Garco 10 has joined ITMF as corporate member. Garco 10 is one of the largest enterprises in Vietnam’s apparel and textile industry with a total of 19 factories and manufactures and exports nearly 30 million garments a year.

Established in 1946, Garco 10 initially focused on making military uniforms. Founded in 1904, the ITMF is the international forum of the global textile value chain for producers of fiber to finished products. Its members are from textile and apparel-producing countries representing approximately 90 per cent of global production.

For Garco being part of an international forum like ITMF is very valuable. Having access to an international network like ITMF provides Garco 10 access to companies and people from around the world in a cooperative environment and allows participationin discussions about trends and initiatives in the industry. The publications, reports and surveys that ITMF produces will help Garco better understand the underlying dynamics in the industry.

Equally having Garco 10 as a member will provide ITMF an additional perspective on Vietnam. The global textile and apparel industry is constantly undergoing structural changes. Currently, the changes and dynamics are unprecedented and therefore an international forum for exchange and discussion provides added value.

The much-awaited ‘The State of Fashion 2023’ report launched on the second day of the annual gathering of industry experts in London by the Business of Fashion Voices in association with McKinsey & Co reiterates a fact that has already been trending, i.e. global slowdown of the fashion sector. It also predicts a shift in purchase of fashion will not only be determined by household incomes but also region-wise. The silver lining however, is luxury sales as this niche sector is expected to grow by 10 per cent, which is a new of relief for premium brands and hope for the industry. With uncertainty in China due to their zero-Covid spread policy and the tightest of lockdowns, the country has been deprioritized and the growth will be led by the usual markets of North Americas and the Middle East.

Luxury sales growth the good story

The successful growth is predicted for luxury is because higher-income households are least affected during these times of inflation and will continue purchasing luxury items. The Gulf Cooperation Council (GCC) countries will generate around $11 billion in luxury sales in 2023 as this is the region which is least affected by global recessions and inflation and continue maintaining a huge proportion of high-income households.

China was the center of focus for many fashion brands but due to many internal factors that the country faces, slowdown in demand, particularly for luxury items is the challenge that these brands will need to address right away. Experts are already identifying regions that are continuing to drive growth amid economic uncertainty, such as the Middle East and the US, and focus investment in those markets. In the Business of Fashion & MkKinsey & Co State of Fashion 2023 report, Achim Berg, Senior Partner, Global Leader of McKinsey’s Apparel, Fashion and Luxury Group, said, “Global fashion sales growth will be driven by the luxury segment — up to 10 per cent, compared to up to 3 per cent for the rest of the industry.”

Discretionary purchases will affect fashion segment

The interesting insight from the report is that consumers who are affected by recession and inflation will put away or completely do away with discretionary purchase. Research indicated that in the US and Europe, apparel and footwear will be in the ‘deprioritized’ list and suffer setbacks. Bargains will play a big role in sales of fashion items for this segment as will the resale, rentals and off-price items. This will be a tightrope walk for many fashion brands as whilst not diluting their brand equity, they will need to retain and acquire customers.

The report provides significant data to corroborate this fact. Customers may seek out lower-priced retailers and discounts, particularly in younger segments. Over 75 per cent of US Gen-Z and Millennials said they are taking steps to manage finances, compared with Gen-X’s 64 per cent and Baby Boomers’ 53 per cent. Off-price retail is expected to experience a boom with pre-loved and off-season items at heavily discounted rates. In fact, off-price as a fashion industry channel is expected to contribute 12 per cent of the industry’s income by 2025.

In China, the younger generation is really not affected by the recession and inflation running through Europe. However, young Chinese are feeling the impact of their economy’s slowdown, especially driven by the Covid-19 related issues. Unemployment stands at 20 per cent for Chinese aged between 16 and 24 years, compared to the overall national figure of 5.5 per cent. This in turn has severely impacted their lifestyle purchase choices as they make drastic cuts for a simpler life than did their parents. The trend is called “tang ping” – leaving the rat race for a low key life, with far less focus on material consumption.

Every cloud has a silver lining and industry analysts are predicting good things for 2023. After rampant inflation in 202, with disruption in supply chains after the pandemic, there is a positive projection that the cost of goods as a whole, including apparel, should start to come down by next year.

US-based investment research firm Morningstar has predicted that since inflation was worse in 2022 than what is expected in 2023, global customers can look forward to a happy new year with some financial relief soon. With commodities supply chains now more stable, the gap between supply and demand will soon be narrowed, and this will make consumers cut back on spending. This will enable the cost of goods as a whole to come down and will directly benefit the apparel industry too.

