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Gerber Technology, based on its successful initiative in China, announced the creation of the Gerber PPE Task Force and Resource Team to support their global customers and partners as they work to increase their production or transition to manufacturing personal protective equipment (PPE).
In a global context where COVID-19 inexorably continues to spread, the global shortage of masks and other personal protective equipment needed to keep healthcare workers safe is a concern of everyone.
Gerber has helped several customers transition into producing protective masks and other much needed medical supplies including Taglio Marchesini (Italy) and Shanghai Challenge Textile Co. Ltd.
“In what’s an unprecedented global emergency, all of us in the manufacturing industry need to work together to protect those fighting COVID-19 on the front lines,” Mohit Uberoi, CEO of Gerber Technology, as quoted.
South Africa's first Covid-19 lockdown national collective agreement for the clothing and textiles industry was expedited and ratified by the end of March 23.
The primary focus of the agreement sets out several safeguards for workers within the industry. The agreement was formulated by the National Bargaining Council for the Clothing Manufacturing Industry in South Africa. And, the signatories to the clothing industry agreement are the Southern African Clothing & Textile Workers’ Union, the Apparel & Textile Association of South Africa and the South African Apparel Association.
Agreement also sets out to reinforce a belief that all South Africans, their organisations and institutions develop cooperation between themselves and government during this period of national crisis. It also hopes to spur affected parties to “dig deep” to develop support programmes to address issues arising from the threat of Covid-19.
Guarantees of full payments of salaries to 80 000 clothing workers for the lockdown period is also a primary concern highlighted in the agreement.
The establishment of a clothing industry Covid-19 Lockdown Rapid Response Task Team will also be developed to manage immediate practical implementation matters arising from the conclusion of the agreement.
Exporters are in dark over whether the government will go ahead with the scheduled announcement of the new Foreign Trade Policy (FTP) 2020-25 on April 1. Many feel that FTP shall be postponed due to the uncertainties unleashed by the Covid-19 pandemic and a shut-down of government offices.
The Commerce & Industry Ministry, however, has not yet made any official announcement on whether the new FTP will be unveiled on April 1 or delayed.
The Apparel Export Promotion Council has sought a special package for the apparel sector, including creation of a corpus fund for exporters, as it expects uncertainty to linger for at least next two months impacting shipments worth $1 billion that would affect 13 million direct workers and their families.
“There is no point in announcing a new FTP policy on April 1 if there is not much to be announced in terms of schemes and measures,” pointed out Ajay Sahai, Director-General, Federation of Indian Export Organisations (FIEO).
Earlier government had said that the popular Merchandise Export from India Scheme (MEIS) for exporters will be replaced with the new Remission of Duties and Taxes on Exported Products (RoDTEP) scheme in phases after sectoral discussions over the next few months, there was no need to announce a new FTP in a hurry.
Under the MEIS scheme, exporters are assured of a minimum incentive for their exports while there is no guarantee what the new RoDTEP scheme will have to offer as it still needs to be deliberated upon.
It is felt that it woul be better for the government to wait and have proper deliberations with the industry on special packages before finalising the FTP for the next five years.
India’s goods exports during April-February 2019-20 dipped 1.5 per cent to $292.91 billion compared to the same period last year, although exports increased 2.91 per cent to $27.65 billion in February 2020, for the first time in seven months.
Though, Bangladesh has become the second-largest garment exporter worldwide by grabbing 6.4 per cent market share, the country is soon likely to be overtaken by Vietnam, whose exports have been rising rapidly and the country expects its apparel shipments to cross $40 billion by the end of the year. However, to achieve this, Vietnam needs to maintain export growth at 11-12 per cent for the rest of the year.
Why Bangladesh slowed down
During the first eight months of the current fiscal, Bangladesh exported garment worth $21.84billion. However, as per Export Promotion Bureau figures, exports declined by 5.53 per cent year-on-year. Revenues too declined by 13.45 per cent during these eight months to $25.24 billion. Between July and February, the country recorded $10.89 billion from its shipment of knitwear products and $10.94billion from the woven product shipments.
