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A global leader in sustainable chemicals, Indorama Ventures Public Company has joined the innovative T-REX (Textile Recycling Excellence) Project. This ambitious initiative aims to establish a harmonised blueprint across the European Union for the closed-loop sorting and recycling of household textile waste, facilitating the fashion industry's transition towards a circular and sustainable future. By uniting key stakeholders across the entire value chain, the T-REX Project positions itself as a frontrunner in sustainable innovation.
As the designated spinning partner, Indorama Ventures will process chemically recycled feedstock into polyester yarns and fibers through the extrusion process, ensuring the removal of impurities. This role aligns with the company's broader goals of promoting the circular economy and advancing the circular fashion industry through PET recycling and the supply of recycled materials. It underscores Indorama Ventures' strong commitment to sustainability.
Diego Boeri, Executive President-Fiber Business, Indorama Ventures, says, utilisingcircular feedstock across the value chain to help partners achieve their sustainability goals, Indorama Ventures plans to leverage its technical expertise to boost textile-to-textile recycling within the T-REX Project.
Funded by the EU, The T-REX Project aims to create a unified system for post-consumer textile waste recycling in Europe. It brings together a consortium of 13 major players from across the value chain, alongside research institutes, to transform end-of-life textiles from waste into valuable feedstock. The project's goal is to develop new business models that can be scaled up, ultimately making a significant impact on the sustainability of the textile industry.
A prominent player in the textile industry, RSWM plans to set up a new production unit in Jammu & Kashmir with an investment of Rs 730 crore. Spanning 32 acre, the upcoming facility will expand the region's industrial landscape and contribute to its economic development.
To be operational within the next 18-24 months, the new production facility will manufacture a wide range of textile products, leveraging advanced technology and machinery to ensure high-quality output. The plant will include state-of-the-art infrastructure, adhering to international standards and sustainability practices.
One of the key highlights of this project is its potential to create employment opportunities for around 3,000 individuals. This will not only provide job prospects for the local population but also enhance skill development in the region. The new unit will employ a diverse workforce, including skilled technicians, engineers, and administrative staff, contributing to the socio-economic upliftment of the area.
RSWM's decision to invest in Jammu & Kashmir underscores its commitment to foster industrial growth and supporting the government's initiatives to promote investment in the region. The company's move aligns with broader efforts to stimulate economic activity, attract investment, and develop the region's infrastructure. By setting up this facility, RSWM aims to strengthen its market position, expand its product portfolio, and meet the growing demand for textiles in both domestic and international markets.
The recent unrest over the quota reform movement has severely impacted Bangladesh's garment sector, leading to significant financial losses. Industry associations estimate that the garment and textile sector suffered losses of approximately $800 million over five days due to disruptions. Furthermore, the communication blackout during this period resulted in an estimated $4 billion loss in orders.
The unrest began on July 17 when mobile internet services were suspended following violence and clashes during a "complete shutdown" called by BoishommoBirodhiChhatraAndolon, a platform advocating for quota reform in government job recruitment. The situation escalated, leading to a shutdown of broadband services on July 18, the declaration of a general holiday, and the imposition of indefinite curfews, resulting in the closure of all industrial establishments.
Operations resumed on July 24, but the damage was already done. Mohammad Hatem, Executive President, Bangladesh Knitwear Manufacturers and Exporters Association (BKMEA), reported, the sector lost approximately $4 billion worth of orders to competitors due to the inability to communicate with buyers during the blackout.
To mitigate these losses, garment manufacturers have requested a one-year loan at a 2 percent interest rate and appealed to the finance minister and Bangladesh Bank to suspend loan installments and interest payments for the next six months. Hatem noted, currently 80 percent of garment sector owners are in critical condition and without government intervention, many factories risk defaulting on loans and closing.
SM Mannan Kochi, President, Bangladesh Garment Manufacturers and Exporters Association (BGMEA), estimates, the garment export sector incurred losses of Tk 11,050 crore, with the production sector alone losing Tk 7,400 crore. The washing and linkage sectors faced losses of approximately Tk 3,000 crore. The supply chain collapse left workers without wages, and interest on bank loans will still need to be paid, exacerbating the situation.
In response, Khalid Mahmud Chowdhury, State Minister announced the waiver of delay fees on imports and exports for the period when port services were halted, aiming to provide some relief to businesses.
