Foreign Trade Industry Record: 72 Years Old, The Foreign Trade Veteran Even Said Three Times "Really Very Very Difficult".

"How is the company now?"

"It's really, very difficult." One afternoon in mid April, after more than half an hour after the scheduled interview, the reporter finally found Gu Xin Yi, who had just returned from Zhejiang's Haiyan factory to Shanghai in the crowded subway exit. At that time, Shanghai had just passed away from the cold spring, and the temperature had just returned to warmer. The old man who had passed through the old year wore only a red and blue lattice shirt, carrying a yellow mountaineering bag, looking far away, his eyebrows slightly frown, slightly serious. In a hurry to the reporters and after a simple greeting, talking about the current situation of the company, Gu Xinyi said this sentence unintentionally repeating three times.

The difficulty stems from too much unknown. Under the burning global epidemic, Gu Xin Yi's clothing trade industry bears the brunt. Domestic trade orders are pending, foreign trade orders have been cancelled or postponed in large areas, and the backlog of finished products and semi finished products has increased sharply, with the increasing financial pressure. Since late February, Gu Xin Yi's foreign trade companies have been faced with various difficulties. In his own words, "all these things have no clue since the outbreak of the epidemic."

Gu Xinyi, who went to sea in 1984, has already set foot in the clothing and foreign trade industry in the early 90s of last century. He founded GSD International Enterprise Co., Ltd. in New York, mainly engaged in leather export. Business sea ups and downs for nearly 40 years, at present, the company's market extends from abroad to the domestic, product category is also expanded from leather clothing to woven jacket, down jacket, etc., but after many storms, he never thought that now the company will face such a situation.

Constantly broken plans

"This war epidemic, China plays the first half, the world plays the second half, the foreign trade person plays the entire audience!" At 4:15 in the morning of March 26th, Gu Xin Yi reprinted an article in his circle of friends entitled "withdrawal tide" has arrived. These big British and American buyers have begun to cancel supplier orders. The article is accompanied by this passage.

In 2020, Gu Xinyi became the thirty-first year of "foreign trade man". In 1989, he worked in a large scale construction machinery sales enterprise in a port enterprise. He came to the United States on the other side of the Pacific because of a chance to work. After some market research and several overseas Chinese opinions, Gu Xin Yi took a look at leather clothing export business and established GSD International, a foreign trade company in New York, USA. Enterprises.Inc (hereinafter referred to as "GSD"). At that time, it was the fashion of fashion that swept the world, and China's leather industry also entered the golden age.

"At that time, leather clothing export business is very good, compared with the domestic market, foreign market profits are considerable." According to figures provided by Gu Xinyi, in the 90s of last century, there was a difference of 6 times between the domestic market price of a fur coat and the export retail price. "For example, in the domestic market, the price of a leather garment is 50 dollars, and it can be sold to the United States for 300 dollars," he said.

"Since 1990, foreign trade has been done for 30 years. Five or six years ago, products exported to 100% countries, mainly exported to the United States, and the largest customers were American first-class department stores like J.C.Penney (Penny department store)." Gu Xinyi told reporters that before the company's business focus was mainly on the department store's free brand, the GSD became the A-level supplier of the top five department stores in the United States.

However, due to various factors such as the US economic situation, Gu Xin Yi began to lay out domestic sales in 2014 and chose to set up factories in Zhejiang sea salt investment. 4 years later, he expanded the production base to Xiping, Henan. The cooperative customers include Bosideng, Hai Lan home, Taiping bird and other famous clothing brands.

Over the past 30 years, Gu Xin Yi, 72 years old, admitted that the epidemic is the most severe test he has ever faced. "The factory in Xiping, Henan has just completed and covers an area of 45 thousand square meters. Originally, this year it was going to be a big recruit and ready for a big fight. Now there is no reason for it."

