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India is considering over branding its cotton to fetch premium prices overseas after seeing the success of branded Egyptian and US cotton. Work is under way to revise the ‘Technology Mission on Cotton’ (TMC) to accommodate branding of cotton and contract farming of the natural fibre, which, experts feel, are needed for better realisation in export markets.
Several meetings with various stakeholders have been held by textiles commissioner Kavita Gupta to draft guidelines for revising the TMC, which will allow exporters to improve the quality of Indian cotton, with less contamination, trash and staple length in the raw fibre, according to a report in a business daily.
Initiated in 2000, the TMC aimed at improving cotton yield and quality through the use of improved seeds and integrated water, nutrient and pest management technologies.
Under contract farming, seeds, fertilisers, advice and required markets for selling the produce are offered by private firms. Farmers, who own the land, dedicate labour to receive an assured annual income from their produce.
Many companies are interested in cotton contract farming, but are awaiting enabling regulations, says Ujwal Lahoti, chairman of the Cotton Textiles Export Promotion Council (Texprocil). He also stated that Vardhman Textiles has made a beginning with contract farming and has been growing cotton for captive consumption in some areas in Rajasthan.
The International Finance Corporation (IFC) plans to launch the second phase of its advisory service—Partnership for Cleaner Textile (PaCT)—in Bangladesh with an aim to achieve sustainable textile production.The factories will need to invest 63 million dollars.
Under the program, garment and textile makers are advised to adopt modern technologies in factories and changing attitudes to reduce water and energy consumption in the next four years.
During the second phase, the World Bank arm targets to annually save 32 million cubic meters of water and 3.8 million megawatt hours of electricity in 250 weaving, spinning, wet dyeing and finishing factories.
It aims to annually reduce greenhouse gas emissions by 701,588 tons, wastewater discharge by 28.8 million cubic meters and chemical use by 10,000 tons.
Two hundred factories got back the 39.1 million dollars they invested in just ten months and in turn saved 16.3 million dollars every year, under the PaCT’s first phase adopted in 2014.
They also annually saved 21.6 million cubic meters of groundwater, which 8,40,000 Bangladeshis use on an average per year, and 2.5 million megawatt hours of electricity, which was 5.4 per cent of the national grid’s output in 2015-16.
The first phase's achievements surpassed targets by a huge margin.
An office of the International Apparel Federation (IAF) has opened in Pakistan. The office will help local garment manufacturers establish B2B contacts with international buyers. It would give a boost to the textile and garment industry of Pakistan besides paving the way for growing the business and ensuring easy access of Pakistani exporters to European markets.
Sialkot, where the IAF office is located, is one of top export hubs of Pakistan. It is dotted with cottage industries producing garments, uniforms, surgical instruments, sports goods and musical instruments. Sialkot is also a sourcing hub for top international brands and its artisan and craftsmanship is acclaimed throughout the world.
The Sialkot IFA office will grant membership to Pakistan’s garment manufacturers and also help in holding B2B meetings with importers and exporters.
The International Apparel Federation is based in the Netherlands. The regional office in Pakistan would be the first ever IAF office in South Asia.
The International Apparel Federation is a politically neutral global association, open to entrepreneurs and executives from the apparel chain worldwide. Its membership includes national clothing associations and companies whose core business is sourcing, designing, development, manufacturing, distribution, and retailing of apparel products. In addition the IAF welcomes, as associate members, educational institutions and companies that supply textiles, accessories, equipment, technology, and services to the apparel industry.
Portugal seems to be on the road to recovery with a GDP growth rate of 2.8 per cent in 2017. This is the decade-high growth rate clocked by Portugal on the back of expanded private investment and increased consumer spending. The major growth factor seems to be tourism welcoming close to 7.1 million visitors in July 2017 alone, according to The National Statistics Institute. While Spanish luxury is dominated by consumers from China, Russia and the US — who come to purchase pieces at a lower cost than their home countries — the high net-worth clients in Portugal are often Angolans, a former colony. This aspect has fueled the opening of new concept stores and designer labels in Portugal.
