IN 2022, THE TEXTILE AND GARMENT FORECAST IS STILL IN THE ” NEW NORMAL” STATE.
The outbreak of the Covid-19 pandemic for nearly 2 years has upset the production and business plans of many industries, including textiles. While the forecast about when the epidemic will be controlled is still unclear, this export industry of nearly 40 billion USD/year will continue to be significantly affected?
In fact, in the past 18 months, we have experienced a lot of false predictions about when the epidemic will be under control. Since the first quarter of 2020 is forecasted that the Covid-19 virus cannot stand the heat, the hot summer will end with the hope of stabilizing again in August or September 2020. Then it is forecast that when there is a vaccine, the situation will be contained after reaching herd immunity in mid-2021 in many countries. However, the reality shows that the epidemic comes back with many different variants, the spreading rate of the latter variant is many times higher than the previous one.
In many countries with high vaccination rates that have reopened, then suddenly positive cases have skyrocketed, having to go back to a state of closure or control. Trade and travel between countries and regions continue to be hindered. With this reality, businesses are forced to adapt to continue to maintain production and business in the “new normal” state.
In your opinion, how is the “new normal” state, at least for the period from now to the end of 2022, for textile and garment businesses to be understood?
With the current epidemic situation, I think that the trend of working online will continue to increase, even if the epidemic is over, not 100% of the previous offline jobs will return, but there will be a a certain percentage decide to switch to online jobs. Therefore, the demand for standard products (formal, dress code) for the office will be at risk of being difficult to recover to the old level. Casual products that bring comfort, combine both at home and suitable for working online will be in higher demand.
In addition, because the epidemic is not yet known how it will develop, there is no radical solution to end the epidemic, so the possibility that by 2022 it is still not certain that the production will be completely normal, but there may be another phase. be separated, even isolated, affecting production.
Businesses must also pay attention to the trend of increasing online business, cutting intermediaries, and extending payment time. Orders tend to be smaller, delivery time needs to be faster, while all factors of production and delivery have many uncertainties and are prone to change, and global logistics continues to be unbalanced, simple and unbalanced. Transportation costs increase, lead time is extended, greatly affecting delivery time and costs to consumers.
Thus, enterprises in the textile and garment industry are and will continue to prepare to work, produce and do business in the “new normal” state with much flexibility to adapt. What solutions do they have to implement, sir?
I think that the business model of the business needs more flexibility, carefully analyzing market movements to have a closer forecast and decision-making.
For example, in terms of production, businesses have to face a new situation that will make the output status uneven, unable to measure monthly productivity. Especially when the gap is definitely decreasing, the only way to maintain growth is to have a higher output in the non-distance time to compensate. Of course, this way of organizing production will certainly be very stressful, even high cost, but compared to reducing total production for the whole year, it is still more effective.
In terms of production, that is, related to the market and customers is also not a simple problem for each business, when the market plan is always in a passive state, production capacity can go up and down unexpectedly because of risks. disease risk. Therefore, the solution to a reasonable approach at this time is probably not to negotiate the order too far. Accept the difficulty of production planning, in return can better fulfill the delivery commitment with customers.
Financial pressures are also an issue, because irregular production puts the financial system in a very short cycle in terms of turnaround. I think there will be a surge in working capital demand when production exceeds peak capacity, and at the same time there will be a cash flow shortage in periods of production interruption because of the epidemic.
Many textile enterprises are concerned that they will not have enough workers to fulfill orders after the lockdown. In your opinion, how to solve this problem?
Human resources are the stage under the greatest pressure for businesses, especially the garment industry, especially when the production plan is unstable and the epidemic makes workers worried. However, in the new conditions, businesses should approach thinking about hourly wages, annual income. If you have to relax or stop working, you will be paid according to the minimum wage. In peak months, you will work more, and your income will be higher.
It is important to communicate and convince workers to accept the new system. Good propaganda will help ensure human resources in the context of variable production plans and difficult to predict early.
Sourced from smartex
If you would like to know more about knitting, pls reach at: https://lpcasualclothing.com/blog
