As per a 2021 outlook report from Moody’s Investor Services, apparel retail is set to bounce back.The report expects operating profit of department stores, including Macy's, Nordstrom and Kohl's, to rise over 500 per cent; at off-prices like TJX Companies and Ross more than 450 per cent; and at apparel and footwear retailers brands like those at Tapestry, Gap Inc. and L Brands by over 100 per cent.

The report says, casualization accelerated by the pandemic will continue, as will online sales and healthy living trends, benefiting companies like Nike, Under Armour, VF Corp and Wolverine World Wide. Work and formal attire will continue to decline but companies like PVH Corp. and G-III Apparel Group will prosper thanks to their diversity of merchandise and "ability to tactically evolve product mix. The analyst expects strong profit improvement" next year thanks to international sales and sales growth, cost cutting and inventory management.

Moody's analysts also describe 2021 ripe for a comeback for some apparel retailers, who had to react not just to the pandemic's disruption of their front and back operations, but also to swiftly changing consumer behavior. As per the report, many of those behaviors are set to last beyond the pandemic. Migration online will continue to pressure profit margins. However, it will also increase price competition to gain market share.

The lingering economic troubles will hit financially weaker retailers especially hard and erode the positive effects of low interest rates on debt servicing capacity, said Moody's. Despite the sales recovery, helped along by the upcoming year-over-year comparisons, more stores are expected to shut down, the analyst warned.

Cambodia closed around 110 garment factories in the first nine months of this year, leaving 55,000 employees without jobs, though union leaders fear that the figures maybe even higher. As per a Textile Focus report, Ngoy Rith, Undersecretary of State for the Ministry of Labor and Vocational Training, the country has closed 111 factories in the clothes, footwear and travel goods sector by early September. The number of these closures is equivalent to the first nine months of last year when 110 factories were closed, Rith said. According to him, these closures left 55,174 jobs unemployed.

However, the government has enforced suitable step to keep factories though COVID-19 pandemic and other causes had effectively shut down the global demand for garment goods. The number of suspended job contracts had steadily subsided while the number of frozen work contract garment factories had declined to 52, impacting the incomes of nearly 14,000 employees, says Rith. However, Fa Saly, President, National Trade Union Confederation, says, the real statistics may be higher than the estimates published by the Ministry of Labor and that more Cambodian employees every day were losing their employment and incomes.

As per Apparel Resources, after a temporary setback in September ’20 both on M-o-M and Y-o-Y basis, Canadian apparel import values improved significantly in October. The report estimates the import value of Canada to have increased by 15.21 per cent from October ’19 to $ 960 million in October ’20, and by 5.39 per cent as compared to September ’20. Imports increased with the onset of festive season in November and this surge is expected to continue till December.

Of all, the value of knitted garments imports increased to $508.97 million while that of woven garment categories reached $ 451.03 million. Imports of woven garments increased by 27.95 per cent in October ’20 over October ’19 while those of knitted garments increased by 5.87 per cent.

As far as January-October ’20 period is concerned, Canadian apparel import declined by 17.57 per cent to $7.23 billion, making a total loss of $1.54 billion for exporters from a year earlier.

As per estimates import recovery benefitted partner countries and all top Asian apparel manufacturing destinations. China’s share increased 31.84 per cent from October’19 to $381 million in October ’20. The country’s share has been falling for last two months as it stood at 45.63 per cent in August which fell to 42 per cent in September and has gone further down to below 40 per cent in October.

On the other hand, Bangladesh’s shipments increased 1.25 per cent to $106.94 million worth of garments to Canada in October ’20, noting 9.79 per cent growth from a year earlier. However, as compared to September ’20 figures, Bangladesh shipped just 1.25 per cent more garments in the subsequent month. India exported $25.19 million worth of garments to Canada in October, noting 17.61 per cent growth from October ’19 and 39.72 per cent surge from September ’19.

The pandemic has been a nightmare for retailers with big department store chains going into bankruptcy. This year, the global retail industry faces a 30 per cent drop in revenue as retailers continue to close stores and lay-off employees, says a report by Business of Fashion and McKinsey & Co study.

Returns rate to spike as stores remain closed

As per Be Global Fashion Network magazine, though brick and mortar stores may eventually reopen and offline operations resume, retailers will face significant hurdles in maintaining social distance and ensuring safety of products and environment. Made-to-measure (MTM) businesses will face more challenges as they provide perfectly fitting garments, which require multiple personal fitting sessions with customers. Studio and store closure have made personal fitting sessions impossible. MTM players can’t ask customers to measure themselves as there is no room for inaccuracies in their businesses. Hence, they expect a spike in garments return rate.

