As per an OTEXA report, the global pandemic led to a 23.46 per cent decline in US’ apparel imports in 2020. The largest apparel supplier to the US, China noted a 39.16 per cent decline in its apparel shipments during the year. China’s market share declined to 23.65 per cent from 29.68 percent a year earlier and 33 per cent in 2018.

Shipments by other suppliers, Cambodia, Pakistan and Vietnam showed considerable growth during the past year and are likely to continue, along with Bangladesh, India and Indonesia, said Julia Hughes, President, United States Fashion Industry Association in a Sourcing Journal report.

Among the other top tier countries, Vietnam countered tariff threats by the Trump administration as did Cambodia whose apparel imports increased during the pandemic. While Vietnam’s shipments fell by 7.25 percent to $12.57 billion its market share rose to 19.62 from 16.18 percent in 2019. Imports from Bangladesh declined 11.73 per cent to $5.23 billion last year.

Cambodia was the only supplier whose shipments increased by 5.45 percent to $2.82 billion. Imports from Indonesia fell by 20.09 percent to $3.52 billion for the year, while India’s shipments declined by 25.58 percent to $3.02 billion and Pakistan’s dipped by 4.17 percent to $1.4 billion.

As per a new Denim Market report, global denim market will grow at 6.20 per cent during the forecast period of 2020 to 2027. Growing demand for recycled denims manufactured using plastics and other materials will create new opportunities in this market, says the report.

Rising urbanization and growing disposable income will enhance the growth of the denim market by 2027 supported by the growing popularity of denim shirts, increasing trend of stretchable denim jeans by blending cotton with synthetic material, easy availability of raw material, rising government initiative to enhance the product manufacturing and increasing promotion of denim wear. However, this growth is likely to be hampered by the rising prevalence for inexpensive woollen wear, availability of alternatives in the market, fluctuation in the cost of raw material and changing fashion and consumer preference.

The Denim Market analyzes the growth leading denim organizations and their thought process and methodologies to maintain their brand image in this market. The report helps new entrants understand the level of competition in the market and helps them strengthen their roots.

Cotton Association of India projects the coutnry’s exports of cotton fiber will increase by 4 lakh bales to 54 lakh bales for the season 2020-21 (October to September). Cost advantage in the international market helped India export about 29 lakh bales of cotton by end of January 2021.

Nearly 60 per cent of these shipments were executed during the first four months of the 2020-21 season. Data shows that in the initial four months of the season October 2020 to January 2021, cotton exports have touched highest in past three years. During the comparable period in 2018-19, cotton exports were reported at 24 lakh bales and in 2019-20 it was at 20 lakh bales.

Traders attributed the jump in exports to the lower prices and better quality of the initial crop. Meanwhile, in its crop estimate for the month of January, CAI has retained the crop size for the year at 360 lakh bales. However, of the total projected supply of about 499 lakh bales for the season, first four months have reported total supply of 389.25 lakh bales.

Opening stock at the beginning of the cotton season on October 1, 2020 was estimated at 125 lakh bales. Of the 499 lakh bales supply projection, barring 125 lakh bales of opening stock, crop size for the current season is likely to be 360 lakh bales and 14 lakh bales of imports.

CIFRA has launched a new antiviral collection made with exclusive Q-SKIN® yarn powered by AMNI VIRUS-BAC OFF, which guarantees permanent anti-viral activity. The innovative yarn was developed by the Rhodia-Solvay Group and is distributed by Fulgar, a leader in the sector of high-tech and eco-sustainable yarns. This extraordinary polyamide yarn is effective against the proliferation of bacteria and the spreading of viruses, thanks to the antiviral and antibacterial agent permanently incorporated into its polymer matrix.

The technical characteristic of this new yarn prevent antiviral and antibacterial agents from entering onto the skin or into the environment. Unlike garments treated with dyeing finishes that have limited functionality and lose theirs with washing, the antiviral and antibacterial properties of Q-SKIN® polyamide powered by AMNI VIRUS-BAC OFF are permanent.

This special, soft, and easy to wash polyamide fiber also guarantees freshness and comfort, contributing to the thermal well-being of the wearer. WKS technology guarantees the practicality of seamless and warp-knit garments, truly unique in the sector, which is designed to offer differentiated functionality thanks to body-mapping.

