The US, the UK and the EU are continuing with their rhetoric about decreasing dependency on China but the ground reality is on the contrary as the Chinese footprint is spread far, wide and deep – from basic items to high-level industrial equipment. The three huge consumer markets may speak from the moral high ground of Western democracies but insiders know well that developing other supply sources that are as resourceful as China is going to be a long-haul, hoping that India, Mexico, Brazil and South Africa could be brought forward as the diverse basket of options the US, the UK and the EU need. 

In a series titled ‘Worlds Apart: Risks and opportunities as deglobalization looms’, RBC Wealth Management has paid particular attention to this situation as it explores the trend away from globalization and its ramifications for investors, economies, and financial markets. 

China’s sophisticated production makes it aleader

For a start, there are quite a few points which make China’s case as the global king of production irrefutable. More often than not and much to the displeasure of the US, China has proven its ability to overcome the impact of technological restrictions in the past and its massive manufacturing scale and well-established supply chains are laying the foundation for future technological innovation. It is already a well-known fact that China is shifting away from low-end, labour-intensive component manufacturing to higher-tech, full-spectrum product manufacturing. 

According to the report, the high complexity of global supply chains, combined with the extensive scale of China’s industrial sector and manufacturing competencies, makes it undesirable and unrealistic for many multinational companies to make a complete break with China anytime soon. Additionally, this break-up could lead to multinational brands finding themselves in a precarious position as the country’s domestic consumer population is just too large to ignore. China has migrated from low-cost manufacturing to one that increasingly focuses on innovation and complex manufacturing techniques. China will maintain its manufacturing dominance while at the same time make inroads into emerging and strategic fields such as electric vehicles, telecommunications, bioengineering, artificial intelligence, and other areas. 

In recent years, the West has started implementing restrictions on China’s access to critical technologies, such as AI, quantum computing, and advanced semiconductors, raising concerns about the country’s ability to move further up the supply chain and achieve its stated “technological self-reliance” goals. However, the resourcefulness of the Chinese has not prevented their progress in these areas at all. 

Western on-shoring and friend-shoring isn’t ready to deliver

The Chinese approach to the pandemic was indeed a stringent one and hurt supply chains like never before, leading to many importers seeking to not only diversify their points of sourcing but also set up manufacturing in locations closer home and in regions that are on friendly terms with importing countries. For the US, the opportunity lay in cost-efficient Mexico and the cluster of Central American countries – however, whilst Mexico being a North American country has the basic infrastructure and cheap talent pool in place, it cannot deal with even 15 per cent of the Chinese capacity and that too with huge production line investments. 

The Central American countries are a no-go as they are in continuous socio-political conflicts, have huge illegal and criminal bases that can jeopardize operations and supplies and most importantly have no skilled labour or infrastructure worthy of complimenting Mexico’s production capabilities. In The EU, Turkey has always been a viable option and now that the nation is undergoing economic downturns regularly, it does not guarantee a stable environment for a steady supply and the East European countries that don’t fall within the EU are not ideal places to develop as friend-shoring hubs. 

As things are, trade relations with China will continue and a slowdown will take decades to achieve. 

H&M Group has successfully issued a EUR 500 million green bond with an 8-year maturity, signaling a significant move towards sustainable finance. This green bond attracted immense interest, being oversubscribed by over 3.5 times, from a diverse group of international institutional investors. 

The funds raised through this issuance will be dedicated to projects falling within five distinct categories, as outlined in the Sustainable Finance Framework introduced on September 1, 2023. These categories include Circular Economy, Green Buildings, Renewable Energy, Energy Efficiency, and Sustainable Water Management & Wastewater Management.

H&M Group's Chief Financial Officer, Adam Karlsson, expressed satisfaction with the strong demand for their inaugural green bond, emphasizing its role in extending the company's debt maturity profile. 

Moreover, this move reinforces the group's commitment to leading the fashion industry towards circularity and a net-zero climate impact. It is also noteworthy that H&M Group's investor base has broadened to include prominent green investors, reflecting the company's commitment to sustainability.