Menswear store Slou in Lisbon stocks edgy and streetwear brands such as Gosha Rubchinskiy and Stone Island, while online platform Les Filles specialises in supporting young Spanish and Portuguese designers like Moisés Nieto and Alexandra Moura. Paulo Vaz, General Director-Portuguese Textile and Apparel Association, says exports in the sector amounted to €3.17 billion last year, a 4.3 per cent year-on-year increase. Reduced margins post-crisis meant survival of the fittest for Portuguese textile and apparel firms, forcing ‘each cent to count’, to achieve results and stay afloat. But upon recovery, streamlined structures and highly skilled workers meant international private labels could turn to the country’s manufacturers for more than raw materials.
But while the ‘Made in Portugal’ leather, footwear and textile manufacturing is well-established — having long produced for European luxury houses including Prada and Gucci — much of the 4.4 per cent year-on-year growth of the country’s apparel market is owed to fast-fashion brands attracting low-income consumers. According to Euromonitor, Inditex holds the overwhelming majority of the market, at 18.3 per cent.
Domestic consumption drives Spanish market
While overall apparel market size grew year-on-year to €20.85 billion in 2016, a 0.8 per cent increase, Spanish barometer Acotex, which records monthly sales in apparel, reported a 2017 growth of only 0.1 percent, compared to 3.39 per cent in 2016. Having said that, Spanish market is in recovery mode; real GDP growth is forecast at 2.5 per cent in 2018, down slightly from robust 3.1 per cent estimated in 2017, according to BMI Research. Josh Holmes, senior consumer analyst at BMI Research, stated that overseas investor sentiment towards Spanish companies and assets have generally turned more positive… in line with the wider economy. Private equity firms have been able to acquire Spanish brands that have been seeking buyers to help pay down debt and/or fund expansion plans. The luxury goods industry reached €5 billion in sales in 2016, according to the Spanish Luxury Association, but it still falls behind markets like the France, where sales of luxury goods reached €18 billion in the same year. With luxury players finding increasing interest in Spanish cities, Christian Louboutin is setting up shop in Madrid. The year 2017 saw brands including Sonia Rykiel, Fendi and Isabel Marant open stores.
Fast fashion dominance
All 15 top retailers in Spain are fast-fashion brands, according to Euromonitor International, with Zara taking the first spot and Primark and H&M occupying second and third place. When Interbrand released its annual ranking of the best Spanish brands, Zara featured prominently at the top spot, while five other low-cost brands were dispersed alongside Santander bank and football team Real Madrid.
In the Madrid district of Salamanca, a Zara store sits on the same block as the Armani boutique, and Uniqlo plans to take over the first two floors of luxury shopping mall El Jardín de Serrano. Joaquim Bretcha, director at Netquest International, informed that the appropriation of the main shopping districts by the Inditex Group began before the crisis of the expulsion of smaller independent stores from prime retail locations. Inditex and Mango reported €23.3 billion and €2.2 billion in sales for fiscal year 2016, respectively. Chain Desigual reported poor performance in the first half of 2017, year-on-year revenue was down 9.6 per cent to €377.9 million, but retains popularity among Spanish consumers, with over 85 owned stores across the country. In such fast fashion environ, the competition is stiff for independent labels. Additionally, global brands would also need to revisit their strategies or consider reigniting some of their business activities in order to sustain their position.
"Due to labor shortages, developed countries, such as the UK, the US and Japan, had to hire workers from Mexico, China, India and Vietnam. In the era of Industry 4.0, many textile and garment plants in Vietnam, China and India are expected to be moved to the US where robots have replaced humans in many positions. Using robots costs less than hiring manual workers."
Due to labor shortages, developed countries, such as the UK, the US and Japan, had to hire workers from Mexico, China, India and Vietnam. In the era of Industry 4.0, many textile and garment plants in Vietnam, China and India are expected to be moved to the US where robots have replaced humans in many positions. Using robots costs less than hiring manual workers.
A recent International Labor Organization report shows more than two thirds of 9.2 million textile, garment, leather and footwear workers in Southeast Asia are being challenged by the rapid explosion of scientific and technological applications. Large amounts of work being done by humans will be passed on to robots. As a result, low-cost workers who account for about 86 per cent of the total workforce of the Vietnamese textile and garment sector, 88 per cent of that in Cambodia, and 64 per cent of that in Indonesia risk unemployment.
