With fluctuating global cotton prices, a drop in consumer spending due to economic slowdown and high inflation, research agency IBISWorld has updated its report on the Global Apparel Manufacturing industry. The study is however optimistic that increasing population and disposable incomes will push up growth of the industry in the next five years.
The report says, after several years of strong revenue growth, the global apparel manufacturing industry suffered weak demand conditions in 2009. As recession hit, demand for high-priced apparels declined in Europe, the US and Japan. While demand for apparels in emerging markets, such as China, continued to grow during this period, it did little to buffer the industry from the effects of the global recession. As a result, revenue dropped 13.8 per cent in 2009 and has declined at an annualized rate of 0.2 per cent over the five years to 2013. IBISWorld estimates that industry revenue will total $577.5 billion (Rs 36,52,110 crores) by the end of the year.
The report suggests that imports are expected to account for 76.2 per cent of demand and exports are expected to account for 75.4 per cent of industry revenue in 2013. Industry participants are continuously shifting manufacturing operations to low-wage countries or sourcing their products from independent contractors to minimize costs. China is the world's primary source of apparels, it accounts for 38.0 per cent of total industry exports. Other emerging countries, including India and Bangladesh, are growing their presence as key manufacturing regions.