In April’20, the Lithuanian Association of Clothing and Textile Companies (LATIA) predicted one third of its clothing and textile companies would go bankrupt and a quarter of people would lose their jobs. The association welcomed the government’s post-quarantine assistance measures, in particular the subsidies provided to these sectors for up to six months. However, to maintain sustainable jobs, the share of these subsidies needs to increase, especially in the fifth and sixth months, viewed Kestutis Dauksys, President, LATIA. In addition, export guarantees and support for companies with over 250 employees also needs to be increased, he added.
Consumption decline leads to loss of export orders
COVID-19 restrictions have severely impacted apparel and textile production volumes in Lithuania. The country exports around 80 per cent of its textile and apparel products to Europe. In 2019, its tailors sold 70 per cent of their products to five European countries namely Germany, Sweden, the United Kingdom, Denmark and Norway. Decline in consumption in any of these markets results in reduced orders for Lithuanian clothing manufacturers. The pandemic has caused a significant decline in clothing consumption in Germany which has adversely impacted the performance of many Lithuanian clothing and textile companies.
A shift to casual clothing and other market
To deal with this situation, LATIA members urge textile and clothing companies to diversify their activities. Vidas Butkus, Head, Kauno Baltija AB recommends a shift to casual wear which is currently in high demand. The company currently produces certified work and medical clothing. It has also diversified exports from Scandinavia to Germany.
The pandemic has neither affected the volume of work for Omnitekas UAB nor its income. Though the company recorded 20 per cent sales decline in the first half of this year, it aims to stabilize operations by diversifying to new markets and products. It focuses on customers’ needs and opportunities and plans to launch its Autumn collection depending on the weather and pandemic situation.