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| Issue date:07/12/2009 |
| ATA Journal for Asia on Textile & Apparel - Dec 2009 Issue |
| Source:Journal for Asia on Textile & Apparel |
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| As signs of economic recovery were witnessed and confidence cautiously returned in recent months, issues like new market potential, product development and production optimization have become hot topics to discuss in the manufacturing sector. According to some industry veterans, Chinese consumers, online selling and eco-friendly apparel are expected to characterize the new era of the textile and apparel industry, Michelle Phong reports |
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| Vincent Fang (far left) observed that Asia is less impacted by the global financial crisis |
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Asia offers opportunities
Asia, is the world's largest and most populous continent with approximately 4 billion people or 60% of the world's human population. It is believed to be a strong market in coming years.
Wealth is created in the Asian region as globalisation intensifies, said Vincent Fang at the Interstoff Asia Essential exhibition held in Hong Kong in October 2009. Mr Fang is a legislative councillor representing the wholesale and retail functional constituency of Hong Kong; he is chief executive of Toppy Company (Hong Kong) Limited.
This part of the world is less impacted by the global financial crisis following the credit crunch, Mr Fang said. Moreover, some governments in Asia have further bolstered domestic consumption with various economic measures to reduce adverse impacts brought by the crisis.
In fact, a new global economic landscape is taking shape. Replacing the so-called G7 trade bloc, the Group of Twenty (G-20) is an informal forum involving developed and developing economies to discuss issues related to the global economy.
China is now the third largest economy in the world with a gross domestic product (GDP) of RMB 30.067 trillion in 2008 (or US$4.4216 trillion), after only the United States and Japan, according to the Chinese National Bureau of Statistics (NBS).
"The strong economic strength will sustain consumption in China, and the country's apparel imports are on the rise at an annual growth rate of some 30% from US$30 billion in 2006 to US$42.8 billion the following year, and US$35.4 billion in the first eight months of 2008. Renminbi has appreciated about 15% in the last three years," said Mr Fang.
The latest economic figures announced by the NBS of China in October 2009 appeared to support the optimists. The expansion in China's economy in the third quarter of 2009 was 8.9%, faster than the 7.9% growth rate in Q2, and the authorities were quite confident in achieving its target of a yearly GDP growth at 8%. The relatively loose economic policy remained in force.
Mr Fang believes that China potentially will be the biggest buyer of apparel in future, meaning that business opportunities are there for textile and apparel manufacturers. A lack of apparel variety in the country presents business chances, e.g. in the segment of female executives. New comers of the apparel retail market can work on service quality to impress consumers who welcome fashion updates and advice on building up personal image.
Possible challenges for entering China's retail market include: inconsistency in regulations across provinces and bureaucracy; the lack of intellectual property rights remains common; service industry in the nation is in its infancy, making it challenging to constantly provide quality service; high commission rentals set by department stores and lengthy procedures to open own stores.
In the meantime, the vast geographical size of the market is both a blessing and a challenge.
"The first step is to focus on just one market segment," said Mr Fang. Product positioning is crucial, so is quality of service and investment on unlimited designs, which might be "better than spending on legal fees against counterfeiting."
Considering that Chinese consumers are generally not used to dry cleaning and ironing, desired products are those easy to take care of, he added.
Online selling
Online selling is possibly a big thing in China soon, for its relatively easy handling of the payment, as well as cost-effective access to target customers. Some overseas brands are targeting millions of online surfers in China, including Uniqlo and Jack & Jones.
Under a recent partnership, a virtual flagship store of Uniqlo is available on Taobao's online marketplace (taobao.com) that has almost 100 million registered users by the end of 2008. Uniqlo is a casual wear retail brand under Japan's Fast Retailing, while Taobao is a Chinese consumer e-commerce company under Alibaba Group.
Bestseller Fashion Group, member of the Danish Bestseller Group and one of the biggest clothing companies in China, has also launched its online store, featuring Bestseller's Jack & Jones brand.
Green fashion
While apparel retailers are trying to gain a share in the China apparel market, western consumers appear to be more conscious about the fact that they are global citizens and increasingly demand retailers to be socially responsible in their ways of doing business. Such a wave of awareness has met with like-minded designers and businessmen, who established the Ethical Fashion Forum (EFF) in the United Kingdom.