The bond will be listed on Euronext Dublin, with support from financial institutions such as BNP Paribas, ING, J.P. Morgan, SEB, and UniCredit, while ING played a pivotal role as an advisor for the Sustainable Finance Framework.

Fashion for Good and Spring Lane Capital have teamed up to help unlock the capital needed to scale sustainable innovation in the textile industry. Their new report, “The Great Unlock: Closing the innovation commercialisation gap through project finance solutions”, reviews the different types of capital available to close the funding gap within the commercialisation stage.

The report discusses the benefits, requirements, and opportunities related to project finance as a funding solution in this space, and highlights the roles that various stakeholders would need to play in order to bring this to life.

The report aims to enhance innovators’ understanding of relevant industry stakeholders and ultimately assists in further enabling the scaling of much-needed innovation.

Project Finance as a Solution

The bulk of the funding needed will come from debt financing, with project finance serving as a key solution due to the strong focus on risk mitigation and allocation, which the structured nature of such funding provides.

Project finance is a specialized type of financing in which the project's assets and cash flows serve as collateral for the loans used to finance the project. Project finance distinguishes itself by mitigating risks, bolstering credit ratings, and allowing for greater borrowing capacity based solely on the project's viability. It thereby offers a lifeline to innovators who may lack creditworthiness in traditional financing channels.

Project finance is particularly beneficial for new technologies because it allows them to scale effectively and faster compared to traditional funding channels. Project finance also gives access to broader debt capital markets and offers longer repayment periods compared to corporate finance, making it more attractive for technology development.

From February 1 to 4, 2024, the Bangabandhu International Conference Center (BICC) in Dhaka will host the DTG Dhaka International Textile and Garment Machinery Exhibition. This event will showcase the latest technologies and innovations in the textile and garment industry, with participation from both local Bangladeshi and international companies.

The exhibition will cover a wide range of products and services, such as:

Apparel manufacturing machinery

Home textiles

Machinery for the textile industry 

The exhibition will offer a unique opportunity for attendees to discover the newest products and services from leading companies, network with potential customers and suppliers, and learn about the latest trends and developments in the textile and garment sector.

This event is of great significance for the Bangladeshi textile and garment industry, as it expects to attract over 10,000 visitors from Bangladesh and around the world. It provides an excellent platform for companies to display their products and services to a global audience.

The DTG Dhaka International Textile and Garment Machinery Exhibition will feature presentations from both local and international companies, who are ready to share their most recent products and services. This gives a great opportunity for businesses in the textile and garment industry to gain insights into current trends and developments, build relationships with potential partners, and grow their businesses.

Indian textile exports are expected to grow by 10% in the financial year 2024, driven by strong demand from the US and European markets, according to a report by Crisil Research. The report also predicts that the Indian textile sector will have a compound annual growth rate (CAGR) of 10-12% in the next five years.

The growth in textile exports is attributed to a number of factors, including the recovery in the global economy, the rising demand for Indian textiles in developed markets, and the government's initiatives to boost the textile sector.

The US and Europe are the two largest markets for Indian textiles, accounting for over 50% of total exports. The demand for Indian textiles in these markets is expected to remain strong in the coming years, driven by factors such as the growing population, rising disposable incomes, and the increasing popularity of Indian culture and fashion.

The Indian government has also taken a number of steps to boost the textile sector, including the launch of the National Technical Textile Mission (NTTM) to promote the production and use of technical textiles, and the announcement of incentives for the textile sector under the Production Linked Incentive (PLI) scheme.

The growth in textile exports is expected to have a positive impact on the Indian economy, as it will create jobs and generate foreign exchange. The growth is also expected to benefit the Indian textile industry, as it will lead to increased investment and innovation.

Overall, the outlook for the Indian textile sector is positive. The sector is expected to grow significantly in the coming years, driven by strong demand from domestic and international markets, government support, and technological innovation.

