This year, Christmas products industry is facing not only the cost of a substantial upward pressure on China, while also facing a substantial appreciation of the RMB exchange rate risk pressure analysts believe that the costs continue to rise and the rapid appreciation or even years to become the second half of the long-term trend , foreign trade enterprises will continue to bring the two face the dual pressures.

Higher costs

Faced with a sharp rise in the cost of the status of Christmas products business generally reflects the materials, labor and land costs rose sharply pushed up the total cost.

Christmas Crafts Factory Zhejiang Yiwu Tomohiro horse owner to the China Securities Journal reporter, said: "For us to do this Christmas accessories business, the fear of plastic (10850,135.00,1.26%), gasoline and paint prices rose. Because these three raw materials accounted for about 80% of the cost, they rose too high, the cost will be significantly lifted. "

Horse owner explained, is the production of plastic parts of the main raw material supplies Christmas, accounting for about 50% of the cost; gasoline and paint color for the Christmas supplies accessories to reconcile raw materials, the cost of the two together account for about 30% this year, these three materials magnitude larger than the rise of plastic from last year's 4,200 yuan/ton this year rose to 4,700 yuan/ton, up about 12%; paint from last year's $ 320/barrel this year rose to 390 yuan/barrel, up nearly 22%; gasoline largest increase from last year's 6 yuan/liter this year, rose 8.5 yuan/liter, up 42%. only raw material costs higher than last year, about 16%.

Enterprises generally indicated that in addition to raw material costs higher proportion of total costs, boosting the total cost increases, the second is the labor cost ratio of labor costs to total costs is generally 10% -15% of it's rise to become second largest source of higher costs.

"This year's wages from last year's 1,600 yuan/month to this year's 3,500 yuan/month, more than doubled while the proportion of wage costs accounted for about 10% to the total count, a larger proportion of raw material costs and wages rising cost of making the actual total cost increased by 20% more. "horse owner said.

Ruian Huada crafts factory owner Wang Jianshu said: "People like us do Christmas products processing enterprises, the proportion of wage costs accounted for more than Christmas accessories business is even higher, generally about 15%, because with the processing of finished products different parts, machine parts are semi-semi-artificial production, and finished entirely by a large number of manual operation, so the proportion of labor costs will be higher. the proportion of the already high, and wages has gone up a lot. from last year's 2000 yuan/month to 3,000 yuan this year/month, up 50%, making this year's labor costs rose last year by nearly 8 percent. "

China Securities News, reporters found that the factors that drive costs in addition to raw material costs and labor costs, as well as the rise in rental costs.

Yiwu Christmas supplies the business are basically "front shop" model its stores are concentrated in the city center near the Second District, Futian, rather plant mostly scattered in tens of kilometers away from Futian two areas outside the suburban or industrial areas, some even in the nearby provinces.

Zhejiang Yiwu Christmas Industry Association Chen Jinlin explained: "Fukuda Second District near the city center, convenient transportation, favorable foreign investors to come here to see sample orders, so companies are trying to set up shop here, but because the store rents, companies negotiate with the owner of the rental price alone is almost 'useless' after all by the association on behalf of business and the owner of the store after consultation, an annual rent in the form of rent down the whole area,And then leased to each enterprise, so has a lot of business minus the rental cost. Nevertheless, the store still rents an average of 20,000 last year/year to this year's average of 3 -5 million/year, up more than 50%."

"Plant in the outskirts of tens of kilometers away where the rent is relatively cheaper than in urban areas but even in the suburbs, rents are still high plant, but in rising every year, this year has gone up a lot more, such as distance 40 kilometers of an urban industrial area, last month rent per square $ 12, the first half of this year rose to 16 yuan per square foot per month, up 33% in the second half is expected to rise to around $ 20 per square foot per month , or will reach 67%, to 10,000 square meters of factory building when the rent as high as 2.4 million years, which also led to many companies out of production, to make money directly by the plant rental. "Chen Jinlin said.

"Plant rental shop rents and the cost would account for about 5% -7% of the" handicraft company boss Huangyun Xu Bo Xu said, "plant rents rose too high, many people like me can not afford to micro and small enterprises, to move from the industrial zone out to Japan from the Yiwu closer, such as rent, Ruian plant. "

Improve product pricing

Christmas goods industry faces rising costs in addition to leading to shrinking profits of pressure, as foreign trade enterprises, also face the pressure of RMB appreciation.

Since June last year to further promote the exchange rate reform, accelerate the appreciation of the central parity of RMB against the U.S. In order to bring the enterprise to reduce the appreciation of the renminbi exchange rate risk and the outlet pressure, Yiwu Christmas business this year, basically using the RMB settlement, refused to use U.S. dollars .

Chen Jinlin, said: "As the RMB appreciation, depreciation of the dollar because 99 percent of Christmas goods companies have joined together to require the use of RMB,And refused to use U.S. dollars. Christmas goods industry has been able to choose a strong RMB, two reasons: First, by the impact of foreign economic downturn, many foreign investors are biased in favor of some relatively cheap low-end Christmas items, Christmas and Yiwu supplies just to meet this requirement; second seven criteria developed by the Institute to improve the Yiwu Christmas product quality, enhance the product competitiveness in the international market. Looking at the world, only the Christmas supplies in line with the Yiwu Foreign 'reasonable price Lim 'requirements."

Minsheng Securities chief economist Tengtai that, in appreciation of the yuan against the backdrop of enterprises to improve product quality and competitiveness, we must also improve product R & D capability and brand effectiveness, the only way to enable enterprises to enhance the voice of At the same time, improve product pricing, which can either reduce the appreciation of the RMB exchange rate risk arising, and can pass through increased pricing pressure from rising costs in China, and improving profit margins.

Pressure or continuous double

Face of China's costs continue to rise, the pressure on appreciation of the yuan, Christmas business in the first half has been very strong over land, but the companies continue to face in the future these pressures will become more concerned about their problems.

Minsheng Securities macro-economic analyst, said Zhang Lei, the second half and the next few years, companies will face rising costs of labor-based, other costs rise while long-term trend low labor supply would be reduced, so that labor-intensive industries The labor costs will continue to rise. In addition, the structure of China's labor force will shift, 80,90 after the generation of migrant workers into the labor marketplace, and their demands will be Forced labor costs.

Zhang Lei said,With the increasing appreciation of the RMB, foreign trade enterprises rush-order situation will become more apparent. Enterprise will receive foreign orders, for the first time to complete the production, export as soon as possible, as soon as receiving foreign remittances into RMB, as reduce exchange rate risk.

In addition, he believes that the appreciation of the yuan will continue to maintain momentum, it will accelerate enterprise restructuring and upgrading. RMB appreciation to extract a low-end manufacturing, from manufacturing to create the enterprise, from low to high-end, high value-added products and thus expand production, improve profit margins.

Teng Tai said in the second half Chinese or declining oil prices, which is good news for business, help companies to reduce the cost of certain raw materials; and labor costs in the next five years, or at an average ratio of 13% per year continue to grow, which means that enterprises will continue to face upward pressure on labor costs.

This chapterfrom the:China Trade Information (http://en.zgxu.com),visit the above web site.