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Vietnam’s labor costs are rising. Hence, international apparel makers are slowing down and in some cases, completely halting expansion in the country. Some are now focusing on Indonesia, which is expected to become a significant production base in three to five years.
Manufacturers are worried the US-China trade war will further push up labor costs since tech giants are shifting production out of China to avoid US tariffs. Vietnam has traditionally attracted foreign manufacturers due to its low-cost labor and availability of natural resources but its low cost appeal is waning. Its minimum wage grew at an average of 8.8 per cent a year between 2015 and 2019, making it one of three countries with the highest minimum wage growth in southeast Asia. This, together with robust economic growth and the rising costs of living risks exacerbating regional wealth inequality, has emboldened workers to demand for higher minimum wages. Vietnam raised its minimum wages by an average of 5.3 per cent last January. Along with rising costs, one of Vietnam’s weaknesses is the lack of skilled workers. It is far behind China, Singapore, Malaysia, and Thailand in this aspect at a time when developing a highly skilled workforce is critical for attracting FDI into value-added industries.
"The Japan Observatory - a convergence of specially selected Japanese companies in business booths; totaling 30 companies and groups, alongside PR and Trend booths will showcase new trends and an index presenting highlighted fabrics at Milano Unica 2020 AW."
The Japan Observatory - a convergence of specially selected Japanese companies in business booths; totaling 30 companies and groups, alongside PR and Trend booths will showcase new trends and an index presenting highlighted fabrics at Milano Unica 2020 AW.
The new exhibitors at the exhibition include
Fubisya Co: A weaving studio in Fukui Prefecture; Fubisya Co produces woven silk clothes used for clerical garments worn by monks (known as ‘KESA’ in Japanese). The company sells original leno fabrics woven by six rapier looms. Its fabrics normally centre on leno weave using polyester, but it has now developed a weave with silk-cashmere to showcase this time and further present a weave of 70 per cent tri-acetate/30% polyester alongside.
Showa Co: Showa Co will showcase fabrics retaining sustainability/eco-conscious elements such as selvage
denim that is vegetable dyed on organic cotton and organic wool denim honoured with the PV Award, alongside union denim made of wool and cotton for the autumn/winter season.
The company will present products including: selvage denim (using 60/4 yarn) and stretch denim (using 60/4 yarn), alongside 100 per cent silk denim. Other line-ups will comprise a wide-ranging variation: double-faced denim using double gauze (80 single yarn), nylon denim, as well as sample items featuring lamé prints and/or laser processing.
Toban Textile Co: Toban Textile Co will showcase a fabric with an expressive surface feel; creating an uneven touch derived from the yarn characteristics, belying its seemingly plain appearance, alongside a 100% cotton fabric processed to give a pigskin touch. In their own words: ‘We produced a fabric using natural fibres with a leather-like appearance.
Their sustainable fabrics comprise; organic cotton, recycled cotton and WASHI fabric. They have also developed and successfully produced yarn-dyed 100% cupro (spun) in volume, although fine-count methods normally weaken yarns, hindering mass production. They will further present developed items; covering thickness from a thin shirt-like material to thick fabric alongside double-weave gauze and union cupro/wool cloth.
Toyoshima & Co: With the high demand for sustainable fabrics in European markets in mind, Toyoshima & Co will showcase filament type textile/knits using ‘Tencel’ lyocell alongside spun type for menswear/ladieswear, all of which are produced in the textile regions of Hokuriku, Bishu and Tohoku.
The company will equally introduce ‘Orgabits’ related fabrics at Milano Unica, as part of its contribution to global environmental protection. Its other project to recycle and reutilise food waste, namely ‘food textile, has been already acclaimed via sales in Europe and it will further showcase knits leveraging food waste and using tomatoes, cabbages, coffee and cherries.
Chugai Kunishima Corporation: Chugai Kunishima Corporation decided to participate in Milano Unica to further expand its sales channels. The company will showcase two different types of line-ups comprising 50 itemsd. One involves fabric for menswear, using fine-yarn-count wool. The other type is casual fabric for high-end brands; a blend of linen and wool and piece-dyed, so that only wool is dyed while the linen part remains white and appears as a design. They refer to it as a fabric likely to exist but as yet unseen. When they make a striped pattern, for example, unique stripes in gradation emerge, as if drawn by chalk. They will equally propose other fabrics for unisex use; one with an uneven feel by washer finishing and an original design textile tactfully produced by weaving and finishing techniques.