Ethical fashion is defined by Tamsin Lejeune, Founder of EFF, as fashion made with minimal adverse impact on the environment and people, while maximising benefits for people. In other words, ethical fashion refers to apparel that are manufactured sustainably (in terms of environment) and ethically (in terms of workers' welfare)
Tamsin Lejeune |
The global market of ethical fashion quadrupled to approximately ￡175 million over the last four to five years, Ms Lejeune said, although such fashion holds less than 1% of the entire fashion market on the globe. About 80% of fashion is produced in developing countries, and EFF hopes both consumers and workers can enjoy their lives. With the networking of EFF, 38 leading UK fashion businesses have expressed interest to ethically source from Africa to help improve the livelihood of African people.
According to EFF, buyers of ethical fashion in the UK are mainly women aged between 30 and 50, many of them are professionals at the workplace and loyal consumers of ethical apparel. In recent years, however, Ms Lejeune noticed an emerging group of ethical fashion consumers aged from 20 years old, who are relatively fashion-focused.
Noting the trends, more apparel retailers have captured the opportunity and integrated ethical issues into their business strategies. Marks & Spencer, for instance, sold 1.1 million pieces of organic cotton apparel in 2008, which was fivefold from 2007, according to Clare Lissaman, Consultant of ethical trade and an active EEF member. She said: "Sustainability sells, and it holds true for high-street retailers."
Ms Lissaman cited popular smaller brands as examples. Asher Clark, head designer of Terra Plana and an EFF founder member, introduced ecologically inspired, fashion footwear to the UK and US markets. For each pair of shoes, Terra Plana gives a score of Eco Matrix to examine its products’ environmental impact throughout their lifecycle: from raw material procurement, through processing, manufacture, use and finally disposal. The score measures five aspects: efficiency (energy / number of components), sole (minimal toxins / durability / lightness), upper (eco-friendly materials / simplicity), comfort (functionality / sensual feeling), and looks (beauty)
A pair of suede high-heels has 16 scores in Eco Matrix, and the lightweight, glueless Barack shoes (left) is Terra Plana's best sustainable shoes to date, scoring 25 |
Another example is Kuyichi from the Netherlands. During the development of fair trade coffee and fruit, Dutch Non-governmental organization (NGO) Solidaridad discovered cotton to be harmful for people and the environment, especially with the use of pesticides. In the year 2000, Solidaridad started developing organic cotton in Peru. When big jeans brands did not show interest, Solidaridad launched its own style-conscious jeans brand, Kuyichi, in 2001 to bring organic cotton jeans into the fashion industry.
About 80% of Kuyichi jeans consist of organic cotton and are produced in "fair working conditions". Other relatively green fibers used include linen, hemp, vegetable tanned leather, recycled PET and lenpur (from wood pulp).
Additionally, Kuyichi has collaborated with Made-by since 2004 to advocate the offerings of fashion that respects people and the planet, and help retailers to speed up changes and identify opportunities in the supply chain. Made-by, an initiative of Solidaridad, is an independent consumer label with the mission to make wearing ecological fashion popular. To do so, Made-by and Organic Exchange jointly offer a series of seminars throughout Europe in 2009 and 2010.
Eco-friendly fashion is also stressed in the United States, as mentioned by Jody Turner, CEO of Culture of Future. She identified three kinds of green fashion. 
More brands and labels are selling eco-friendly and ethical fashion in the western markets (Photo: Kuyichi) |
First, "invisible green" products refer to beautiful design that one cannot tell if it is "green" by looking at it; an example is Jordan23 luxury basketball shoes of Nike. Second, by visually emphasizing eco-friendliness, a product is made "clearly green", generating a personal statement about commitment to responsible consumerism when it is purchased. Third, "inventive green" explores new realms of material and fabric design and use. A good example is innovative dyeing without water.
Recently used by designer label Costello Tagliapietra at the New York Fashion Week in September 2009, AirDye is a process of dyeing synthetic materials that deposits color inside, as opposed to on, it. Proprietary dyes are transferred from recycled paper onto fabric using heat, used dyes and toners are recycled into tar and asphalt.