Safety, economic concerns affect business

Many countries have advised retailers to keep fitting rooms closed and limit fitting sessions. However, even if these restrictions are relaxed, retailers are not confident of customers returning to stores soon. A recent survey by predictive analytics company First Insight finds less than 45 per cent consumers feel safe returning to physical stores due to COVID-19.

Also, consumers are likely to pull purse strings in due to economic uncertainty. Experts expect consumer spending on high end garments to contract 39 per cent with MTM businesses being the worst hit. Bespoke brands may also suffer on account of extended lead times due to factory closures and lack of raw materials. These issues will make it difficult for brands to increase their customer base.

Affordable MTM tools to ensure smooth operations

Though the fashion industry has woken up to innovative design, manufacturing and sales technologies few are beneficial to MTM businesses as they are expensive. Also, MTM brands lack the technical knowledge to implement these solutions. These solutions require the knowledge of working in 3D design environments, building fabric and trimming libraries, and using 3D across pattern fit. To benefit MTM businesses, these technologies need to be affordable and simple.

The tools and technologies that the fashion industry currently has access to, fail to address specific needs of MTM sector. A digital process doesn’t require costly hardware or hiring, outsourcing developers. It enables bespoke fashion businesses to operate entirely online through new tools such as 3DLOOK’s Mobile Tailor. The tool was built to address the needs of smaller businesses. Its contactless technology allows MTM businesses to provide additional in-store benefits, such as virtual try-ons. These tool also provide contactless in-store fitting process that combine the safety of a digital process with the convenience of having expert tailors at hand.

Deloitte estimates a strong demand for personalized clothing amongst 41 per cent consumers, majority of who belong to Generation Z. It advises MTM retailers to collect accurate and safe body measurements that would help them provide memorable shopping experiences to customers.

As per Ellen MacArthur Foundation, the global apparel industry loses $500 billion every year as over 100 million tons of clothing is thrown into landfills. Lack of recycling initiatives has made circularity elusive in the industry with brands focusing on a few isolated initiatives. To halt climate change and restore biodiversity, the industry needs global-scale solutions, says a Forbes report. As per this report, the industry needs scaled circular solutions to control increasing waste generation and carbon emissions. It also needs active participation from various industry stakeholders to thrive in the fiercely competitive market.

Providing the required scale for recycling

To deliver affordable textile recycling solutions, Finnish biotechnology group Infinited Fiber Company has introduced a €6M European Union research and innovation fund which encourages 12 consortium members, spanning Finland, Sweden, Germany, The Netherlands, Portugal, Slovenia and Turkey, to launch the New Cotton Project to reduce fashion waste and environmental impact. To be developed in collaboration with industry giants like Adidas and H&M, the project will provide the required scale and volume to test recycling technology, says, Petri Alava, CEO, Infinited Fiber.

Spanning three years, the project will provide 3 ton cellulose carbamate fibers to Inovafil, Tekstina and Kipas, partners of H&M and Adidas who operate within the brands’ supply chains. The fibers will spun, dyed, knit and weaved into yarns and fabrics of the brands’ commercial fashion products.

Analyzing new business models

For this project, global consortium collaborators aim to collect and analyze new workflows and processes. For instance, Holland-based Frankenhuis plans to pre-process textile waste, while the South-Eastern Finland University of Applied Sciences (XAMK) plans to launch new solutions for processing waste fibers. For consumers and retailers, RISE (the research institute of Sweden) plans to analyze the sustainability and techno-economic feasibility of the project besides managing its eco-labeling. Finland-based Aalto University also plans to analyze the project’s resulting ecosystem and circular business models on a more macro level

Its magnitude and complexity make EU funding for this project extremely essential. However Katheleen Rademan, Facilitating Stakeholder and Petri Alava, CEO, Infinited Fiber, are confident that the project will achieve commercial viability as there is growing consciousness amongst brands about environment protection. The newly established Fashion Pact further stimulates these brands’ sustainability drive.

Determining the planet’s future health

KirsiNiimimaki, Professor, Aalto University believes, the project will educate the industry on the environmental impact that fashion has on developing countries. Though launched in Europe, project targets apparel producers in China and Bangladesh. Hence, it will pave the way for an immediately implementable global blueprint solution.

The project will take into account the entire value chain, from raw materials through to fiber, yarn and garment production, as well as end-of-life. For this project Infinited Fiber is negotiating with two Chinese companies to license their recycling technology. The company is also exploring other business models that could see it become a large-scale supplier.

Besides determining Infinited’s future business model, the outcome of this three year project will also determine the future health of our planet.

Bangladesh and Bhutan have signed a preferential trade agreement (PTA) on 6 December to ease further trade barriers between the two neighboring countries and facilitate an increase in the volume of bilateral trade. As per Textile Today, this is the first such agreement Bangladesh has signed with any country since independence in 1971.

