Textile shoes and clothing industry is tested by rising cotton price

“the change of raw materials has affected the operation behavior of production enterprises. 1n terms of purchasing, it is not as easy as in the past to store cotton. A large amount of money is needed to store cotton, and it will suffer heavy losses after a big drop. This situation is not without precedent, in 2004 a large number of enterprises hoarding cotton died in the bull market 1n the face of this year’s market environment in which cotton prices repeatedly hit new highs, said Zhang Bin, an analyst in the textile industry at Guojin securities (16.60%, 0.38%2.34%)

on September 25, cotton prices reached a new high in nearly 10 years, breaking through 20000 yuan / ton. On September 27, Shanghai and Shenzhen stock markets, Shandong Hailong (6.18, – 0.06, – 0.96%), Xinxiang Chemical fiber (6.42,0.02,0.31%) and other chemical fiber stocks were all red. 1t is said that the price rise of cotton led to the price rise of viscose raw material cotton linter, which promoted the price rise of viscose

while facing the rise of raw materials, manufacturers face the price reduction of buyers. Accordingly, the industry diagnosis said that whether the pressure of high cotton prices can withstand will depend on whether the end consumers are willing to digest

the price growth is faster than the sales growth

“if the price of terminal products rises, it must be the price rise of the whole industry, rather than a certain brand, then most consumers can only accept it, and the result may reduce the purchase frequency, but because the price rises, the overall sales data is expected to grow. Judging from the current ordering situation, Next year, the growth of clothing sales may lag behind the price growth. ” Zhang Bin said

qipilang (33.54,0.49,1.48%), Li Ning and other listed brand shoes and clothing enterprises all confirmed that the price increase did not affect the sales performance. Qipilang’s medium-term operating profit was 169330500 yuan, an increase of 40.68% over the same period of last year; The net profit was 123.7834 million yuan, an increase of 31.02% over the same period of last year. Meibang apparel (28.80%, 1.30%, 4.73%) also entered the growth period after the adjustment. 1n addition, Luolai home textile (73.94%, 0.94%, 1.29%) and other home textile enterprises exceeded expectations, and their income and net profit achieved high growth at the same time

the ordering meeting of Li Ning’s brand products dealers in the first quarter of 2011 ended, and the published data seems to confirm this statement: the company’s large-scale orders increased by 12% year on year, in which the average retail price of shoes increased by more than 7%, and the order quantity increased by more than 5%; The average retail price of clothing products increased by more than 11%, and the order quantity increased by about 1%

according to the analysis of securities companies, the price rise driven by production cost will not benefit the enterprises in the end, and the drastic fluctuation of raw materials will only hurt the newly recovered textile industry again. At the same time, they generally believe that although it will be transmitted to the terminal, it will have little impact on the terminal brands. Most of the cost pressure will be borne by the production enterprises, some of which will be paid by the consumers, and the part borne by the brand enterprises is very small. Moreover, the price transfer ability of the brand enterprises is generally strong

another worry of securities companies is that the proportion of raw material cost in the price of brand shoes and clothing enterprises is low, and the impact is small. However, at present, a large number of foreign brands of clothing enter China. 1f domestic clothing brands only raise prices, but fail to follow up in design and quality, consumers may not always pay for the price increase

from the survey, we can see that terminal brands such as qipilang, Li Ning and Meibang clothing continue to avoid the fierce competition between first tier cities and international brands, expand consumer groups and ensure sales volume through channel sinking and expanding second and third tier cities and network markets. 1n 2009, with 8.387 billion yuan, Li Ning surpassed Adidas and ranked second in China’s sports brand sales, benefiting from its deep cultivation in second and third tier cities in recent years

second and third tier cities are considered as “value depressions” with consumption potential. From the perspective of macro policy, the reform of income distribution system is inclining to the middle and low-income groups, the minimum wage standards of all provinces have begun to rise significantly, and the consumption ability of consumer groups is waiting to rise. However, the brand recognition of second and third tier cities and first tier cities basically converge. Once the consumption ability is available, the brand recognition of second and third tier cities will increase, The majority of terminal brands will benefit

another important reason for many terminal brands to enter the second, third and fourth tier cities is real estate. Since 2009, the real estate prices in the first tier cities have increased dramatically, which has led to the increase of rents. Some economically developed second and third tier cities have relatively reasonable housing prices and consumption potential, and the second and third tier cities are not the important objects of national real estate regulation. For example, in the first half of the year, seven wolf company adjusted its channel expansion strategy, moved to the third tier cities, and encouraged new stores to choose shopping malls with small initial investment, thus alleviating the upward pressure of rent. 1n the first half of the year, the company’s sales expense rate was only 14.15%, a year-on-year decrease o2.95 percentage points

at the same time, the real estate market is also driving the high growth of the home textile industry. Fuana (45.41, – 0.17, – 0.37%), Mengjie and Luolai are the three major home textile listed companies. 1n the first half of the year, the stock market performed well, and the performance of Zhongbao was steady growth. 1n the first half of the year, fuana achieved a net profit of 47.786 million yuan, a year-on-year increase of 41.77%, and earnings per share of 0.46 yuan; 1n the first half of the year, Luolai home textile achieved a net profit of 76.7957 million yuan, a year-on-year increase of 58.96%, and earnings per share of 0.55 yuan; Mengjie home textile (43.97%, 0.17%, 0.39%) achieved a net profit of 28.3574 million yuan in the first half of the year, a year-on-year increase of 32.75%, and earnings per share of 0.54 yuan

the data show that the per capita consumption of household textiles in China accounts for less than 1% of the consumption expenditure, which is 7% of the clothing consumption, while the clothing consumption in developed countries is basically equal to the consumption expenditure of household textiles. From the perspective of consumption structure, there is a huge market space for the development of household textiles in China

securities companies also generally believe that the real estate transactions in 70 large and medium-sized cities across the country are stable, the prices of some second and third tier cities are rising, and China’s continuous urbanization process and consumption upgrading will provide strong support for the demand of home textile industry

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