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Cost controls have helped H&M limit a drop in quarterly pretax profit but the fashion chain is increasing investments as it tries to keep pace with its rivals. H&M is investing significantly in the supply chain, such as in new logistics solutions with greater levels of automation, but also in optimising its lead times. H&M has been investing heavily in IT investments to integrate its stores and e-commerce and make its supply chain faster and more flexible.
H&M is the world’s second-biggest fashion company. After years of hectic expansion across the world, the Swedish company’s profitability has faltered. Conditions remain very tough in key European markets and in the United States, with shopping behavior and expectations changing rapidly.
Fast fashion rivals are turning over more new styles each year and helped by having production closer to customers so they can quickly boost supplies of fast-selling items.
The retailer is also branching out into new concepts to reach a broader customer base and reduce exposure to the increasingly crowded budget segment. It announced a new chain of stores, Arket, with a slightly higher price range than its core budget H&M brand.
Large markdowns in stores last year hit sales and highlighted shortcomings in design and supply planning.
Back in 2014, Forever 21 introduced a new retail-only brand called F 21 Red, which was created to stock exclusively pieces in the entry-level category price points of its inventory. This offshoot further lowered the range of an already notoriously cheap fast-fashion company even more.
Almost three years into the venture, Forever 21 is expanding the concept. Forty new F 21 Red stores are expected to open in the US in 2017 — a big jump from the eight outposts already in operation. This expansion will allow the brand to bring a wide variety of product at competitive prices to new regional areas for its increasing customer base.
The first three new F 21 Red stores are opening in San Antonio, Chicago, and New York City.
Even at its outset, F 21 Red drew concerns about the human cost of its even-cheaper merchandise. There's the sourcing and preparation of the materials, the dyeing and manufacturing of the fabrics, the actual putting-together of the garment, and, finally, the shipment from factory to store floor.
The news of F 21 Red’s expansion could have deeper implications for consumers and what they're taught to expect from retailers. A generation is being sold on the concept that low-quality products are desirable. Being on an endless rat race of fashion instead of style isn’t doing anything for shoppers’ confidence, and it’s having an enormous impact on the planet and the people making those clothes.
"The International Advanced Research Center for Powder Metallurgy and New Materials (ARCI) in Hyderabad has recently developed and commercialised nanomaterials that give fabrics special properties. Two of its most popular innovations are nano-silver suspension and nano-titanium dioxide material. The nano-silver suspension, called N9, is being widely used by the textile industry to produce antibacterial fabrics for hospitals, innerwear, sportswear, socks, baby care products and other such use."
The International Advanced Research Center for Powder Metallurgy and New Materials (ARCI) in Hyderabad has recently developed and commercialised nanomaterials that give fabrics special properties. Two of its most popular innovations are nano-silver suspension and nano-titanium dioxide material. The nano-silver suspension, called N9, is being widely used by the textile industry to produce antibacterial fabrics for hospitals, innerwear, sportswear, socks, baby care products and other such use. The nano-titanium dioxide material — also called nano-titania — has high photocatalytic activity and is used to impart self-cleaning property to the textile and to make them ultraviolet proof.
Innovative technology as sunscreen The technology of two nanomaterials has been transferred to Bangalore- based Resil Chemicals for commercialisation. The company has launched garments treated with the nano-silver suspension under the brand name ‘N9 Pure Silver’ and those treated with nano-titania material under the tag names of ‘Sun Wash’ and ‘Wearable Sun Screen’. Several leading denim brands including Splash, Flying Machine and Colour Plus have adapted this technology.
ARCI has taken a major task to improve the efficiency and performance of Lithium Ion Battery (LIB) technology for electric vehicles. It is trying to figure out whether it can use its experience and expertise in the areas of nano-material and carbon coating on electrode to achieve this. In addition, it is engaged in looking at the possibility of developing a new range of batteries that performed better than Lithium Ion for electrical vehicles.
