In terms of category, the impact on the fast-track industry is not so great. For the mothers and babies, cosmetics and household goods that we have more contact with, the brands and intermediaries will not bear the added tax, but will only pass on to the consumers who will pay the final bill.
Ye Junxian, general manager of Hangzhou Enterprise and Fung Trade, said, The most direct impact at present is that the US dollar exchange rate has risen. After exchange, our income has increased, and the short-term benefits will increase. But the companys export orders to the U.S. market have already been stagnated. After the orders before the Canton Fair are made, the latter must be re-checked. Now we can only suspend them. We are also thinking about countermeasures.
The first is the corporate remittance link under this wave of exchange rate fluctuations. Because the export is an order system, the order is usually ordered six months or even a year in advance. 25% of the tax increase may face cancellation of the goods by customers, and no return will be received, which will cause a backlog of goods. This will have a great impact on the domestic production and processing factories that export to the United States. Of course, depending on its dependence on U.S. exports, some small and medium-sized factories may not be able to sustain cash flow if they are not sufficient.
Transition Trilogy of Cross-border Trade
Because of the small increase in foreign orders and the rapid growth in China, the domestic emerging manufacturing industry, if relying solely on the foreign trade market, can not meet this growth demand. So in fact, many factories in China had already transferred from foreign trade to domestic sales in 2017 before trade frictions began, and expanded offline channels.
But the problem is that domestic sales are more complex and competition is more intense. For example, if an order can get the price of more than ten factories, customers can not distinguish the quality.
Earlier, Li Jianwei, chairman of Hangzhou Eurolac Import and Export Co., Ltd., said in an interview with 21st Century Economic Reporter that the companys domestic trade orders were also affected, with a decline of up to 50%. The escalation of trade frictions between China and the United States is the first to be affected by companies that have trade relations with the United States. Taking our company as an example, not only foreign trade orders have dropped sharply, but also domestic trade orders have dropped sharply. Since the second half of last year, domestic trade orders have dropped sharply by more than 50%.
How can the government and enterprises overcome the difficulties together
Ling Yun, the leader of the Leading Group on Reducing the Burden of Enterprises in Zhejiang Province and the deputy director of the Department of Economy and Information Technology of Zhejiang Province, said in a press release on May 13 that Zhejiang EnterprisesLoad Reduction and Cost Reduction Policy (the first batch of 2019) is expected to reduce the burden of enterprises in Zhejiang Province by more than 200 billion yuan in 2019, and the Zhejiang Government will issue the second batch of policies in 2019 by the end of the year. For example, it is more difficult for export enterprises now. Can Zhejiang reduce the burden of export enterprises by reducing the burden of freight forwarders in ports and standardizing them?
Take a 40-foot container as an example. From Frankfurt to Shanghai Airport, it takes two euros per kilogram by air, and from 6,000 euros to 8,000 euros per container by sea. This has not arrived yet. The cost from the port to my bonded warehouse is 8,000 to 12,000 yuan per container.
He thinks there is more room for a reduction in the postage tax.
Why is cross-border fever now? It is believed that the profit margin is bigger after the reduction of the postal tax. The general value-added tax for trade is 13%. After the reduction of the postal tax twice, the profit margin is only 9.1%. It has certain advantages. Personally, I think there is room for the tax to continue to fall. In addition, the processing cost of cross-border import orders is too high compared with that of domestic orders. Lu Xiangyang said.