In the textile and apparel field, high inventory has always been a common problem in the industry, and this indicator has also attracted attention. As the 2021 semi-annual reports are released one after another, some listed clothing companies are happy and some are sad. The “distress” of some clothing companies is clearly visible, and the “inventory crisis” that has long plagued the development of the industry is still spreading.
Clothing companies are entering the inventory cycle: 8 companies are listed on the market The inventory of clothing companies exceeds 1 billion yuan
According to Wind data, among the 43 textile and apparel stocks, as of the first half of this year, 39 stocks have inventory amounts exceeding 100 million yuan. Meibang Apparel , Anzheng Fashion, Souyute, Peacebird, Semir Clothing, Jihua Group, Heilan Home, and Youngor have eight stocks with inventories exceeding 1 billion yuan, among which Youngor ranks first in terms of inventory amount.
Youngor’s semi-annual report shows that as of the end of the reporting period, Youngor’s inventory amounted to 16.575 billion yuan, accounting for approximately 19.67% of total assets. It is understood that Youngor’s inventory categories include material procurement, materials in transit, raw materials, turnover materials, inventory goods, products in progress, shipped goods, commissioned processing materials, land to be developed, products to be developed, development costs, etc. Among them, the book balance of Youngor’s inventory products is approximately 1.27 billion yuan, and the corresponding book value is approximately 1.198 billion yuan.
At the same time, according to the reporter’s inquiry into the annual reports, it was found that since the listing of Peacebird, only 2018 was the year when the inventory fell by 0.12%. The remaining years have increased to varying degrees, and the book value has increased from 664 million in 2011 to 664 million in 2011. Yuan has continued to grow to 2.364 billion yuan in the first half of 2021, accounting for 27.77% of total assets. The company mentioned in the report that the company’s inventory is still large and accounts for a high proportion of total assets. If the market environment changes or competition intensifies, it will lead to difficulties in realizing inventory, and the company will face larger inventories. Impairment pressure and price fall risk.
For clothing companies, inventory has always been one of their main pain points. Product backlog not only occupies the company’s operating funds, but also increases the company’s management costs and profit costs, lengthens the product turnover cycle, thereby reducing the company’s overall profits. For huge inventories, closing poorly operating stores and offering discounts and promotions have become the traditional methods for most clothing companies to destock. An executive from a clothing company who did not want to be named said frankly: “At present, it takes a long time for clothing companies to digest these inventories, but profit support is needed to sell the inventory. Once the financial statements look ugly, banks will follow behind to collect debts. Therefore, More and more clothing companies are entering the inventory cycle.”
The terminal stock is not sold in time. Weaving companies are struggling, and foreign trade orders are trembling.
Textile and clothing are closely related industries. If the terminal stock is not sold in time, it will directly affect the textile industry. develop. Fabric merchants lack large-volume orders, and weaving manufacturers are slow to deliver goods, resulting in gray fabric inventory. Further down the line, the continued decline in the value of raw materials has caused pressure on raw material production.
From the perspective of the recent textile fabric trade, the inventory of polyester filament and terminal weaving products has shown an upward trend, while the inventory of weaving raw materials has been declining since the third quarter, which also confirms the trend of reduction in the scale and frequency of downstream weaving purchases. . Repeated epidemics at home and abroad have caused greater resistance to textile and clothing exports, while domestic demand is sluggish and weaving companies are struggling. At present, there is a trend of reducing the load on looms in many places, and some companies with high inventories have temporarily stopped.
On the other hand, and the most important point is that the sales situation of fabrics is not optimistic. The peak season market in the first half of this year was not as good as in previous years, and the performance of fabric orders in the off-season was even worse, except for some autumn and winter fabrics. Apart from the best-selling products, other products are difficult to sell. Without orders, the inventory growth rate of weaving companies has also become extremely fast.
September 2021 has entered. At present, the foreign trade situation is still uncertain, and most export textile companies are cautious about orders in the second half of the year. Repeated overseas epidemics, shipping costs, international relations, and high textile and clothing inventories have led to trepidation in receiving foreign trade orders.
For those clothing companies whose products are not very competitive and have poor differentiation capabilities, the onset of inventory pressure may be a severe test. In the future, if inventory factors cannot be effectively alleviated, the inventory will collapse. clothing companies may bring down traders and weaving companies. No matter what the situation is, in short, inventory digestion has a long way to go and is still the top priority of the current textile industry chain.
</p
