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A lifetime of weavers never expected to experience the double impact of a century-old epidemic and the global recession. As we all know, China's textile industry has always been to textile exports as the leader, is the main force to obtain foreign exchange. This year, at the end of the 13th Five-Year Plan, I wanted to make up for the loss of production as soon as possible after the domestic epidemic was basically under control, but I encountered a runaway epidemic in Europe and the United States, and the economy began to stop. It can be said that the biggest hit by overseas outbreaks is the domestic textile industry. For a time, a large number of European and American foreign trade orders were canceled, and a rare winter appeared in the textile and foreign trade industry. Many enterprises shut down due to the break of orders, and the market turmoil is turning into a daily "distress" for manufacturers ". On the network "work stoppage, holiday" words continue to emerge. How to find opportunities in crisis, adjust strategies, realize industrial upgrading, pass the darkness before dawn, and walk out of a new world is becoming the top priority of industry colleagues.

The pressure is beyond imagination

The impact of this epidemic on the economy, to be honest, most people are not prepared for it. Originally, it was thought that some well-known textile enterprises with large volume in the industry, with strong strength and diversified operation, were only temporary difficulties. After overcoming them, they passed. Now it seems that they can't see the end. The enterprises in operation are linked one by one, and they can't afford to wait or lose. At present, the first thing for enterprises to consider is how to survive.

The author learned that the boss of a textile machinery enterprise in Jiangsu recently visited several well-known textile enterprises in Shandong, Jiangsu, Shijiazhuang, Hebei and other places. The bosses of these textile enterprises were very different years ago and years later. They were originally full of confidence, laughing and energetic, but now they are gloomy on their faces, depressed and unwilling to accept guests. The chairman of Shenzhou is worried that the resumption of work will not be complete, which will affect the default of orders and will not be able to close the eyes for several days. At present, China has the most complete clothing industry chain in the world. 60% of the world's finished clothing products are produced in China, and the output value accounts for about 70% of China's foreign trade surplus. The most closely integrated with this industry chain is the international brand foundry. The bosses of these factories are extremely anxious these days. The boss of a foreign trade company in Keqiao, Shaoxing, said that the impact of the overseas epidemic is fatal. European factories have reduced orders and overstocked inventories, and half of the payment may not be collected. The cash flow of many factories does not last for three months. Due to the aggravation of the epidemic, the severe depression in the European and American markets is difficult to recover in the short term. In order to survive, many brands are eager to ship, and the boss takes the lead in selling products at prices below cost in the circle of friends.

The outbreak has disrupted normal operations.

A 120000 Spindle Cotton Mill in Jiujiang, Jiangxi Province is a manufacturer of special products for foreign trade. Even when the cotton spinning industry is at a low ebb as a whole and the trade war between China and the United States, it has not been greatly affected. Its products are exported to Europe and the United States, and some of them are exported to Africa. Its profit per ton of yarn is higher than that of its peers in 1000 or 2000 yuan. It has not lost money for more than 10 years. Due to the impact of the outbreak, U.S. and Japanese orders are largely gone. In particular, due to the obstruction of domestic logistics, we suffered a big loss in cotton procurement, with serious losses in the first quarter of this year alone.

At present, production has initially returned to normal. However, after the production capacity gradually recovered, it was hit by two waves: one was that cotton futures were hit by three fuses of US stocks. Cotton futures prices fell from 14300 yuan/ton to 9930 yuan/ton a year ago, and spot prices fell by nearly 3000 yuan/ton. The average price of more than 1500 tons in the factory was 14150 yuan/ton a year ago, and the average loss per ton of yarn was about 3000 yuan due to the epidemic situation in Xinjiang; the second wave of impact is that the goods cannot be destroyed or the foreign orders are broken, and the logistics are blocked. There are only sporadic small orders, and the collection time is more than 3 times longer.