"The 8th edition of HGH India 2019, the annual trade show for Home Textiles, Home Décor, Gifts & Houseware in India, was inaugurated by Shantamanu Development Commissioner, Handicrafts along with Arun Roongta, Managing Director of HGH India and other dignitaries from the industry."
The 8th edition of HGH India 2019, the annual trade show for Home Textiles, Home Décor, Gifts & Houseware in India, was inaugurated by Shantamanu Development Commissioner, Handicrafts along with Arun Roongta, Managing Director of HGH India and other dignitaries from the industry.
HGH India 2019, being held from July 02-04, 2019 at the Bombay Exhibition Centre in Mumbai, connects 700 brands and manufacturers from 32 countries with over 35,000 retailers, brand representatives, distributors, importers, as well as institutional and trade buyers.
One of the highlights of the exhibition includes the presence of international brands from Turkey, Europe, USA,
UAE, UK and over 75 exhibitors from China brought through the Zhejiang Broad International Convention & Exhibition Co. Well-known Indian brands are also showcasing a wide range of innovative products in the home textiles, home décor, houseware, and gift space.
Shantamanu, Development Commissioner, Handicrafts, says, “HGH India focuses on the artisans, craftsmen, carpet weavers and handicraft workers. Trade shows like this help in providing exposure to them and watching the biggest names of the industry together on one unified platform, helps them understand the kind of opportunities available. While HGH stands for Home Décor, Gifts and Houseware, for me it stands for Higher, Go Higher.”
Arun Roongta, Managing Director, HGH India, says, “the exhibition is a testimony to the entire home product industry’s trust in the trade show and we are confident that it will be another successful year for all our patrons, accelerating the growth of the home textile, home décor, houseware and gift industries.”
"A study by the NPD Group in 2018 titled, ‘The Denim Evolution’ reveals, despite stiff competition denim remains a highly popular category with activewear having 24 per cent of total apparel sales while sales of men’s and women’s jeans making up 25 per cent sales. As per the study in 2018, American women spent $8.8 billion on jeans, a growth of 6 per cent over previous year."
A study by the NPD Group in 2018 titled, ‘The Denim Evolution’ reveals, despite stiff competition denim remains a highly popular category with activewear having 24 per cent of total apparel sales while sales of men’s and women’s jeans making up 25 per cent sales. As per the study in 2018, American women spent $8.8 billion on jeans, a growth of 6 per cent over previous year.
The report also notes that despite the introduction of new apparel styles, denim holds a major share in bricks-and-mortar sales. Driven by its fits, price and comfort, around 70 per cent consumers prefer buying jeans at physical stores rather than online.
Adequate representation of the denim category
According to Marshal Cohen, an NPD retail analyst, despite their robust growth, denim
brands needs to introduce new styles and designs. He cites the examples of retailer Debbie Rudoy, whose shop in New York has 30 per cent of its space dedicated to denim with brands including Mother, Frame, CQY and L’Agence. According to Rudoy, denim will remain the top choice of consumers if retailers represent the category well. These retailers should direct their shoppers to brands that will give them a superior fit in order to create long-term customers.
Offering novelty to their customers
Los Angeles–based designer Rik Guido seconds her opinion. According to her, denim brands need to offer more novelty to their consumers. She validates her statement with the introduction of a new denim brand named La Forme. The brand has created a new denim that though looks like an indigo jean but fits and feels like yoga pants. It is made from an Italian fabric that is 86 percent performance cotton and 16 percent polyester/spandex, retailing for $68 to $88.
Cohen says, the denim sector holds a lot of potential if entrepreneurs are able to satisfy the needs of their customers. According to him, instead of manipulating their consumers, brands should try to evolve with them.
"ROICA™ - the pioneer of innovative stretch fibers, will display five unique yarns groups under the themes of Heritage, innovation and lifestyle at Interfiliere 2019. The Heritage theme will focus on the ROICA Eco-Smart™ family which offers two new sustainable solutions. The first includes ROICA™ EF, a premium stretch fiber consisting of recycled content with GRS certification."
