VietNamNet Bridge – Businesses have been trying every way to turn the
inventories into cash to get money for re-investment.
As MM failed to ask the partner to pay for the event services, despite a lot of
efforts, it decided to receive three trucks of sweets and snacks worth 120
million dong from the partner – a big group, instead of 100 million dong in cash
as agreed by the two sides before.
“I could not imagine before that such a big group could not arrange 100 million
dong to pay debts,” Thuy said.
Finally, Thuy decided to accept sweets instead of cash, because she was not sure
when the company would have money to make payment, while MM needed money to pay
its staff and pay other service providers.
After carrying sweets to the head office of the company, Thuy asked her officers
to try to sell the products, wholesaling and retailing, advertise the sale on
mass media, bring goods to groceries or offer to sell on Internet.
According to Thuy, the company could take back 65 million dong instead of 100
million dong as it previously expected. However, 65 million dong would be better
than nothing.
The high inventories have pushed the sweets big group into big difficulties and
forced it to pay debts in goods instead of money. Of course, both the sides
suffered loss in the transaction. The client had to pay the volume of goods with
the value higher than the value of the contract. Meanwhile, the service provider
could not get the whole sum of money it expected.
However, enterprises have no other choice than… suffering loss. They have been
trying to bargain away goods to clear stocks and get money to maintain
production.
The noisy streets Nguyen Trai, Le Van Sy, Cach Mang Thang Tam in the commercial
hub of HCM City have become the places for manufacturers to display and sell off
inventory goods. The banderoles hung over the pavement shops show the big
discounts of 50-70 percent, which means that customers can buy the goods at
surprisingly low prices. All the supermarkets have offered price discounts for
2000-3000 product items, or offered gifts to buyers.
Inventories big enough to sell until the end of the year
Dang Quynh Doan, General Director of Viet Thy Fashion Company, has said that the
demand for ready made clothes has decreased by 20-30 percent in comparison with
the same period of the last year. It is estimated that the inventories amount to
50-70 percent of the sold volumes.
Other garment companies have agreed with Doan, saying that the volumes of goods
at the shops are now big enough for the sale until the end of the year. Some
analysts have warned that if the low weak demand cannot be improved, the
products would be enough for sale until the next year.
Producers understand that it’s difficult to sell old products. Therefore, they
still have to make new products, but at moderate levels, while still trying to
boost sales to clear stocks and get back the investment capital.
The cosmetics and processing food inventories are also very high. Deputy General
Director of a supermarket chain said he has never seen such a big inventory
volume before.
The retailer planned to sell a volume of goods within three months. However,
only 60-70 percent of the volume has been sold after four months.
Nguyen Thi Anh Hoa, the owner of Citimart chain, has estimated that the volume
of drinks, processing food and cosmetics kept in stocks has reached tens of
billions of dong.
“A lot of manufacturers have said they would join any sale promotion programs to
be launched by our supermarket chain in order to boost sales,” she said.
Nguyen Phuong Thao, Director of Maximark supermarket chain, said that some
cosmetics manufacturers now offer big preferences: customers, who buy one
product, would get one more product free of charge. This means that when selling
a container of new goods, the manufacturers would be able to clear one container
of inventories.
Source: SGTT
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