Better inventory and demand-supply chain coming soon

As interest rates rise, consumer spending will slow down and demand will decrease, potentially leading to lower clothing prices. After Covid years, the combination of high sourcing costs coupled with an increasingly challenging retail environment has pressured retailer margins and compounded issues related to inventory. But having overcome some earlier difficulties, apparel import volumes have grown in leaps and bounds in recent months. Analysts feel the seasonally adjusted terms for raw fibre equivalence (weight terms), and total apparel imports (all fibres) have recorded the highest ever between February and June. Although some recent figures may be on a slight decline, they are still soaring above the average before 2019 before Covid and may add to inventories as the present consumer environment slows.

Reports suggest, that although retail prices for garments decreased by 0.2 per cent month-over-month in September, the year-on-year retail apparel prices were 6 per cent higher. This is relative to the 2019 average, where current retail prices were 2.1 per cent higher in September, as per the Executive Cotton Update by Cotton Incorporated. However, import costs continue to rise and the latest value for Square Metre Equivalent (SME) of cotton-dominant apparel set a record (data since 1989) in seasonally adjusted terms of $4.11/SME. These recent values are a total reversal relative to the values that were posted when Covid started.

Some garment segments are a non-negotiable expense The total overall consumer spending increased 0.3 per cent month-over-month in seasonally and inflation-adjusted terms in September this year with YOY overall spending up to 1.9 per cent, which is the slowest rate of annual growth since early 2021. Among this, the spending on garments was up 1.4 per cent month-over-month but was down 0.3 per cent year-over-year.

Although certain expenses such as food, gas and housing are non-negotiable expenses, many items of clothing are considered essential expenses too, although not all. Kids wear as children outgrow clothes, winter clothing, sports gear for wellness, and corporate dressing for the work segment among others are not an extra expenditure- they are essential for our daily living. Cost-cutting techniques such as ditching the expensive branded kids wear that kids will outgrow soon and buying the cheaper alternatives, accepting hand-me-downs from older kids of friends and family and shopping at the end-of-season sales instead of the beginning are all ways of cutting expenses.

Fashion is not about labels and price tags- it’s all about you being you. And consumers are looking forward to that in 2023 with the dip in inflation and lower prices and the Covid fear slowly ebbing away.

Year 2023 shows a greater acceptance and following of gender-fluid fashion as detailed research in the just published Business of Fashion and McKinsey & Company’s report ‘State of Fashion 2023’ reveals. Gen Z is the key segment driving popularity as this generation does not identify their gender on static lines like their previous generations. Markets leading genderless clothing are Northern Americas, Europe, Japan and Korea.

Growing acceptance to drive market

In a survey conducted among top industry executives during the compilation of this report, 73 per cent of American respondents said they would consider buying genderless clothing whereas 36 per cent respondents said they already had, making the US youngsters leading the world on this fashion trend. Interestingly, fashion hubs like France and Italy showed 58 and 67 per cent respondents willing to buy whereas only 22 and 21 per cent respondents had already bought genderless clothing in these two countries respectively.

The survey also indicated that amongst Gen Z respondents, below 20 years of age are more likely to buy clothes that are gender-fluid and 56 per cent of this target group said they prefer buying clothes that are not gender specific. This group of young consumers is the future customer of fashion brands as by 2036, they would represent the largest segment in the fashion sector. A lot can be said about the influence of pop culture in the changing attitudes towards gender-fluid fashion. A fashion app Lyst said they saw a 33 per cent increase in searches ‘gender neutral’ in 2021. The Korean search engine Naver reported similar searches rising since 2020. Sale of handbags has reiterated this shift in many ways. The RealReal site that resells pre-loved luxury items reported that men’s interest in the iconic Birkin bag has grown considerably and when it comes to purchase of luxury handbags, men are beginning to catch up with women in terms of numbers. “Gender neutral is not a trend, it’s a reality,” said Jonathan Anderson, Creative Director of Loewe and founder of label JW Anderson, in 2021. “My whole philosophy is that you cannot tell people what to wear. You’re not allowed to say: ‘I want this to be bought by a woman or by a man’.” According to Brigitte Chartrand, senior director of womenswear buying for online luxury boutique Ssense, “Modernised merchandising techniques can help brands sell products to a wider range of customers. For example, Ssence presents men’s pieces in its womenswear offering based on cut, fit, size or styling.”