The concept of combining fair trade and care for nature with fashionable apparel will continue to be tested by market forces. Statistics from EEF show that the awareness of ethical fashion has significantly improved in Britain and one third of the British consumers who are positive to ethical fashion, or 23% of total respondents, are willing and able to pay more for ethical fashion. Self-report figures give confidence to positivists of ethical fashion, which may or may not show up in reality, and time will tell us if it is really the next big thing in the western fashion industry when the economy rebounds.
Jody Turner |
Apart from market development in Asia and China geographically, and eco-fashion product-wise, Asian manufacturers need to turn themselves into truly sustained business (as well as sustainable) by improving the production process.
Four directions to get stronger in crisis
Felix Chung |
Also at the Interstoff fair in Hong Kong, Felix Chung, Chairman of Hong Kong Apparel Society (HKAS), suggested four directions for manufacturers to come out stronger from the crisis.
Mr Chung, Director of Chungweiming Knitting Factory, said four areas: cost control, new product, new industry and new market were areas to look into.
In addition to overhead reduction, better management, fewer wastage and quality, Asian manufacturers are encouraged to look closer at optimising the production process, which can bring about substantial savings of up to 20% to 30% a year, Mr Chung said.
Optimising production process
It is possible to improve the production process of apparel makers with a one-piece flow model. Workers under this model work on apparel pieces from-beginning-to-end usually along a U-shaped production line. Further explanation is on page 23.
New Product
To further strengthen market competitiveness, Asian manufacturers need to create new products. Design capabilities and product development are increasingly demanded in the market. Research centers can be good collaborators for manufacturers in research and development Merger and acquisition, Mr Chung added, can be another way to make a corporation bigger other than its own organic growth.
New markets
With the availability of good products, market is the next critical area for attention. Apart from traditional markets in the US, the European Union and Japan, non-traditional markets are important, such as China, Russia, the Middle East and other parts of Asia.
Importers from these emerging markets often come to manufacturers asking directly for finished apparel products (with labels or brand names), which are ready to be marketed at retail stores.
New industry
Mr Chung believes that it is essential for apparel manufacturing to move towards a creative industry, where original design (ODM) and original brand (OBM) are crucial value in addition to manufacturing.
In Hong Kong, the Fashion World Talent Awards (FWTA) is being organized by the HKAS to discover creative talent in the city and in mainland China. The newly launched competition recognizes creative efforts in three areas: fashion designers, image stylists and fashion photographers.
One-piece flow of manufacturing helps enhance efficiency
One-piece flow manufacturing model has been used to achieve lean production in recent years. When the model is applied in the textile and apparel industry, workers complete apparel pieces from-beginning-to-end usually along a U-shaped production line, as explained by the Clothing Industry Training Authority (CITA) of Hong Kong.
Workers traditionally sit in groups. Each group finishes a single part of a lot size of apparel products; this is large-lot production. The large-lot production has been used for decades, which is meant to be efficient since workers keep working on the same process and usually can work faster. At the same time, in-process inventory, or work-in-progress (WIP), are piled up because these inventory do not move on to the next process until the entire lot of WIP are gathered. The larger the lot of WIP, the longer they sit and wait between processes.
Large-lot production, as a consequence, lengthens the lead time between customer orders and delivery of products. Labour, energy and space are needed to store and transport products.
With the one-piece model, however, customers can receive a flow of products with less delay. When done correctly, the model allows a continuous flow of activity between workers and manufactured products. In-process inventory is largely reduced and floor space freed up. It also allows a more efficient use of workers.
According to CITA, the first piece of knitted T-shirt can be completed in two hours under a one-piece flow model. Conversely, it takes about three days to finish the first lot size of T-shirts in the traditional approach.
Paul Chan, managing director of Hanin Garment Manufactory Ltd, said: "By adopting a one-piece flow model at our facilities, we have been able to improve efficiency by 15-20% in two years. It is beneficial to the company's long-term development, as well as advantageous to weather the current weak market environment. Mr Chan is a Vice-Chairman of Hong Kong Apparel Society (HKAS). 
One-piece manufacturing model |
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Copyright © Adsale Publishing Limited. Credit goes to Adsale Industry Portal when used.
We reserve the right to take legal action against any party who reprint any part of this article without acknowledgement. For enquiries, please contact the Editorial Department. |
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