ROICA™ - the pioneer of innovative stretch fibers, will display five unique yarns groups under the themes of Heritage, innovation and lifestyle at Interfiliere 2019. The Heritage theme will focus on the ROICA Eco-Smart™ family which offers two new sustainable solutions. The first includes ROICA™ EF, a premium stretch fiber consisting of recycled content with GRS certification. The second is ROICA™ V550, a sustainable premium stretch fiber certified by the Cradle to Cradle Certified™ Gold Level for Material Health product and ingredients for biological cycle.
Also featured in this area are innovations from ROICA Feel Good™ family of yarns including the unique odour neutralising ROICA™ CF yarn and the ROICA Color Perfect™ range which offers world-first sustainable color solutions.
As part of the “ROICA™ ‘Innovation’ gallery, ROICA™ will explore topics around well-being, tactility,
comfortable wearability, advanced colour technology, lustre and performance. A full suite of innovations will be on show including examples from ROICA Colour Perfect™, ROICA Resistance™, and a special focus on ROICA Eco-Smart™ and ROICA Feel Good™ family.
The ‘Lifestyle’ area displays revolutionary and technologically advanced yarns and fabrics with a fresh approach to its style of ‘doing business’. The area features the following brands:
COSABELLA produced by Collezioni SRL: The brand sells in over 100 countries, with a premium collection of 2000 styles for every sector of lingerie and leisurewear. Latest styles use a delicate floral lace by Tessitura Colombo Antonio made with ROICA™ V550 belonging to the ROICA Eco-Smart™ family for their more luxurious upscaled lines.
Livy selects Iluna Group’s contemporary graphic stretch lace with ROICA™ EF for the precious “BELLAGIO” line that includes a soft triangle bralette, a padded bra, a brief and a body for optimal comfort. The must-have range has a stunning aesthetic which represents the unique appeal of this lifestyle brand”.
Sarah Borghi: The worldwide luxury Italian fashion brand offers hosiery, tights, and socks. It scrutinises the finest yarns and evolving technologies to breath flawless life into its unique range of luxurious fashion. The brand has developed the first line made out of sustainable ingredients that will be launched at the ROICA™ booth during Interfilière.
Vitamin A: The Californian brand offers a swimwear made with sustainable high-performance fabrics including a unique jacquard development by Maglificio Ripa with a 3D texture made with the GRS certified premium responsible stretch ROICA™ EF and Q-NOVA® by Fulgar.
Wolford: This is one of the first brands to explore the real value of ROICA™. Known for its exceptional European Skinwear including legwear, lingerie and bodywear, the company has been striving to develop fully degradable items at the end of the product lifecycle.
"A new report, Economic Development in Africa 2019, by the United Nations Conference on Trade and Development (UNCTAD), the Rules of origin may have a deep impact on African Continental Free Trade Area (AfCFTA). As these rules specify the criteria needed to determine the made-in label for a product, they will boost the economic well-being of the continent. However, for this they need to be formulated in a simple, transparent, business friendly and predictable manner."
A new report, Economic Development in Africa 2019, by the United Nations Conference on Trade and Development (UNCTAD), the Rules of origin may have a deep impact on African Continental Free Trade Area (AfCFTA). As these rules specify the criteria needed to determine the made-in label for a product, they will boost the economic well-being of the continent. However, for this they need to be formulated in a simple, transparent, business friendly and predictable manner.
AfCFTA to boost intra-African trade by 33 per cent
The UNCTAD data for 2015-2017 notes AfCFTA has the potential to change the intra-continental trade which
currently constitutes only 15 per cent of commerce in Africa, compared to around 47 percent in the Americas, 61 per cent in Asia and 67 per cent in Europe. If fully implemented, it could increase the GDP of most African countries by 1 to 3 per cent once all tariffs are eliminated.
The AfCFTA will also boost the intra-African trade by 33 per cent once full tariff liberalisation is implemented, attracting additional intra-African investments and creating market opportunities to foster Africa’s industrialisation through regional value chains, according to the report. However, many of these gains could be undermined if rules of origin are not appropriately designed and enforced to support preferential trade liberalisation
Rules of origin have ensured the success of many trade agreement negotiations over the years, including the North American Free Trade Agreement and Central American Free Trade Agreement. However, these rules have also at times invited contrasting views from various economists. While some argue that the role of these rules should be confined to the authenticating the origin of goods, others believe that the negotiations for these rules are often inundated by lobbying and protectionist pressures.
