The Italian fashion brand United Colors of Benetton opened its new Corso Vittorio Emanuele flagship store in the metaverse during the upcoming Milan Fashion Week. As per a Spin Off report, the company aims to create the same emotional ecosystem in its virtual store as in physical store. Customers entering the physical store in Milan were able to immerse themselves in a cross between physical reality and digital connection, says Massimo Renon, CEO, Benetton Group.

Visitors to United Colors of Benetton's store in the metaverse participated in gaming experiences to accumulate QR codes to make purchases in the physical store. This enabled the brand to create an additional touchpoint with the consumer in the brand's omnichannel strategy.

Through this ominchannel strategy, the brand aimed to offer a dimensional bridge between the present and future, real and virtual, through an immersive brand experience says Antonio Patrissi, Chief Digital Officer, Benetton Group.

The virtual store offered a mirror experience to visitors as the physical store The Milan flagship store was also reinterpreted and painted entirely in pink during the Milan Fashion Week to emphasize the shades of Benetton’s garments.

The temporary installation was accompanied by the #playchange project. From February 21-23, 2022 February, five talents revealed their personal stories of change with Benetton, telling of those moments in life when they had to change their skin and approach in order to move forward.

The limited production of spandex by downstream buyers before the Spring Festival holiday and the extension purchase of spandex by downstream plants may surge Spandex prices this month. New spandex plants started trial production during the period while the existing plants increased their operating rate to 80 per cent, says a report by the CCF group. Suppliers sold and grabbed the market share with moderate profit.

Spandex prices had dropped after the Spring Festival holiday. Stocks of Spandex plants mounted as more downstream plants shut down for Spring Festival holiday than spandex producers. This led to a 5.4 per cent decline in spandex prices from February 07. However, a few spandex plants that had suspended production due to the Spring Festival holiday or the XXIV Olympic Winter Games resumed operation after holiday. By February 22, the operating rate of spandex plants rose by 9 percentage points to 91 per cent compared with early-Feb. Most plants in Middle China and West China ran at full capacity and plants in East China ran at above 87 per cent of capacity now.

Price of upstream BDO rebounded after holiday. Demand for PTMEG apparently recovered in February and may improve further. Price of PTMEG is expected to have very small downward space in end-Q1 and early-Q2, not ruling out to rise.

Indonesia’s garment industry is likely to grow 10.44 per cent in the first half of the 2022, as the upcoming Ramadan festival will drive demand, estimates Elis Masitoh, Director- Textile, Leather and Footwear Industry, Ministry of Industry. Production volume of the apparel industry could grow 10.44 per cent on an annual basis in the first quarter of 2022. However, demand is likely to rebound to only 75 per cent of pre-COVID levels, adds Masitoh.

In Q2, FY2022, the volume of Indonesia’s garment industry production is likely to slow to 10.15 per cent on an annual basis, adds Masitoh. In Q4 FY2022, growth in the garment industry declined to 0.16 per cent. However, in 2022, Indonesia’s garment industry will grow 5.84 per cent on an annual basis. The textile industry or the garment raw material industry is projected to decline by 1.02 per cent in Q4 FY2022. The textile industry will start growing from July 2022 while the garment industry will have two surges of demand in 2023.

The realization of the textile industry production growth was in the red zone in the Q2 and Q3 of FY21, notes Redma Wirawasta, Secretary General, Indonesian Filament Yarn and Fiber Producers Association (APSyFI) However, the improvement in demand in the fourth quarter of 2021 will make textile production throughout 2021 better than the 2020 achievement.