Exports of knitwear and woven products declined 5.17 per cent and 5.88 per cent respectively during the year. If the country’s shipments do not rise
abnormally, Bangladesh might not achieve its target of exporting $38.20billion worth of garment by the end of this fiscal. The country’s garment exports have been declining due to the closure of nearly 200 small garment factories over the last few years. It also reflects falling competitiveness of RMG industry whose exports dipped by 7.74 per cent during July-November of FY2019-20.
Some major reasons behind the slowdown are: policy incentives by competitor countries which enable them to get more business by lowering prices; increase in production cost fueled by a minimum wage increase in December last year; poor efficiency and relatively higher cost of doing business and over concentration of the industry to a few product items and over-concentration of markets.
Vietnam takes the lead
In contrast, Vietnam has been performing strongly as it recently signed the landmark Free Trade Agreement (FTA) with the EU, which allows them to enjoy zero-duty benefit to the largest trading bloc of the world. Also, geographically, Vietnam is closer to the EU and other Western countries. This allows garment manufacturers to ship goods with lower lead time. They can ship their goods with airliners at lower costs. Another big advantage is its abundant Chinese investment and higher factory productivity. Many Chinese investors have factories in Vietnam in addition to those they run in Mainland China. As a result, the benefit of product development in China also trickles down to Vietnam. This makes the job of sourcing by buyers easier in Vietnam. This is the main reason why Vietnam is doing so well in RMG exports in recent times.
Latest ‘Ease of Doing Business’ shows, Vietnam is a better choice for investment than Bangladesh as the country is concentrating on product diversification. In contrast, Bangladesh still manufactures basic apparels. Almost 75 per cent of its shipments consist of T-shirts, trousers, sweaters, formal shirts and jackets though the country is slowly graduating to value-added and high-end garment items for upscale customers in the Western world.
Bangladesh also lags in the production of technical and smart clothing items, which prevents it from tapping the global market for hospital clothing, school uniforms and armed forces, worth billions of dollars.
Another advantage for Vietnam is its government’s support to the entrepreneurs through food subsidy to workers, social benefits, medical benefits and housing assistance. Also, Vietnamese workers are known to be more efficient than Bangladeshi workers as they have an improved supply of gas and electricity, working environment and infrastructures.
Textile and textile product (TPT) entrepreneurs strongly reject import relaxation as the productivity of textile factories is under pressure from the corona virus pandemic (COVID-19). Deputy Chairman of the Indonesian Trade Association (API) of the Domestic Trade Sector, Chandra Setiawan said that in the midst of these conditions the government must provide opportunities for domestic producers to keep the national economy running.
If there is relaxation of imports, the textile industry from upstream to downstream will be hit. Given the textile production has a long and sustainable process. Chandra hopes that people will increasingly love domestic products so that textile production continues to run and can be a way to create jobs in Indonesia. It urges the industry to launch a movement to love domestic products because this is the only import substitution as an effort to create employment. At present, the smallest employment creation will be very meaningful in the current conditions
Garment exporters in Tiruppur and home textile exporters in Karur have decided to stop production. Tiruppur has over 1,200 exporters and thousands of supporting units. Together the industry employs nearly six lakh workers. The entire chain, including industries supplying to the domestic market, will come to a halt from tomorrow.
Industries are facing severe financial crisis. The market is also not accepting the goods. The District Administration has given orders to stop all trading activities in the district, he added. It is estimated that the goods worth ₹750 crore will not be produced from Tuesday for eight days.
M Nachimuthu the president of Karur Exporters’ Association revealed that about 500 exporting units that employ nearly two lakh workers in Karur have decided to stop production from March 24 to 31. The units will pay wages to the workers for these days. The annual export turnover of Karur is nearly Rs 5,000 crore. Just 20 per cent of the buyers are willing to take the orders placed. However, exporters face challenges in sending these goods too, he said.
