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Lower profits for holiday gift makers

12-15-2010 09:38 BJT

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With Christmas quickly approaching, spirits should be high, and gift giving should be plentiful. But sadly, this isn't the case in the east China city of Yiwu -- increasingly known as Santa's workshop for the world. This year, the largest holiday present export base is struggling to make profits even though orders are pouring in.

Known as a trinket paradise, Yiwu manufactures and exports nearly half the world's Christmas gifts.

Leading up to Christmas, overseas orders are pouring in. But the amounting orders have failed to bring joy to the gift makers.

With the price of raw materials steadily climbing this year, manufacturers are finding it difficult to make a profit. Add on a stronger yuan, and these export oriented exporters see their margins shrink.

To cope with higher costs, some producers have designed hollow Santa toys, while some are using cheaper materials to dress them. They say, with a smile, that the Santa cannot afford cotton coats this year.

Experts say the companies taking Christmas orders are mostly small and medium sized. They're facing increasing pressure this year.

Some businesses seeking to solve the problem, cut labor costs, hike their prices, or develop entirely new products. For Yiwu manufactures, Christmas can't come and go soon enough.

Editor:Xiong Qu |Source: CNTV.CN

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