Demand improvement witnessed in Q4 FY2021 will continue this year also, says Wirawasta. He expects demand to rise by 40 per cent under normal conditions. However, textile demand is expected rise by only 15 per cent in the first semester of 2022

A Pitti Immagine event dedicated to the relationship between fashion and the digital world, E-P Summit aims to facilitate a dialogue between supply and demand of digital innovations. The next edition of the event will be held on May 4-5, 2022 in Florence, under the theme "Shaping the digital future of Fashion". As per a Spin Off report, the event will be led by a new scientific director Rinaldo Rinaldi, Professor, Department of Industrial Engineering of the University of Florence, who has been working for many years on the relationship between the major fashion and luxury brands and ICT (Information and Communication Technologies) for the digital transition of the entire supply chain. He, alongwith a comprising university professors, experts and high-level executives of fashion and luxury companies will select the themes and contents of the next editions of the eve

The theme is the digital development of creative and production processes underlying the new collections, with particular attention to artisan manufacturing; the new supply chains; the digital transition in support of ecology and the circular economy; integration between traditional distribution and e-commerce channels; strategies for social media; consumer customer engagement and analysis models; the Internet of Things; Artificial Intelligence and Machine Learning; use and protection of Big Data and the Cloud; the Blockchain; the Metaverse and the creation, exchange and fruition of NFTs, etc.

As per ResearchAndMarkets.com’s new report titled, ‘The Clothing Industry in South Africa,’ the garment industry in the country has been deeply impacted by COVID-19-led disruptions. With lockdowns and supply chain disruptions dealing a massive blow, Companies across the value chain decided to reduce their reliance on imported goods and increase local sourcing. Retailers in the country committed to increasing locally-made clothing ranges in their stores from around 50 per cent currently to 65 per cent by 2030.

The value/discount fashion segment recorded a relatively robust performance as customers flocked stores offering cheaper products. Online retail sales surged as people cut back on in-store shopping. Retailers prioritized cash preservation against new store openings in 2020. Focusing on clothing manufacturing and retail, the report includes comprehensive information on the state and size of the sector, notable players and their performance, developments and corporate actions, and factors influencing the sector including the effect of the pandemic on sales and the increase in online sales.

The report profiles 89 companies including major players such as Pepkor, Truworths and Woolworths, manufacturers such as Prestige Clothing and specialist companies such as Ubunye.

The upmarket stores across Asia had expanded rapidly in response to luxury brands increasing their footprint to capture domestic demand with travel corridors having shut down during the pandemic years. All the way from Thailand to South Korea, the quick shift toward domestic consumption made Western brands rethink their global retail footprint and distribute their investment in new ways. However, as the pandemic ebbs out, the same Western brands are now trying to figure out how best permanent repatriation can be made in the Asian market as the stakes get higher.

Experts feel, by 2025, Asian consumers are expected to account for more than half of the global luxury goods market. The proportion of spending that each nationality makes at home compared to the proportion they make abroad needs to be focussed on. Global consultancy company, Bain & Company forecasts now with a dip during the pandemic, Asians will make up between 55 and 64 per cent of total spending, up from 43 per cent in 2019. While the Chinese and Japanese will remain the two biggest spending nationalities, others too are on the rise. The luxury fashion industry’s collective efforts to rope in Asian customers in their own country have accelerated with premium brands pulling out all stops to make this work.

Local high-profile events help domestic consumption

Hosting fashion shows and having famous local celebrities and models endorsing products are some of the ways to keep the buzz going. French luxury fashion house recently cast Asian models on the runway and its creative collaboration with Thai film director Sivaroj Kongsakul lured high-profile Thai celebrities such as Urassaya Sperbund and Mario Maurer as well as South Korean actor Park Bo-gum to the red carpet at the mall. Christian Dior’s also had its first fashion show in South Korea in April, to forge new powerful ties with this country. Dior also recently presented events in Ho Chi Minh City, Vietnam, and Bali in Indonesia. Not to be outdone, Burberry took its TB Monogram pop-ups on tour, hosting events at holiday destinations in South Korea and Singapore.

