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H&M’s 2019 Sustainability Performance Report released recently shows, the Swedish retail giant H&M sourced 97 per cent of its cotton from sustainable sources in 2019, as it moved one step closer to achieving 100 per cent sustainable cotton. The fashion retailer has also committed to stop sourcing conventional cotton for collections from 2020 onwards in a bid to accelerate its sustainability targets. By 2023, the company wants 100 per cent of its materials to be either recycled or sourced in a more sustainable way.
Among other things, H&M explored new circular business models with the launch of on-demand, customisation, repair and rental initiatives. New sustainable materials were introduced, such as the cellulosic fibre made by Infinited Fiber Company from recycled cotton textiles and Re:newcell’s ground-breaking Circulose.
There were also efforts to provide more transparency, with the brand disclosing viscose and other man-made cellulosic fiber suppliers. And 100 per cent of H&M’s textile and leather supply chain are now enrolled in the Zero Discharge of Hazardous Chemicals program which tackles the issue of hazardous chemicals in the global textile industry.
One of H&M’s latest initiatives is Treadler, a B2B service for external textile and apparel retailers announced in March. Initially working on a small scale, the service will give companies access to H&M’s global supply chain to help them overcome initial business barriers and accelerate sustainable change.
PVH Corp recorded both a fourth-quarter and full-year sales uptick in 2019, on the back of strong sales growth at Tommy Hilfiger. Sales of the New York-based company said full-year increased by 3 per cent, or 5 per cent on a constant currency basis, compared to 2018, reaching $9.91 billion for the year ending February 2.
Sales of its brand Tommy Hilfiger rose by 8 per cent increase, or 11 per cent on a constant currency basis, driven by outperformance in Europe and added revenues resulting from the company's acquisition of its Australian distributor, Gazal Corporation, in the second quarter.
International comparable store sales increased 9 per cent, while North America comparable store sales decreased 6 per cent, due to weakness in traffic and consumer spending trends, especially in stores located in international tourist locations.
Calvin Klein, however, witnessed a 2 per cent decrease, or 1 per cent increase on a constant currency basis, compared to the prior year, impacted by foreign currency conversion, and softness in Asia due to the Hong Kong protests, and trade tensions between the U.S. and China. International comparable store sales dipped 1 per cent, while North America comparable sales decreased 2 per cent, due to weakness in traffic and consumer spending trends, especially in stores located in international tourist locations.
VF Corporation, a global leader in branded lifestyle apparel, footwear and accessories, announced the appointment of Markus Hamm as vice president and general manager, Kipling EMEA, effective April 1, 2020. He will be based in Antwerp, Belgium where the brands’ marketing and sales operations are based and will report to Vera Breuer, global president Kipling.
Hamm has many years of market experience and a successful track record across Sales, Marketing and Digital, combined with excellent leadership skills. After joining VF in 2004, he held various key sales positions for Jansportand Eastpak, including sales director, DTC & strategic accounts director and most recently taking over wholesale, strategic accounts, sales operations and digital for the Eastpak brand.
In Kipling, Hamm will be responsible for leading the Kipling EMEA organisation, maximising business and financial objectives and overseeing the general execution for all functions.
Council of All Pakistan Textile Mills Associations and Pakistan Apparel Forum has urged its government to revive zero-rated sales-tax regime and reinstate SRO 1125 in its true spirit to address the industries’ liquidity problems. The associations also submitted their proposals for a relief package to demand government’s support and relief for textile industries in the covid-19 situation. They said that hardships of exporters in terms of liquidity would multiply in the presence of 17 percent sales tax.
Thus, restoration of zero-rating or exemption from sales tax was crucial, for which SRO 1125 should be revived in true spirit. Under current circumstances, the local markets were closed, the intention of the government to collect sales tax was not being achieved, and by continuing to collect 17 percent sales tax, the government was creating severe liquidity problems for the exporters.
President Donald Trump is reportedly prepared to announce a 90-day deferral on tariffs for certain apparel imports. The move, which comes amid a mounting COVID-19 pandemic crisis, would defer payments for most-favored nation duties and isn’t expected to apply to Chinese goods tariffed higher in the trade war. Most-favored nation, or MFN, tariffs are the highest rates countries agree to impose on other members of the World Trade Organization (WTO), for product groups like textiles, clothing and footwear.
Nearly 400 CEOs from major global companies sent a letter to President Trump recently imploring him to delay duty collection in light of the havoc coronavirus has already wreaked on businesses both stateside and worldwide. The request was for a 90- to 180-day deferral. The deferral the CEOs are seeking would help the companies preserve their cash flow at a time when funds have largely dried up with stores shuttered and sales stunted. Many retailers have already laid off workers or furloughed them, and executives are starting to take pay cuts.
The 90-day pause on import duties still awaits Trump’s approval, according to reports, but his sign off on some sort of deferral is expected.