Gu Xin Yi remembered very clearly that at first, foreign orders had not been affected. In February 5th, he received 100 thousand orders from the famous British fashion brand Primark. He said that since the Sino US trade friction began, its long-term cooperation with the United States business partners to lift the contract, foreign trade orders have been greatly reduced since last year, the order is also the company's largest foreign trade orders this year.

But after entering March, the crisis began to approach. Gu Xin Yi obviously felt that all kinds of plans were disrupted because of the uncertainty brought by the epidemic. "Because we are mainly making winter clothes, orders have very strong timeliness. Under normal circumstances, winter clothing will be completely finished before and after March, and after the opportunity, business opportunities will be lost."

The Domino effect is reflected in the sharp reduction and postponement of domestic orders. According to Gu Xinyi, at present, most domestic clothing brands are overstocked, and they have delayed the time of placing orders. The price that has not been postponed is also a mess. "Although it is understandable to them, after all, most stores and retail stores in February were in a" stop "state, and their goods were not sold, but the wages of our workers should be paid.

At that time, Gu Xinyi believed that domestic orders fell, and foreign orders could still maintain the normal operation of the company.

But the notice that the foreign trade orders have been postponed or cancelled has given Gu Xinyi a head start. Beginning in March 15th, Gu Xin Yi was told by customers that the unfinished orders had to be suspended first, and that the order should not be shipped first. The next step of the order should be determined according to the specific circumstances, including the Primark of the order in force in accordance with the force majeure clause in the contract.

According to relevant media reports, as the largest fashion retailer in the UK market, Primark has 40% of its products from China. In February, Primark was also planning to find alternative suppliers in Bangladesh, Kampuchea, Vietnam, Turkey and Eastern Europe for fear that China's epidemic would affect the supply chain. However, a month later, after the outbreak of the British epidemic, the company announced that it was expected to close its Primark20% stores and cancel all orders that had not yet been delivered.

"Fortunately, unfortunately, Primark is just saying that we should postpone (order) rather than cancel, but whether the quantity of orders will change or when to postpone it is unknown." Gu Xinyi admitted to reporters that one after another variable allowed him to fall into a new round of news waiting time and again. "Before, according to the order volume at the beginning of the year, you know how much money you can earn in a year, but everything is uncertain now."

"Fortunately, we are doing protective clothing".

"Does the company have layoffs?"

"No, the Haiyan factory originally had more than 500 workers, and now there are more than 100 more." Under the impact of the epidemic, layoffs and wage cuts are the choices that most foreign trade enterprises have to make. According to Gu Xinyi, at that time, the factories basically returned to work, and there were fewer orders for continued production. If the production stopped, what should the 500 workers do?

Under internal and external difficulties, since the beginning of April, because of the technical conditions of the factory with glue, Gu Xin Yi's enterprise has joined the production line of medical protective clothing like many textile enterprises. "Fortunately, it is to make protective clothing, because the protective clothing is a cash transaction, if there is no protective clothing, our capital chain has also been broken."

Gu Xinyi said that at present, the whole chain of textile export industry basically takes credit mode, which means that no delivery can be made, and there is no way to raise the loan. "Although the domestic trade order is based on the" deposit + tail payment "mode, besides the price reduction, customers generally ask for a delay of 1 to 2 months, which is a great blow to us because the original profit of the garment factory is relatively low. The pressure of cash flow has increased sharply.

This is a common problem faced by many foreign trade enterprises. Cheng Weixiong, general manager of textile and clothing brand management and Shanghai Liang Qi Brand Management Co., Ltd., told reporters that due to the cancellation and shrinkage of orders at home and abroad, the upper reaches of the supply side of clothing industry were the first to bear the brunt. At present, the phenomenon of serious shortage of production capacity has been presented. In addition, under the superposition of rent, labor, operation and management costs, small and medium-sized enterprises will be closed down or become bankrupt. Normal behavior.

Since the change of medical protective clothing, Gu Xin Yi's frown has eased a little. Gu Xinyi told reporters that after the rotation production, Haiyan factory has only one production line for domestic trade clothing processing, mainly for Pinghu, which has the "famous Chinese garment manufacturing city", and the other production lines are used for processing and producing medical protective clothing.