Many brands adopt ‘Made for All’ categories

Many brands have decided to do away with gender-based categories for all or some of their clothing lines. ‘Made for All’ is Uniqlo’s collection that was presented within men’s and women’s collections on their online and ins-store channels. The collection met with great success in most Western countries. Phluid Project, the NYC clothing label has stopped clothing by gender completely. Depop, the online resale platform does not filter searches by gender unless at the request of the visitor.

Industry experts have advised fashion brands to know their young customers at a more personal level – demographics, markets and local cultures will be the key to success for gender-fluid fashion. Even in Europe, countries like Italy, Spain, Portugal, France and Poland will be harder to crack than the UK and the very-liberal Scandinavian countries. Similarly, with the exception of Japan and South Korea, at the present moment the rest of Asia, the subcontinent and the Middle East are not ready to embrace the concept enmasse.

The global market for textile chemicals is growing by four per cent a year.

Textile chemicals are used in many parts of the manufacturing process to ensure that fabrics, yarns, and fibers are produced with consistent results across multiple batches.

In addition, textile chemicals can help create innovative finishes and styles that make textile products more attractive to consumers.Textile chemicals are used in various stages of fabric production such as pre-treatment, dyeing and finishing, printing and other processes. Textile chemicals are used to improve the feel, look and performance of fabrics. They are an integral part of textile production, as they provide special treatments that help reduce wear and tear, resist stains and add colour to fabrics. Increasing investments in the textile industry, growing demand for eco-friendly and sustainable fabrics, advances in the production technologies of textiles are some of the factors driving the growth of this market.

Initiatives to promote investments in the fashion and garment industry are providing a major impetus to the global textile chemical market. Countries are regulating standards for the safe use of chemicals for dyeing and processing of fabrics. This is likely to boost the growth of the global textile chemical market. Rising disposable income coupled with changing lifestyle trends in developing countries is estimated to increase demand for apparel and other textiles, which can grow the demand for textile chemicals in coming years.

Textile chemicals are used to enhance various characteristics of textiles such as shrinkage protection, resistance against bacteria, soil release property, dye fixation, texture modification and flame retardation. The use of enzymes, bio-polishers and biobased surfactants is gaining traction due to their environment-friendly nature and cost effectiveness. Moreover, the increasing demand for improved quality of textile products is another factor driving the global textile chemicals market.In addition, technological advances in the production of dye intermediates and textile dyes are another factor propelling the growth of this market.

Furthermore, increasing investments in research and development activities, introduction of bio-based dyes are some other factors estimated to contribute to the growth of the global textile chemical market in coming years.Major brands and stores are continuously looking for ways to reduce their water and energy consumption. As a result, the demand for eco-friendly textile chemicals is increasing in the global market.Colorants and auxiliaries account for the largest revenue share in the global textile chemicals market due to an increasing demand for vibrant shades and textured fabrics in the textile industry.

The segment is expected to remain dominant due to rising awareness regarding sustainability and development of innovative products that have advanced properties. Additionally, increasing production capacities by leading companies is anticipated to drive market growth.

Challenges

Stringent environmental regulations and health safety issues associated with certain chemicals are some factors hampering the growth of the global textile chemical market.Despite these challenges, companies operating in this industry are focusing on the development of environment-friendly chemicals for dyeing and processing of textiles. This factor is expected to provide new opportunities for the growth of this market in future.

Garment manufacturers and exporters in Bangladesh want the tax at source on the readymade garment sector to be at the previous 0.5 per cent from the existing one per cent.

They say they have made this request considering the apparel sector is now passing through a tough time considering the current global situation and that without policy support, it will be hard for them to maintain their competitive edge in the garment industry. They say if the tax at source is made at 0.5 per cent for the next five years, it would be possible for them to maintain export competitiveness and if the industry were to be kept alive, there will be newer employments while export competitiveness and revenue income can also be increased through raising the competitive edge without raising the tax rate.

The tax at source on the apparel sector was increased to one per cent from 0.5 per cent in the current fiscal year. Bangladesh hopes to reach a share of eight per cent in the global apparel market within this year. Although there are some signs of a slowdown in garment exports now, because of the war-related crisis, the global economic turmoil, and a record inflation affecting retail businesses, it is expected that shipments to new destinations, particularly to Asian markets, will witness growth.

Online Black Friday sales in the US this year set a new record. So says Adobe Analytics. The event kicked off a solid start to the holiday shopping season despite inflation and other economic concerns.