Kontoor Brands, the global lifestyle apparel company known for its Wrangler and Lee brands, has announced impressive financial results for the second quarter of 2024, exceeding market expectations. Despite a slight decline in overall revenue, key financial indicators showed significant improvement, driving the company's decision to raise its outlook for the rest of the year.
Kontoor reported $607 million in revenue for the quarter, a 1 per cent decrease from the previous year. This decline was mainly due to inventory management actions by retailers in the US and a reduction in seasonal product sales. However, growth in direct-to-consumer sales helped offset these decreases. US revenue stood at $496 million, also down by 1 per cent, while international revenue was $111 million, marking a 6 per cent decline (5 per cent in constant currency).
The Wrangler brand saw a 1 per cent increase in global revenue, reaching $429 million. In the US, Wrangler's revenue remained flat, with a 10 per cent growth in direct-to-consumer sales balancing out a slight decline in wholesale. Internationally, Wrangler's revenue grew by 7 per cent, driven by significant gains in direct-to-consumer and wholesale segments.
Conversely, the Lee brand experienced a 7 per cent drop in global revenue to $175 million, attributed to reduced shipments in the US wholesale channel and declines in international markets.
Kontoor's gross margin increased by 410 basis points to 44.7 per cent, reflecting benefits from lower product costs, improved product mix, and supply chain efficiencies. The company reported an operating income of $75 million, with adjusted operating income up by 10 per cent to $80 million. Adjusted earnings per share (EPS) rose by 27 per cent to $0.98.
Kontoor ended the quarter with $224 million in cash and equivalents and $750 million in long-term debt. Inventory levels decreased by 22 per cent compared to the previous year. The company returned $53 million to shareholders in the second quarter, bringing the year-to-date total to $101 million.
CEO Scott Baxter expressed confidence in the company's performance, raising the full-year outlook based on better-than-expected Q2 results. Kontoor now expects revenue between $2.57 billion and $2.63 billion. Adjusted gross margin is projected to be approximately 44.8 per cent, with adjusted operating income at the higher end of the $377 to $387 million range. Adjusted EPS is expected to be around $4.80.
Kontoor is making strategic investments to support brand growth and market expansion, anticipating significant revenue growth and cash generation in the latter half of the year.
Scott Baxter, CEO of Kontoor Brands, is optimistic about the second half of the year, as the company’s improving fundamentals provide opportunities for long-term value creation. Kontoor remains committed to delivering shareholder value while navigating the current economic landscape.
A new study by Public Desire ranks the United States with a 10.873 per cent share as the eighth largest sustainable fashion market in the world.
Leading the rankings is the United Arab Emirates, followed by Estonia, Finland, Japan, France, Canada, Australia, the US, India, and Latvia. The study analyses over 20 countries to determine those most advanced in sustainable fashion. The analysis considers metrics such as the size of the apparel market, fast fashion and slow fashion revenue in 2024, and the proportion of these revenues in the overall market. Data sources include Statista, IBIS World, and official reports from various countries.
To gauge public engagement with fast fashion and sustainable fashion, the researchers identified the top fast fashion brands in each country, examining the number of online searches for these brands. Shein emerged as the most searched fast fashion brand across all analysed countries. For sustainable fashion, the study also looked at the frequency of searches for ‘thrift stores near me’ as an indicator of the public's interest in sustainable shopping options.
At the end of August (27-29), the National Exhibition & Convention Centre in Shanghai will host China’s premier textiles and apparel trade shows amid a backdrop of slowing consumption and economic growth.
The event features the Intertextile materials show, co-organized by the Chinese Textiles Chamber of Commerce (CCPIT-Tex), the Textile Information Centre of China, and Messe Frankfurt, which is celebrating its 30th anniversary in Asia. In March, Intertextile attracted nearly 3,000 exhibitors and 90,000 visitors from 116 countries, recovering from pandemic-related disruptions.
Intertextile will run alongside the Yarn Expo and Chic, a fashion and apparel show sponsored by CCPIT-Tex, the China World Trade Centre, and the China National Garment Association. Chic's March edition saw 158,000 visitors and 1,250 exhibitors showcasing 1,398 brands. Additionally, PH Value, a key knitwear market event, will also take place concurrently.