ARCI Director G Padmanabham says, there is a need for alternate cheaper battery materials. As a major research centre in the field of material sciences, ARCI specialises in areas such as solar and automotive energy materials, engineering coatings, ceramic processing, fuel cell technology, and laser processing of materials.
After several fits and starts, Uniqlo has once again tweaked its U.S. strategy as it struggles to become a mainstay in the American shopping scene. The brand is shuttering stores in suburban U.S. malls, in cities like Boston and Washington, D.C.
Chief Marketing Officer Masahiko Nakasuji stated in CNBC that probably the best way to let the people understand what the company is sellingand that the people know about our product. The label's first attempt at cracking the U.S. market came more than a decade ago, when it opened stores at three New Jersey malls.
Then, after expanding to 20 locations over a 10-year period, the company picked up its expansion pace in 2014. Still, its strategy fell short, leading to the closure of several mall-based stores in towns like Willow Grove, Pennsylvania, and Danbury, Connecticut.
Nakasuji further stated that the company has a very low presence and the brand has a much bigger opportunity in the U.S. Indeed, while it is still relatively unknown by American shoppers, Uniqlo is owned by the world's third largest specialty apparel retailer:
Uniqlo first time held an event that was showcased its upcoming fall line at a presentation in downtown Manhattan Wednesday. Jan Kniffen, CEO of the J Rogers Kniffen research and consulting firm and a CNBC contributor mentioned that the company doesn't do a great job communicating the quality and functionality of its products to the American consumer.
Uniqlo's products are low quality and disposable due to the fast-fashion companies like H&M or Forever 21. Meanwhile, the brand has an "extremely limited" number of styles that makes its assortment look repetitive, Kniffen stated. The company will better be able to respond to consumer demand if CEO Tadashi Yanai wishes to trim that window to two weeks
Uniqlo's parent company Fast Retailing does not explicitly break down the brand's U.S. performance. However, it said in its latest quarterly earnings report that revenue across all of Uniqlo's international divisions increased when excluding the impact of currency. According to Nakasuji the company is making a lot of progress.
The creation of gender-neutral clothing is not a new device by any standards. Recently, Denim United, H&M has announced its upcoming unisex denim line, these brands are one of the first major commercial clothing companies to present gender neutrality clothing on a large scale. It will feature jackets, overalls, shorts, and t-shirts. In a press release, H&M spokesperson Marybeth Schmitt stated that it is very natural for the company to launch a unisex collection as fashion is constantly evolving and intersecting.
This boldness has, in the recent past, though temporarily popular on high-end runways unisex clothing in North America largely faded awayin the late 1960s. The designation of clothing into gendered categories has been affecting theobservations and projects meaning onto otherwise neutral garments. Increasing trans-visibility, awareness of non-binary gender identities, and changing cultural and industry attitudes towards gender equality, stereotypes and roles have made clothing manufacturers and retailers aware of the demand for and potential that unisex clothing can have, as well as what consumers want out of gender-neutral lines. In the US, more than 50 per cent of Millennial believe that gender and gender identity falls on a spectrum and shouldn’t be limited to the categories of male and female. This is aunadulterated departure from attitudes and presents new opportunities and consumer groups for businesses to cater to.
This decision has put H&M in line with retailers like Zara and Gap Zara’s line, under the name Ungender, featured gender-fluid model Ruby Rose as the spokesperson. Gap offers a line of unisex baby clothes and recently announced its intention to create more unisex clothing pieces for children, something that the global apparel market tends to lack.
Talking about the Unisex fashion it has helped to do away dissimilarity in terms of clothing costs between genders. According to a 2015 study conducted by the New York City Department of Consumer Affairs, adult women pay roughly 8 per cent more for clothing than men. The idea of gender neutrality in clothing products will surely benefit the retailers which will further save money on branding, eliminating labelling, signs, and gender-specific marketing initiatives.
Bangladesh’s readymade garment exports to the United States fell by six per cent in the first three months of the current calendar year.
Bangladesh now faces an export duty of 15.62 per cent under America's most favored nations' category.
Garment items account for 95 per cent of the goods exported from Bangladesh to the US market.
