Global T&A industry needs to up its sustainability performance
"The ‘Pulse of the Fashion Industry’ report by Copenhagen-based Global Fashion Agenda (GFA) in partnership with Boston Consulting Group (BCG), reveals that textile/apparel is the world’s second most polluting industry after oil, and has ample room for improving its sustainability performance. The textile/apparel sector's overall score is low at 38/100. Big sportswear companies are well ahead of the pack with a score of 84/100. A performance explained by their sometimes troubled history in terms of the working conditions in some of their suppliers’ factories, as well as their efforts to deliver innovative products, which pushes them to tread new ground, in the fields of circular economy and recycled materials."
The ‘Pulse of the Fashion Industry’ report by Copenhagen-based Global Fashion Agenda (GFA) in partnership with Boston Consulting Group (BCG), reveals that textile/apparel is the world’s second most polluting industry after oil, and has ample room for improving its sustainability performance. The textile/apparel sector's overall score is low at 38/100. Big sportswear companies are well ahead of the pack with a score of 84/100. A performance explained by their sometimes troubled history in terms of the working conditions in some of their suppliers’ factories, as well as their efforts to deliver innovative products, which pushes them to tread new ground, in the fields of circular economy and recycled materials.
For the same reason, companies positioned at entry-level and generating more than €8 billion in annual revenue
have, on average, a score of 67/100. On the other hand, companies which generate less than €80 million in revenue posted the lowest scores: 20/100 on an average for entry-level segment, and 37/100 for the mid-price segment. The study observed mid-price players, by adopting solutions consistent with the size of their business, have managed to improve significantly. Only the luxury segment recorded the same score for great groups and smaller entities alike: 51/100.
The companies surveyed said they prioritise design and product development more than production processes and, above all, materials. The latter is a crucial area, where 89 per cent companies are keen to make further progress in the next few years. The study highlighted that, in order to respond to the market's and consumers’ expectations, short-term innovation in materials will be necessary to furnish new, industry-wide solutions.
Opting for a circular approach
Indeed, a few companies train their styling teams to adopt a circular approach, envisaging from the design phase how products can be recycled. However, the majority still has a long way to go. Workshops for garment repairs are also thriving. While the study pointed out improving recycling of discarded products will still need a few more years, the use of RFID tags carrying information on the exact composition of the product seems to be the best way to recycle it.
Analysts feel industry players will have to move forward collectively in order to truly step up to the next level. The main challenge identified by the ‘Pulse of the Fashion Industry’ report is that of leading as many companies as possible on the road towards ecological and social change. To make comfortable progress, companies need to implement a system for full supply chain traceability, improve the way they consume water, energy and chemicals, and uphold and/or demand compliance to standards in terms of working conditions. In second phase, they should be able to source a responsible mix of sustainable materials, introduce a circular approach to business, promote improvements in worker remuneration and finally tap the opportunities provided by the electronic and digital revolution. All of these changes (and investments) need to be incorporated in business strategies. The report suggests, companies which invest on environmental and social initiatives will earn themselves a ‘bonus’ in operating margin by 2030: rising to the new challenges will be worth the effort.
VF Corporation appoints new VP
VF Corporation has appointed Travis Campbell the new Vice President, General Manager, The North Face®, Americas. Campbell was earlier engaged as the President of VF’s Smartwool brand. At The North Face®, he will provide leadership and vision for the brand’s American business by creating and executing growth strategies in sales, direct-to-consumer and merchandising. He will also play an important role in establishing the Americas Region Leadership Team and ensuring the successful regional activation of the global brand vision and strategy. Campbell will report to Arne Arens, Global President, The North Face®.
Prior to VF, Campbell was President & CEO of Far Bank Enterprises, an integrated manufacturer and distributor of fly fishing products and owner of the Sage, Redington, and RIO brands. In 2005, he became President of Rio Products International, Inc., and in 2003 he was named President of Redington Tackle & Apparel. Prior to these roles, Campbell served as Director of Business Development for Sage Manufacturing. He also held various positions at Deloitte Consulting and Andersen Consulting.