To Showcase Upcoming Textiles in Tokyo

The Textile Division of the Japan Fashion Week Organization (JFW) will host the JFW JAPAN CREATION (JFW-JC) 2024 event from October 31 to November 1 at the Tokyo International Forum. The event will be held concurrently with Premium Textile Japan 2024AW and is expected to welcome 271 exhibitors.

In addition to the related Pigskin Fashion Show, the JFW-JC will also feature an expanded What's Next program, which was launched at the PTJ 2024 Spring/Summer show in May to promote the charm and appeal of upcoming textiles. The theme of the JFW Textile Trends is Time to Pass On To the Future.

The JFW-JC is a key event for the Japanese textile industry, providing a platform for exhibitors to showcase their latest products and innovations to domestic and international buyers. The event also features a variety of seminars and workshops on the latest trends and technologies in the textile industry.

The What's Next program is a new initiative that aims to highlight the next generation of textile designers and their work. The program features a curated selection of textiles from emerging designers, as well as a series of talks and events that explore the future of the textile industry.

The JFW-JC is a must-attend event for anyone interested in the Japanese textile industry. The event offers a unique opportunity to see the latest trends and innovations in the industry, as well as to network with leading textile designers and buyers.

Officina39 is a company that is always innovating and leading the way in color and effect explorations for denim. At Kingpins, the company's booth (no.1 at green pavilion) takes the attendees through the many technologies and processes that compose the Officina39 colorful and denim universe.

BLEACHING RE-PLAY

The first stop is Bleaching Re-play, a theme embodied by two cutting-edge Officina39 top products: Novapress Bleach and Novafoamer Ind/J. Novapress Bleach is an innovative bleaching system that uses the press to obtain unique geometric shapes, patterns, and replicas on denim, with the bleaching effects remaining localized. Novafoamer Ind/J is a permanganate-free foaming agent for bleaching effects for the fashion industry and for discharging effects on denim. 

COOL COATING

Next is Cool Coating, a process that can provide distinctive coating effects to give fashionable finishing. It employs a metal range of colors and Novapret Crack which, used in combination with RecycromTM, grants a vintage look and cracked leather effect to garments.

JUST ONE STEP PROCESS

Officina39's Just One Step Process shines bright as the innovation that saves time, energy, space, and of course water, by combining several phases of the Aqualess Mission at the same time.

COLOR EXPLORATION

Finally, the last stop takes the shape and color of the multicolor universe that comes alive with Officina39's ranges of dyes on denim achieving a variety of effects using:

Officina39 is a company that is always looking for new and innovative ways to use color and effects on denim. The company's booth at Kingpins is a great place to see the latest and greatest that Officina39 has to offer.

While cheap and cheerful fast fashion clothes are currently rocking the ready-to-wear garment industry, those who want to create their own sense of style are still going to their tailor for customized fits and a personal touch. Bespoke or customized clothes stitched to an individual buyer's specifications by a tailor have always been popular in India until the international and domestic fashion brands with their ready-to-wear item took over the bespoke category. Bespoke styling has had a long history in India because tailoring was cheap compared to Western countries and these garments become timeless legacies with a USP of individuality and craftsmanship.

Personalized styles fuel growth

A recent report by Business Research Insight estimates, the global customized bespoke market at $59.890 billion in 2021 and is expected to rise to 131,601 billion by 2030 at CAGR of 10.9 per cent during the forecast period. Growth will be fueled by customer fashion preferences becoming personalized and rising disposable income among the urban youth that allows deeper pockets for specially-made clothes like custom-printed T-shirts. These T-shirts with prominent logos and slogans for spreading social awareness, backing a cause, or just being themselves with their own USP are becoming the hot-selling items in the casual category. Sports teams and clubs who design their own emblems and then aggressively market them are one of the biggest segments of the personalized custom-made garment segment raking in the profits.

Suits and wedding attire do well in the tailored segment

This tailored segment can be segmented into type and application, depending on who wears it where and why. In the type segment, coats, skirts, dresses, trousers shirts sell well, although the women’s and men’s coat segment had the biggest market share till 2028. In terms of application, the market is divided into online and offline, and in post-pandemic days, it is the online segment that is ruling the roost.

