“For an external order of thickened fake twisted satin, it was not enough for one manufacturer to ship more than 10,000 meters of 40 looms every day. The customer ordered another manufacturer and asked for at least 20 looms to be produced. If the machine can be set up quickly, Add orders sustainably,” said a textile boss.
There is no time limit and no quantity requirement. This order is very large for the textile boss. If it is produced for one month, it will be millions of meters. At the same time, customers are still placing more orders, so will taking this order really mean that they will not have to worry about food and drink in the second half of the year?
In fact, this is not the case.
low profit
“Although this order is large in volume, the profit is not high, especially in the off-season. The profit of the machine may be less than 100 yuan per machine. If it were not for the fact that there were fewer orders in May, we would not be able to handle such a small number of orders. If you know how to pick up the machine, the profit per day will be less than 50 yuan.” said the textile boss.
Although the current order situation is not as deserted as the off-season, it has indeed begun to decrease compared to the peak season of March and April. The biggest problem facing the market now is insufficient profits, and it is precisely because of this order The quantity is very large, so there is room for price negotiation. Based on the principle of small profits but quick turnover, it is also at this time that weaving manufacturers maintain normal operation in order to maintain normal operation during the off-season.
Of course, as long as it doesn’t make a loss, I’ll take it.
Long account period
“Another disadvantage of this order is that the billing period is very long, which takes two months.” said the textile boss.
The payment cycle in the textile industry has always been a pain point for textile companies. There is much variability and extended cycles have become the norm. In previous years, the market’s payment recovery cycle generally ranged from 1 to 3 months, but there are also some longer ones, such as 3 to 6 months, or even 1 to 2 years or bad debts. In recent years, people have not had sufficient funds on hand, and the payment cycle has been lengthening.
However, most of these situations occur in domestic demand, and the account period in the foreign trade market is usually not long. Maybe two months is not a long time for the domestic demand market, but it is indeed a bit long for the foreign market.
This is undoubtedly a kind of pressure for textile bosses who have been affected by long payment periods in recent years.
The money is either on the books or sitting on inventory.
According to the inventory days of sample companies monitored by Silkdu.com, it can be seen that the current local inventory days are only 35.2 days. Although this number does not seem to be much, there must be manufacturers with low inventory, but at least one-third of the manufacturers have Inventory in the warehouse is still piled everywhere, taking up millions or even tens of millions of funds.
Through investigation, it is found that whether selling gray cloth or finished products, or even trading companies, there is generally a problem of receivables. Almost all of these companies said that the problem of receivables has been common since they started to make textiles, and it is a long-standing problem. However, compared with previous years, the receivable situation has become worse in recent years than in previous years, and the repayment cycle has become worse. It’s longer than in previous years, and it’s getting harder and harder to get.
The harder the textile market becomes, the harder it is to collect receivables. If you want to say that the market is not good this year, then it is indeed very good. But if you want to say that it is good, it may not be comparable to the peak season. Looking at the piles of inventory at home, there are uncollectible accounts floating around. Money is difficult, it is really difficult.
So, no matter how busy some textile bosses are running their looms, are they really making money? Has his money already come in? Only they know their pain. To gain a foothold in the market, they not only rely on their own superior products, but also rely more on the market environment.
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