Trade bodies want UK to decide on Brexit
The Europe-India Chamber of Commerce (EICC) has joined hands with industry bodies representing the US, Canada and Japan to issue a Brexit plea to the UK to make urgent progress on the issue. The groups also include the American Chamber of Commerce to the EU, Canada Europe Roundtable for Business and Japan Business Council in Europe. They represent the interests of an array of international businesses who are heavily invested in both the European Union and the UK and warned that the clock was ticking towards the October deadline for Britain to strike a final withdrawal agreement with the EU.
In the lead up to the European Council summit in Brussels, they have urged policymakers to address issues around governance, regulatory cooperation and post-Brexit preparedness. They say reaching agreement on these issues will provide businesses with more confidence that a withdrawal agreement can be agreed and ratified, thereby providing legal certainty for the proposed transition period and avoiding the worst-case cliff-edge scenario in March 2019. While they recognise the complexity of finding a solution for the Irish border, they say the EU and UK must continue to try to find agreement on the issue that is seen as a stumbling block to an agreement.
Tax hiked for garment manufacturers in Bangladesh
Readymade garment manufacturers in Bangladesh have to pay a higher corporate tax. The tax rate has been raised from 12 to 15 per cent. However, certified green factory owners will enjoy a three per cent rebate and pay 12 per cent, while publicly traded readymade garment manufacturers will have to pay 12.5 per cent. At present a certified green factory pays ten per cent tax, which will be increased to 12 per cent.
The RMG industry in Bangladesh plays an important role in generating employment and fostering economic growth. In the budget the 100 per cent export-oriented textile industry gets duty exemptions on raw material imports. Exemption of import duty is proposed for textile raw materials such as flax fiber and flax tow.
Efforts are on to ensure congenial working environment in the readymade garment industry. Safety evaluation work has been completed in 3,780 factories. In addition, a public accessibility database has been prepared, containing information on 3,743 export-oriented readymade garment factories. Also creating a database with information on another 27,000 factories is under way.
About 65 Leadership in Energy and Environmental Design (LEED)-certified factories have been operating in Bangladesh. Among these, 13 have received platinum status, 20 gold status and 34 silver status.
Taiwan to join CPTPP next year
Taiwan is planning to join CPTPP as soon as the agreement comes into force early next year. Canada this month introduced legislation to ratify the CPTPP. Japan and New Zealand are planning to complete the ratification process by the end of this year. Mexico has already ratified the agreement. The CPTPP will come into force once six countries have completed ratification.
As per John Deng, Taiwan’s trade negotiator and cabinet minister without portfolio, Taiwan would begin to be locked out of the network of trade agreements in the region, which could become a burden for Taiwanese companies and create export diversion. Regional trade pacts involving the Association of Southeast Asian Nations and the European Union’s trade deal with South Korea had already begun to be implemented. Taiwan was planning to continue market liberalisation on its own and touted increased transparency efforts including allowing foreign companies to comment on new regulations.
SDC hosts conference in Mumbai, focus on innovations in textile supply chain
The Society of Dyers and Colorists (SDC) held a conference in Mumbai to discuss innovations in chemical compliance, certification, fashion and business in the textile supply chain. Over 200 delegates from process houses, brands, retailers, fashion and technical educational institutions participated.
Panel discussions focused on dyes and chemicals compliance, sustainable business strategies and ideas to support the textile computation industry. Stress was laid on innovations, ideas and projects that would help everyone involved in the textile supply chain to take a step forward in creating a greener and happier ecosystem for all its living beings.
A session highlighted the importance of color and helping brands in selecting the right color. The total appearance capture system consists of a camera that can scan the object from every angle, helping in visualizing the product. The Pantone cloud- its tools and concept of 3-D object making-- can reduce the cycle of prototype and sampling in garment industry that can help in reducing waste. For sustainable production 3-D object making can help in reducing the steps of making prototypes and waste of resources.
