Indonesia is seeing a steep decline in textile exports to Turkey due to the additional duties and the coronavirus pandemic’s effect on global trade.

In the January–August period, Indonesian textile exports to Turkey declined by nearly 50 percent year-on-year (yoy) at $168.9 million, said MarthinKalit, secretary of the foreign trade director general at the Indonesian Trade Ministry

Indonesia’s overall textile exports reached only $7.03 billion over the same period, marking an annual decline of 19.92 percent.

The decline in Indonesia’s textile exports to Turkey come at a time when both countries are dealing with the COVID-19 pandemic. The World Trade Organization expects global trade to decline by between 13 and 32 percent this year as a result of the pandemic.

To keep its domestic industries afloat amid the economic downturn, Turkey introduced in April additional duties of 4 to 50 percent on textile products imported from countries with which it has no trade agreements. The duties are to remain in place until the end of the year.

Bangladesh’s apparel exporters fear a fresh setback due to the second wave of the coronavirus pandemic in the western countries and sought support from the government to face the imminent shock.

Exporters said that the export-oriented readymade garment industry was on a recovery track in the last two to three months with a compromised price level but the second wave would slow the export orders as the major markets in EU — France, Germany, Spain and Italy — were going for partial lockdown to contain further outbreak of the virus.

RubanaHuq, President, BGMEA, said that due to the second wave of the pandemic in the western countries, the volume might drop as well, buyers might hold back placing new orders — meaning factories might end up with idle capacity after they had already been in a weak financial position after sustaining price hits. This might give rise to a situation which would be extremely difficult for the industry to cope with, she added.

Due to the worldwide outbreak of the pandemic, the global fashion buyers and retailers started cancelling orders since March this year. Bangladesh faced halt or order cancelation worth more than $3 billion up to May and from June buyers started reviving their cancelled orders.

Country’s apparel exports was back on the positive track with the revived orders, but the second wave will bring further shock, said Mohammad Hatem, First Vice-President, BKMEA

MdFazlulHoque, Managing Director, Plummy Fashions said the country’s readymade garment exporters were running their units on loan and the government would have to continue support to the sector realizing the global situation. According to data from the Export Promotion Bureau, Bangladesh’s apparel exports in financial year 2019-20 declined by 18.12 per cent, or $6.18 billion, to $27.95 billion from $34.13 billion in FY19 as the coronavirus pandemic hit the global business hard

Amazon posted very strong sales during its Prime Day event held in the country in August and its ongoing Diwali sales were also off to a good start.

The US-based online retailer posted a 37 per cent YoY growth in international sales to $25.2 billion in the quarter ended September 30, while profits from the international segment shot up to $407 million.

In comparison, Amazon’s international sales in the third quarter of 2019 stood at $18.3 billion on a loss of $386 million. Olsavsky said high volumes and leverage in markets like the UK and Germany were creating profits in the international segment ahead of schedule.

He added that investment in its international business, including in India, should get back to previous levels once the pandemic subsides.

Its international business has turned profitable only after the Covid-19 pandemic, having made a rare operating profit of $345 million in the second quarter.

Overall, Amazon reported record sales in the three-month period, with revenue growing by 37 per cent to $96.2 billion and profit almost trebling to $6.3 billion, on strong sales, resurgence of digital advertising and robust performance of its cloud computing business, Amazon Web Services.

Avendes Capital, the leading investment banking arm of financial services firm Avedus Group expects, COVID-19 related restrictions will prompt consumers to discover new Direct-to-Consumer (DTC) brands that may collectively achieve $100 billion turnover by 2025. In fact, over 600 DTC brands have entered Indian market since 2016. These include: Lenskart, Zivame, Boat, Wow Skin Sciences, Mamaearth, among others. The sector is likely to witness consolidation in the next three-to-four years with many large consumer goods companies buying D2C brands.

An equal mix of retail channels

Starved for variety, Indian consumers have largely turned to online shopping, says Pankaj Naik, Co-head, Digital and Technology Investment Banking Practice, Avendus Capital. He feels, horizontal and vertical e-commerce players, social media marketing, plug-and-play supply chain and logistics options have created a strong ecosystem for these brands. However, to add more customers, they would have to reach more households and provide an equal mix of online and offline retail channels.

Growing at 4 per cent annually, the Indian e-commerce market is expected to be worth over $200 billion and shift to organized retail in the next five years, says Avendus. The market is currently dominated by unorganized small players. With COVID-19 accelerating the adoption of online shopping, DTC brands in the beauty and personal care category are emerging strong contenders.

Another category where DTC brands can make their presence felt is the foods and beverages category. Leading DTC brands in these categories have witnessed over 100 per cent growth to pre-COVID levels. The pandemic has accelerated sales of DTC brands in India. It has strengthened their entire ecosystem from logistics to warehousing.

Limited scale and false targets pose challenges

However, despite their popularity, DTC brands also face certain challenges. One of them is their limited scale. Indian consumers still prefer offline shopping over online purchases. For such consumers, DTC brands should open physical stores, once they achieve a certain turnover, adds Sreedhar Prasad, Bengaluru-based independent internet business expert.

Moreover, they should target the right group of consumers. With some brands being into nutrition or healthy food products, they cannot depend on earlier target groups which classified consumers on the basis of their age or socio-economic category.

A new Boston Consulting Group (BCG) report says, the next half-decade could see the resale market rise at a compound annual growth rate (CAGR) of 15 per cent to 20 per cent. For some strategically placed online resale players, the researchers calculated a potential CAGR of 100 per cent over the next half a decade alone.

BCG surveyed 7,000 consumers across six countries, specifically individuals who are active on Vestiaire Collective – an online fashion resale platform. The aim was to explore a market that is rapidly gaining momentum, positioned on the bright side of the dramatic changes in consumer behavior resulting from Covid-19.

