Since 2010, the rise in ***, raw material prices, and rising labor costs have had a lot of impact on the business environment of the company. The opinions of scholars at home and abroad have been divided. Luo Baihui, head of the International Mould, Hardware and Plastics Industry Suppliers Association, interviewed foreign trade export companies and found that most companies are still optimistic about the export environment next year.
Phenomenon 1 Corporate Profit Reduction At present, companies are suffering from double losses caused by exchange losses and a significant reduction in exports. Some foreign traders have complained that the company does not allow for long-term orders, especially long-term exports to Europe and the United States, emphasizing that some short-term orders will be accepted. This is because companies are mainly concerned about the loss caused by exchange rate conversion and the reduction of profit margins. Some companies even believe that as the current operating environment continues to develop, the survival of enterprises will be severely challenged.
Response: Increase the contract down payment ratio In response to this problem, a foreign trade manager suggested that the down payment ratio of the contract can be increased to reduce the risk of exchange rate changes and prevent exchange loss. If the contract down payment rate from the previous 5% -20% to 30% -40%. Some companies have also proposed to specify the limit of appreciation in the contract. If the limit is exceeded, the export price of the product will be adjusted accordingly. In addition, Luo Baihui suggested that companies could carry out ** switching, return ***** in advance, and then convert it into USD **; use financial instruments to evade exchange rate risk, forward transactions, and lock forward exchange rate in advance; Settlement with ***; companies can also actively explore new international markets, speed up the development of new non-US settlement international market, while speeding up product transformation and upgrading, optimize export product settlement, improve product technology content, create their own export brand, improve The company's core competitiveness.
Phenomenon 2 Increase in Production Costs This year, raw material price increases ranged from 20% to 60%, and some raw materials reached 100%. Such as aluminum ingots, strips, the average increase in more than 35%, copper, zinc and other prices rose 60% -70%, the plastic even rose more than 100%. A number of companies stated that the continuous increase in raw material prices has caused companies to face rising production costs, narrowing profit margins, declining product competitiveness, increasing pressure on capital turnover, and difficulties in purchasing.
Responsiveness: Realizing product upgrades The dramatic increase in the prices of bulk raw materials has not only directly affected the company’s costs and profits, but has also affected the market competitiveness of its own products. In response to this situation, some enterprises in the Economic Development Zone have implemented cost reduction plans, Ways such as the transformation of energy structure, reducing waste as much as possible, improving the management level and reducing the unit cost, have achieved very good results.
In light of the new year, Luo Baihui suggested that companies can also strengthen technological innovation, achieve product upgrading, differentiate business strategies such as branding, technology, and opening up new markets to increase product added value and profit margins; while exporting, insist on raw material outsourcing , and strive to tie up with orders, reduce costs and exchange losses; expand the scale, to achieve small profits but quick turnover; improve the utilization of machinery and equipment, mechanical replacement of manual operations, efforts to reduce labor costs and other methods.
Phenomenon 3 Frequent job-hopping of employees The gap in employment demand that began at the beginning of this year has continued until the end of the year. For this reason, the increase in wages for enterprise employees this year is all above 10%. Even so, some companies still can't keep people, and the job-hopping phenomenon of employees is relatively common, especially for those enterprises below the scale. The main reason for this problem is that the current renewal of the concept of employment of new generations of migrant workers in the 1980s and the 1990s is frequent job-hopping, resignation, and bargaining. To the good, it is the awareness of employee self-protection and legal awareness, but Some employees also lack the spirit of hard work.
Response: Strengthening the construction of employment networks In response, most companies hope that government departments can further strengthen the construction of employment service networks, improve the labor market service system, and improve bottlenecks in recruitment difficulties. In addition, companies have expressed their hope that government departments can give support to tax policies and bank credit funds policies, while continuing to improve the system and create a good external environment.
Phenomenon 1 Corporate Profit Reduction At present, companies are suffering from double losses caused by exchange losses and a significant reduction in exports. Some foreign traders have complained that the company does not allow for long-term orders, especially long-term exports to Europe and the United States, emphasizing that some short-term orders will be accepted. This is because companies are mainly concerned about the loss caused by exchange rate conversion and the reduction of profit margins. Some companies even believe that as the current operating environment continues to develop, the survival of enterprises will be severely challenged.
Response: Increase the contract down payment ratio In response to this problem, a foreign trade manager suggested that the down payment ratio of the contract can be increased to reduce the risk of exchange rate changes and prevent exchange loss. If the contract down payment rate from the previous 5% -20% to 30% -40%. Some companies have also proposed to specify the limit of appreciation in the contract. If the limit is exceeded, the export price of the product will be adjusted accordingly. In addition, Luo Baihui suggested that companies could carry out ** switching, return ***** in advance, and then convert it into USD **; use financial instruments to evade exchange rate risk, forward transactions, and lock forward exchange rate in advance; Settlement with ***; companies can also actively explore new international markets, speed up the development of new non-US settlement international market, while speeding up product transformation and upgrading, optimize export product settlement, improve product technology content, create their own export brand, improve The company's core competitiveness.
Phenomenon 2 Increase in Production Costs This year, raw material price increases ranged from 20% to 60%, and some raw materials reached 100%. Such as aluminum ingots, strips, the average increase in more than 35%, copper, zinc and other prices rose 60% -70%, the plastic even rose more than 100%. A number of companies stated that the continuous increase in raw material prices has caused companies to face rising production costs, narrowing profit margins, declining product competitiveness, increasing pressure on capital turnover, and difficulties in purchasing.
Responsiveness: Realizing product upgrades The dramatic increase in the prices of bulk raw materials has not only directly affected the company’s costs and profits, but has also affected the market competitiveness of its own products. In response to this situation, some enterprises in the Economic Development Zone have implemented cost reduction plans, Ways such as the transformation of energy structure, reducing waste as much as possible, improving the management level and reducing the unit cost, have achieved very good results.
In light of the new year, Luo Baihui suggested that companies can also strengthen technological innovation, achieve product upgrading, differentiate business strategies such as branding, technology, and opening up new markets to increase product added value and profit margins; while exporting, insist on raw material outsourcing , and strive to tie up with orders, reduce costs and exchange losses; expand the scale, to achieve small profits but quick turnover; improve the utilization of machinery and equipment, mechanical replacement of manual operations, efforts to reduce labor costs and other methods.
Phenomenon 3 Frequent job-hopping of employees The gap in employment demand that began at the beginning of this year has continued until the end of the year. For this reason, the increase in wages for enterprise employees this year is all above 10%. Even so, some companies still can't keep people, and the job-hopping phenomenon of employees is relatively common, especially for those enterprises below the scale. The main reason for this problem is that the current renewal of the concept of employment of new generations of migrant workers in the 1980s and the 1990s is frequent job-hopping, resignation, and bargaining. To the good, it is the awareness of employee self-protection and legal awareness, but Some employees also lack the spirit of hard work.
Response: Strengthening the construction of employment networks In response, most companies hope that government departments can further strengthen the construction of employment service networks, improve the labor market service system, and improve bottlenecks in recruitment difficulties. In addition, companies have expressed their hope that government departments can give support to tax policies and bank credit funds policies, while continuing to improve the system and create a good external environment.
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