Since 2010, the appreciation of the renminbi, the increase in raw material prices and labor costs have had a lot of impact on the business environment. The appreciation of the renminbi is a blessing. The domestic and foreign scholars have expressed mixed opinions. Luo Baihui, head of the International Association of Mold and Hardware and Plastics Industry Suppliers, interviewed foreign trade export companies and found that most companies are still optimistic about the export environment next year.
Phenomenon 1 corporate profit compression
At present, enterprises are suffering from double losses caused by exchange losses and a significant reduction in exports. Some foreign trade personnel have complained that the company is not allowed to pick up long orders, especially long-term orders exported to Europe and the United States, emphasizing more short-term orders. Because the company mainly worried, considering the losses caused by exchange rate settlement and the reduction of profit margin. Some enterprises even believe that the survival of enterprises will be severely challenged according to the current operating environment.
Coping: Increase the proportion of contract down payment
In response to this problem, some foreign trade managers have suggested that the proportion of down payment for contracts can be increased to reduce the risk of exchange rate fluctuations and prevent exchange losses. If the contracted down payment rate is increased from the previous 5%-20% to 30%-40%. Some companies have proposed to extend the limit of the contract in the contract. If the limit value is exceeded, the export price of the product will be adjusted accordingly. In addition, Luo Baihui suggested that enterprises can switch loans, return RMB loans in advance, and then exchange them into US dollar loans; use financial instruments to avoid exchange rate risks, forward transactions, lock forward forward exchange rates in advance; commodity trading strives to settle in RMB; It is also possible to actively explore new international markets, accelerate the development of new non-US dollar settlement international markets, accelerate product transformation and upgrading, optimize export product settlement, improve product technology content, create its own export brand, and enhance its core competitiveness.
Phenomenon 2 rising production costs
Since the beginning of this year, the price increase of raw materials has been 20%-60%, and some raw materials have reached 100%. For example, aluminum ingots and strips have an average increase of more than 35%, copper and zinc prices have increased by 60%-70%, and plastics have even increased by more than 100%. A number of companies said that the rising prices of raw materials have caused problems such as rising production costs, narrowing profit margins, declining product competitiveness, increased capital turnover and difficulties in procurement.
Response: to achieve product upgrades
The sharp rise in the prices of bulk raw materials not only directly affects the cost and profit of enterprises, but also affects the market competitiveness of their own products. In response to this situation, some enterprises in economic development zones have implemented cost reduction plans and energy structure reforms. To reduce waste as much as possible, improve management level and reduce unit cost, and achieved good results.
For the new year, Luo Baihui suggested that enterprises can also strengthen technological innovation, upgrade products, improve product value-added and profit margin through differentiated business strategies such as brand, technology, and new market development; while exporting, insist on raw material outsourcing. And strive to be bundled with orders, reduce costs and exchange losses; expand the scale to achieve small profits but quick turnover; improve the utilization of machinery and equipment, replace manual operations with mechanization, and strive to reduce labor costs.
Phenomenon 3 employees frequently change jobs
The gap in employment demand that began at the beginning of this year has continued until the end of the year. To this end, the wage increase of corporate employees has exceeded 10% this year. Even so, some companies still can't keep people, and employee turnover is more common, especially for companies below the scale. The main reason for this problem is that the renewal of the employment concept of the new generation of migrant workers in the 1980s and 1990s has frequently changed jobs, resigned, and bargained. On the positive side, employees’ self-protection and legal awareness have improved significantly. There are also some employees who lack the spirit of hard work and hard work.
Response: Strengthen employment network construction
In this regard, most enterprises hope that the government departments can further strengthen the construction of employment service networks, improve the labor market service system, and improve the bottleneck of recruitment difficulties. In addition, enterprises have expressed the hope that government departments can provide support in tax policy and bank credit fund policy, and at the same time continue to improve the social security system and create an excellent external environment.
Phenomenon 1 corporate profit compression
At present, enterprises are suffering from double losses caused by exchange losses and a significant reduction in exports. Some foreign trade personnel have complained that the company is not allowed to pick up long orders, especially long-term orders exported to Europe and the United States, emphasizing more short-term orders. Because the company mainly worried, considering the losses caused by exchange rate settlement and the reduction of profit margin. Some enterprises even believe that the survival of enterprises will be severely challenged according to the current operating environment.
Coping: Increase the proportion of contract down payment
In response to this problem, some foreign trade managers have suggested that the proportion of down payment for contracts can be increased to reduce the risk of exchange rate fluctuations and prevent exchange losses. If the contracted down payment rate is increased from the previous 5%-20% to 30%-40%. Some companies have proposed to extend the limit of the contract in the contract. If the limit value is exceeded, the export price of the product will be adjusted accordingly. In addition, Luo Baihui suggested that enterprises can switch loans, return RMB loans in advance, and then exchange them into US dollar loans; use financial instruments to avoid exchange rate risks, forward transactions, lock forward forward exchange rates in advance; commodity trading strives to settle in RMB; It is also possible to actively explore new international markets, accelerate the development of new non-US dollar settlement international markets, accelerate product transformation and upgrading, optimize export product settlement, improve product technology content, create its own export brand, and enhance its core competitiveness.
Phenomenon 2 rising production costs
Since the beginning of this year, the price increase of raw materials has been 20%-60%, and some raw materials have reached 100%. For example, aluminum ingots and strips have an average increase of more than 35%, copper and zinc prices have increased by 60%-70%, and plastics have even increased by more than 100%. A number of companies said that the rising prices of raw materials have caused problems such as rising production costs, narrowing profit margins, declining product competitiveness, increased capital turnover and difficulties in procurement.
Response: to achieve product upgrades
The sharp rise in the prices of bulk raw materials not only directly affects the cost and profit of enterprises, but also affects the market competitiveness of their own products. In response to this situation, some enterprises in economic development zones have implemented cost reduction plans and energy structure reforms. To reduce waste as much as possible, improve management level and reduce unit cost, and achieved good results.
For the new year, Luo Baihui suggested that enterprises can also strengthen technological innovation, upgrade products, improve product value-added and profit margin through differentiated business strategies such as brand, technology, and new market development; while exporting, insist on raw material outsourcing. And strive to be bundled with orders, reduce costs and exchange losses; expand the scale to achieve small profits but quick turnover; improve the utilization of machinery and equipment, replace manual operations with mechanization, and strive to reduce labor costs.
Phenomenon 3 employees frequently change jobs
The gap in employment demand that began at the beginning of this year has continued until the end of the year. To this end, the wage increase of corporate employees has exceeded 10% this year. Even so, some companies still can't keep people, and employee turnover is more common, especially for companies below the scale. The main reason for this problem is that the renewal of the employment concept of the new generation of migrant workers in the 1980s and 1990s has frequently changed jobs, resigned, and bargained. On the positive side, employees’ self-protection and legal awareness have improved significantly. There are also some employees who lack the spirit of hard work and hard work.
Response: Strengthen employment network construction
In this regard, most enterprises hope that the government departments can further strengthen the construction of employment service networks, improve the labor market service system, and improve the bottleneck of recruitment difficulties. In addition, enterprises have expressed the hope that government departments can provide support in tax policy and bank credit fund policy, and at the same time continue to improve the social security system and create an excellent external environment.
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