The Spun Garment Industry Should Be Cautious About The "New Stimulus Policy" And Do Not Blindly Expand.

Lao Chen didn't expect that the new production line was left idle so quickly.

"Now the export situation is not very good, mainly in Europe, the domestic market is also general, the competition is too intense."

Own brand

Lao Chen, now speaking with a little tired, is no longer a few years ago.

In 2009, the overseas market was improved, the domestic market was hot, and the textile and garment industry was listed as a key revitalization industry. The factory of Lao Chen made some expansion, but the days after that were not as satisfactory as Lao Chen's imagination.

This year has been a particularly difficult time. Lao Chen can only deal with one line after another.

Last month, there were a lot of new economic stimulus policies.

"No need for policy support or support is temporary, sooner or later, we must face it."

Lao Chen seemed very sensible this time.

"Hard work is an inevitable choice. Two years ago, we should not rush into the production line. Now we are all shelved."

Many of the companies that I used to expand and buy were regretted.

He said.

Sorry, there are many business owners.

Xu Xiaonian, a professor of economics and finance at CEIBS, also said that most of his students, who were eager to expand in the past few years, regret most.

Stimulus effect

In 2009, the cold war of the financial crisis did not recede in the previous year. Some domestic enterprises began to move against the current. Most of them were carrying cash in search of their own direction of development.

Lao Chen's business is one of them.

In April of this year, he took his children's clothing brand to China International for the first time.

"We only rented a small booth this time, first showing a little face at the exhibition, and coming back every year."

His remark is still fresh.

The children's clothing brand is their first brand.

Before, Lao Chen was a ranking cadre in Shanghai, and his wife, Ms. Li, was the chairman of the company.

After the financial crisis, export enterprises were in danger, and the domestic market was hot.

As the export market can not be abandoned, Lao Chen even resigned from public office and devoted himself to his own brand.

Lao Chen came to Beijing to participate in the China International Fashion Fair. Another goal is to find a way for his new brand to enter the big market like shinguang world.

"Their entrance fees are very high, and no one can get in at all."

He said.

Although he failed to enter the new world, Lao Chen's business is getting better and better.

"The overseas market is getting better again. Now the factory is very busy.

We have added four production lines, which can not be done and will be subcontracted.

Self created brands are still in progress, but obviously some of them are incompetent.

In the second half of 2009, Lao Chen always smiles when he talks about business.

Not only Lao Chen, but many textile companies invested money in expanding and integrating mergers and acquisitions.

In addition to seeing opportunities hidden in the industry, the encouragement and policy support from the macro level are also the reasons why some big enterprises "wait for action".

In November 9, 2008, the Chinese government announced the implementation of large-scale economic stimulus measures, and invested 4 trillion yuan in total before the end of 2010, for infrastructure construction and increasing bank credit.

Since then, some key industries have been listed as key areas of revitalization, and textile and clothing are also among them.

"With the support of government policy, enterprises have great enthusiasm for expansion or merger.

There are some supporting policies in terms of capital, loans and taxes.

Lao Chen was not an anomaly at that time, and many enterprises regarded it as an opportunity of their own.

According to the statistics of the China Textile Industry Association, in 2009 1~11 months, the total fixed assets investment projects of China's textile industry over 5 million yuan actually totaled 270 billion 802 million yuan, up 9.53% from the same period last year, and the growth rate increased by 0.78 percentage points over the same period last year.

Prudent response

In fact, textile and clothing is far from the main industry benefiting from "4 trillion".

Relying on the "investment" engine, the Chinese government quickly pushed the accelerator to the bottom and soon pulled the Chinese economy from the bottom.

Now, "drug efficiency" is excessive, the European debt crisis continues to ferment, and the Chinese economy seems to be pushed back to the edge again.

Since April, the added value of investment, consumption and industry has reached a new low for many years. The growth rate of power generation, steel output and the output of 10 kinds of non-ferrous metals has dropped to varying degrees.

In May, when the State Council executive meeting set a tone for the steady growth of China's economy, many people were envisaging the "4 trillion 2 edition".

This has also made it more important to increase investment.

In May 21st alone, more than 100 projects were approved by the NDRC, and the total number of approved projects was almost the same as that of the first 20 days of May.

In May 24th, two steel projects of Guangxi Fangchenggang and Guangdong Zhanjiang were approved with a total investment of over 130 billion yuan. When Zhanjiang mayor Wang Zhongbing walked out of the national development and Reform Commission, he couldn't help kissing the project approval document.

In May 25th, Shang Bing, Vice Minister of the Ministry of industry and commerce, revealed that this year's telecom infrastructure construction will usher in a new round of construction climax. The industry's annual investment is expected to exceed 370 billion yuan.

But this time, the business is clearly sober and sensible than the government.

Lao said: "the encouragement policy and relevant preferential measures are important reasons for large enterprises to dare to expand against the market in the current economic situation, and even some enterprises are supported by loans acquired through expansion of mergers and acquisitions, so as to support the flow of funds within enterprises, where money flows to nowhere."

"As long as the stimulus policy is over, the excess capacity can not be digested. Now the domestic and foreign markets are not so good. My production line can only be idle."

He said, "as early as I knew, I should still try to pform and not expand my mind at that time. At that time, the 4 production lines also spent about 2000000. Fortunately, no other factories were built."

Xu Xiaonian in China

The top 500 forum also admitted: "many of my students, who were eager to expand at the time, now regret most of them."

In September 2009, the equipment manufacturing industry investment and development forum, the equipment manufacturing industry investment fund preparatory group Cheng Sheng directly told: "although the machinery industry is in a period of rapid development from the export growth rate and the proportion of exports, but the start of the international equipment market takes time.

In the first half of the year, subsidies have been used almost everywhere, and many purchasing power in the second half of this year may have been prepaid in advance. Did the industry perform well in the second half of the first half of this year? I can't see clearly about that.

This is also the problem of most industries at that time.

Mei Xinyu, a researcher at the Ministry of Commerce, said: "the biggest bubble in China's economy is actually a productivity bubble, that is, a serious surplus of capacity. This bubble reached a climax in 2008.

Export manufacturing capacity expansion, while local government investment and real estate development is also overheating stage, resulting in expansion of capacity.

"However, after the international financial crisis in 2008, the demand for foreign investment reduced, especially the very loose monetary policy, which further stimulated the expansion of the capacity of enterprises.

In this way, an excess cycle is formed.

He said.

Chen said, "we do not have a very good solution yet, but the direction is more clear. We must work hard at the top end.

There is assurance. "