Research On Risk Control Strategy Of Raw Material Price Adopted By T Textile Enterprise

In recent years,due to the influence of domestic and foreign supply and demand,land,labor and other related policies,domestic cotton prices have always been in a state of ups and downs.Cotton textile enterprises mainly use cotton as the main raw material.The fluctuation of raw material prices is like an invisible hand,which not only affects the cost and profit of cotton spinning enterprises,but also affects the inventory management of cotton spinning enterprises,resulting in certain difficulties in raw material inventory control.In the case of the continuous decline of the industry’s prosperity,cotton spinning enterprises must reduce inventory costs and minimize price fluctuations of raw materials in order to control risks.Therefore,studying the risk control of raw material price fluctuations is benefit for reducing corporate costs,improving corporate profits and market competitiveness.Taking t textile enterprise in Changle City,Fujian Province as the research object,this paper analyzes the price risk of raw materials.Faced with the problems of high purchase price of raw materials,high inventory,increasing enterprise operating costs,and the decline of product demand affecting economic benefits,enterprises adopt risk management means such as stopping production and limiting production,buying raw materials with use,and raising product prices.However,due to the insufficient ability to predict the price of raw materials and the difficulty in determining the purchase batch of raw materials,there are still some problems in risk control.In this regard,combined with the actual situation of the textile raw material market,this paper uses Markov chain to predict the cotton price,then eases the assumption of the traditional economic order quantity batch model,discusses the application of protection to avoid the risk of cotton raw material price fluctuation,is familiar with the inventory optimization model of t textile company under uncertain demand,and finds the optimal economic raw material order quantity under price fluctuation and order cycle.At the same time,this paper also puts forward the contract settlement method.With the process of raw material procurement,the previously purchased futures contracts are hedged in the market by closing positions.The profit and loss of the futures market roughly offset,and the purpose of locking is to lock in the upstream cotton cost.Based on the investigation of T textile enterprises in Changle City,Fujian Province,and the analysis of raw material price risk,the proposed raw material price risk control strategy has certain reference significance for small and medium-sized textile enterprises in Changle area and even the whole country.