The phenomenon of integration of industry and trade in the foreign trade industry

Recently, there have been two thought-provoking news in the foreign trade industry. One reason is that Zhongtuo Clothing, located in Nanchang City, Jiangxi Province, with a focus on foreign trade exports, has already scheduled its orders for June this year. The company is also a representative industrial and trade integrated enterprise in the local area that is undergoing "5G+smart factory" technological transformation. Secondly, a certain Hangzhou foreign trade enterprise owner stated that he is striving to invest in top factories this year, striving to ensure more stable product quality. His two colleagues are also actively seeking to invest in his factory. "If he does not invest, it will be difficult to accept orders. It is really difficult to do foreign trade without a factory background now.".

Generally speaking, contract factories, pure commercial foreign trade enterprises, and integrated industrial and trade foreign trade enterprises are several basic types of market entities in China's foreign trade field. There is no standard answer among foreign trade industry insiders as to whether factories have more advantages in foreign trade or purely commercial foreign trade enterprises have more advantages in foreign trade. But based on their own experience in foreign trade, their narration and analysis reflect the basic fact that factories have both advantages and disadvantages in foreign trade, and pure commercial foreign trade enterprises also have both advantages and disadvantages in foreign trade. Foreign trade enterprises and practitioners can only better meet the needs of the international market and enhance their competitiveness by continuously adjusting between these types based on the development and changes in the environment and situation, expanding their advantages, and making up for their shortcomings.

With the development of the foreign trade environment and situation, the international market has increasingly high requirements for the stability of the supply chain of foreign trade enterprises. This makes the entire process of price comparison, sampling, negotiation, scheduling, quality control, delivery, and payment between multiple processing plants that pure commercial foreign trade enterprises relied on in the past. Not only does it have high transaction costs, but the process is also cumbersome and lengthy, with many uncertain and unstable factors, and there are risks in quality control and timely delivery. Some foreign trade enterprises have made adjustments as a result. American economist Coase believes that enterprises are organizations that replace the market for resource allocation, and the high cost of market contracts leads to some transactions using internal transactions within the enterprise. This theoretically explains the reasons behind the phenomenon of some commercial foreign trade enterprises in China investing and investing in factories. Commercial enterprises can become integrated enterprises of industry and trade by investing in stocks and factories, internalizing production processes and making their supply chains more stable and secure, and product quality more controllable.

Under this trend, integrated foreign trade enterprises such as Zhongtuo Clothing and Tianjin Julong Group have obvious competitive advantages. This type of integrated industry and trade foreign trade enterprise combines the advantages of factories with those of commercial foreign trade enterprises, forming a composite competitive advantage. In this way, the potential and resilience of such foreign trade enterprises are indeed considerable. After visiting multiple industrial and trade integrated foreign trade enterprises on site, the author found that industrial and trade integrated foreign trade enterprises also have an advantage, which is that they have a complete and infectious display of their products and development process throughout the entire process. For example, the first floor lobby of the headquarters of a certain integrated industry and trade foreign trade enterprise displayed the earliest product samples produced by the enterprise, as well as the year and situation of the first foreign trade transaction, as well as how the demands and feedback of foreign trade partners gradually changed the production line and characteristics of the enterprise, and how they gradually changed the thinking mode of the enterprise management. The person in charge sighed and said, "The company's foreign trade business is not just a business, but mainly deeply inspired us, who were originally buried in production in the county, from aspects such as ideological concepts, perspectives, and so on.".

It can be seen that the integration of industry and trade in the foreign trade industry is also a good thing for the development of China's manufacturing industry. It is beneficial for enterprises to timely and efficiently connect various information and demands from the production, circulation, and consumption ends, and frequently exchange feedback, so that the production, circulation, and consumption links can learn from each other and complement each other with higher quality. The good examples and innovations formed from this can also provide more inspiration for other foreign trade enterprises.