Speaking of the experience of cotton purchasing, the general manager of the company sighed with emotion. Xinjiang's cotton payment was paid years ago, but Xinjiang could not deliver the goods years later, so it was not allowed to enter. After entering, the cotton drivers were quarantined for 14 days and returned for another 14 days. Such a ordeal, considering all kinds of increased costs (during the isolation period) and transportation costs to Xinjiang, the driver can hardly bear it. The person in charge lamented: the epidemic across-the-board management of the enterprise production rhythm is like a bottom draw, the provincial epidemic policy is different, to the post staff delay for nearly a month.

At present, the order is a year ago, but the second half of the estimate is also very difficult to do, consider doing a ton of loss of one ton, plus several major customer orders canceled, temporarily cut production by half, rotation of 5 days of exile, unless the global epidemic in April to June is under control, otherwise difficult to sustain. The biggest concern is the extent to which the U.S. epidemic has developed, and if the U.S. economy is really, as some economists predict, the recession is much more severe than the 2008 financial crisis, cotton spinning companies may not survive at least one-third of them this time.

Present Situation of Textile Enterprises

Many textile enterprises, such as cotton mills, do not directly do foreign trade, but rely on well-known group textile enterprises in the industry that face the international market to do OEM processing. For example, the pioneers and leading enterprises include Wuxi Yimian, Lutai, Huamao, Sunshine, Ruyi, Ningbo Shenzhou, Huafu, Bailong, Deyongjia, Yida, Bosideng, Yagor, Hailan, Shanshan, Senma and Dongdu all have this characteristic. Recently, according to the WTO, the economic recession and unemployment are likely to be more serious than the global financial crisis 12 years ago, and trade is expected to decline sharply.

The epidemic is disrupting the pace of global production, life and markets. Consumption has shrunk sharply, overcapacity has intensified, markets and factories have been deserted, and news of suspension, slowdown and cancellation of orders has been heard. The author interviewed several cotton mills and confirmed that the actual situation is indeed grim.

A cotton mill in Jianhu, Jiangsu Province, will resume work in the next year with the last batch of 500 tons of OEM processing orders provided by Sanyang, but I don't know what kind of products to make next. As the equipment can only make conventional pure cotton varieties, the price of cotton fluctuates violently, and the price of yarn falls endlessly, facing the risk of loss. The original air spinning equipment was basically unable to produce due to the low market price of yarn. All air spinning manufacturers in the area around Jianhu stopped, and the market was full of laid-off maintenance workers and operators looking for jobs. Acrylic core-spun yarn and differential yarn, which used to be more popular in the past, are now available.

There are the following problems in the cotton spinning mills around Jiujiang, Jiangxi: triangular debts reappear, funds are in arrears, and goods cannot be returned. At the beginning of the construction, the staff could not be arranged. Jiangxi is close to Hubei, and Hubei staff could not be on duty. Apart from the normal opening of a factory in Jiujiang, Jiangxi, the remaining seven or eight 2-30000 spindle mills are basically on temporary leave (half a month to one month) to observe the situation. The inventory backlog is approaching the limit, at the beginning of the production limit of 50%, the customer cut off the order, and now there is no chance to talk. Suppliers dare not do, dare not credit. The factory did not dare to do, no cash to buy raw materials.

How to survive the impact of the epidemic

Although the domestic economy is improving for a long time, the medium-term risks of the world economy are expected to decline, and it will take time for the market to recover. Investment projects need to pay attention to the isolation policy to control the time required for the spread of the epidemic and the final economic cost. They need to carefully and actively adjust their response, preserve their strength and fight against the uncertain risks that may exist for a long time, the shareholders, employers and partners of the textile enterprise company unite to support the company through the once-in-a-century difficulties, carefully do a good job in orderly development, and are ready to go.

