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Continuing to set new standards, Inditexregistereda 10.8 per cent rise in net profit increased to €1.294 billion during the first quarter of FY24.The company’s revenue for the quarter increased by 7.1 per cent rise to €8.15 billion.
Continouslyoptimisingits store network, Inditex is identifying new opportunities to boostgrowth across all concepts within Spain, states Oscar Garcia Maceiras, CEO. Moreover, the company achieved strong global sales across both physical and online channels during the quarter, emphasisesMaceiras.Its sales grew by 10.6 per cent during the quarter.
Besides enhancing product offerings, Inditex continues to optimise its store network through strategic new openings and refurbishments in prime locations across each market,elaborates Maceiras. In the current fiscal year, the company plans to invest around €1.8 billion in store expansion. It also plans to invest €900 million annuallyin enhancing its logistics capacity.
In Q1, FY24, the group reported a net increase in its store count for the first time since 2021. This included six net openings, in contrast to the 14 net closures reported in the first quarter of the previous year. By the Q1, FY24-end, the company was present in 5,698 stores in 214 international markets.
The company anticipates its gross retail space to grow by 5 per cent annually through 2026. Recently, the group has inaugurated its first stores in Uzbekistan and reopened 48 stores in Ukraine.
Chaired by Marta Ortega, the group also highlighted significant initiatives such as the launch of Massimo Dutti on the Chinese e-commerce giant JD.com and the rolling out of innovative security technology to eliminate traditional alarms.
In its latest report on the ‘Know Your Grower’ initiative in India and Pakistan, global textile sourcing solution Sourcery has emphasisedon the need for more precise, reliable, and fair data collection within the textile supply chain.
RuchitaChhabra, Grower Engagement Director, Sourcery, says, the company can achieve greater visibility by moving beyond inaccurate GPS data and utilising digital polygon mapping.
The company aims to empower growers to independently share data. Beneficial to both growers and manufacturers, the company aims to incentivise data sharing, especially in terms of financial rewards. It aims to create a future to empower every participant in the cotton supply chain through collaboration.
Sourcery gathers primary data on a commercial scale in the Indian states of Maharashtra, Madhya Pradesh, Gujarat, and Rajasthan, as well as the Punjab province in Pakistan. The organisation combines commercial investment with grower incentives and engagement to improve industry standards.
The Ministry of Chemicals and Fertilizers' recent Quality Control Order (QCO) on polyester staple fibers and various yarns, effective from July and October 2023 respectively, mandated procurement only from Bureau of Indian Standards (BIS) license holders. However, pending approvals for foreign manufacturers disrupted the supply chain, severely impacting manufacturer-exporters, especially those reliant on overseas markets for specialty fibers. This has hindered the man-made fiber (MMF) value chain's export performance. Similarly, the QCO for Viscose Staple Fibre (VSF) affected the VSF value chain, prompting industry pleas for exemption, particularly for exports.
In response to industry pressure, the Southern India Mills’ Association (SIMA) hailed the government's decision to exempt VSF imports under the Advance Authorization Scheme, effective March 2024. Additionally, the recent exemption for polyester staple fibers, filaments, and spun yarns under the same scheme, announced in June 2024, received appreciation. SIMA Chairman SK Sundararaman commended the reduced export obligation period from 18 to six months, easing constraints on MMF imports.
Sundararaman emphasized the significance of these policy changes in revitalizing MMF textile exports, crucial for achieving the textile industry's ambitious growth targets. He highlighted the industry's struggles, including higher raw material prices, which hindered India's competitiveness compared to countries like China and Bangladesh. Sundararaman urged the government to tackle structural issues, proposing a unified 5 per cent GST rate for the entire MMF value chain, alongside measures to ensure uninterrupted raw material supply.
While lauding the removal of anti-dumping duties and import duty reduction on MMF, Sundararaman emphasized the need for comprehensive reforms to propel India's textile industry forward. Addressing these concerns, including duty inversion and GST rates, he asserted, would not only bolster exports but also enhance access to affordable clothing for millions of Indians, while invigorating the industry and fostering economic growth.
