Hong Kong–Global Sources (NASDAQ: GSOL) has just published its China Sourcing Report: Fashion Accessories covering belts, buckles, sunglasses, optical frames, reading glasses, gloves, hats, caps, hair accessories, hosiery and neckwear. The report found most suppliers optimistic about an overall recovery from the worldwide slump, and are anticipating overseas sales to climb by at least 10% in the coming months. Almost 40% of companies interviewed for the report expect export growth of more than 20%.
“China suppliers are definitely optimistic about 2010 for substantial sales growth,” said Publisher of the 129-page Report, Livia Yip. “Besides the overall recovery from the export slump, manufacturers of headwear, gloves, neckwear and hosiery especially foresee buyers boosting orders, due to expectations of extreme conditions in winter this year.”
Higher production costs
Suppliers might be upbeat about a steady improvement in exports, but they’re challenged to keep prices down. “Profitability is being jeopardized by rising material and labor outlay. Cotton is now 33 percent more expensive than a year ago, and the cost of polyester and most metal materials has also surged, by 50%in some categories,” Yip said. “Many suppliers may have no choice but to pass the additional expense onto buyers in order to maintain reasonable margins.”
In the Report, two-thirds of respondents said they intend to push up prices due to the higher outlay, although most expect to cap this at 10%.
Apart from rising material cost (34%) and labor cost (28%), the following are some of the other difficulties challenging suppliers:
- 14% cite price competition as becoming a problem;
- 10% regard design piracy as a threat;
- 7% see stricter overseas standards as a challenge; and
- 7% worry that a stronger yuan could impact profitability
To boost competitiveness, manufacturers have put the following measures in place
- 49% are working on enhancing operating efficiency;
- 18% are widening product range;
- 10% are increasing staff training to reduce product defects.
The China Sourcing Report: Fashion Accessories profiles 29 suppliers with verified manufacturing and export credentials, plus contact details of 18 more suppliers. The Product Gallery features 135 of the most popular export models. The Report’s surveys, price trends and supply forecasts aim to help buyers make better-informed purchasing decisions.
About Global Sources: Global Sources is a leading business-to-business media company and a primary facilitator of trade with Greater China. The company provides sourcing information to volume buyers and integrated marketing services to suppliers. It helps a community of over 888,000 active buyers source more profitably from complex overseas supply markets. The company delivers information on 4.5 million products and more than 256,000 suppliers annually through 14 online marketplaces, 13 monthly print and 15 digital magazines, over 80 sourcing research reports and 21 specialized trade shows which run 55 times a year across 9 cities. For more information go to www.Globalsources.com.