标题: Li &Fung sees fall in export prices [打印本页] 作者: 飞雪寒冰 时间: 2010-3-25 10:32 标题: Li &Fung sees fall in export prices The average price of Asian exports shipped by Li & Fung, the world's largest trade sourcing company, fell by 9 per cent last year as consumer confidence fell sharply in the US and Europe.
The Hong Kong trading group tracks the average unit price of the goods it handles, the vast majority of which are sourced in Asia and sold in either the US or Europe.
“The trend was very clear. We experienced a 9 per cent decline [in export prices],” William Fung, managing director, said yesterday.
In a tougher climate [western retailers] were trading down.”作者: 飞雪寒冰 时间: 2010-3-25 10:32
In addition to demand for cheaper products, Li & Fung also saw a shift in orders from relatively high-cost production bases, such as southern China, to more competitive regions in south and south-east Asia.
“The beneficiary of this tough market was Bangladesh,” Mr Fung said. “Bangladesh was by far the star.”
Li & Fung's purchasing activity in Bangladesh, now its fourth-largest sourcing market, increased by 20 per cent year on year – compared with a 6 per cent decline in China.
“We're going through a structural change that will take five to 10 years,” said Bruce Rockowitz, president of Li & Fung's trading arm. “Part of [the business] is migrating away from China as well as a big shift inside China.”
Factories in southern Guangdong province, which accounts for one-third of China's exports, have been suffering from acute labour shortages as migrant workers laid off in late 2008 and early 2009 have been slow to return to the coastal manufacturing belt.作者: 飞雪寒冰 时间: 2010-3-25 10:32
In response, Guangdong and Jiangsu, another important provincial exporter, have recently mandated double-digit increases in minimum wage rates.
“The level of wages has to rise,” said Mr Fung. “If you pay the right amount, the labour will be there. People want to be employed in the factories rather than on the farms.” Li & Fung blamed deflation, weak demand and insolvencies for a 6 per cent fall in revenues last year to HK$104.5bn ($13.4bn).
However, the company boosted its “total margin” – the difference between what it charges western retailers and what it pays Asian exporters – from 10.9 per cent to 12.2 per cent. With aggressive cost-cutting, this helped boost net profit 40 per cent to HK$3.4bn.
Li & Fung forecasts that factories will recoup some pricing power this year. “Orders we have taken [in] the last two to three months are at higher prices,” said Mr Rockowitz. “Prices were really pushed down artificially [last year] because of such weak demand. Re-stocking star-ted late last year. We were airing in a lot of goods and that's why air [cargo] rates have gone up.”