In the wake of this year's challenging export environment, many textile and garment companies in China are facing severe pressure. Rising labor costs and increasing raw material prices have significantly squeezed profit margins. During interviews with exhibitors at the 15th China Fashion Festival (CFF), several companies reported that their orders from Japan this year have not been as strong as expected. With minimal or no profit, some Japanese-bound exporters are now hesitant to take on new orders, leading to a growing trend of rejecting orders—something that has become increasingly frustrating for businesses.
Xue Xiaoyan from Changzhou Dongna Clothing explained that the Japanese market remains sluggish, with local merchants struggling to absorb the rising costs that Chinese manufacturers are facing. As a result, while export costs have gone up, companies find it difficult to raise selling prices, which directly impacts their profitability.
Feng Ming from Weifu Foreign Trade Co., Ltd. in Nantong Development Zone noted that last year’s financial crisis led to a significant drop in exports to Japan. This year, there has been a recovery, but the Japanese market is still slow, with low product prices making it hard for companies to respond to orders. Many have had to abandon orders due to unprofitable terms.
Weifu, a major exporter to Japan, has chosen not to actively seek out new orders, as it already has a solid network of Japanese partners. However, despite having orders, the company now faces challenges in fulfilling them due to changes in the domestic business environment. Companies are becoming more selective about which orders they accept.
Jiangsu Weifu Group’s Nantong Jianghai Economic Development Co., Ltd. also voluntarily turned down several orders this year. Zhang Xiaolian, a sales representative, said that with rising costs, the company raised its prices by 10%, which some clients accepted, while others did not. As a result, the company had to walk away from orders that would not yield any profit.
According to Zhang, many of these orders have shifted to northern China, where production costs are lower. However, she remains calm about the situation, noting that some orders were lost because the price was too low, and the company couldn’t afford to take them. In some cases, customers later returned to the original supplier after realizing that the quality from cheaper alternatives was subpar.
Zhu Yunxia from Ningbo Yunhe Foreign Trade Co., Ltd. expressed frustration over this year’s difficult business conditions. She mentioned that raw material prices have continued to rise sharply, making it hard to fulfill existing orders. Since prices were set earlier, companies are suffering losses, and customers are unwilling to accept price increases.
Although the overall cost of garment processing has increased by more than 10% this year, Japanese buyers are not willing to accept such a large price hike. Some orders are being abandoned due to the inability to negotiate favorable terms.
Many Chinese export companies told reporters that although the volume of textile and garment exports to Japan has increased this year, the profit outlook remains bleak. Rising production costs have put pressure on traders, especially given the persistent low-cost nature of the Japanese retail market. Some orders that exceed acceptable profit margins are being left behind.
Abandoning orders is an unfortunate but necessary decision for many companies. However, this trend is not entirely negative—it shows that Chinese exporters are no longer chasing profits at all costs. As costs continue to rise and margins shrink, companies must adapt by adjusting their product structures to better meet market demands. Market forces will ultimately drive the transformation and upgrading of these enterprises, pushing them toward more sustainable and profitable operations.
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