The conference was based on the theme of a circular economy. The textile industry is struggling to reduce its footprint and one of the promising pathways to this is to embrace the concept of the circular economy.
Pakistan: Port strike threatens exporters
A port strike in Pakistan threatens to cause cancellation of vital export orders. Export orders running into huge amounts are at stake. Carriers and other freight-loaded ships anchored at the terminal have not been offloaded owing to the strike.
The industry has not been able to meet international commitments and failure to perform will lead to disputes, loss of valued customers, loss of market share as well as damaging Pakistan's reputation as a reliable supplier.
The strike comes at a moment when Pakistan’s industrial production and exports are registering a positive growth. Blockage of export goods would hurt the growth pace. Given the trade deficit and the national debt, the economy can hardly bear such delays in trade activities.
If the situation continues, the industry fears production activities will reduce further. The port strike is not only hurting shipments of export consignments but importers too. They are forced to pay demurrages for not clearing their consignments from the ports. Also industrial units are not receiving raw materials.
If the issue is not resolved, exporters fear facing huge financial losses and also losing their hard earned export contracts. Cancellation of vital export orders would in huge losses not only to exporters but also to the national exchequer.
OSL steps into voice interface in apparel, footwear industry
Options System Limited (OSL) specialises in computer systems for the apparel, footwear and soft goods industries. Its Styleman and Styleprm systems are used by over 100 companies in 35 countries. OSL’s software improves speed in PLM. Styleman PLM software reduces the possibility of errors and drives the development schedule according to the desired timetable. Errors are reduced by both the factory and company looking at the same data, by the accuracy of the tech pack and by quality of feedback from sample fit sessions.
The company’s future plan is to tap into voice interface (Siri, Alexa, Google, etc.), which is gaining traction on home devices but has yet to make it into the office. Robot assembly is starting to make inroads into manufacturing, raising the possibility of micro-factories making to order.
One can visit a shop, browse some garments physically or virtually, adjust the coloring or pattern to suit tastes, and wait a few minutes while the garment is manufactured on the spot. This is more likely to happen in footwear first, since 3D fabric printing/knitting still has a way to go.
In the next 10 years, 3D printing may develop to a stage that it will disrupt e-commerce, allowing individual garment or footwear personalisation and printing at home.
Surat mills continue to ignore safety provisions
Of the 145 textile units at Pandesara in Surat, none has adequate provisions for fire safety. No mill has been adequately equipped with fire safety provisions. Notices will be issued to all of them and asking them to comply with fire safety norms. There are about 350 textile mills located in the city and nearby areas of Palsana and Kadodara. These textile mills employ about three lakh workers and their monthly turnover is pegged at about Rs 1,800 crores. The lives of lakhs of workers are at risk due to weak structures and no fire safety provisions.
Major industries spend around eight per cent on corporate social responsibility and also on lavish layout for their own units. However, other textile mills are run under tin-sheds and have concrete walls and temporary supports. These textile mills dump their finished products and raw materials in semi-open shades, which is a recipe for fire disaster.
The recent instruction of the Gujarat Pollution Control Board about chimneys to mills has helped bring down air pollution marginally. In the last few months, notices have been issued to at least 36 textile mills for causing air pollution. They comply with law for a few days and then again turn to their old practices.
Demand for menswear on the rise
Luxury brands are expanding their range in menswear with big fashion houses including French conglomerates LVMH and Kering hiring eye-catching designers and investing in male attire. For example, Louis Vuitton recently launched a collection by its new DJ-turned-designer Virgil Abloh.
There's strong demand for menswear in all its shapes and forms, and which comes in part from a younger clientele. Louis Vuitton recently generated 5 to 7 per cent of its revenue from menswear. Market research firm forecasts men's lines will outperform women's between 2017 and 2022, with sales expanding by a compound annual growth rate of 2 percent. The US department store is also launching newer menswear-focused labels like France's Ami, or Off-White, the streetwear brand founded by Vuitton's Abloh. This is due to men placing a greater emphasis on their appearance, fuelled by the rise of social media, and dress codes for men softening globally.