The ITM 2024 Exhibition in Istanbul has emerged as a resounding success, attracting thousands of visitors from a staggering 94 countries within its initial three days. Hosted by the collaboration of TeknikFuarcılık AS., Tuyap Tum FuarcılıkYapım AS, and Temsad, this international textile machinery showcase commenced on June 4th, unveiling cutting-edge innovations and fostering lucrative partnerships.
The event showcased the prowess of the global textile technology leaders, providing an unparalleled platform for product launches and collaborative ventures. The diversity of attendees, ranging from Sri Lanka to Uruguay, Mauritius to Mongolia, underscores the exhibition's widespread appeal and significance in the textile industry.
Notably, the strategic choice of Istanbul as the venue enhanced the exhibition's international flavor, facilitating cross-border collaborations and overcoming visa barriers prevalent in European exhibitions. Exhibitors lauded the opportunity to engage with clients from diverse markets like Pakistan, India, and Bangladesh, culminating in machinery sales and robust partnerships.
With its remarkable success in attracting a diverse array of visitors and fostering global collaborations, ITM 2024 sets a new benchmark in the textile industry's exhibition landscape, poised to break records in both attendance and participation from countries worldwide.
Energy costs, constituting up to 15 per cent of turnover for textile finishing companies, are a significant economic burden. To address this, Karl Mayer Group has introduced Cascade, an innovative system designed to slash energy consumption in the drying processes of its Prosize sizing machines and Bluedye dyeing systems.
Cascade leverages steam as a heating medium in cylinder dryers, offering substantial energy savings and reduced carbon dioxide emissions. By recirculating process steam within the machine, Cascade significantly lowers the need for fresh steam. According to Karl-Heinz Vaassen, Head of Textile Drying at Karl Mayer, this approach enables "genuine, efficient energy recycling."
The financial benefits are notable. A 14-cylinder dryer running 7,000 hours annually in the Asian market can save up to $17,000 per year. The system's dashboard provides real-time data on steam circulation, allowing precise tracking of energy and carbon dioxide savings.
Cascade operates by utilizing the pressure drop across the dryer sections. The highest pressure in the first section condenses steam without temperature loss, and the hot condensate is fed into a flash tank, generating vapor exhaust through pressure reduction. Instead of being wasted, this "freshly recycled steam" is used to heat the second cylinder section after mixing with live steam.
This patented system, integrated into Prosize machines from January 2024, debuted at ITM 2024 in Istanbul to great acclaim. The first upgraded machine will be delivered to a European manufacturer in the second quarter of 2024. Future plans include extending Cascade to other dryer types and the Bluedye system.
Berlin Fashion Week (BFW) and Copenhagen Fashion Week (CPHFW) have joined hands in an innovative partnership aimed at accelerating sustainability efforts within the fashion industry. The collaboration, introduces the Sustainability Requirements framework pioneered by CPHFW to Berlin Fashion Week, making it a mandatory criterion for show brands. This strategic move aligns the sustainability endeavors of two influential fashion hubs, marking a pivotal moment for both the Nordic and German fashion markets.
Supported by a grant from the Berlin Senate Department for Economic Affairs, Energy, and Public Enterprises, and executed by Fashion Council Germany in collaboration with Studio MM04, this initiative signals a significant leap towards establishing Berlin as a leading global destination for responsible and innovative fashion. Michael Biel, State Secretary for Economic Affairs, emphasized Berlin's commitment to sustainability, highlighting the city's investment of 180,000 euros until 2025 to foster a culture of eco-consciousness and innovation.
Scott Lipinski, CEO of Fashion Council Germany, expressed pride in partnering with Copenhagen Fashion Week, renowned for its sustainability initiatives. By integrating the Sustainability Requirements, Lipinski underscores the commitment to higher ethical standards and serves as a beacon for responsible practices within the industry.
