in the lighting industry has kept his nerves tight.


Although the customs statistics show that from January to November, China's total import and export value was 2,677.28 billion US dollars, an increase of 36.3% year-on-year, of which exports were 142.35 billion US dollars, an increase of 33%, and the overall rebound was good.


However, Yue Peng is still not happy. “After our research, at least in the lighting industry, this is not a normal recovery. Since mid-2009, the destocking process in developed economies such as Europe and the United States is slowly coming to an end, and then entering the inventory stage. Our industry export situation The improvement is largely dependent on this inventory filling action."


Zhao Liang said that many foreign-oriented toy processing companies now have profits below 10%, and even more than 2% to 3%. "The goods of 100,000 yuan only earn 3,000 yuan. Customers come to eat and eat, basically No.” Zhao Liang said that the price of the toy industry has basically been transparent. Under the circumstance of unclear foreign trade situation, many customers are desperately trying to drive down prices, which directly leads many companies to single or not.


Compared with the beautiful transcripts of the national import and export, Dongguan has shown signs of fatigue. According to the latest data from the Guangdong Provincial Department of Foreign Trade and Economic Cooperation, Dongguan exported 6.18 billion U.S. dollars in October, an increase of 18.5% year-on-year. The export growth rate has declined for three consecutive months.


September and October are the intensive periods of Western Christmas order delivery. The decline in export growth at this stage shows that this year's Christmas orders have a limited boost to Dongguan's exports. Some analysts believe that it is an important reason for companies that are caused by meager profits to be single.


Jiang Ling, deputy mayor of Dongguan, who was in charge of foreign trade, also said earlier that Dongguan’s foreign trade exports are growing, and there are serious problems of insufficient stamina. It is expected that the foreign trade situation in Dongguan in the first quarter of next year will not be optimistic.

Everything is going up

In addition to rising raw material prices, rising labor costs have also become an important factor affecting companies. The author saw in Chashan Town that many companies have long recruitment banners at their doorsteps. In order to encourage the return of the old employees, a factory issued the preferential conditions of “the original factory returned to the factory and subsidized 1,600 yuan”. But the staff still feel that the salary is too low. "There are no 100 pieces a day, I don't want to do it."


From May 1 this year, the minimum wage in Dongguan has been raised from 770 yuan per month to 920 yuan, an increase of nearly 20%. The average salary for enterprises is 1,500 yuan to 2,000 yuan. Workers will be higher.


Not only raw materials, labor costs are rising, Xue Meng, secretary general of the China Light Industry Arts and Crafts Import and Export Chamber of Commerce Toys Branch, told the media: "The pressure of RMB appreciation is the most important reason for compressing the toy industry's already low profit margin." A questionnaire survey conducted by China's light industry craft exporters on 45 light industrial export enterprises showed that 35 of the 45 companies experienced a decline in profits. Chen Xiangyou, secretary general of Dongguan Toys Association, told the Daily Economic News that according to his estimation, this year's exchange rate alone will reduce the profits of enterprises by 2 percentage points.


In late October, Global Sources, a multi-channel B2B media company, published a survey of 239 Chinese suppliers in Guangdong, Zhejiang, Fujian and other places. 60% of the respondents indicated that exchange rate changes will lead to Export orders fell, and 8% of respondents believe that the appreciation of the renminbi will seriously affect them. In addition, in the survey, 21% believe that rising raw material prices are the biggest challenge for their business, while 18% believe that labor shortage is the biggest challenge.

Industrial upgrading becomes a life-saving straw


Dongguan Ha Yidai Toy Industry Co., Ltd. directly increased the ex-factory price of products by 15%. Xiao Lin, chairman of the company, said that in order to cope with the pressure, this is the most direct way to take it.


For the Harbin generation with its own brand, this price increase method can still work, but for some companies that have a large number of OEMs, there is obviously no room for bargaining.


Zhao Liang’s current dream is to create a brand of his own in the future and end the OEM days, but this is only a plan for the future. The immediate thing is to expand the proportion of domestic sales and get rid of dependence on foreign markets.

In order to minimize the impact of exchange rates on corporate profits, Yue Peng put more energy into product technology research and development, and hopes to bring greater added value. "Only by making better things, there is more room."


Three months ago, Yue Peng invested 1 million yuan to build a lighting laboratory. "Only a few large companies have (laboratory). With the laboratory, the company's products will be significantly improved in terms of performance and technology. ."


However, Yue Peng also admitted to the reporter that at present, in the field of lighting, the core technology is still in the hands of foreign companies, and it is not easy to take the road of product innovation. In order to learn more advanced technology, Yue Peng is also seeking foreign excellent enterprises to carry out joint ventures. However, "the threshold is very high, the investment is relatively large, and there are very few real joint ventures."


Yue Peng also pointed his attention to the domestic market and exported to domestic sales. “We have established the Lighting Business Unit and set up 21 offices across the country, mainly facing the domestic market and strengthening the domestic sales.”


Hu Weiquan, general manager of Global Market Group, said, “Transformation and upgrading, and improving brand influence can resolve the crisis.” In his eyes, switching to domestic sales is a method, but it may not really solve the problem.


“As far as processing companies are concerned, under the pressure of exchange rate fluctuations, they may be transferred to Southeast Asian countries with lower costs,” said Xie Yongjun, vice president of vice president of policy management consulting. He also believes that this transfer is not easy. The infrastructure and labor quality of Southeast Asian countries are uneven, and may not be suitable for all enterprises that need processing.


Xie Yongjun believes that ultimately it is nothing more than two endings, the upgrade is successful or eliminated. He suggested that the process of RMB appreciation should be as smooth as possible and give the company some time. The state must also strengthen the protection of intellectual property rights and encourage innovation.




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