US imports of clothing from the rest of the world including China, India, Indonesia, Honduras and Cambodia also declined by around two per cent. There is a change in the attitude of US consumers, who now prefer spending more on electronic gadgets compared to clothes. The US election has also impacted retail sales negatively. Global apparel exports to the US declined 6.44 per cent year-on-year in 2016.
Among the top ten exporters of clothing to the US, export from Vietnam registered a robust 7.21 per cent growth. Export from Mexico, Nicaragua and El Salvador registered moderate growth.
China is the largest source of US apparel imports. Vietnam is in the second place followed by Bangladesh.
All nine out of ten top apparel exporting nations of the world experienced negative growth in shipment to the US in 2016. Only Vietnam's apparel exports increased 0.30 per cent year-on-year in 2016.
It was recently announced by Tarek Kabil, the Minister of Industry and Trade that Egyptian exports have increased by 14 per cent during first 4 months of 2017.
According to the ministry as compared to 2016, the value of Egyptian exports reached $7.438bn in 2017. On the other hand imports have also decreased by 30 per cent to $15.931bn, compared to $22.742bn in 2016, thus reducing the discrepancy of the trade balance from $16.196bn to $8.493bn.
Minister Tarek Kabil gave the reason on both exports and imports stating that this happened due to the implementation of many reforms to achieve the goals of improvements in exports, as well as decreasing the imports in order to maintain foreign currency reserves, and to develop local industries, which led to more job opportunities.
He further explained that a lot of sectors have observed hikes in exports, such as agricultural products by 4.1 per cent, construction materials by 47 per cent, textiles by 4.6 per cent, food products by 3 per cent, and fertilizers by 34 per cent. The major markets where Egyptian exports targeted in the first four months of 2017 were the EU, the US, Turkey, Saudi Arabia, the United Arab Emirates, and Lebanon. The statement also read the Egyptian exports to the US recorded $381m compared to $370m, while imports decreased by 27 per cent and exports to Turkey increased by 54 per cent to $608m, while imports decreased by 43 per cent to $624m.
Egyptian exports for Italy recorded an increase rate of 23 per cent with $505m in 2017, compared to $438.9m in 2016, while Italian imports recorded $978m compared to $1.260bn in the same period, decreasing by 22 per cent.
Bangalore witnessed a series of events last week with a focus on sustainability and allied issues.
Sustainable Apparel Coalition, US, held its annual meeting in the city at which its members (brands as well as leading Indian exporters) took part.
Then there was Planet Textiles 2017 in which sustainability heads of brands like Puma, Adidas, Nike as well as Indian apparel exporters like Pratibha Syntex, Orient Craft, Eastman Exporters, Sharadha Terry Products participated. More than 300 delegates from over 20 countries participated in the event, which tapped on numerous sustainability issues like chemical management, wastewater, circular economy etc.
Similarly Fabric of Change Globalizer Summit also concluded in Bangalore. An announcement was made at the event that Fabric of Change, a global initiative to support innovators for a fair and sustainable apparel industry initiative, and C&A Foundation will launch a new Scaling Impact Fund as part of their joint venture to support social innovation in the apparel industry.
Top-notch professionals from various brands and organizations, along with Indian apparel export houses, participated in these events, shared their ideas and discussed various issues related to sustainable apparel industry. A collective approach; need to increase transparency; and a fresh look to existing sustainability practices were the key highlighted points at these events.
Bangalore is one of the biggest apparel manufacturing hubs in India.
"Much like the fear of online retail, there has been an influx in intellectual properties of brands. A new report by TrademarkNow suggests, the industry has seen a major spurt in luxury goods-related intellectual property (IP) protection. The report says top five clothing, apparel & luxury goods companies applied for more than 6,400 marks around the world in 2016, and a more globally diversified playing field – both in terms of competition and in companies' vies for IP protection."