This year’s Black Friday online sales were two per cent higher compared to last year, with electronics, smart home equipment, toys and exercise equipment providing the biggest boost. Americans are dipping into their savings accounts and racking up debt on credit cards to make purchases. Online shopping is expected to remain strong through Cyber Monday. US shoppers’ spending on Thanksgiving Day were up two per cent from a year ago. The holiday shopping season looks very different now than it once did. Instead of door buster deals on Black Friday, many retailers began their holiday sales in early fall. By spreading out their holiday deals online, retailers have reduced the draw of Black Friday. But shoppers are returning to many of their pre-pandemic routines and retailers expect a more typical holiday season than the last two years in the pandemic. Shoppers are once again expected to buy around key holidays like Black Friday and also buy later in the season. This year, inflation squeezed many shoppers’ budgets. Customers are pulling back on discretionary spending like furniture and electronics and are being more selective about what they buy.

Some 300 textile and weaving units in Tamil Nadu, India plan to shut down for some time. The units mainly in Tirupur and Coimbatore have decided to do this due to unstable yarn prices and highpower tariffs. Prices of grey fibers and textiles have risen due to the volatility of yarn prices and high tariffs.

Apart from this Tirupur’s apparel exports have fallen 21 per cent in October 2022 from October 2021. Of this, knitwear exports, which Tirupur is known for, fell almost 40 per cent. And this was the third straight month knitwear exports contracted. Average capacity utilisation at garment exporting units in Tirupuris 30 per cent now.

The US, EU and the UK account for 85 per cent of shipments from Tirupur. With high inflation in these economies, clothing is not a priority for consumers now. Further, with buyers saddled with huge stocks, they are postponing delivery. This has resulted in stocks piling up at the producers’ end. So Tirupur has a huge inventory of finished goods as brands are asking for deferred shipments. With buyers in the EU and the US holding high inventory, and expectations of better sales during the Thanksgiving holidays and Christmas, exporters are expecting orders to revive only by January.

Shima Seiki will exhibit at India ITME, Noida, December8 to 13, 2022. The Japanese flat knitting solutions provider will exhibit the latest in knitting technology for both whole garment and shaping as well as the latest in DX solutions utilizing virtual sampling.

Seam-free wholegarment knitting technology offers an alternative to labor-intensive manufacturing in India and other international markets. Featured will be the Mach2 XS wholegarment knitting machine with original Slide Needle on four needle beds and a spring-loaded moveable sinker system supporting a wide range of high-quality wholegarment knitting in all needles.

The N.SVR 123SP computerized knitting machine features a special loop presser bed, capable of producing hybrid inlay fabrics with both knit and weave characteristics, and the special i-Plating option, capable of alternating yarn colours in any pattern, producing jacquard-like designs using plain jersey stitch for even greater diversity in knit design.Demonstrations will be performed on Shima’s SDS-ONE APEX4 design system.

At the core of the company’s Total Fashion System concept, SDS-ONE APEX4 provides comprehensive support throughout the production supply chain, integrating production into one smooth and efficient workflow from yarn development, product planning and design, to machine programming, production and even sales promotion.India's textile industry is seeing rapid growth in both the domestic market and demand for exports and ShimaSeiki will show the latest sustainable solutions that can keep up with this growth.

India will promote the development of textile machinery through a production linked incentive (PLI) than the Amended Technology Upgradation Fund Scheme.

The threshold for textile manufacturing units to be eligible for sops under the proposed scheme would be investment in plant and machinery of Rs1 crore to Rs50 crores for micro, small and medium enterprises and above Rs50 crores for non-MSMEs.

Incentives would be provided based on the turnover achieved after making the threshold investment in modernisation through installation of benchmarked technology.Incentives of up to 60 per cent based on the investment and turnover criteria could be provided across weaving, knitting and spinning, among other textile segments. Turnover achieved from job work in select segments would be accounted for while calculating incentives and only the products manufactured by the registered company would be eligible.

Incentives are likely for manufacturing of garments and home textiles such as blankets and bed spreads, and textile accessories like lace, button, and zippers. The Amended Technology Upgradation Fund Scheme (ATUFS) was intended as a flagship incentive scheme for capital investments in textiles and garments.

ATUFS was notified in January 2016 with an outlay of Rs17,822 crores to mobilise new investments of about Rs 95,000 crores. It helped create employment for about 3.5 million till 2022. The scheme expired on March 31, 2022.