These trade shows come at a crucial time for China’s textiles and apparel market, which faces challenges from inflation affecting Western brands and declining domestic consumption. Despite this, the luxury and sportswear segments show some resilience. In response to the economic slowdown, China has recently introduced a short-term interest rate cut to stimulate growth.
Following a successful debut in 2022, global denim icon Wrangler has unveiled the second edition of its upcycled denim collection, Wrangler Reborn. This latest collection marks the brand's first collaboration with BVH Services' brand, Beyond Retro, a prominent vintage retailer in Europe known for producing trendy fashion with minimal carbon footprint.
Thoughtfully designed with circularity and sustainability at its core, the Wrangler Reborn collection features sustainable reinterpretations of some of Wrangler's classic styles, including the Greensboro Straight Leg Jean, Reworked Short, Icon Jacket, and Heritage Shirt. These pieces offer consumers timeless wardrobe staples that can be worn for years while also helping to divert textile waste from landfills. By reviving discarded denim and transforming it into durable apparel, Wrangler provides consumers with an opportunity to purchase high-quality, long-lasting pieces that can be repurposed and cherished.
The brand Wrangler has been creating durable and long-lasting products since 1947, helping to reduce waste in landfills. Aligning with the brand WeCare Wrangler goals, the Wrangler Reborn collection aims to create a better future through sustainable practices.
Despite experiencing negative financial performance in the previous quarter, Vishal Fabrics has shown signs of improvement, with the company's net sales rising toRs 411.51 crore in Q1, FY25, the highest in the last five quarters, indicating a positive trend in near-term sales.
The operating profit (PBDIT) for the quarter also hit a five-quarter high at Rs 30.16 crore, suggesting a positive trend in operating profit. Additionally, the company's operating profit margin peaked at 7.33 per cent.
However, the profit after tax (PAT) declined by 38.9 per cent Y-o-Y, amounting to Rs 6.52 crore. The near-term trend for PAT remains negative. Furthermore, the company's interest costs increased by 13.88 per cent Q-o-Q reaching Rs 11.65 crore, the highest in the last five quarters, indicating higher borrowings.
Overall, Vishal Fabrics delivered a mixed performance for the quarter ending June 2024.
Once synonymous with British heritage and timeless elegance, Burberry has faced turbulent times in recent years. While the brand has undoubtedly held a strong position in the luxury market, a series of strategic missteps has impacted its performance.
A fall from grace
Burberry's global market share in the luxury apparel segment has dipped from 3.2 per cent in 2015 to 2.7 per cent in 2023 reveals Euromonitor International. Revenue growth too has stagnated, hovering around the £2.8 billion mark for the past three years. And the company's stock price has plummeted by over 40 per cent since 2019.
Table: Burberry's financial performance
|
Year |
Revenue (£ million) |
Operating Profit (£ million) |
|
2019 |
2,813 |
519 |
|
2020 |
2,231 |
200 |
|
2021 |
2,828 |
539 |
|
2022 |
2,915 |
528 |
Burberry's challenges can be attributed to several interconnected factors. First, brand dilution as overexposure of the iconic check pattern has affected it. While it was once a symbol of exclusivity, it has become ubiquitous, diminishing its allure. The brand's attempts to appeal to a younger demographic has resulted in a diluted brand identity. The core luxury customer base feels alienated, while the new target market remains elusive. Also, the rise of luxury competitors, particularly those with a strong digital presence and agility, has eroded Burberry's market share. Then there are factors like global economic uncertainties and shifting consumer spending patterns have impacted luxury brands, including Burberry.
Strategic missteps
Over-reliance on traditional markets is a major factor for Burberry’s loss of market share. Burberry's focus on mature markets like Europe and North America may have blinded them to the booming luxury market in China. Add to this, frequent creative director changes (four in the last decade) might have resulted in a lack of brand identity and direction. Also, aggressive discounting and a large outlet network could be damaging brand perception and cannibalizing full-price sales.
Consider the contrasting fortunes of Burberry and Moncler. Both are European luxury brands, but Moncler has seen significant growth in recent years. Analysts attribute this to Moncler's successful focus on digital marketing and e-commerce, particularly in China. They've consistently offered fresh designs and diversified their product portfolio beyond outerwear. Moncler has cultivated a clear brand identity associated with luxury sportswear and adventure. Similarly, Louis Vuitton successfully expanded its product range while maintaining brand exclusivity through limited edition collections and collaborations with renowned artists. And Gucci reinvigorated the brand under Alessandro Michele by embracing a bold and eclectic aesthetic, attracting a younger demographic without alienating core customers.