CecilieThorsmark, CEO of Copenhagen Fashion Week, hailed the partnership as a significant step towards industry alignment and urged fashion weeks and councils worldwide to embrace collaborative efforts for positive change. The joint venture aims to onboard approximately 35 brands onto the official Berlin Fashion Week show schedule, with the Minimum Standards becoming a mandatory criterion by February 2026.
The Sustainability Requirements, introduced by Copenhagen Fashion Week in 2020 and updated in 2024 to reflect industry advancements and EU policies, have garnered global recognition. With initiatives like the government-funded program "FremtidensTekstiler," which selected the framework for SMEs, the fashion industry is poised to undergo transformative change towards a more sustainable future.
Early summer sales figures for US apparel chains offer a glimpse into consumer spending habits. While reports from big-box retailers paint a mixed picture, mall-based apparel chains are showing signs of a comeback.
Mall revival with focus on fashion freshness The story of US apparel retail is one of contrasting fortunes. Mall-based chains like Abercrombie & Fitch (A&F) and American Eagle Outfitters (AEO) are expected to see continued revenue growth, with on-trend styles like wide-leg pants. Gap Inc. also anticipates a modest increase in comparable sales, hoping its focus on in-season trends will drive full-price purchases.
This optimism stems from data provided by Columbia Threadneedle Investments, where senior analyst Mari Shor highlights a trend of "share gainers and losers" – brands capitalizing on fresh styles are pulling ahead, according to. “We're seeing positive signs in traditional apparel, fueled by exciting new styles like wide-leg pants," says Shor. "While overall category growth remains slow, there's a widening gap between successful and struggling brands." This renewed focus on fresh styles aims to attract shoppers this summer, while cleaner inventories allow retailers to offer fewer discounted items, boosting profit margins.
Value reigns supreme
However, the apparel market isn't a monolith. Consumers are hesitant to splurge on discretionary items like electronics and furniture, favoring value over premium. This trend benefits discount giants.
Walmart: Leads the US apparel market with a dominant market share, followed closely by Target, according to GlobalData. Their recent strong quarterly results highlight the appeal of value-driven apparel.
Off-price retailers: TJX Companies (TJ Maxx, Marshalls, etc.) and Ross Stores also reported solid results, collectively capturing 5 per cent of the US apparel market share as per GlobalData. Gap's Old Navy brand holds a smaller 1.3 per cent share. This suggests a consumer focus on value, echoing the strong performance of Walmart, the overall market leader.
Walmart CEO John Furner emphasized apparel and online fashion as bright spots during their earnings call. Conversely, Target's overall performance was disappointing, with apparel being a rare positive. “This suggests a potential shift towards a more balanced spending pattern between essential and non-essential items in the coming years,” said Target CEO Brian Cornell during his earnings call.
Picky yet resilient consumer
US consumer confidence remains relatively stable despite inflation concerns. A strong labor market provides some financial buffer, contributing to sustained retail sales in recent months. "Consumers have become more selective in their purchases, leading to a mixed bag of winners and losers in the retail landscape," explains Neil Saunders, Managing Director of GlobalData.
Investors meanwhile are closely watching brand-specific performance. A&F, whose stock has grown nearly 70 per cent this year, is expected to report strong Q1 earnings. AEO and Gap are also in focus, with Gap hoping to break a five-quarter sales decline streak by offering in-season merchandise at full price. While cleaner inventories and a focus on trendy styles bode well for these brands, the overall picture remains uncertain.
Kering, a leading luxury goods conglomerate, has appointed Laurent Claquin as its Group Chief Brand Officer, effective July 1st, 2024. This strategic move, under the helm of Deputy CEO Jean-Marc Duplaix, signifies Kering's commitment to fortifying its corporate brand identity and expanding its global footprint.
