During the discussions on our how corona virus is affecting us all and our industry , we speak to Neeraj Sachdeva on the current situation and timings which we call #Covidtimes . An industry veteran and having held position of creative heads in many global retailers including Benetton besides being a Professor in Fashion Institute of Technology (NYC) , Neeraj shares his unique perspective with Sandeep Agarwal on this situation and what all we can expect. We bring the talk verbatim.
Sandeep Hi Neeraj, How are you doing and How’s everything going in NYC?
Neeraj
Good Morning Sandeep, it’s getting a little sunny now, sometimes the Sun definitely helps when other things are not going so well. I’m sure you’ve seen the news, unfortunately, I wish I could say the news is exaggerating for once, actually, things are not.
I think the good thing is everybody’s taking the severity of the situation very seriously and we’re following orders and shelter in place and social distancing and non-essential services and business are on hold.
It’s definitely helping the contagion but there’s a lot of work ahead for everybody and it’s interesting to see how the small businesses are being so creatively evolving, how to deliver, how to service customers. Because safety is first and even when you go out for your grocery, I can see every day New Yorkers actually exercising extreme caution and courtesy and common sense.
Sandeep :
Coming to the business side, it’s a terrible situation right now, stores are closing down and supply chains are being badly affected, so what do you think it is going to lead to?
Neeraj: Well to tell you the truth, obviously, I don’t have a crystal ball to tell you this is exactly what’s gonna happen, a lot of stuff depends on when we can do a calendar that’s the thing as an organization or individual we are so used to working with it and believe Oh! this is my time so I hope this happens
In two months this happened and in three months I can do this and that.
There’s not much we can do right now, I mean like you said who thought that maybe like a nationwide lockdown three weeks long and we’re all in week 3 and so we’ll just have to wait to see and I think a lot of what happens to all of us as consumers.
Our confidence post-pandemic like how excited are we and what are we excited about do we want to go immediately on a shopping spree or do you want to be cautious and current take it slow and you know just to be a bit more conservative with our expenses. You only buy things and we wanna buy experiences, you wanna reach out to our loved one in weeks now which seems like decades for a lot of us. So I think a lot will depend on consumer confidence as we step out of it.
I think brands and businesses will have to involve products and messaging and how we kind of deal with these things. One thing that I think is gonna make a huge comeback is the brick-and-mortar store. I think all of us will rush back to engage with humanity as you said to actually touch them feel because of the product and I think currently three weeks in I’m a bit dizzy and I’m a bit digital afflicted and I will be okay not to see my computer screen for hours and hours and hours then because that’s all I do ten hours a day now. Obviously it’s great that we have the technology and tools to connect with people, talk to businesses like yourself and still stay connected and inspired but I miss physical touch and space.
I miss things to touch and feel I think we’ll all crave that’ll definitely impact on what happens once we’re out of this pandemic. Businesses are just nimble and they’re ready to adapt and do whatever that happens. We have to quickly mold into the new reality because I don’t think we’re going back to what my business was a month ago. I think you see a lot of new business models. I think a lot of new creativity I think big businesses will have to start thinking like smaller businesses and be agile and you will see a whole new rebalancing.
Sandeep
If this situation lasts for a couple of months and supply chains get broken, I mean it won’t be so
easy for the brick and mortar stores and even online stores to come back very quickly.
Neeraj
Well, this is highly nuanced and extremely technical and as you said this would be like a logistical nightmare but I myself just filling out different scenarios if I’m back to my office after two months or three months, what would come, I will be ready to embrace whatever comes our way because I don’t think so anybody can predict an exact timeline.
So say if the lockdown left in May week two, then I have X raw materials and manufacture X number
of goods, we just don’t know and what I was going to be doing stuff for because think about it. Unfortunately, spring and summer are pretty much a wash at this point the next week is namely back-to-school or q3.
Sandeep
I have been speaking to some of my industry friends, and they are advocating about SEASONLESS Garments, what’re your thoughts on it?
Neeraj
Well, don’t you think the concept of Seasonless has been followed for the last couple of years and not new? So I think this season analogy has been abandoned as the collections are coming after every alternate month, I guess. So I do not think that there is anything new about it. I guess we should ask retailers not to produce in such heavy quantities.
I think you may see less of quantities because since we’ll be producing less, to begin with, you know
again that could be a tiny positive out of this whole thing.
Sandeep
Do you think, is it the beginning of the end of mass fashion?
Neeraj
So again, to tell the truth, it all depends on consumer behavior. I mean do you think the whole idea that I’m just going to wear this outfit for one Instagram photo gonna go away overnight is going to be still there, probably not but you see a whole different realization of it.