As we move towards tech enhancements and embedding industry 4.0 into our factories of future, times are going to be challenging for countries who are still running on the power of labour. Today skilled manpower who is tech-enabled is the need of the hour to survive the battle. To get ready for Industry 4.0, Vietnamese textile and garment companies should promote technological innovation and human resource development.
Technology over human skills
It’s an accepted fact these days that technology is overpowering human skills when it comes to efficiency and time. For instance, the Viet Thang Jean Company, used to employ about 2,200 workers to operate a production line that creates 10,000 products daily. Now, with the help of automatic equipment, the company needs only 800 workers to operate the production line. However, investment in machine is still costlier. A laser cutting machine that can replace 100 workers per day costs nearly €800,000. To reduce the number of workers required to operate its production line, the company had to spend approximately $10 million. This effectively means that businesses should take into account investment in automation to ensure its highest effectiveness.
Preparing for the big race
Experts say the use of automatic equipment has helped Vietnamese textile and garment companies increase productivity by about 20 per cent. However, machinery cannot replace humans in the field of garment design that requires human creativity. Vietnam currently is the world’s fifth largest textile and garment exporter. In recent years, Bangladesh, Cambodia and Myanmar have been able to gain business on the back of cheap labour as compared with Vietnam. However, these countries can compete with Vietnam only in attracting orders that require simple techniques. Vietnam prides itself in having a skilled and experienced workforce, and thereby delivering complex technical requirements.
Saurav Ujjain, Chief Representative of ThreadSol in Southeast Asia, points out garment and fashion companies should make the most of technology and software to increase productivity and save materials. Artificial intelligence and mobile applications should be used to control and minimise material waste. Human resources should be trained in information technology, network security, artificial intelligence, robot technology, the Internet of Things (IoT), and 3D printing technology. Nguyen Thi Tuyet Mai, Deputy Secretary General and Head of the Vietnam Textile and Apparel Association’s Representative Office in Ho Chi Minh City, also felt that businesses need to pay attention to information security when using software and technology in production. They should be careful in choosing the most suitable technologies to help them enhance economic efficiency and contribute to the development of the Vietnamese textile and garment sector. At a macro level, the government needs to increase the application of information technology in institutional and administrative reform to help businesses enhance their competitiveness and invest in Industry 4.0 technologies.
In order to promote sustainable development throughout the industry, a number of yarn and fibre manufacturers have endeavored to introduce green products into the early stages of textile production, and Yarn Expo, as the leading yarn and fibre business platform in Asia, serves as an ideal stage for these suppliers to gain exposure to buyers looking for such products.
In response to the strong demand for fibre and yarn products in China and the Asian region, the coming autumn edition of Yarn Expo will double its exhibition space, and will accommodate around 500 global yarn suppliers from 13 countries and regions. Together with Yarn Expo Autumn 2017, three other textile trade fairs are held concurrently from 11– 13 October in the same venue: Intertextile Shanghai Apparel Fabrics – Autumn Edition, PH Value and the China International Fashion Fair (CHIC).
Debut BCI Pavilion joined by Sateri and Birla Planet Pavilions to showcase eco-friendly products. Amongst a record number of exhibitors at this October’s Yarn Expo Autumn, the debut BCI Pavilion as well as the Sateri Pavilion and Birla Planet Pavilion that include eco-friendly products are certainly amongst the highlights this year. Better Cotton Initiative (BCI) is a global organisation with more than 1,000 members including spinners, weavers and garment manufacturers throughout the entire cotton sector. It aims to promote sustainable cotton production, benefiting workers, customers and the environment as a whole. They will form the BCI Pavilion in Yarn Expo for the first time, with five spinners showcasing their cotton yarn manufactured with eco-friendly cotton.
Not only are a number of chemical fibre products with innovative, ecofriendly and health & comfort properties on offer from exhibitors, but visitors can also gain insights into product trends in these areas from the 2017/18 China Fibre Trend Area and Innovative Textile Material Forum, both of which feature in the colourful chemical zone. The Natural Cotton Yarn Zone is another highlight of the three-day show, where exhibitors will showcase their natural cotton yarn and a range of functional products. Around 50 suppliers will also showcase their latest collections in the expanded Fancy Yarn Zone.