Claquin's tenure as President of Kering Americas since 2012 and his extensive leadership experience within the group, including roles in communications and corporate social responsibility, position him well for this pivotal role. His mandate encompasses synchronizing Kering's communication strategies across diverse regions, leveraging a unified editorial calendar, and spearheading high-profile events to bolster brand initiatives.
The creation of this role underscores Kering's ambition to maintain consistent messaging across all touchpoints, amplifying brand visibility and influence. Claquin's multifaceted background, spanning luxury retail and cultural institutions, equips him to navigate the complexities of Kering's diverse portfolio. His appointment reflects Kering's dedication to strategic growth and brand excellence in the dynamic luxury landscape.
Cascale, formerly known as the Sustainable Apparel Coalition, is set to host its Manufacturer Forum: Shanghai on June 28 at the Shanghai New International Expo Center. This event is part of an annual series designed to amplify the voices of global manufacturers, focusing on local challenges and providing solutions through Cascale’s Higg Index tools and various impact initiatives. The forum is held in collaboration with ISPO Shanghai, a prominent summer trade show.
Following successful events in Bangalore, Dhaka, and Shenzhen, the Shanghai forum aims to foster pre-competitive collaboration, share best practices, and address critical industry challenges. Keynote speakers include Cascale's new CEO, Colin Browne, and Scott Raskin, CEO of Worldly, Cascale’s technology partner and event sponsor.
Colin Browne emphasized that China stands as a leading production hub, with its manufacturers playing a pivotal role in driving transformative changes. He highlighted their essential contribution to combating climate change and ensuring decent work conditions, underscoring their importance in achieving shared goals. Browne's primary focus is on fostering global collaboration with manufacturers to develop solutions that will revolutionize the consumer goods industry.
Scott Raskin noted that many of Worldly's customers are Chinese manufacturers. He explained that the forum would enhance their collaboration by providing these manufacturers with advanced tools and insights to achieve their sustainability objectives.
The event, themed “Catalyst for Change,” is expected to attract over 200 attendees. It will cover topics such as global policy, strategic partnerships, Higg FEM evolution, decarbonization impacts, and Science-Based Targets training for decarbonization. Sponsors include Worldly, Benchmarks, TÜV Rheinland, ESTS Global, and Stantec.
Lenzing Group, a global leader in wood-based specialty fibers, has partnered with tech start-up Exponent Envirotech to launch Ecohues, an innovative waterless dyeing technology. This breakthrough is now applied to Lenzing'sTencellyocell and modal fibers, as well as LenzingEcovero viscose fibers, marking the first time Ecohues has been used on cellulosic fibers. The collaboration also includes Hong Kong-based knitwear manufacturer Cobalt Fashion, aiming to bring this sustainable dyeing method to the mainstream textile market.
Ecohues offers a significant environmental advantage by using a non-aqueous solvent that is 99.8 per cent reusable, reducing water usage by 95 per cent compared to traditional methods. Traditional dyeing processes require about 120 tons of water per ton of yarn, while Ecohues eliminates this need, streamlining pre-treatment and finishing processes, and reducing dyeing time from 12 hours to 6-8 hours. The technology also cuts out the use of salt, a common dyeing assistant, reducing the salinity in wastewater. It saves 40 per cent on dyestuff and ensures a color fixation rate of over 97 per cent, outperforming traditional dyeing.
Rex Mok, Director of Technical Marketing and Development at Lenzing, highlighted the company's commitment to sustainability, stating that the collaboration is a step towards reforming conventional textile practices. Wesley Choi, Chairman of Exponent Envirotech, emphasized the project's alignment with sustainable production and responsible materials.
The knitwear collection, produced by Cobalt Fashion using Lenzing'sfibers dyed with Ecohues, exemplifies how this technology can enhance performance while meeting consumer demand for style and sustainability. Andrew Dixon, SVP of Merchandising at Cobalt Fashion, stressed the importance of this partnership in reducing carbon emissions and water usage, paving the way for a more sustainable textile industry.