The thing is when I was at the discussion with some of my colleagues about sustainability in our businesses, we realized that it is there but nobody is really investing it in a big big way but I think this experience will make sustainability a very personal thing like experiencing all of these things for something. Consumers will look at who is manufacturing and how’s it impacting their daily life actually now.
I think this would reshape everything that for a long time to come and a lot of great things will come on I just don’t know what they are absolutely
Sandeep
Do you think in terms of outsourcing, the globalization model will probably take a backseat and people may look for nearshoring, sourcing near their own countries or regions as far as possible?
Neeraj
It’s again a matter of rebalancing and maybe well one of the things that actually comes to mind is maybe we need to look at our traditional product development. A lot of things are going to be virtual and digitalization of most of the process is going to happen now.
One of the criticisms of virtual tools is that they are very expensive but the more the people get behind it, the technology will become cheaper. And if there’ll be more players coming up, it will bring even more innovative solutions in a much faster way.
I think we should start to think more about digitalization.
Sandeep :
Do you think many small brands that do not have deep pockets will not be able to survive and be shutting down due to this pandemic?
Neeraj :
Yes, I do think but I also think a lot of crowdfunding will happen and the small brand will find ways to save itself. Campaigns like buy from locals either its restaurants or cloth, local stores/shops have already started, and I think a lot of amazing things will come out of it.
Sandeep
You work with a lot of designers and yourself being in senior creative positions , to your mind what is their main concern as of now?
Neeraj
I think it is just uncertainty, if they will be certain for two weeks, they will behave in a certain way or if they will be certain for three months, they will behave in a certain way. Every day new supply chains get disrupted, everyday new orders get canceled, so there is just a lot of uncertainty and that is what most of the people are worried about.
Sandeep
The biggest positive takeaway from this situation ?
Neeraj
I am optimistic about everything and I believe that a lot of adaptability, flexibility, and creativity will come out of it.
Sandeep
It was really wonderful speaking to you and thank you for joining us and please be safe
Although China is gradually coming back on track, however, the last few months weren’t good for the business. The globe has been witnessing a lockdown everywhere but it all started from China, either it’s COVID 19 or the lockdown.
Factories were closed in many of the parts of China to limit the outbreak, the business was hit badly and so was the production . According to the latest export data, we’ve learnt that the jeans export from China to the EU fell by 40% in January 2020 compared to the export figures in January 2019.
Let’s check out in the report below to understand the export of Jeans by China To the EU For January 2020.
TABLE OF CONTENT
Table and Graphs Showing The Export Of Jeans- by China to EU ( Jan’19 V. Jan’20)
Table and Graphs Showing The export of Mens and Women Jeans by China to different EU countries along with the Average Price ( euro/pc) For Jan’19 and Jan’20
[private_special]
Export Of Jeans By China To EU – Jan 19 V. Jan 20
In Jan’19, China exported 9.3 million pcs of Jeans to the EU out of which 3.8 million pcs were Men Jeans and 5.5 million pcs jeans were women jeans. In Jan’20 the Men Jeans export reduced by 53% and only 1.8 million pcs were exported, Women Jeans export was plunged by 31% and dropped up to 5.6 million pcs.
Figure in Million
Particulars
Jan-19
Jan-20
% Change
Men(Pcs)
3.8
1.8
-53%
Women(Pcs)
5.5
3.8
-31%
Total(Pcs)
9.3
5.6
-40%
Average Price Of Export Of Jeans By China To EU – Jan 19 V. Jan 20
The average price also witnessed a sharp increase due to the COVID 19, the average price in Jan’19 was Euro 4.94/pc which rose to Euro 6.42/Pc, a 30% increase in average price could be considered substantial . Men’s Jeans which was earlier exported at an average price of Euro 5.43/pc increased up to euro 7.66/pc. This clearly shows that the fast fashion items were mainly cancelled and long term orders from higher end buyers still were shipped.
Particulars
Jan-19
Jan-20
Men(Euro/Pc)
5.43
7.66
Women(Euro/Pc)
4.59
5.82
Total(Euro/Pc)
4.94
6.42
Export of Men Jeans
Below we have mentioned some of the European countries which have imported Men Jeans from China. All these five countries have lesser imports as compared to Jan’19. Germany -one of the biggest importers, -which imported 620 thousand pcs in Jan’19 had imported only 500 thousand pcs. The same trend has been observed in the rest of the countries.
Though the Average price has some inconsistency, Italy’s average price has been substantially increased to Euro 11.22/pc from the level of Euro 6.94/pc.