Men's wardrobes of suits, pants, shirts and Indian outfits have always been popular and bespoke suits are always the hot-seller in this segment. Traditionally crafted by a master tailor based on specific patterns and exact specifications of the wearer, these customized suits can never compare with the ready-to-wear collections.

Likewise in the women’s segment, traditional wedding, and festive clothing as well as Indo-western clothing with a rekindled appreciation for indigenous crafts and textiles are currently trending along with global western like dresses, blouses and skirts. Celebrity endorsements as well as social influencers are also helping this category in the online segment in a way that was unheard of even a decade ago.

Luxury brands big on customization 

Men’s formal clothes brands in India such as Raymond, Peter England, Arrow, Blackberry, and Park Avenue among others are now reputable names for both their ready-to-wear as well as bespoke suits and jackets with their immaculate history. Traditional bespoke clothing makers from London’s Saville Row such as Anderson & Sheppard, Dege and Skinner, Davies & Son, and Cad & The Dandy have created a unique road synonymous with a specific form of men’s wear clothing and attracts a high-profile clientele of global politicians, celebrities, and royalty. 

Most suit makers feel bespoke clothing can cater to any figure and having things made by hand in an artisanal way is an ultimate work of art which AI can never hope to replicate as it is all about personal interaction with the customer of measuring and fitting.

Connecting with the true process of craftsmanship is an expensive proposition in today’s world of fast fashion, but bespoke clothing is here to stay for all those who want to make a fashion statement with their own USP.

RUDOLF HUB1922, a prominent player in textile chemistry, is stepping up to address the textile and apparel industry's growing demand for sustainability. 

Their latest offering, unveiled at Kingpins Amsterdam, is a game-changer. RUDOLF's innovative chemistry harnesses raw materials derived from organic waste, plastic waste, and renewable feedstock, effectively reducing the industry's environmental footprint.

Alberto De Conti, Head of RUDOLF HUB1922, underscores the significance of repurposing waste materials into valuable resources.

 By diverting waste from landfills and incinerators into textile chemical production, the industry can lessen its reliance on non-renewable resources and promote a circular economy model.

Collaboration is pivotal to the success of this sustainability endeavor. De Conti stresses the importance of scientists, fashion designers, and manufacturers working together to drive greener practices and make sustainable fashion the industry standard. 

RUDOLF's revolutionary approach promises a brighter, eco-friendly future for the fashion world.

Karl Mayer North America, a leading name in textile machinery and digital solutions, is making waves in the industry by fostering innovation and connectivity. The company recently organized its first-ever Textiles Innovation Conference, marking a significant milestone in the American textile manufacturing landscape. The conference, held in Greensboro, NC, from September 12-14, brought together over 120 industry professionals and 15 guest speakers who shared insights and knowledge on various textile-related topics.

The primary objectives of the conference were to connect the textile supply chain, share expertise, and facilitate networking within the textile community. "We would like to position the Karl Mayer Group as a thought leader within the industry, connecting yarn through fabric formation to finished goods through personalized customer products," said Mariano Amezcua, President of Karl Mayer North America.

Key highlights included presentations on cutting-edge production technologies, sustainability, and the future of knitting. The conference showcased the potential of warp and flat knitting machinery, such as the digital HKS 3-M and the innovative ADF series by STOLL. Attendees were also treated to live demonstrations.

Keynote speakers delved into global trade trends, on-demand textile manufacturing, and the advantages of flat knitting, underscoring the growing importance of these aspects in the textile industry.

The event's success was evident in the diverse array of attendees, from manufacturing executives to startup founders and government trade agents, demonstrating a collective interest in advancing the textile sector.

The next Textiles Innovation Conference is already in the works, with plans to expand its focus on brand leadership and integrating automation and on-demand principles to create high-margin products. Karl Mayer North America is poised to continue connecting its customers with the American textile supply chain, further bolstering the industry's future.