A path to revival
Burberry has recently appointed a new CEO, outlining a turnaround plan. The new CEO, Fiona Kelly, has acknowledged the challenges and stated, "We are committed to reigniting the magic of Burberry...by focusing on our heritage, product excellence, and innovation." Analysts say here's what they need to focus on:
Capturing Chinese market: Increasing brand awareness and tailoring offerings to Chinese consumers' preferences.
Digital transformation: Investing in e-commerce platforms and social media engagement.
Product innovation and relevancy: Revamping core collections and exploring new product categories.
Rejuvenating the brand image: Building a more consistent and relevant brand story that resonates with younger generations.
The bottomline is Burberry's journey to recovery will require a steadfast commitment to redefining its brand identity, reconnecting with its heritage, and delivering exceptional customer experiences. By implementing the proposed action plan and learning from competitors' successes, Burberry can regain its position as a leading luxury brand.
The recently released Textile Exchange Materials Market report offers a comprehensive snapshot of the global fiber landscape, revealing a complex interplay of growth, sustainability challenges, and emerging trends.
A booming but resource-intensive market
The global fiber market is experiencing unprecedented growth. The report indicates a staggering increase in fiber production from 57 million tonnes in 2000 to 113 million tonnes in 2022. This exponential rise, driven by increasing global population and consumption, is projected to reach 149 million tonnes by 2030.
However, this growth comes at a significant environmental cost. Polyester, the dominant fiber, primarily derived from fossil fuels, constitutes 54 per cent of the market. While its affordability and performance properties have contributed to its popularity, the reliance on non-renewable resources raises concerns about sustainability.
Regional disparities in fiber consumption and production
The report highlights stark regional differences in fiber consumption and production. Asia, particularly China and India, is the epicenter of both fiber production and consumption. The region's rapid industrialization and growing middle class have fueled demand. In contrast, Europe and North America, while consuming significant quantities of fiber, are increasingly focused on sustainability and circular economy models.
Consumer power driving change
A pivotal force reshaping the fiber industry is the evolving consumer. Growing awareness of environmental issues, coupled with a preference for sustainable products, is driving demand for eco-friendly fibers. Brands are responding by incorporating recycled and organic materials into their offerings. Consumers are becoming more discerning, say experts, a sustainability consultant. They want to know where their clothes come from and how they are made. This is putting immense pressure on the industry to clean up its act.
Sustainability at the forefront
The future of the fiber industry is inextricably linked to sustainability. The report predicts a surge in demand for recycled fibers, driven by both environmental concerns and economic considerations. Technological advancements in recycling processes are expected to play a crucial role in scaling up production.
Additionally, there is a growing interest in bio-based fibers derived from renewable sources such as wood pulp and agricultural residues. While still a niche market, these fibers offer a promising alternative to fossil-based synthetics.
Policy initiatives for change
Government regulations are increasingly shaping the fiber landscape. Policies promoting sustainability, such as extended producer responsibility and carbon pricing, are encouraging industry to adopt eco-friendly practices. Governments have a critical role to play in creating a level playing field for sustainable fibers. By providing incentives and setting clear targets, one can accelerate the transition to a more circular economy.
Circular economy gains momentum
The concept of a circular economy, where resources are kept in use for as long as possible, is gaining traction in the textile industry. Textile-to-textile recycling is emerging as a key focus area, with companies investing in innovative technologies to break down and repurpose used garments. Closing the loop on textile waste is essential for the long-term sustainability of the industry, say experts. One needs to move away from a linear model and adopt circular principles at every stage of the value chain.
While the report outlines promising trends, challenges persist. Scaling-up production of sustainable fibers while maintaining affordability remains a hurdle. Additionally, ensuring the transparency and traceability of supply chains is crucial for building consumer trust.
Despite these challenges, the fiber industry is at a crossroads. The choices made today will shape the industry's future. By embracing sustainability, innovation, and collaboration, the textile sector can contribute to a more sustainable and resilient global economy.