To cut their reliance on cotton yarns, local Bangladeshi spinning mill owners are choosing to invest more in the synthetic yarn segment. As per a Textile Today report, leading spinning mills, including Envoy, Matin Spinning of DBL Group, Maksons, Square, and Shasha Denim, are investing in synthetic yarn. According to Mohammad Ali Khokon, President, Bangladesh Textile Mills Association (BTMA), demand for cotton yarn has fallen by 35 per cent on the global market as most buyers are preferring synthetic and mixed yarn-based fabrics

Hence, sister concern of DBL Group, Matin Spinning Mills has decided to invest Tk1.86 billion to set up a special yarn unit to manufacture synthetic yarn. The Matin Spinning special yarn unit will increase the company’s daily production capacity by 10 tones and the assessed turnover will grow by Tk1 billion per year, as per the Dhaka Stock Exchange website.

Similarly, Envoy Group plans to invest Tk1.25 billion in setting up a synthetic yarn unit. The new unit will produce 12 tonne of yarn per day and will come into operation by October. One of the top 10 spinning mills in the country, Maksons Group has also decided to invest around Tk100 million in three new spinning units in Mirsarai Economic Zone.

While a concern of Maksons Group, Metro Spinning will invest Tk3.40 billion in a unit while Maksons Spinning Mills will dispense Tk2.54 billion and Tk3.48 billion into 2 other units, according to company insiders.

Square Textiles will invest Tk300 million while Mozaffar Hossain Spinning Mills has already invested Tk2.50 billion to increase synthetic yarn production. Shasha Denim has also signed a deal with the Bangladesh Export Processing Zone Authority (BEPZA) to lease 8 plots in the Dhaka Export Processing Zone (DEPZ) area for future business expansion.

The acquisition of apparel retailer Aeropostale in 2016 led to a new trend of landlords acquiring tenants. In the past several months, the Simon Property Group has acquired a slew of retailers like the Lucky Brand, acquired in partnership with Authentic Brands. Brookfield Property Group took over the brand Forever 21 earlier this year.

Financial gains lure property owners to retail

As per a Retail Dive report, there are many reasons behind landlords acquiring tenants these days. One of the most fundamental amongst these is to make money, says David Simon, CEO, Simon Property Group, which along with Brookfield bought JC Penney in November last year. The acquisition helped the group boost JC Penney’s pre-COVID sales to $9 billion. Another reason, property owners look to own their tenants is to preserve rent—the most important revenue source for a mall REIT. It also help them maintain a broader tenant base, says Michael Brown, Partner-Consumer and Retail Practice, Kearney.

Bradley Tisdahl, Founder and CEO, Tenant Risk Assessment adds acquiring a failing retailer also offers accounting advantage for a REIT. It allows the mall operator to control the retailer’s net operating losses (NOLs).

Emerging scenarios

However, for mall operators, owning their retailers can lead to two scenarios. It could either lead them to offer favorable lease terms to own retailers or encourage them to shut retailer’s stores in rival malls. This could lead to rival mall’s elimination from the market, which may encourage the surviving mall to raise prices.

Earlier, malls used to be anchored by department stores. However, now they are being replaced by specialty players, off-price stores, big boxers and Amazon. Apparel stores like Gap and department stores like Macy’s are opening shops at strip malls and open-air centers. This has led to two mall REITs, CBL and Preit filing for bankruptcy withom 24 hours of each other. Property owners like Simon and Brookefield are also under a lot of stress, says a report from S&P Global Market Intelligence.

Brookfield Property Partners aims to solve this problem by going private. This would offer them more flexibility to operate their portfolio besides enabling it to realize asset value, adds Nick Goodman, Chief Financial Officer, Brookfield Asset Management.

Besides their incomes being untaxed, the rules for mall REITs are designed for passive investments, says Nick Egelanian, President, SiteWorks. This boosts their partnership with retailers, adds Matthew Katz, Managing Partner, SSA & Company, which advises companies on strategic execution. However, this deviates from the REIT’s original function of owning and managing properties. REITs venture into this business to ensure a steady flow of their revenues. However, by doing this, they also put their stable rents at risk.

Despite a consistent 10 per cent annual growth over the past few years, India’s retail sector has not been able to achieve the same level of growth as Malaysia and Thailand. Now, the pandemic has forced around 7 lakh small retailers to permanently shut down operations, reports Economic Times. Though the Indian government has launched several initiatives to boost the sector’s growth in past decade, it needs to introduce a cohesive National Retail Policy that promotes inclusive growth amongst all key players.

The report says the policy needs to introduce a single window clearance system for retailers planning to open a new store. It also needs to digitalize the approval process to make it more speedy and transparent. Also, the process needs to be time bound and easily renewable. The government can also use e-governance and digital tools for inspection/audits to make the process more efficient.

The policy should also focus on launching flexible loans for kiranas, partnering Finetech startups to assess credit worthiness and incentivizing organized players to extend credit to smaller players.

