Big Reshuffle Of Textile And Garment Industry, Small And Medium Garment Enterprises Are All Upside Down.

Recently, according to the latest news, Adidas confirmed that the company will close its last factory in China.

Does this mean a warning for China's textile mills?

"China is no longer the country with low labor cost a few years ago."

An industry insider told reporters.

It is worth mentioning that Adidas was once accused by the London Organizing Committee of its sweatshop in Kampuchea.

At that time, the company responded that its factory workers in Burma earned $130 a month (about 828 yuan).

By contrast, the average monthly salary of the company in Suzhou is no less than 3000 yuan, which is 3.6 times the monthly salary of Burma workers.

Relocation to reduce labor costs

"A few years ago, especially in 2008.

Later, international famous companies began to move their factories in China to Southeast Asia and other places.

The industry insiders told this reporter that "for these international Brand Company, where artificial cheap will move to where."

In August 2008, France's "Le Figaro" reported that in view of China's rising wage levels, in order to reduce production costs, Adidas is ready to shift the production of some products from China.

The report also pointed out that Adidas president Haina had publicly stated that Adidas had more than 50% of its sports shoes produced in China, but because of the increasing wage demands of Chinese employees and increased production costs, the company intends to reduce the proportion of production in China in the future.

Although Haina said that the proportion of production in China reduced, but then responded that "the number of foundry in China will definitely not decline, nor will it close any market in China".

The industry insiders said that

The closure of the production plant directly under the company, and the foundry factory will continue.

Because Adidas only gives orders to the OEM factories, so it doesn't need to consider labor cost.

That is to say, Adidas will shift the risk of labor costs upward to the OEM manufacturers. Considering the order, the profit can only be compressed by the OEM factory.

In addition to Adidas's factory relocation, Nike, the world's top sports brand in March 2009, also closed the Taicang factory, the only shoe production facility owned by the company, to be pferred from Fengtai group's footwear production business to Fengtai's factory in other parts of Asia.

Ma Gang, an independent critic of sports industry, said that this is a signal of "great shift and great pformation". The announcement of Adidas's withdrawal at this node is caused by the market rule and the cycle of industry.

"The end of the demographic dividend era makes garment processing enterprises face the choice of pformation. ODM (original design and manufacture) is China's most basic and practical choice."

"In view of the fact that the textile and garment industry is a labor-intensive industry, Adidas, Nike and other companies pay more attention to labor costs in terms of cost reduction, and of course do not exclude pportation costs after moving to Southeast Asia."

The industry insiders told reporters that "with the increase of labor costs, I believe there will be Chinese factories moving to the central and western regions or Southeast Asian factories."

Data show that China's labor cost is two times that of Southeast Asia.

At the same time, France

The research data released by the association show that the average wage of Chinese textile enterprises employees is 188 euros -300 euros, which is much higher than that of Bangladesh, which is the lowest wage country in the global textile industry, about 80 euros.

The south migration of garment textile enterprises

It is precisely because of the Brand Company's pursuit of maximization of interests that the low labor force has achieved the history of "sweatshops".

According to foreign reports, in order to produce related products of the London Olympic Games, Adidas's factory in Kampuchea allows workers to work at most 10 hours a day and 6 days in 1 weeks.

These workers say that their working environment is bad. If they work 8 hours a day and work for 1 days for 6 days, the monthly salary is 61 dollars, and another 5 dollars of medical insurance premiums.

It is reported that Adidas has invested 100 million pounds in the Olympic Games.

The London Olympic Organizing Committee has signed an agreement with manufacturers of Olympic commodities, which requires Olympic sponsors to provide enough basic living wage for workers.

The labor union behind the trademark said Adidas's wages to Kampuchea workers violated this agreement.

The industry insiders said that the reason why Adidas set up factories in Burma is that local labor costs are cheap and wages are low.

In response, Adidas responded publicly on the 13 day that the average wage of the factory worker was $130, and the salary would rise at the end of the year.

But some people believe that the Kampuchea factory has violated the requirements of the London Olympic Organizing Committee, that is, sponsors must pay workers' sustainable and guaranteed wages.

In a foreign media interview, a spokesman for the London Organizing Committee said that the OCOG attached great importance to the accusation and would investigate the matter.

It can be seen that whether it is moving out of China due to rising labor costs or hiring workers at low prices in Kampuchea, Adidas's behavior shows that in order to save labor costs, the marketing concept of low cost and high profits of international brands is exposed.

It is worth noting that in addition to Adidas and Nike moving factories to Southeast Asia, Clarks, K-Swiss, Bakers and other international shoe giants have added production lines in Vietnam and Indonesia.

In June this year, 13 Chinese textile companies including the famous Tianhong Textile Group Co., Ltd. sent representatives to Indonesia to find suitable factories.

In view of this, Southeast Asia has launched a boom in spinning factories.

It is understood that China's textile export enterprises have been hit by the price advantage of Southeast Asian products.

In the face of price shocks in Southeast Asia, the owners of textile enterprises proposed to build factories in Southeast Asia to make up for their inferior prices.

A textile company official told reporters that the domestic low end export products orders have been reduced by 1/3 this year, and many orders have been snatched away by Southeast Asian companies.