Eurostat data shows the European textile and clothing manufacturing went through a difficult year in 2019, despite good retail sales and export performances. This trend will worsen in 2020 due to the Coronavirus outbreak. An ongoing Euratex poll with members show 80 per cent companies are already laying off workers; more than half of them expect a drop in sales and production by over 50 per cent.
The outlook for 2020 is expected to worsen due to the virus’ outbreak, as in March 2020 industry confidence fell dramatically. Euratex is conducting a survey among European companies: preliminary results indicate that more than half of the companies expect a drop in sales and production by more than 50 per cent. Moreover, almost 9 out of 10 companies face serious constraints on their financial situation and 80 per cent of companies is temporarily laying off workers. 1 out of 4 is considering closing down the company.
The Tirupur Exporters’ Association (TEA) says, garment industry in Tirupur, which has over 10,000 manufacturing units, is facing the worst time ever. The garment clusters that employ over 6 lakh people is staring at a loss of over Rs 10,000 crore in just three months. For both the small and big firms, the road to revival seems difficult.
As per Raja Shanmugham, President TEA revealed, Tirupur exports industry used to see a turnover of Rs 2,500 crore per month on an average, but the units have not yet received their payment dues for January and February. As COVID-19 affected the EU, Canada and other markets, the brands have not made our payments. Besides, the shipments released in March are right now on high seas or lying at the ports.
Even the domestic market, which is also worth Rs 2,500 crore a month, is affected. The business hub of Tamil Nadu is wearing a deserted look. The chances of its revival depend solely on government patronage as most firms have bank loans and insufficient working capital.
The association has requested the government for a moratorium of at least one year. “It’s clear that in next three months we won’t get any major export orders as coronavirus has battered economies globally. It has also requested the government to infuse at least 25 per cent of working capital into the industry.
Madewell has announced long-term commitments to further its sustainable practices across key areas of the business and in connection with Earth Day in April. The brand’s sustainability initiatives include production, supply chain, retail and corporate culture, as the company deepens its commitments to better materials, its existing Fair Trade USA partnership, packaging and carbon usage.
Several goals and commitments were announced for 2025 and 2030. For starters, 100 per cent of key fibers used in all of Madewell’s materials will be sustainably sourced and free of virgin plastics, including more sustainable cotton, synthetics, cellulosics, wool and leather. To date, 60 per cent of Madewell’s spring collection incorporates sustainable materials.
Madewell will continue to expand its partnership with Fair Trade USA and will have at least 90 per cent of its denim confirmed as Fair Trade Certified. Madewell added four Fair Trade Certified denim factories in the past few months and has now nominated 10 additional factories to be certified in the near future. Among the existing ones is the Saitex factory in Vietnam, which prioritizes renewable energy, washes efficiently, air dries and turns its manufacturing waste into bricks for affordable housing.
In addition, 100 per cent packaging materials will be sustainably sourced and free of virgin plastics by substituting recycled and alternative sources. Madewell will also ensure that all operations in company-owned and operated facilities are carbon neutral by 2030.
To kick off these commitments, Madewell has added new Spring styles to the brand’s Do Well Shop featuring sustainably made pieces to Fair Trade certified denim. They include a tie-dyed jean jacket, denim short overall, a midi dress and cardigan.
ACT signatory brands have expressed their commitment to maintain responsible business practices and social dialogue with union representatives from IndustriALL Bangladesh Council (IBC) and the Bangladesh Garment Manufacturers and Exporters Association (BGMEA), amid the corona virus outbreak.
In majority of garment factories in Bangladesh, workers are yet to receive their due payments for March. Union leaders in the IBC stress that workers are vulnerable, as many factories are closing over fears of the virus outbreak, and in some cases laying off workers.
The IBC is urging brands to pay for orders that are wholly or partially completed, and if possible to consider paying in advance. According to BGMEA, 907 million apparel pieces worth $2.87 billion have been cancelled or suspended by brands and buyers that source from Bangladesh. This has a direct impact on the 2.09 million workers in the country’s textile industry.
If brands don’t take ownership of items already produced and ready to be shipped and pay at least the production cost of orders in the process of being manufactured, it will be nearly impossible for employers to pay workers’ wages.
Major U.S. retailers Macy's Inc , Kohl's Corp and Gao plan to furlough tens of thousands of employees, as they prepare to keep stores shut for longer to curb the spread of COVID-19.
Kohl's would also suspend its share repurchase program, evaluate its dividend plan and draw down $1 billion from an existing credit line, joining a growing list of companies seeking to shore up their cash reserves to weather the financial hit from the health crisis.
Macy's and Gap have suspended their dividends and have also tapped into their credit facilities. Kohl's furloughed employees would continue to get health benefits. Macy's specified that employees enrolled in health benefits will continue to receive coverage, at least through May.
Macy's would maintain the "absolute minimum" workforce needed to maintain basic operations across its Macy's, Bloomingdales and Bluemercury brands. The retailer would have fewer furloughs in its digital business, supporting distribution centers and call centers, while Kohl's would start buy online and pick up-at-store services later this week.