· A model for small and medium-sized cotton spinning enterprises
The impact of the epidemic on all spinning companies is equal, but the end result may be very different. This is not, after the outbreak of the big rich driving in early March, 90% open, less than 10 days all open. The company had a large number of orders after the year, and by the end of April, many customers came to ask for help to insert them. The orders were for Vietnam, South Korea, Japan and a small number in Europe. U.S. orders were adjusted due to the Sino-US trade war, and direct contact with the United States was not considered, but some goods were also sent indirectly to the United States.
Their successes: First, they pay attention to the selection of four key domestic high-quality enterprises-Lutai, Deyongjia, Shenzhou and Changzhou Xurong Knitting, and focus on quality research according to customers' technical requirements, with 50S ~ 80S as the main high-grade products, accounting for 70% of the total production. The second is to produce differentiated conventional varieties. Due to the increase in average count and rich labor, more people will arrange to produce 30S ~ 32S coarse products, however, the varieties of high value-added and high-quality old customers are the best cost-effective, while maintaining a balance between production capacity and customer demand, with the total production accounting for 30%; the third is to adhere to the business idea of differentiation and high value-added, to open up the high-end industrial chain of the back road, and to make customized, top-level yarn and customer use docking.
Of course, if the global epidemic is not effectively controlled in June, the big rich will not be left alone, but also face future inventory and financial pressures. Fortunately, at present, all the funds are raised by oneself, and there is no bank interest. The money earned every year is completely used for targeted transformation. Starting from 2011, the spinning frame will be successively transformed into 30000 spindle Sailuo compact spinning, 20000 spindle Sailuo spinning and some core-spun yarn devices. In 2019, we will speed up the transformation of the three major projects of fine yarn single spindle detection, short car collection and tight spinning, and generally improve the forming of tube yarn through the transformation. At the same time, it will improve the self-network production efficiency by at least 2%.

· Pay attention to the risks of switching to the production of medical and epidemic prevention products.
In the face of the sudden "return tide", many clothing fabric foreign trade enterprises to actively self-help, switch to the production of masks and other epidemic prevention materials. As early as the beginning of February, China Export Credit Insurance Corporation issued a mask supply and demand risk warning, must be used to achieve 95% of the filterability, effective prevention of virus medical meltblown non-woven raw materials to make masks. The output of non-woven fabrics in Xiantao City, Hubei Province accounted for 60% of the country's total output. On February 1, Xiantao City shut down all local civilian mask manufacturers in order to control the production quality of medical masks and prevent and control fake and shoddy products. China's Ministry of Commerce issued standards, from April 1, China's export of anti-epidemic materials tightened, only the European Union, the United States certification without Chinese registration can not be exported! Medical products in Europe and the United States standard is the current international high technical threshold, as long as the demonstration will be released. No CE demonstration can not enter the European Union, no FDA certification can not enter the United States, N95 masks must meet the NOISH-N95 standards and certification before they can be used in the United States. "CE" "FDA" certification, may lead to the port of destination can not be cleared, resulting in fines and logistics transportation warehousing and other huge costs.

Online live broadcast to expand domestic demand channels
The epidemic has changed consumption habits and consumer demand, and the epidemic has inadvertently changed the original habits of different generations. As a result of the epidemic, people are shopping less at home, and more and more consumer behavior is being addressed through the Internet. For the textile industry, the embodiment of a strong domestic market requires good channels, and online live broadcast has become an important choice worth trying. On March 31, a live webcast called "Director Selling Yarn" was held in the conference room of the Shandong Provincial Department of Industry and Information Technology. On March 14, 2000 wool weaving enterprises in Dongguan took the lead and opened a live exhibition hall with the help of e-commerce platform, which was watched by consumers. Live multi-dimensional display, strong interaction and authenticity and other effective relief, live broadcast is not only selling goods, but also to achieve high-quality shopping guide sales capacity amplification, multi-channel access, efficient management of members and other functions, to help the brand fine operation capacity. In the face of the difficult situation, various garment enterprises are actively seeking countermeasures, most of the business owners said that the current primary goal is to survive first, waiting for the end of the epidemic after the recovery of consumption.

· Prejudge the layout of foreign trade in advance.
In order to reduce export risks, "eggs" are placed in multiple baskets in advance to increase innovation. The West is not bright, the East is bright, while adjusting the direction of exports, while starting to develop innovative products, two hands, two hands hard. Shaoxing Gaogu Import and Export Co., Ltd. is persistent in innovation and research and development, making "Gaogu" products very in tune with overseas brand clothing manufacturers. A 3D lace fabric recently developed by the company is especially popular with foreign customers. There are countless inquiries and samples, and there are many potential customers, which can be mass produced immediately.