As Thailand’s Chadatip Chutrakul, CEO of Siam Piwat Group points out, during lockdowns, demand from affluent local customers helped compensate for most of the loss of international shoppers. The decline in tourists made them change strategy to focus on local customers’ needs and requirements, allowing them to build a robust domestic market. The Siam Piwat Group owns high-profile shopping centres in Thailand, where the overall luxury market sales are on a meteoric high. Churakul says, over the past two years, there has been no decline in luxury spending — only a triple-digit increase, as the result of the consolidation of local Thai spending in the domestic market.

Although in India, the effects of repatriation is yet negligible, Mukesh Ambani , the chairman of Reliance Industries is building at least one new luxury mega-mall, Jio World Plaza, which is expected to include dozens of premium label boutique stores from Louis Vuitton to Gucci, to cater to the growing demand for premium brands. With local stores in the big cities across Asia having evolved to very high standards of fit-outs as well as offering a varied global product portfolio of the latest trends, the apparel repatriation game is going to be a tricky one.

The industry needs to stop converting plastic bottles into polyester fabrics, says Ashley Gill, Director-Standards, Textile Exchange. In 2019, only 14 per cent polyester fabrics were made recycled materials, he adds. As both polyester and plastic bottles come from fossil fuels, they could cause climate change, says Gill. As per an Indo Textiles report, the industry needs to reduce the demand for pure materials like this as they release tiny particles that are increasingly being found in food, air and water sources.

Sports brand Girlfriend Collective also says microplastic pollution needs to be curbed. The brand makes about 80 percent of its clothing from recycled polyester from plastic bottles. Other sustainable clothing brands such as Reformation and Patagonia also selli microfiber filters to catch microplastics before they end up in the ocean.

In addition to the problem of microplastics, the heavy chemicals and dyes used can also cause other problems, says Gill. Hence, the industry needs to reduce its dependence on polyester. He hopes, clothing companies will reduce overproduction and consumption of polyester even it is recycled,

China's latest move to allow duty-free access presents an opportunity for Bangladesh to export $25 billion worth of garment items, say experts. Bangladesh's exports to China are likely to grow to $25 billion if local suppliers grab an additional 1 per cent share of the Chinese apparel market of $350 billion. Currently, the country's share of exports to the Chinese market is 0.05 per cent, which is equivalent to a bit above $1 billion.

Despite Bangladesh's overall export earnings from China increasing by 9.81 per cent year-on-year to $426.14 million in the last seven months, apparel shipments to the East Asian nation declined 19.66 per cent to $131.20 million in the July-January period of the current fiscal year. Knitwear exports declined 30.77 per cent to $53.53 million while shipments of woven products declined by 10.36 per cent to $77.68 million, as per Export Promotion Bureau.

The Chinese government is encouraging the production of their own garment items, which negatively impacted Bangladesh's exports, says, Faruque Hassan, President, BGMEA. He hopes exports to China will grow with easing of coronavirus restrictions. Azizul Akil David, Senior Vice-President, Bangladesh China Chamber of Commerce and Industry says, Bangladesh should not target Chinese markets for garment shipments as China itself is the world's largest apparel producer.

MA Razzaque, Research Director, Policy Research Institute, adds, a major reason behind the decreased garment exports to China is the rising demand for locally made apparel items in the EU and the US. Bangladesh's current production capacity is mainly tailored for European and US markets, Razzaque adds.

The Ukraine-Russia crisis has sent energy stocks spiraling with crude oil prices trading at about $104 per barrel. This is likely to impact not just stock markets and commodity prices but also customers’ purchasing behavior, points out Sheshadri Ramkumar, Professor, Texas Tech University, United States.

Sanctions to harden crude oil and natural gas prices US, EU, and UK reacted to the crisis by imposing economic sanctions against Russia. These sanctions will only harden the current crude oil and natural gas prices in Russia, a major exporter of these commodities to EU nations like Germany, Sheshadri says. They may also strengthen the US dollar, making imports from the country more expensive. Cotton market will continue to remain volatile due to uncertain demand and high energy prices. The high energy costs will also influence overall EU market as many countries in the region depend on Russia for their energy needs, he says.