Digitization to help double retailers’ profitability

Digitization can help traditional retailers grow revenues by around 30 per cent. It can also double their profitability. However, the digitization process is often hampered by a lack of capital, capabilities, and awareness. Government can help such retailers by launching new digital solutions and providing them tax breaks or subsidies for adopting digital tools. With an investment of Rs 12,000 crore, the government can modernize over 10 lakh retailers. It can also encourage private players / start-ups to collaborate with traditional traders to further increase their reach.

Infra development to reduce cost

Lack of efficient warehousing, cold-storage, and transportation facilities often increases the overall logistics costs of Indian products by around 5 to 8 per cent than global counterparts. Therefore, the National Policy needs to invest in the development of new warehouses, cold storage and other logistics-related infrastructure. This will reduce retailer’s costs by up to 2 percentage points besides improving their service to consumers.

Simplfy labor laws

India’s current skilling programs fail to provide employment to laborers. The policy to needs to clarify and simplify laws related to part-time and gig retail workers. It needs to encourage flexible work hours and part-time work. The policy also needs to incentivize employers to implement comprehensive childcare systems which would help improve women participation in retail by 5-10 per cent points. Scaling up skilling programs and vocational courses can also the government upskill India’s workforce.

As the retail industry has a major impact on the Indian economy. Its growth policy needs to be simple, standardized and digitized. This will not only create 30 lakh more jobs but also help the sector realize an additional growth of up to 2 per cent by 2024.

Indian manufacturer of textile machines, ATE has entered into an exclusive partnership with Sieger Spintech Equipments to sell its products and solutions in India. Based in Coimbatore, India, Sieger offers many kinds of hi-tech textile machinery and textile engineering solutions.

Sieger’s range of products includes innovative automation solutions for the textile industry and tailor-made solutions for textile material handling from roving transportation to garments. Sieger also offers systems and solutions for roving transport from simple loop to automatic creel change systems.

Sieger’s product portfolio also includes an automatic cone packing system which has modules for weighing balance, buffer storage, cone labelling, wrapping, and bagging or boxing (both packing options are also possible).

Sieger offers a variety of solutions for yarn conditioning such as the latest generation, power saving YCP NG UF (pit not required), and the fully automatic YCP NG HI cubical palette yarn conditioning plant with and without pre-conditioning chambers.

Additionally, Sieger also provides automatic overhead travelling cleaners, designed with state-of-the-art aerodynamic CFD. Sieger’s ADOF is an advanced doffing system with a doffing speed of less than 90 sec with minimum start-up breaks.

The value of Canada’s RMG imports declined by 14.20 per cent in 2020. The country imported $ 8.67 billion worth of garments in the pandemic-hit year down from $ 10.10 billion in 2019.

Knitted clothing constituted $ 4.37 billion in total Canadian apparel imports, declining 18.03 per cent in 2020 from 2019, while the fall registered by woven clothing segment was 9.89 per cent valuing US $ 4.30 billion.

The fall in import of woven clothing was less than the fall noted in knitted category which is somehow surprising as the other major apparel markets in the world have experienced a rise in demand in knitted clothing, especially in the second half of the year, owing to pandemic which led world’s population working remotely or opting for work from home system.

Particularly in December ’20, Canada’s import valued $ 629.90 million which was down by 8.96 per cent on Y-o-Y basis.

A new wave of COVID-19 lockdowns and patchy national vaccine rollouts are puncturing recovery hopes of apparel retailers. As per a Reuters report, McKinsey forecasts a 15 per cent sales drop in 2021 while Euromonitor expects recovery to be around 11 per cent. According to these analysts, retailers are still holding last year’s unsold inventories like Primark which has around stock worth £150 million from 2020 spring/summer and £200 million pounds from autumn/winter.

McKinsey estimates the value of unsold stock at around €140-160 billion. Hence, this year retailers are keeping volumes small and lead times tight, says Ron Frasch, Former President, Saks Fifth Avenue. Hong Kong-based sourcing agent Li & Fung, which manages more than 10,000 factories in 50 countries for retailers including global players, says though some retailers had requested late payment terms but declined to provide specifics. 

Fifty factories surveyed by the Bangladesh Garment Manufacturers and Exporters  Association reported receiving 30 per cent fewer orders than usual this season, as pre-Christmas lockdowns in Europe followed by another clampdown in January hit their businesses hard.

Some retailers are also trying to sell off as much of their excess stock as possible before placing new orders, said, Raffy Kassadiian, CEO, Parker Lane Group .