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Even as the larger economy has taken a hit due to the ongoing pandemic and the resultant social containment measures, the apparel industry has been particularly scrambling to stay afloat. With overflowing inventories, canceled orders and sales hitting a record low at 84 percent (based on a CMAI survey), it has been a downward slide all the way. For an industry which employs more than 45 million people and contributes 15 percent of the country’s exports, this is a massive wake-up call. The manpower shortage stemming from the recent reverse migration has further compounded this challenge.
However, just like most adversities, this is also an opportunity for the sector to reset itself for the long haul. Although COVID-19 has been the immediate ‘nemesis’, the industry needs to make structural changes as well as short-term adjustments for it to emerge as a competitive world-class apparel economy.
How Should The Industry Go About It?
– We have to tighten and streamline the entire manufacturing value chain processes from yarn making to weaving to fabric processing and finally apparel making with a view to maximise our domestic production capabilities and improve efficiencies. There is an urgent need to improve our weaving and fabric processing through investments in technologies, upskilling and economies of scale given that most lie in small informal sector with inadequate and unreliable power and other infrastructural support systems. In addition, we have to improve our speed-to-market in light of most low-cost high fashion retailers’ faster delivery business models with Standard Allowed Minute (SAM) being one critical metric where we lag. So, we have to make our factories more Fast Fashion Industry (FFI)-compliant. At the same time, we need to move from the 6 month-seasonal production cycle to a full-year one where full capacity utilisation occurs vis-à-vis the costs involved.
– The digitisation of the value chain must be embraced. This will not only allow a leaner and more realistic inventory imparting flexibility to the whole supply chain but also catalyse more nimble-footed businesses with faster turnaround times. Digitally connecting with both buyers and suppliers in B2B and B2C modes implies it will be better prepared to respond to a situation such as one created by COVID-19.
– The industry must think beyond cotton. Besides strengthening its comparative advantage in cotton further, the industry should pivot towards man-made fibres (MMF) in a big way. With widespread use of synthetic fibres across formal, fashion or sports categories as well as the rising popularity of semi-stitched garments, the Indian industry must adapt and upgrade to the needs of this increasing trend. That synthetic apparel accounts for 70 percent of world trade, must be some food for thought for the industry. For the government’s part, it must reduce import duties on synthetic raw materials such as PTA, PSF, PFY, acrylic fibers, etc with a view to the promotion of a more competitive domestic MMF sector.
– The industry should also consider developing a garments/ fashion accessories product market domestically. With 90 percent of those including zippers, buttons, needles, pullers, badges, lapel pins etc coming from China, there is a dire need to either indigenise their production or scout for alternative source suppliers.
– In light of COVID-19, there has been a shift in consumer preference from what can be called the fashion quotient of the industry to the health and sanitisation quotient. It is likely that the apparently temporary migration of many industry units to production of medical textile products such as masks, disposable gloves and wipes may become somewhat permanent in the medium term. Concurrently, as the pandemic gives rise to certain lasting behavioural changes in terms of consumer behaviour spurring a demand for more sanitised clothing items with proven anti-microbial properties, the industry requires recasting itself as a health-compliant business. This would also raise the general product quality of Indian apparel products at all levels adding to the competitiveness of the industry in the global market.
– Mindful of the unenviable record of the industry on pollution and therefore for the sake of sustainability, the industry should contemplate the evolution of a circular textile/apparel economy. Through increased use of recycled material and offering innovative business models such as rental, subscription-rental and e-commerce, a sustained green apparel economy can be achieved. Towards this end, while AI can be deployed for quality control, blockchain-enabled data management system can offer openness and traceability in the supply chain.
– The government must play its role by creating a policy climate conducive to the health of the industry through timely release of dues under Technology Upgradation Fund Scheme (TUFS), extension of moratoriums on loans and GST refunds in the short term, and reduction of import duties on raw material and export subsidies, among others in the long term.
Therefore, as global textile/ apparel supply chains shift with India increasingly emerging as an alternative manufacturing hub on account of COVID-19 as well as the periodic trade wars between US and China, the Indian industry must seize the opportunity. While developing scale and quality internally, it should also explore new markets beyond US and Europe.
A Credence Research report from March 2018 says that India is set to register the highest growth rate for t-shirts sale in the Asia-Pacific region in the next five years. “Presently, the t-shirt market is a promising one. It is a very versatile segment and is now emerging to be the fastest growing categories in India,” says Neha Shah, Head of Marketing, Pepe Jeans.
Fashion to me has to have the creativity/aesthetics which are appealing and differentiated, it also has to be simple, comfortable, as a brand it is an opportunity to create and present garments with love, passion and definitely making it accessible for people at large to adapt into it. Apart from being one of the largest and one of the fast growing industry providing huge employment opportunity fashion also has a bigger influence of allowing people to express themselves and as people disposable income grows looking good and fashion becomes even more important.