Trade preferences to help develop regional value chain
As per the report, the best way to approach this dilemma is to use AfCFTA to enhance the consistency of trade policy with industrial policy objectives and the continent’s transformation agenda. These rules are not an industrial policy tool and should not be crafted or used to build non-tariff barriers around regional suppliers.
Rather than importing, AfCFTA member countries can source more intermediate and final goods among themselves by granting each other trade preferences. This would not only develop regional value chains but also build manufacturing capabilities in Africa.
Proper design and implementation to ensure success of rules
However, for companies to utilise these trade preferences, these rules of origin need to be designed and implemented properly. If they are made too costly or complex, firms could choose to trade with partners outside the AfCFTA. Another option is that companies might stick to trading only within existing regional economic communities, with few incremental gains arising from consolidating the regional market.
These rules should also consider the production capacities and infrastructure across the broad set of countries, including the Least Developed Countries (LDCs) that face challenges in making use of preferential tariffs and implementing origin requirements.
The global wool yarn market is growing at four per cent a year. Wool yarn is used to manufacture curtains, carpets, etc. The increasing preference for upholstery fabrics among consumers to enhance the appearance of their home interiors is creating a lucrative impact on the wool yarn market. The textile market has been growing at a significant rate. Owing to this, textile manufacturers are demanding raw materials such as wool yarn. Thus growing textile industry is acting as an influencing factor for the global wool yarn market. Increasing consumption of wool in end-use industries, especially in regions such as Europe and Asia Pacific, is set to boost cloth production, which is expected to increase the demand for wool yarn. The increased penetration of online retailing in the clothing sector is indirectly driving market growth. Even with the reduction in overall wool production, the trade in yarn, apparel, and textile items has grown. This is expected to drive the demand for wool yarn from clothing and textile industries.
India is working on persuading growers to focus on wool production rather than meat production. Production in such countries is further backed by the availability of cheap labor. Hence a considerable amount of wool yarn produced in India is exported to international markets.
German textile and clothing companies have made 2.5 percent more sales in the first quarter of this year. The number of employees rose year on year by 1.5 percent. The German textile and clothing industry has about 1 400 companies and 135 000 employees and is the second largest consumer goods industry in Germany. Exports increased by 9 per cent last year, while the sales declined due to a crisis in the German fashion retail.
German brands are leaders when it comes to excellent design and value. Worldwide, German companies produce according to best environmental and social standards. The medium-sized companies in the German textile industry assert itself worldwide with high quality.
Indian technical textile market is expected to witness substantial growth from 2016 to 2024. The government of India has launched various support schemes for textile and apparel manufacturers to make them globally competitive. The schemes target technology up-gradation, infrastructure development, export promotion etc. Various state governments have also announced their textile policies aimed at attracting investments in their states.
However, several measures still need to be undertaken and prioritised to facilitate the growth of the overall technical textile industry in India and help in the growth of India as a global manufacturing hub. Some of these measures include: establishing regulatory norms for mandatory usage of technical textile items in specific industries to increase their consumption, developing exclusive HSN codes for identifying high growth products for further development, establishing and implementing Indian standards for developing high quality products of global acceptance, improvement of operational standards, focus on training and education and creating end user awareness for increasing domestic demand for high end technical textile products.
Besides the above measures, few specific measures need to be undertaken for developing India as a global manufacturing hub including measures to attract investments from domestic and global players, forming partnerships with global players for acquiring technical know-how, the creation of mega parks to attract large-scale investments and focus on R&D initiatives.
Textile firm Welspun India has received preliminary court approval for settlement of its litigation in the US with regards to labelling and marketing of Egyptian cotton products. In May this year, Welspun India had announced that company and its subsidiaries, which have been facing litigation in the US surrounding its premium cotton home textile products, have entered into a settlement agreement in the US.
The settlement agreement provides monetary payments to settlement class members not exceeding $36 million (about Rs 250 crore). The company has agreed to increase payouts to individual settlement class members without increasing the aggregate $36 million settlement cap.
As per statutory procedure, the settlement agreement is subject to final approval and review by the appropriate courts in the USA. Welspun had reported a consolidated loss of Rs 78.43 crore for the quarter ended March 31, 2019, due to exceptional expense of Rs 224.01 crore related to settlement of litigation in the US with regards to labelling and marketing of Egyptian cotton products.