Under the agreement, around 100 Bangladeshi products will get duty-free access to Bhutan while Bhutan will enjoy duty benefit on its 34 products. Some of the Bangladeshi products that will enjoy duty free access include baby clothes and clothing accessories, men’s trousers and shorts, jackets and blazers, jute and jute goods, leather and leather goods, dry cell battery, fan, watch, potato, condensed milk, cement, toothbrush, plywood, particle board, mineral and carbonated water, green tea, orange juice, pineapple juice, and guava juice.

In order to thank the leadership of board members and committee chairs whose terms end in 2020, AATCC plans to recognize all outgoing chairs at Spring AATCC committee meetings to be held from May 11-13, 2021.

AATCC board members include Rembert Truesdale III, Immediate Past President TenCate Protective Fabrics; Martha Carper, Regional Board Member, Central Atlantic; John Crocker, Midsouth Regional Board Member, SDL Atlas LLC; Heather Elliot, Western Regional Board Member, Adidas, etc.

Its Research committees members include Joseph Lin, Fiber Analysis Test Methods Acting Chair, Vartest Laboratories Inc; William (Buddy) Garrett, RA34 Preparation Test Methods Acting Chair, Cotton Incorporated; Andrew Fraser, RA36 Color Measurement Test Methods Chair, InMocean Group LLC; John Crocker, RA38 Colorfastness to Crocking Test Methods Acting Chair, SDL Atlas LLC, etc.

The organization’s Administrative committee members include Administrative committees include Rembert Truesdale III, Appropriations Committee Chair, TenCate Protective Fabrics; John Darsey, Chapin Award committee Chair, Darsey Color; Michael Grigat, Olney Medal Award Committee Chair, Crypton Inc; William (Bill) DiIanni, Millson Award for Invention Committee Chair, Elevate Textiles.

As per the data from the Export Promotion Bureau, Bangladesh’s knitwear exports grew by 4.8 per cent year-on-year to earn $7.13 billion in the period of July to November of the current FY. As per Textile Today, experts attribute the increase in demand to extensive stay at home, which triggered orders and sales of sweaters.

Simultaneously, Bangladesh’s readymade garment (RMG) exports have been bouncing back as the grim year of 2020 almost coming to an end. The RMG sector earned US$ 2.45 billion in November. Although November’s receipts are 8.2 per cent less of the monthly target of $3.35 billion, still the export earnings in the month are the highest in the August-November period. Official data also showed that, from July to November of this year, the sector earned $12.89 billion with a 1.48 per cent growth rate.

As in November, the export of woven garments fell 10.48 per cent while knitwear export grew by 4.97 per cent.

At the same time, home textile exports grew pointedly during the COVID-19 pandemic because of the increase in the use of hospital bed sheets, medical gowns and curtains, especially in the countries that have been severely hit by the rogue pathogen.

Apparel Export Promotion Council (AEPC) has applauded Reserve Bank of India (RBI) for liberalizing the rules for writing off unrealized export bills. In a letter to Shaktikanta Das, Governor, RBI A Sakthivel, Chairman, AEPC thanked the central bank for permitting Authorised Dealer (AD) banks to write off unrealized export bills of any amount, which earlier was allowed only up to a certain limit beyond which the AD bank had to approach RBI for approval.

The AD banks have also been allowed to consider refund of export proceeds without insisting on import of goods, which are perishable in nature or had been auctioned or destroyed by an authorized agency in the importing country. Sakthivel believes these changes will not only simplify the procedure but also reduce the time taken for getting approvals and thereby reducing the regulatory cost. These measures will help exporters suffering from non-realization of export proceeds due to bankruptcy and insolvency, he said.

BGMEA has sought a fresh stimulus package for the sector besides urging the government to continue benefits given at the beginning of COVID-19. Since April this year, the Bangladesh government has granted Tk 10,500 crore to the export-oriented garment sector in three phases to help factories pay salaries and allowances to workers at 2 per cent service charge. The government has also unveiled some other packages.

For example, it has introduced a Tk 33,000-crore stimulus package for large industrial units and has made available another Tk 12,750 crore in the Export Development Fund. BGMEA has also demanded an extension of moratorium period for repayment of loans under the first stimulus package to one year from six months now. It has also sought an extension of the payback period to five years from one year as the sector is going through a rough patch

Recently, BGMEA participated in the Call for Action program launched by the International Labor Organization to get back payments from international retailers and brands through discussions and consultations.

Of the major retailers and brands with which the BGMEA held talks and discussions are C&A, Bestseller, H&M, M&S, VF, PVH, KIK, Primark, Tesco, Decathlon, Arcadia Group, Next, New Look, Asda/George, OVS, K-Mart and Target Australia, Camieu, La Halle, and Ny Gard.