Printed t-shirts have managed to grab attention of Indian consumers the most.“Print and design of t-shirts nowadays have set a different and hot trend of funny quotes, famous dialogues from various popular soap operas, sarcastic statements, reflect tourist locations, mythological stories, cartoon characters, famous personalities and attractive slogans. Demand of t-shirts with embellishments, neon colors, etc., have gained a lot of attention too among the youth in recent times,” says Harkirat Singh.
I think India will need a great pool of talent across all disciplines but especially data driven technology professionals. Faster fashion cycles and a more complex supply chain that enables endless aisle and omnichannel strategies would need professionals who have a strong grip on not only product but a very strong understanding technology and the role it plays in merchandising and forecasting.
“Aside from this, the brand has a lot of incentive schemes where the worker is part of their profitability. As workers get more efficient and start learning how to work on the machines, they start getting more than their minimum cut and that is what has worked for the brand so far,” he explains.
The country is getting more competitive in terms of retail industry with Visual Merchandising being the most effective differentiator in apparel/retail industry. Consumers now want state of the art products having superior quality of global standards. Visual merchandising plays a significant role in the creation of a euphoric experience for the consumers by creatively prepping the interior and exterior of a retail destination.
Our company began its journey with the signature brand ‘Dollar’. Later we introduced premium men’s innerwear brand Dollar Bigboss, which achieved great popularity. We also introduced women’s wear brand Missy, ultrapremium wear for men ForceNXT and Force Go Wear, kids wear brand Champion and a range of winter wear called Dollar Ultra Thermals and Wintercare for all categories – men, women and kids. We recently launched athleisure for sports lovers and apart from these, we have our economy range of products including Dollar RKG, Lehar Bravery, Egyptian, etc.
I think technology has major role when it comes to growing a business and reaching out to multiple customers. With the ever increasing technology there comes social media and online shopping. We strongly believe that accepting such technological changes has helped the brand to explore new market and customers.
Satyen has a successful track record in building a strong profitable business and achieving market growth objectives. At Celio*, he spearheads the retail business right from operations and management to marketing activities and revenue generation and is also responsible for the growth and development of Celio* in India.
“The most common type of fabric used to make t-shirts is cotton, but it is important to mention that there are different types of cotton out there for use. Combed cotton, organic cotton, pima cotton, slub cotton,” says Sandeep Jain, Executive Director, Monte Carlo. In addition to cotton t-shirts, the Indian fashion market is also witnessing huge demand for polyester-cotton blended t-shirts. “At Pepe Jeans, the collection of t-shirts largely consists of cotton material but in order to have a variety and ensure comfort, the fabric is blended with jersey, grindle jersey, piques, mélange, etc., in men’s wear and for women’s wear viscose, crepe and poly linen blends are essential fabrics. Additionally, we also have an athleisure line that has been made with polyester as a key fabric as well as elastane keeping in mind the high performance expectation in terms of function as they are primarily targeted towards gym wear,”says Neha Shah.
This year, The Woolmark Company demonstrated the versatility of Merino wool through its extensive and novel use opportunities. The first ever wind- and water- resistant Optim™ fibre jacket, seamless wool yoga apparels, Merino wool shoes and Knitwarm®, a first-of-its-kind, patented self-heating textile, will be on display. The Knitwarm® fabric has the capability to heat up within 30 seconds to offer instant warmth by plugging into a portable power bank.
The customer of today is more aware about his/her needs. Be it a 10 year old kid or an adult, everyone around us knows what they want, what inspires them and what their needs are. Also, with the advent of technology and also with the help of increase in the disposable income, the customers today have come a long way.
Infrastructure Challenges: Until recently, avenues for showcasing high-end fashion brands were limited to 5-star hotel avenues, fashion shows and a few high-end retail spaces such as DLF Emporio in Delhi, UB City in Bengaluru and others. Luxury brands had to content with the limited retail space in such avenues for selling their products. High per square foot rental costs and limited availability of trained professionals held back their growth. However with over 85 new malls to open in India in the next 5 years, many of which are high-end spaces, luxury and fashion brands would have more space to sell their goods. With more options, comes a stabilization and even a reduction in rental prices – something all brands have welcomed.
E-commerce also allows for more widespread brand availability in Tier II and Tier III cities, where brands may not have physical shops. With globalisation reaching every corner of India, the Millennials of India’s smaller cities are equally tuned into western apparel and accessory trends and are no longer willing to be constrained to functional accessories and gold jewellery. Online shopping opportunities allow them to have access to the same brands as their more urban counterparts.
Accessories are no longer need based purchases but give customers the opportunity to make a fashion statement. The growing need among young urban customers to express their uniqueness has set the stage for the entrance of many international as well as home-grown Indian companies into the evolving world of fashion accessories.
The effects of globalisation have influenced the tastes and consumption patterns of millennials, through international television shows and films, as well as the all-encompassing hold of social media. With their higher disposable income and need to redefine themselves, Millennials have championed the rise of fashion accessories into the organised retail market and assured their diversity.
In a statement, Karl-Johan Persson, CEO, H&M Group said, “India is a growth market with large potential and we look forward to making our brand available to new customers across the country. Myntra and Jabong will be an important complement to H&M’s existing physical and digital stores in India.”