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FIASWI demands additional customs duty on imported silk
The Federation of Indian Art Silk Weaving Industry (FIASWI) has sought various duty cuts on man-made filament yarn, fibre and fabric from the government. It seeks imposition of additional customs duty on silk fabrics imported from Vietnam to provide a level-playing field to Indian manufacturers.
It has also sought reduction of customs duty on all man-made fibre and filament yarn which are not manufactured in India. Recently, the FIASWI submitted a memorandum to textile minister Smriti Irani in New Delhi through Surat MP Darshana Jardosh demanding imposition of 10 per cent duty on fabrics imported from Vietnam.
The FIASWI has also raised the issue of input tax credit (ITC) refund with the minister stating that non-refund of accumulated ITC is resulting in losses to the industry and drastic reduction in capital investment for machine modernization. FIASWI says, there is GST of 5 per cent on fabrics manufactured in India, while imported silk fabrics have zero duty. As compared to the fabrics made in India the imported silk fabrics are cheaper by Rs 45 per metre.
Egypt garment exports up 12 per cent this year
Egypt’s readymade garment exports increased 12 per cent in the first five months of the current year compared to the same period in 2017. Exports to the US also went up by 12 per cent. Garment exports to Europe rose by 16 per cent. But as for garment exports to Arab countries, they dropped by 16 per cent.
Egypt’s garment exports are mainly to the US, Turkey, Spain, Britain, North Ireland, Germany, Italy, France, Saudi Arabia, Belgium and the Netherlands. Egypt wants to have stronger trade relations with Africa. Steps include taking part in international exhibitions in the African continent and setting up an Egyptian-African free trade zone.
Egypt’s main exports to Africa are engineering industries, pharmaceuticals, chemical garments, food industries, and construction materials. Egypt wants to increase exports to the African continent by 35 per cent in 2017. The main countries Egypt is interested in are Kenya, Zambia and Ivory Coast. However, working to make Egypt a leading international trade center in the Middle East requires work to increase the capacities of Egyptian ports in order to attract more container ships as well as working on the development of logistics capabilities and infrastructure to support this trend.
'Made in China 2025' message understated by Beijing
Beijing has begun to downplay Made in China 2025, the state-backed industrial policy as it has provoked alarm in the West and is core to Washington's complaints about the country's technological ambitions. The policy, unveiled by China's State Council in 2015, involves China catching up with rivals in sectors including robotics, aerospace, clean-energy cars and advanced basic materials. The strategy helps China to move up the value chain and achieve Xi's vision of urning the country into a global superpower by 2050.
But the policy has provoked the Trump team, including US Trade Representative Robert Lighthizer and trade and manufacturing adviser Peter Navarro, author of the book “Death by China.” Trump's initial list of tariffs on $50 billion in Chinese goods, which will begin taking effect on July 6, specifically targets items related to Made in China 2025. Under the plan, Beijing wants Chinese suppliers to capture 70 percent of market share by 2025 for “basic core components and important basic materials” in strategic industries.
Australia produces bumper harvest
The cotton industry in Australia is on track to produce about 4.6 million bales or over a million tons of fiber. Cotton prices are particularly attractive but plantings are likely to be significantly down due to water shortage. Next season there could be a crop of around 2.2 million bales, 50 per cent down on last year.
A lot of winter crop hasn’t gone in. The northern areas are hitting the last available date for planting cereals. So, some of that country may be put to summer crops, especially if there is rain in August. So sorghum and dry land cotton are on a lot of people’s minds.
Cotton production in the Murrumbidgee and Murray valleys of southern New South Wales has hit a record 8,00,000 bales, with 53 new growers joining the region’s existing cohort of 110 to grow a record area of 72,000 hectares. The average yield for this all-irrigated area was around 11 bales per hectare.
There are plenty of new growers sending cotton to the gins this year. The shift has been due largely to the high cost of irrigation water.When the price of water goes up, the margin is worse on rice, and that makes cotton look better, especially when the price of cotton is high.