A subdued economy this year has been devastating for the global luxury goods market, as all manner of discretionary spending came to a grinding halt. The good news is that the appetite for luxury has not disappeared – putting secondhand fashion in the spotlight.

The market has already gained some ground across the world – currently valued anywhere between $30 billion and $40 billion. Against this backdrop, considering the fact that resale only represents 2 per cent of the global fashion market at the moment, the only direction seems to be upwards.

Gucci has been crowned the world’s hottest brand according to fashion shopping platform Lyst’s most recent index, dethroning US sportswear giant Nike which topped the list.

The Lyst 2020 named Gucci the planet’s hottest brand in a quarter that saw the luxury Italian label livestream its Epilogue collection in July, with worldwide views exceeding 35 million - its most-watched digital event to date.

Pageviews at the brand soared 52% year-on-year in the quarter. Off-White - which opened new stores in London, Miami and Milan, and whose founder Virgil Abloh launched a 1 million dollar scholarship fund for Black fashion students in the quarter - retained second position on the list, while Nike - which reported an 82 percent jump in digital sales and launched its first dedicated maternity collection - dropped two places to third position.

Lyst creates its indexes by filtering more than eight million items by volume of social media mentions, searches, page views, interactions and sales across thousands of online stores.

Ralph Lauren Corp expects third quarter and full year earnings to be adversely affected by the pandemic. The company missed its revenue targets for the second quarter as fewer customers spent on its high-end apparel and accessories. Ralph Lauren’s net revenue fell by about 30 per cent to $1.19 billion in the quarter ended September 26, missing analysts’ average estimate of $1.21 billion, according to IBES data from Refinitiv.

The company continued its expansion journey fast-tracking Connected Retail and its company-wide digital transformation. It also began to simplify its organizational and cost structures to position the company for future growth.

Looking ahead, the company will continue to work proactively to deliver an elevated experience that inspires consumers around the world and creates value for all of our stakeholders. It reported a net loss of $39.1 million, or 53 cents per share, compared with a profit of $182.1 million, or $2.34 per share, a year earlier.

Tiffany’s has approved a reduced price to sell assets to luxury giant LVMH, says a report by Business of Fashion. Tiffany’s board has approved a new price of $131.50 per share, with the deal now set to close early next year, pending shareholder and regulatory approvals. The new deal would save Tiffany’s roughly $425 million on the original price of $16.2 billion agreed before the coronavirus pandemic hit.

The deal allows the French conglomerate and its chairman, Bernard Arnault, to preserve their reputation as savvy buyers. It also spares both companies a prolonged legal battle that kicked off when Tiffany sued LVMH in a Delaware court to force it to close the deal at the original price. LVMH counter-sued Tiffany over alleged mismanagement during the pandemic in an apparent bid to get out of the deal.

The deal provides for Tiffany’s to pay its scheduled quarterly dividend of $0.58 per share in November.

Gerber Technology collaborates with Alvanon to develop 3D samples Gerber Technology has collaborated with Alvanon to enable its AccuMark® 3D users to leverage the Alvanon Body Platform (ABP) to develop production-ready 3D samples and reduce fit errors.

Over the past several months, many companies have had to shut down their brick and mortar locations, adjust to working remotely and rely on eCommerce for a majority of their sales. Gerber's collaboration with Alvanon will help fashion companies recover from the pandemic and enable them to develop products digitally and through eCommerce. Through the powerful combination of AccuMark 2D/3D and the Alvanon Body Platform, fashion companies will be able to develop perfectly-fitting garments that accurately reflect the sizes and body shape of their customer base, resulting in less returns and more satisfied customers.

Fashion brands, retailers and manufacturers will be able visit Alvanon's vast library of over 6,000 3D virtual bodies, each representing a specific brands' fit standards, and download the 3D avatars for AccuMark 3D, use it to test patterns in all sizes and validate fit. Alvanon's library offers both standard (ASTM) and brand-specific avatars.

Local textile and apparel firms in Vietnam must reach a total of $7 billion in export orders in order to achieve the export turnover target of last year. And EU Vietnam FTA is seen as the best opportunity by which local firms can fulfill their goals. Vietnam’s local textile and apparel businesses need to consider key factors such as prices, fast delivery, and tax incentives presented by the EVFTA in order to compete with strong rivals from Bangladesh and Turkey.

As for rapid delivery requirements, beside improving logistic capacity, there should be improvements in simplifying administrative procedures and reducing the clearance time faced by export businesses. Moreover, the domestic textile and garment sector must be proactive to use import materials from countries that have signed FTAs with the nation and the EU, making use of preferential tariffs due to flexible rules of origin stated within the EVFTA.

The industry has therefore been advised to shift to supplying high-tech garment and textile products, including protective clothing, sports, and medical equipment. The complicated nature of COVID-19 has put impacted the sector’s export markets, with global purchasing power in general plummeting, while a series of well-known fashion brands such as Brook Brother, New York & Co, and JCPenny declaring bankruptcy.

As per the Vietnam Textile and Apparel Association, the country exported garments and textiles worth $19.2 billion in first eight months of the year, a year-on-year decline of 11.6 per cent. The number of export orders in the capital HCM city too witnessed a sharp fall of 25 per cent in April, and over 30 per cent in May, with figures predicted to continue falling during the second half of the year, says HCM City Association of Garment Textile Embroidery and Knitting.

At present, the entire sector has an inventory rate of 118.7 per cent, with roughly 20 per cent of textile enterprises being forced to suspend their operations, while the remaining businesses dismissing a large number of workers and restructuring their production activities.