Much like the fear of online retail, there has been an influx in intellectual properties of brands. A new report by TrademarkNow suggests, the industry has seen a major spurt in luxury goods-related intellectual property (IP) protection. The report says top five clothing, apparel & luxury goods companies applied for more than 6,400 marks around the world in 2016, and a more globally diversified playing field – both in terms of competition and in companies' vies for IP protection.
The report titled ‘Trademarks, Now: Trademark Industry Review Q1 2017’ says, LVMH Moët Hennessy Louis Vuitton SE; Victoria’s Secret’s parent company L Brand Inc.; VF Corporation (which owns Wrangler and Lee, Timberland, Nautica sportswear, and The North Face); Gucci, Balenciaga, and YSL’s parent Kering; and Richemont, which owns Cartier, Chloe, and Alaia, top the list of most active trademark-filers, in terms of luxury goods and apparel brands. LVMH’s direct competitor, Kering, which took a luxury goods ranking of No. 4 and an overall ranking of No. 54, applied for over 800 new trademarks around the world in 2016 – a little less than it did in 2015 (when it filed more than 1,200). Leather goods and jewelry were Kering’s top product classes in 2016, with fragrances taking a backseat.
Cosmetics dominance
Cosmetics-related trademarks continued to dominate in 2016. Accordingly, while the top five companies in the clothing, apparel & luxury goods space obviously have varied areas of focus in terms of products, leather goods (trademark class 18) registered consistent growth in trademark applications over the past five years among these companies. Cosmetics (Class 3) and jewelry, while still a larger fraction of the total product mix, have had a flatter growth in trademark filings.
Of all the companies survey by TrademarkNow, the largest-volume trademark classes in 2016 were those within the always-busy broad business-oriented categories (e.g., advertising & business; research & development), and the prominent technology/ media/telecom categories (electrical & scientific devices; education & entertainment). Clothing and pharmaceuticals & medical supplies also placed near the top.
China leads the pack
China took the top spot in terms of trademark filing activity. The State Administration for Industry and Commerce (SAIC) in Beijing accepted 3.7 million trademark applications during the year, a 29 per cent increase over 2015 and more than seven times the filing volume of the second-busiest trademark office, the US Patent and Trademark Office. Following China and the US was India, Japan, South Korea, Brazil, Mexico, European Union, Turkey, France, and Australia respectively.
Global companies counting
LG Electronics was second in portfolio growth, with over 3,600 filings; Time Warner was third, with over 3,500. Pharmaceuticals and medical devices conglomerate Johnson & Johnson and global cosmetics company L’Oreal rounded out the top five. As noted, LVMH took the number 12 spot (filing 2,100 applications, an increase of 4 per cent compared to 2015), Victoria’s Secret’s parent company L Brand Inc. took the no. 45 placement (filing 922 applications, an increase of 60 per cent), and VF Corporation came in at number 49 (filing 840 applications, down by 91 per cent).
Apple was at number 15 (filing 1,800 applications, down by 62 per cent), Chinese e-commerce giant Alibaba at number 18 (filing 1,700 applications, down by 95 per cent), Japanese cosmetics giant Shiseido at number 31 (filing 1,300 applications, down by 94 per cent), Abercrombie & Fitch Co at number 42 (filing 973 applications, a 5 per cent increase), and Amazon at number 50 (filing 837 applications, an increase of 15 per cent). A key fact that has emerged from the study is that there has been an exponential growth in the trademarked brands within the newly-industrialised economies.
"Lot has been said and debated on the usage of water that is required to produce a single pair of jeans. It takes more than 900 gallons of water to produce a single pair of denim jeans using conventional practices. That’s equivalent to a faucet left running for 15 hours, flushing the toilet 128 times in a row, or five years’ worth of drinking water for one person. All these are startling facts when water has become a scarce commodity. Therefore, water-saving measures are a must for the textile industry. Denim mills and chemical manufacturers have been consciously making efforts to find new water-saving dyes, waterless or near-waterless processes or manufacturing facilities equipped with technology to reduce water consumption. "
Lot has been said and debated on the usage of water that is required to produce a single pair of jeans. It takes more than 900 gallons of water to produce a single pair of denim jeans using conventional practices. That’s equivalent to a faucet left running for 15 hours, flushing the toilet 128 times in a row, or five years’ worth of drinking water for one person. All these are startling facts when water has become a scarce commodity. Therefore, water-saving measures are a must for the textile industry. Denim mills and chemical manufacturers have been consciously making efforts to find new water-saving dyes, waterless or near-waterless processes or manufacturing facilities equipped with technology to reduce water consumption.