More than brands understanding the ways their consumers live, they will also have to figure out the most genuine way to reach them and communicate with them. Traditional advertising doesn’t work for a group of consumers seeking personalized experiences from brands that mean something to them.
Today an individual, when buying something, does something more than buying. This person is constructing a personality. Consumers may be consumers, but they’re also citizens with social concerns, environmental concerns and a need for new experiences.
The new wave of connected consumers wants to be part of things like recycling the clothes they wear or understanding how their garments are being created. This is something more than just consuming. Retail is a citizen act.
Brands are cross sharing, cross merging. Successful consuming experiences now go beyond just having an efficient experience and walking out with a garment that provides the need or want sought—a successful experience is also one the consumer can share with others.
Buying on social networks is something that’s more and more relevant. About 45 per cent of Gen Z consumers are ready to buy from social networks.
Athletic brands may be ahead of other retailers in creating extended connections with consumers. It’s about creating a community. Lululemon may sell yoga pants, but it’s also inviting consumers into stores to participate in free community yoga classes.
Vardhman is among the biggest names in textiles in India, with one of the largest spinning and fabric capacities.
This textile giant has rapidly modified its business strategies to carve its own niche regardless of the presence of several small- and medium-level players with the shortest lead times.
Vardhman has been able to sustain its volume by adding new customers and shortening production lead times which was possible due to a big in-house production capacity from yarn to fabric.
Vardhman has also bounced back significantly by diversifying into many new products which it earlier did not have, effectively recovering its lost ground. A few years back, it started its liquid ammonia plant. Last year, it added a printing plant. The product basket is diversified. It is now not only in cotton but creates blends like cotton Tencel stretch, cotton modal super stretch and difficult products like bi-stretch. These are the types of products which are in demand in the women’s wear segment.
With India being the hub of raw materials like Tencel fiber and different types of yarn, these product variations were not difficult for Vardhman. It is now producing 100 per cent Tencel, 100 per cent modal and is very competitive in terms of lead time as compared to China. The company’s focus on basics or core programs still accounts for 70 to 75 per cent of its total volume as it has a huge capacity build-up.
Testing mechanisms for performance textiles are often not based on reality.
The most widely accepted standard currently, ISO 11092, does not put the textile to the test in real world conditions. The ISO 11092, which sets its test conditions at 35 degrees Celsius outside temperature and a relative humidity of 40 per cent, cannot measure the performance of breathable textiles in subzero winter temperature and snow/rain.
The test, for example, does not address the problem of condensation building up inside the clothing when the temperature drops below 14 degrees Celsius. In a dangerous case, this can cause the clothing to freeze up. When the temperature is high, on the other hand, breathability can be reversed, drawing hot steam and vapor inside the garment, boiling the wearer.
There is a need for breathability tests in cold, wet and dry conditions that measure condensation within the layers of a garment system. Such tests can be life-saving as performance garments are used by many working in extreme conditions. An India military serviceman caught in a mountain accident wearing an Ardmel garment was able to survive for nine days under extremely cold temperatures. While the serviceman died of other complications after he was saved, he did not suffer from any cold injuries. Had he worn a garment that could not prevent condensation, he would have died earlier of hypothermia.
For the fourth consecutive quarter companies in India’s spinning sector have reported a year-on-year decline in volumes.
Reasons include a fall in exports due to weak demand from one of the key markets, China; and a focus on inventory clearance prior to GST implementation, which affected offtake and hence production volumes.
The challenges have been further accentuated by consistently firm cotton fiber prices resulting in subdued contribution margins as well as strengthening of the Indian currency vis-a-vis currencies of competing nations, thereby affecting realisations.
Nevertheless the debt coverage metrics continue to improve on a year on year basis, given the secular decline in term debt level and decline in borrowing costs. Improved supply of cotton fiber is, however, expected to provide some respite to domestic spinners during the second half of fiscal year 2018.
The level of global cotton production in 2018 is estimated to exceed consumption, after two consecutive years of shortfall. The resultant cotton surplus therefore will create a downward bias in prices which, besides easing pressure on contribution margins of the spinners, is likely to bring down their working capital requirements. This augurs well for the domestic cotton spinning industry.
Further, Indian yarn exporters are trying to diversify export markets to increase their sales volumes.