Country
Men (Jan 19) – Million Pcs
Men(Jan 20)Million Pcs
Germany
0.62
0.50
France
0.24
0.20
UK
0.18
0.14
Italy
0.26
0.13
Netherlands
0.37
0.26
Total
1.68
1.22
Country
Men (Jan 19)-Euro/Pc
Men(Jan 20)-Euro/Pc
Germany
9.54
9.37
France
7.58
6.58
UK
10.95
7.32
Italy
6.94
11.22
Netherlands
11.25
11.51
Export of Women Jeans
So far as the export of Women Jeans is concerned ,except in the UK all the countries showed a negative trend in imports. However, Italy maintained consistency. France is down by 50% and other countries including the Netherlands and Germany have a reduction of more than 30%.
The average price of women jeans also has some inconsistency . The Netherlands’s average price has been substantially increased up to Euro 9.23/pc from the level of Euro 6.97/pc. This , we believe , is again due to reasons mentioned above.
Country
Women(Jan 19) Million Pcs
Women(Jan 20) Million Pcs
Germany
0.56
0.41
France
0.64
0.31
UK
0.25
0.44
Italy
0.27
0.27
Netherlands
0.51
0.32
Country
Women(Jan 19)
Women(Jan 20)
Germany
8.43
7.39
France
5.08
6.83
UK
9.37
7.59
Italy
10.81
9.61
Netherlands
6.97
9.23
The data for coming months would be even worse and there is a likelihood of steepest possible declines in imports of denim into Europe as most of the countries are in lockdown and stores are closed. Keep reading for further info from our Special Reports section.
Amidst the Coronavirus pandemic and a rising shortage of PPE like masks , people have now started creating the home made mask from different fabric. We have come across some innovative designs and patterns which people are using specially with denim. No wonder all the problems are a source of opportunity and creativity. The masks have been created with scrap denim , pieces and clothing.These masks are circulated all over the world for the protection of one ad all. Some of them are even available in retail . Please follow this link for the same. During this time , denim masks are stealing the attention in the fashion world. We brought some of the pieces below with the profile of the people created them.
One question arises . Will the creativity in masks turn into a new product category for apparel ? We feel yes and will explore this in our next article. In the meantime, enjoy the designers’ creations below. We have tried, as far as possible, to give Instagram names of people creating these masks.
We were drawn to an image of a poem and images of masked women in 1918s . Life goes full circle , is it ?
In this report, we’ve done the analysis of Jeans Exports From Ethiopia during January 2020 and our analysis focuses on three fundamentals :
Volume of Jeans Exported (‘000 Units)
Top Export Destinations
Leading Buyers
Leading Suppliers
CONTENTS
Graphs and Tables Showing Jeans Exports From Ethiopia during November and December 2019
Graphs and Tables Showing Top Export Destinations during November and December 2019
Graphs and Tables Showing Leading Buyers and Suppliers Of Jeans during November and December 2019
[private_special]
Jeans Exported And The Exporting Destinations
Ethiopia is still a country which is developing slowly and the data generation is not still complete with all shipments not being captured. . However, from the available data we can see that during Jan’20, 831,000 pieces were exported out of which major portion to the tune of 67% exported to the USA. This number looks very small but we need to remember that Ethiopia will need some time to get its data in full order. We can only work on the figures currently available.
Spain was the second largest importer and imported 14% of the Jeans during the same period. Other countries that imported jeans from Ethiopia include Germany and Canada.
EXPORTING COUNTRY
JEANS EXPORTED(UNIT IN ‘000)
AV PRICE($/UNIT)
% SHARE
United States
557
1.54
67%
Spain
112
0.50
14%
Germany
60
4.14
7%
Canada
55
1.47
7%
Others
48
0.80
6%
Total
831
1.54
100%
Leading Buyers
The Children Place emerged as the biggest jeans buyer and has imported 571 thousand Jeans at an average price of $1.36/unit through its subsidiaries based in the United States, Malaysia, and Canada. (The price seems to be under reported in the data but we still are presenting it here. We go with the idea that though the data looks not too accurate , it can give a fair idea of what is happening)
Other major buyers include Decathlon Sports Ireland and H&M , they’ve imported 112 thousand and 60 thousand jeans respectively. H&M imported jeans at the highest average price of $4.12/unit from Ethiopia.
BUYERS
JEANS EXPORTED(UNIT IN ‘000)
AV PRICE($/UNIT)
% SHARE
THE CHILDREN’S PLACE
571
1.36
69%
DECATHLON SPORT IRELAND LTD
112
0.50
14%
H & M
60
4.12
7%
ATRACO INDUSTRIAL
27
0.50
3%
PEERLESS CLOTHING
19
2.63
2%
CLASQUIN PARIS
17
0.90
2%
OTHERS
24
5.05
3%
TOTAL
831
1.54
100%
Leading Suppliers
Ashton Apparel made 46% of shipment from Ethiopia and approx. 380 thousand units of Jeans have been exported during January 2020 at an average price of $1.04. Ashton Apparel Mfg. Plc, P.O. BOX 11537 SHED NO. 19 20 BOLE LEMI INDUSTRIAL ZONE TEL : +251 911 259609 TEADDIS ABABA ETHIOPIA
SCM Garments is the next big exporter which exported 112 thousand Jeans and accounted for 14% share.
