Home / Knowledge / News / Apparel/Garments / Inventory rises with Chinese garment enterprises
Inventory rises with Chinese garment enterprises
24
Jul '12
Apparel enterprises in China are witnessing a sudden surge in their inventories in recent months. 
 
Industry analysts attribute the rise in stocks of Chinese apparel firms to the ongoing debt crisis in Europe, the rise in labour costs and prices of raw materials, as well as changes in trading environment, which have together created drastic changes in business environment for Chinese clothing enterprises.
 
Some garment enterprises witnessed a sharp decline in export orders this year, which forced them to sell a large volume of their stockpile in the domestic market.
 
According to experts, during an economic downturn inventory turnover slows down, which affects operating liquidity, and hence companies find it difficult to come out with new products to attract more customers. This, in turn, seriously affects their performance and further increases the cash flow difficulties of apparel firms, which ultimately creates a dire situation for the entire business.
 
Another reason for stocks getting piled up with Chinese apparel manufacturers is that the enterprises produce their goods six months to one year in advance. For the purpose, the firms mainly depend on market information from downstream distributors rather than consumers. This information asymmetry leads to output that is much larger than actual amount that can be consumed by the market.
 
Experts expect leisure and sports apparel categories, which belong to fast moving consumer goods segment, to be rapidly devalued as soon as the season ends.
 
At present, several leading clothing brands are providing discounts in department stores in order to lessen their inventory. 
 

Fibre2fashion News Desk - China

Must ReadView All

Neelesh Hundekari speaking at the event. Courtesy: Subir Ghosh

Textiles | On 27th May 2017

Fabric of Change initiative announces €250000 scaling fund

The Fabric of Change initiative of Ashoka and the C&A Foundation is...

Pakistan's Finance Minister Mohammad Ishaq Dar presenting Budget 2017-18 in National Assembly in Islamabad on May 26. Courtesy: PID, Pakistan

Textiles | On 27th May 2017

Pakistan Budget 2017-18 proposes 4 new measures

To support the textile sector in Pakistan, finance minister Mohammad...

Textiles | On 27th May 2017

Indian exports can touch $325 bn in 2017-18: FIEO

Indian exports are on upward trend in last few months as the country...

Interviews View All

Jim Desai
Blaiva Fabricaa

Fashion industry likely to remain labour-intensive in coming years

DK Sharma
Velocity Apparelz

We constantly communicate with employees at all levels

Sunil Kumar Sharma
Loknayak JPNSSSG Ltd

'The blend of cotton–linen yarn has high demand in the domestic and...

Mark Paterson
Technical Absorbents Ltd

Mark Paterson, R&D manager of Technical Absorbents Ltd talks about Super...

Suresh Patel
Sidwin Fabric

Sidwin Fabric is a manufacturer and exporter of polypropylene textiles and ...

Marten Alkhagen
Swerea IVF AB

Marten Alkhagen, Senior Scientist - Nonwoven and Technical Textiles of...

Jay Ramrakhiani
Occasions Elegance Wear

It is believed that by early 19th century, Varanasi weavers had moved away ...

Sanjukta Dutta
Sanjukta's Studio

<b>Sanjukta Dutta</b> creates unique garments by clubbing prints of...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH

news category


Related Categories:
May 2017

May 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


E-News Insight
Subscribe Today and Get the
Latest News Update in Your Mail Box.
Advanced Search