Cotton price volatility to persist

Velmurugan Shanmugam, General Manager, Jayalakshmi Textiles, believes, the volatility of cotton market will grow. A 100 per cent cotton spinning mill, the company has 72,000 spindles that spin fine count cotton yarns catering to home textiles market in India. The Ukraine-Russia crisis has been influencing commodity markets since the last few days. Mill delivered price for MCU-5 cotton surged from Rs 78,000 per candy to 83,000 per candy in the past 20 days. The current global situation is expected to add to the current price volatility, adds Shanmugam. The rise in gas prices may lead to consumers buying more textiles items, impacting exports.

Plan stocks diligently

Besides cotton and raw material prices, textiles’ demand is also influenced by factors like regional peace and security, says Sheshadri. He advises textile industry leaders to plan their raw material stocks carefully, and also manage transportation and operational costs efficiently. Russia will face tighter economy sanctions. Textile leaders need to monitor the impact of these sanctions on the sector, adds Sheshadri.

The latest Ukraine standoff has resulted in economic sanctions against Russia. This has caused concerns amongst leaders especially in the local fashion industry, already bearing the brunt of inflation, pandemic and the volatility of the rouble. Imposition of new sanctions reduces international projects and investments in Russia and a further weakens its local currency, says Anna Lebsak-Kleimans, Fashion Consulting Group.

Russian fashion leads amongst European markets

In 2021, the Russian apparel and footwear market surged 4 per cent year-on-year to $38.93 billion. However, the market still remains 15 per cent below 2019 levels, as per the data by Euromonitor International. How much of this decline is attributed to the lingerie effects of sanctions is yet to be determined, as per a Business of Fashion report.

However, Russia’s luxury market continues to lead amongst other European markets thanks to the robust return of the consumer spending in the sector, say Claudia D’Arpizio and Federica Levato, Authors, 2021 Luxury Report, Bain & Company. Both the pandemic and the sanctions failed to dent the spirit of the luxury consumers in the country.

In 2021, Russia’s personal luxury goods market surged 1.6 per cent to $6.77 billion over 2019-levels, as per data by Euromonitor International. This year, the market is estimated to grow by 0.65 per cent and by 2024, it is expected to surge by additional 3 per cent. As per Euromonitor International projections, the overall Russian fashion market will decline 1 per cent this year while by 2025 it will drop 2.7 below 2021 levels.

Surge in luxury spenders to sustain market growth

Sergey Suverov, Investment Strategist and Economic, Arikapital opines, though new sanctions may lead to a decline in people’s incomes, they would not directly impact fashion sales due to an increase in the number of wealthy consumers in the country. Lebsak-Kleimans opines, Russia’s previous experience of dealing with economic sanctions may also boost its fashion industry’s resilience to future sanctions. Previous sanctions encouraged brands to strengthen their position in the market with the help of numerous e-commerce platforms that have grown in the recent past, she adds.

Euromonitor data shows, H&M’s sales in Russia increased 280 per cent from 2014 to 2021 while Zara’s sales increased 85 percent for the same period. Sales of Tommy Hilfiger surged 25 per cent while Gucci and Valentino saw their sales shoot up 638 per cent and 96 percent respectively since 2014.

Consumers shift focus to domestic market

Rather than being concerned about the effects of new sanctions, fashion leaders in Russia seem to be still preoccupied with declining business due to the pandemic. Consumers continue to focus on current issues rather than on long-term plans. International travel restrictions have increased spending in the domestic luxury goods market. Consumers are diverting their travel budgets to categories like fashion, beauty and luxury.

The trend of revenge shopping continues in Russia as consumers step up investments on their wardrobes. As Alexander Shumsky, President, Russian Fashion Council says, consumers continue to focus on the present as they shift attention to local brands. Even in case of the devaluation of rouble, wholesale players may choose to buy more from local rather than international brands. In any case, the economic sanctions will not have a major effect on the fashion market in Russia. The market will be affected only if the sanctions have a significant impact on the Russian economy.