Retail sales of consumer goods in China surpassed 50 trillion yuan in 2025, and the total circulation of production materials approached 100 trillion yuan. Yet behind this booming domestic trade, textile companies remain trapped in chronic payment delays and cash flow crises. On May 8, 2025, the 'Domestic Trade Transaction Guidelines (Trial)', jointly issued by 17 national industry associations, directly targets this deep-seated pain point.
Background
The guidelines were launched under the guidance of the Ministry of Commerce, the National Development and Reform Commission, the Ministry of Justice, and the Office of the Central Cyberspace Affairs Commission, with participation from 17 organizations including the China National Textile and Apparel Council, the China Textile Commerce Association, and the China Chamber of Commerce for Import and Export of Textiles. The core goal is to remove obstacles hindering the construction of a unified national market by setting high standards for transaction contracts, goods inspection, payment terms, and commercial conduct in domestic trade.
Notably, textile industry associations have a significant presence among the drafters, covering the entire supply chain from fiber to finished goods. This is no coincidence: the textile sector suffers from one of the worst payment term problems in domestic trade, where fabric mills and yarn suppliers frequently face cash flow disruptions due to delayed payments from downstream apparel brands. With over 180 million market entities in 2025, textile SMEs are among the most vulnerable.
Industry Impact
The implementation of the guidelines means textile enterprises will have clearer benchmarks for maximum payment terms and payment milestones when signing contracts, moving away from the gray zone of 'verbal agreements and indefinite delays.' For buyers, shortening payment periods from three months to one or two months will become an enforceable standard rather than a negotiating chip. This directly transforms cash flow models: a fabric trader with an annual revenue of 50 million yuan could free up about 4 million yuan in working capital if the average payment period is reduced by 30 days.
From an industrial cluster perspective, wholesale markets in Keqiao and Shengze will be among the first beneficiaries. These markets feature high transaction volumes but weak contract awareness; the new rules, through standardized inspection and payment mechanisms, can lower default rates. Additionally, constraints on commercial bribery will force more transparency in procurement bidding, reducing hidden costs.
For textile foreign trade companies, the convergence of domestic and international trade rules means higher dual-operational efficiency. In the past, foreign trade benefited from mature credit systems like letters of credit, while domestic trade relied on personal relationships. Now with clear domestic guidelines, companies can leverage their contract management experience from export operations, lowering the cost of switching between markets.