In fact, the demand for medical protective clothing was almost saturated in the early April, so the products of Gu Xin Yi mainly sold overseas, but it was not easy to become such suppliers.

According to him, take export to the United States as an example, export enterprises need to obtain the FDA certification of the US Food and drug administration, while the European Union needs CE certification. "In fact, most companies, including us, do not have the relevant export qualification. Although the company can apply for it by itself, the cycle will take about 3 months, so we mainly manufacture qualified enterprises. Basically only large factories can receive such orders, and small factories can not get them."

But this is not a permanent solution. In the first interview with reporters in early May, the Gu Xinyi on the phone laughed and talked, but the company faced a difficult situation. "The protective clothing is still doing for two days, but the market demand for the protective clothing has dropped suddenly. Now we mainly serve a customer in Italy, we have finished 30 thousand, and 800 thousand orders need to wait for the news from customers." 。 If you don't need it, it will stop. "

In Gu Xinyi's view, if the next protective clothing can not be done, the company's first priority is to lay off workers. According to the press, more than half of the workers in Haiyan processing protective clothing have been processed.

Looking forward to "turning over"

"Then how did the company plan?"

"We are an old company and try our best to keep up. The good news is that 30 thousand of the 100 thousand orders for Primark have already been started, but it is not known whether they will be able to achieve 100 thousand in the end. In Gu Xinyi's view, although the current situation has improved, it is too early to say that the recovery of the foreign trade clothing market is too early.

This is not alarmist talk. Recently, H&M, a fast fashion giant, said in an interview with reporters that the new crown pneumonia epidemic had an unavoidable impact on the entire enterprise and the supply chain. Garment manufacturing suppliers and garment workers were extremely vulnerable under this situation. They will continue to fulfil their commitments to garment manufacturers and receive products that have been made and are being manufactured according to plan.

Even so, the first retailer, who agreed to pay the cancellation order to suppliers, told reporters that "our orders to suppliers are greatly affected by the sharp drop in global demand. We will place the order according to the current forecast and continue to evaluate it every day."

Regarding the variable foreign trade market, it is the common action of most manufacturers to take a look at the domestic market which is gradually warming. According to its disclosure, a famous chain clothing brand in China has selected nearly 20 winter clothes of its company. According to the quantity of 5000 pieces / money in normal circumstances, this order probably involves 100 thousand garments. "In a few days, the brand will have an order meeting, and I will know the details. In the future, factories will also process products for some stalls in Pinghu and Tongxiang.

In addition, the transformation of electricity providers to defuse risks is one of Gu Xinyi's most current thinking. "We began to move closer to the electricity supplier a few years ago, but the transformation process is rather difficult. Now online sales are about about 3000000 yuan, hoping to sell about 10 million yuan this year.

      Wang Wenhua, director of consulting and executive director of CIC, believes that, whether online or offline, compared with the domestic clothing enterprises, foreign trade clothing enterprises lack sufficient resources to establish a sound downstream marketing and channel network in a short time. Whether they build their own teams or find the next channel and platform partners, the accumulation and the time needed for the two strategic positioning are not enough. The same.

However, for his company, even though the road ahead is rough, Gu Xin Yi still has many years of optimism and open-minded business. "This year I asked the boss of Haiyan factory to come back and see if I could turn it over." Though questioned, his tone was full of certainty.

At present, the old "foreign trade man" is still running around for enterprises to "turn around".

At 8 o'clock in the evening of May 6th, after receiving the information again, Gu Xin Yi sent two screenshots to reporters. In the picture, it was his two day rather compact schedule: the old man who had passed through the old year started off from Shenzhen at eight o'clock the next morning, and arrived in Jinjiang at noon at the turn of Xiamen, and finally flew to Jinjiang from Jinjiang airport at 9 o'clock that evening.