Many industries of the Southern India Mills’ Association has communicated have suspended their operations and shut down the units till March 31 or till normalcy is restored to prevent the spread of COVID-19. Those units that are not in a position to operate the mills are advised to provide lay off to the workers. But, in the case of lay off, 50 per cent of the wages need to be paid, till suspension is revoked.
Since the last few days, several fashion companies have halted operations entirely, as states’ new stay-at-home and shelter-in-place orders mean many also can’t fulfill e-commerce orders. They’ve been forced to close distribution and fulfillment centers, and at the same time, they’ve closed their online stores.
Reformation closed its Los Angeles factory and distribution center, as a result of California’s “Safer at Home” mandate. The company will also not ship its online orders until distribution centers reopen. New York-based Marysia closed its online store while The Frankie Shop also suspended its online operations in compliance with New York Governor Cuomo’s mandate.
Among retail chains that have closed their e-commerce sites are TJX Companies, Inc,’s TJ Maxx, Marshalls and HomeGoods. The company has closed its distribution and fulfillment offices. The company operates distribution centers in several states with current business restrictions, including California, New Jersey, Pennsylvania, Connecticut and Georgia.
American fashion companies have switched production to essential products. Taking a cue from LVMH, which plans to start producing hand sanitizer in its fragrance and makeup factories, Los Angeles Apparel, Aviator Nation and Citizens of Humanity have offered up their factories for mask production. Luxury brand Christian Siriano’s sewers have also gone to work making masks.
Other e-commerce closures are been driven by international restrictions. They include Victoria’s Secret and Pink, which rely on factories in India and Sri Lanka, where factories have increasingly announced shutdowns. Beyond local restrictions, these clothing manufacturers are facing a shortage of raw materials from China and declining orders from western brands.
GHCL plans to demerge its textiles business. The chemical maker’s inorganic chemicals and textiles businesses will be separately listed companies, after the National Company Law Tribunal approves the scheme of arrangement, according to an exchange filing.
The demerged textile business will be listed on the exchanges at a later stage with its currently-listed business being the chemicals, the filing said. The textile business will cease to be the company’s subsidiary after the restructuring.
Textiles constitute 35.5 percent to the chemical maker’s total revenue, as per its FY19 earnings. It consists of manufacture and sale of textiles including, but not limited to, yarn manufacturing along with weaving, processing, cutting and sewing of home textiles products.
The restructuring will maximise value for all stakeholders, leading to a better focus on the demerged business.
As a part of its commitment to progress towards more sustainable fashion, Mango, as, has joined the Sustainable Apparel Coalition (SAC), a leading organisation in the textile sector which aims to promote good practices in the supply chain and measure the environmental and social impact of brands.
Signing up to this initiative is a part of the company’s ambitious plan to implement over the next few years in order to fulfill one of its strategic goals: the sustainable transformation of the firm.
The firm is also a member of the Better Cotton Initiative, which aims to transform the global production of cotton, based on the three pillars of sustainability: the environment, social factors and economic factors.
In this regard, a few weeks ago, Mango announced its intention to increase the proportion of sustainable fibers in its collections, establishing that 100 per cent of the cotton used in its garments will be of sustainable origin by 2025. The company also plans to increase the use of recycled polyester in its garments to 50 per cent by 2025, and for 100 per cent of the cellulose fibers it uses to be of controlled origin by 2030.
Fast-fashion retailer H&M plans to layoff tens of thousands of workers worldwide temporarily, as it works through interruptions to its business from the COVID-19 pandemic. The Swedish brand has also canceled plans for dividends.
H&M, one of the world’s largest apparel retailers, has shut all of its stores in its several of its biggest markets, including Germany and the U.S. All iyd stores in the U.K. were closed last weekend. The brand closed 3,441 of its 5,062 stores worldwide. Faced with slumping sales, H&M is reviewing its business and looking for ways to cut costs. It is considering terminating some of its employees due to the negative impact of the corona situation on the business.
The brand is repurposing its supply chain to help make personal protective equipment, such as masks, to be used in hospitals that are in dire need.
