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

Textiles | On 28th Mar 2017

India may impose duty on elastomeric filament yarn

The Government of India is likely to impose anti-dumping duty on...

Courtesy: Kraig Laboratories

Textiles | On 28th Mar 2017

Kraig gets certificate for silk production in Vietnam

Kraig Biocraft Laboratories, Inc., a leading biotechnology company...

Information Technology | On 28th Mar 2017

Intex Consulting signs partnership with Kawan Era Baru

Germany based Intex Consulting GmbH has entered into a strategic...

Interviews View All

Kamlesh Vaghela
RK Textiles

Very few machinery manufacturers have R&D units

Siddharth Biyani
Mangalam Industries Pvt Ltd

‘The manufacturing sector is improving day-by-day, becoming better in...

Amardeep Singh
Orient Craft

'In export markets, the trend in terms of embroidery, is towards matte...

Kevin Nelson
TissueGen

Kevin Nelson, Chief Scientific Officer, TissueGen discusses the growing...

Kai Poehler
Voith Paper GmbH & Co. KG

The glass mat industry is growing by five to eight per cent annually. Kai...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Judy Frater
Somaiya Kala Vidya

Among the many honours showered on Frater, including Fulbright and Ford...

Pranav Mishra
Huemn

Designers Pranav Mishra and Shyma Shetty’s Huemn is known for its...

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
March 2017

March 2017

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

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search