Levi Strauss & Co say they are only responsible for about a tenth of the water consumed in the entire lifecycle of a pair of jeans; cotton cultivation and consumer care use the most amount of water. Nuria Estape, Head, marketing and promotion of textile specialties at Swiss chemical company Archroma, points out water scarcity is unfortunately already a harsh reality in some parts of the world. The most responsible brands and players in the textile industry fully acknowledge this reality and, under their leadership, impetus and initiatives, the entire industry is slowly but surely turning to more sustainable practices.
Sustainable steps by brands
Levi’s created Water Less, a set of standards and tools that removed up to 96 per cent of the resource from the denim finishing process. For instance, instead of using a lot of water and detergent to achieve a stonewashed look, Levi’s discovered how to get the same result using ozone gas. Patagonia reduced its reliance on the resource by 84 per cent after swapping out synthetic indigo dye for low-impact alternatives that adhere more easily to cotton. Similarly, Eileen Fisher worked with its Los Angeles jeans factory to develop two new washes, Utility Blue and Indigo, that both use 62 per cent less water than the brand’s most intensive wash.
Meanwhile mills and suppliers are also taking initiatives. Hong Kong-based Trusty Trading, a waistband and pocketing specialist partnered Archroma to create a Eco Pocketing range. With Archroma’s near-waterlesss Optisul C dyes, it was able to reduce water usage by 94 per cent, while also increasing speed to market. Archroma offered two eco-friendly dyeing processes under its Advanced Denim concept, Denim-Ox and Pad/Sizing-Ox, since 2009. By using sulfur dyes instead of indigo, traditional dyeing ranges comprising 15 vats are replaced with systems that use no more than five vats.
Jeanologia has been working with ozone finishing for more than 15 years and introduced its G2 washing machine in 2008, which uses oxygen and ozone gas instead of water and toxic processes to give jeans an aged look. As per the firm, G2 cuts water consumption by up to 70 per cent and chemical usage by up to 80 per cent. Carmen Silla, Marketing Manager, Jeanologia says technology minimises water consumption and chemicals, eliminates waste and reduces energy in all processes.
In line with this, Mexico-based mill Global Denim recently launched a zero-discharge dyeing process called Ecolojean that uses less water and energy than conventional methods required to dye one pair of jeans. Anatt Finkler, Creative Director, Global Denim, says instead of passing the denim or thread through water vats and dyeing vats, Ecolojean process only puts them through dyeing vats and the dye bonds to the fabric without having to go in the water. When you dye conventionally, as much as 25 per cent of the dye ends up in the water, but with Ecolojean, 100 per cent of the dye that’s applied remains on the yarn.
Kaltex will release Aqueduct in Autumn/Winter18, a collection of fabrics created using water-saving practices such as a dyeing system that eliminates rinsing in fabric production. Jadel Lam, managing director – R&D, Kaltex, informed that they are constantly looking, researching and investing in new technologies that aid in reducing water, energy and chemical usage.
Cost an added burden?
As a general belief, consumers do not want to pay more for something that is the manufacturer’s responsibility. Arpit Srivastava, Marketing Manager, Arvind feels it’s worth it. With water becoming a depleting resource, this is the future of the denim industry. Another hypothesis on the way of sustainability is that the product quality will diminish, but it has been made clear by experts that there is no aesthetical difference between denim dyed or finished using eco-friendly methods and denim treated using large amounts of water and chemicals. Alvyda Kupinas, head – design, Kaltex, reiterated that safe and sustainable does not require sacrificing aesthetics or quality.