Survive difficult times with a positive attitude

-Macro policy easing economic and monetary measures introduced
Not long ago, the G20 countries held a video conference call to announce that they would launch a $5 trillion billion economic boost plan to deal with the negative global social, economic and financial impact of the epidemic, which to some extent boosted market sentiment. Interest rate cuts and quantitative easing at the monetary policy level are at the heart of the current multi-country economic response. Emerging economies are no exception. The central banks of the Philippines, South Africa, Malaysia and other countries announced interest rate cuts on March 19. On April 3, the central bank's directional downgrade to 400 billion liquidity and cut the excess reserve rate to help the market, but also the third downgrade of the year to land, the total investment of 1.75 trillion. In mid-to-late April refinancing and re-disbursing new 1 trillion on the basis of the previous 500 billion, in order to support the development of the real economy, promote increased support for small and medium-sized enterprises, reduce financing costs. Hou Bangan, deputy director of the Guangzhou Taxation Bureau of the State Administration of Taxation, said, "After the policy was issued, 40 foreign trade companies have applied for tax refunds, and the tax refunds have reached 0.147 billion yuan".
The Ministry of Finance and the Ministry of Transport have issued policies announcing that port construction fees for import and export goods will be exempted from 0:00 on March 1 to 24:00 on June 30. The Ministry of Commerce, in conjunction with the China Export Credit Insurance Corporation, underwrites the losses suffered by the importer's commercial and political risks in the course of the export business.

· Simultaneous development of domestic and foreign markets, waiting for the recovery of the international market
From the perspective of stable operation of textile enterprises, upgrading of industrial structure and balanced economic development, due to the aggravation of the spread of the epidemic in textile export areas and the increase of "breakpoints" in the international industrial chain, it is necessary to improve the layout of the textile industrial chain in Southeast Asia, open up the domestic industrial chain and supply chain, and improve the global rapid response and adaptability. The foreign trade power point will be more implemented on the maintenance and expansion of customer channels, retreat when necessary, open up the domestic demand-side consumer market, and wait for the recovery of the international market.

· Firm confidence and overcome difficulties
In view of the employment, logistics, market and other factors that affect the current constraints of textile production, it is necessary to think in multiple dimensions, make full use of various types of sales channels, diversified consumption areas to tap the potential of internal and external markets to improve capacity utilization in an orderly manner.
Textile enterprises must establish confidence, to trust the central government, trust the government, firmly win the battle of epidemic prevention and resumption of production confidence, can be expected in the first half of this year, the market is difficult to improve, should be prepared for a long-term battle.
The neo-coronary pneumonia epidemic is a human disaster, but it is also an opportunity for the transformation and upgrading of the global industrial chain. China should seize the opportunity of the suspension of some industries in Europe and the United States and the economic recession, speed up the "investment to supplement the chain", and ensure the healthy development of industrial chain clusters. When the foreign market recovers, we should further strengthen international cooperation, expand the scale and development quality of industrial clusters, and drive the global industrial chain cycle.
The foundation of China's long-term macroeconomic improvement will not change. Domestic macroeconomic policies will focus more on stabilizing growth and preventing risks, and will put the improvement of the policy environment for small and medium-sized private enterprises in a more important position. In response to the impact of the epidemic, the state has begun to introduce various support policies to help enterprises gradually ease the pressure on their operations.
China Textile Union put forward to the relevant government departments as soon as possible to ease the pressure on enterprise capital turnover, further reduce the burden on enterprises, continue to ensure the resumption of work and production and other policy recommendations, and proposed to study and deploy in advance after the epidemic to start domestic consumption, stabilize the competitiveness of export products policy plan. As long as colleagues work together, rely on all employees, and overcome all difficulties, we will surely usher in a new future.

Wen | Suzhou Textile Engineering Society Miao Dingshu