Textile Firms to Build Factories in Europe and America
Posted: 02/02/2015 02:02:35 Edited: 02/02/2015 03:02:51Clicks: 6802
Affected by strike, apparel enterprises in Cambodia improve local workers’ wage rates. Hereto, South-east Asia region has lost its advantage on cheap labor cost. In recent period, more and more textile firms come to build factories in America and Europa. This measure can lower transportation cost on one hand and drive the transformation and upgrading of enterprises on the other hand.
It is reported that, under pressures of strike, Cambodian Ministry of Labor would announce an improvement in the lowest wages in apparel industry. The wage will be increased by 25% to 100 USD per month. Nevertheless, workers are still dissatisfied for their expectation is 160 USD per month. After negotiation, many shoes or apparel manufacture factories plan to adjust wages of workers from 80 USD to 100 USD.
In the past, South-east Asia region lead the field on account of cheap labor cost. Therefore, this advantage is loosing day by day and companies in this region have to resort to other solutions. Textile firms, including circular knitting machines manufacturer, varied fabrics manufacturer, apparel and shoes firms, have to reconsider investment orientation and compare domestic with foreign markets.
This event will improve the production cost of factories in Cambodia. With intensified demands on pay raise, South-east Asia region will no longer have cost advantages. However, firms that have built factories there will not return to homeland in a short period. These firms have achieved stable business in this region. In spite of growing labor cost, they are still lower than those in domestic market. New type polyester knitting fabrics nowadays are selling well while the cost is also improving.
Although labor cost in America is higher than that in south-east nations, firms cam still balance costs through other aspects, such as raw materials, power consumption and others. What is more, Chinese textile and apparel firms rely mostly on exports. The products are mainly exported to European nations and America. Therefore, building factories in these regions can greatly decrease transportation costs.
It is reported that, under pressures of strike, Cambodian Ministry of Labor would announce an improvement in the lowest wages in apparel industry. The wage will be increased by 25% to 100 USD per month. Nevertheless, workers are still dissatisfied for their expectation is 160 USD per month. After negotiation, many shoes or apparel manufacture factories plan to adjust wages of workers from 80 USD to 100 USD.
In the past, South-east Asia region lead the field on account of cheap labor cost. Therefore, this advantage is loosing day by day and companies in this region have to resort to other solutions. Textile firms, including circular knitting machines manufacturer, varied fabrics manufacturer, apparel and shoes firms, have to reconsider investment orientation and compare domestic with foreign markets.
This event will improve the production cost of factories in Cambodia. With intensified demands on pay raise, South-east Asia region will no longer have cost advantages. However, firms that have built factories there will not return to homeland in a short period. These firms have achieved stable business in this region. In spite of growing labor cost, they are still lower than those in domestic market. New type polyester knitting fabrics nowadays are selling well while the cost is also improving.
Although labor cost in America is higher than that in south-east nations, firms cam still balance costs through other aspects, such as raw materials, power consumption and others. What is more, Chinese textile and apparel firms rely mostly on exports. The products are mainly exported to European nations and America. Therefore, building factories in these regions can greatly decrease transportation costs.
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