Arvind Lifestyle Apparel Manufacturing, which is an Indian conglomerate, made 13% of shipment from Ethiopia.
Sandeep We are in difficult times, how is Portugal doing?
Vasco Personally, I have been home for voluntary quarantine for the last three weeks because I have a history of asthma since my younger days so they advised me to stay at home.
In terms of our company, we’ve already decided about two weeks ago in order to protect our workers to stop the activity for now. Portugal has not yet closed all non-essential activities and a lot of textile companies are adapting themselves to producing masks and protective gear for medical healthcare.
In our case, we don’t have that expertise so we are contributing in trying to stop the spread of the virus by sending our 400 employees to home to ensure their safety. We’ve also ensured the timely payment of their salaries during this period.
We are adapting ourselves accordingly and reinventing but unfortunately, most of the shops around Europe are closed, Spain has been hit very hard from this virus. I don’t know much about the Asian market but if you could give me some insights, I would be able to understand the situation of that market also.
Sandeep I’m a little surprised because it seems that Asian countries are doing a little better as compared to American and European countries . Asian countries probably took a lot of precautions and still things are working, their shops are open people are going to the markets some of the factories are open, though of course, they are closing down for a few days now . Other countries like Singapore, Thailand or Taiwan which are very close to China, these have done a very good job there.
Vasco
Yes, they’ve set very good examples as there were very close to China and countries like Hong Kong, Singapore and Macau have controlled the situation very well and I also know that Japan is working because we buy fabric from there so I just talked them yesterday so I know that they are working but what I’ve been read is that Cambodia, India have taken serious measures.
Sandeep We are in complete lockdown, no factories no shops are opened. Everything is closed all over India
Vasco Yeah, I think the lockdown is the best measurement that they can do because it will help try to mitigate the spread. We should try to be positive now and we have to stay strong because otherwise, it is really going to be difficult. But I think it will help in the future and it will help us differently by initiating a dialogue of real sustainability and not the greenwashing which has been growing a lot for a couple of years.
Sandeep I would like to hear more about this, please explain a little more, I guess this is very important.
Vasco I think the measurement mechanics of sustainability needs to be expanded a little bit. Especially in how you measure it because I think it’s that the standards can be deceitful now today because I know that there are a lot of people that have their companies based on ZHDC or other parameters.
I think that the parameters they are based on the laws of each country are deceitful because some laws can be more strict than others and also I think that people are not looking well at the waste in terms of – closing the land fills and the number of clothes that are being destroyed every year but the problem is that we have been producing more and I think people don’t look at the overproduction as much as they are focusing now on the other factors of sustainability before the product we made.
The producer and manufacturer need to be more united, irrespective of the competition. I often wonder about how it could be, if we the producers and the manufacturers and the laundry houses and all the little guys unite themselves.
I always wonder that more people from our side of the industry is doing a lot of things for our world everyone wants to give better wages for their workers, everyone wants to give better conditions to their workers , everyone wants to be more sustainable, every one of us wants to spend as less water spends as as possible to create nice things or to develop new things and I believe there’s also the side that is always taking that advantages that we are creating and benefiting more from it but I believe that if we can unite ourselves and if we can understand each other more, It would be very good.
Sandeep Post-Pandemic, do you think E-commerce will do better than the brick-mortar stores?
Vasco
Of course, I believe that once the people leave their houses, they would like to go to a store but I’m talking about the medium to long-run prospect, I think parts of those markets that were resistant to e-commerce earlier will now go for more eCommerce set up.
Sandeep What about the seasons? Do you think we are moving towards season less collections?
Vasco Yes, I think so, and I guess this was already in effect since the last couple of years. Instead of seasons, you see more through with presentation and instead of being colder, this winter season or fall or spring or summer, you kinda see a flow and you see variances that you couldn’t see in another place. I think the frequency with which we have been launching our collections have already made it season less.
Sandeep Do you think brands will want to change their location of sourcing post-pandemic?
Vasco
I think yes, we saw a lot of brands that wanted to have production closer to their facilities. In our case we always adapt ourselves in our trajectory as a company or even on services of course on the laundry and on the finishing and on the packaging, we always support the nearshoring.
We always know that the higher volume and the higher quantities will always will maintain themselves in other countries. Since we know that, in terms of price we cannot compete, we compete through logistics and through differentiation and to give a different product so that’s our way to compete.
Sandeep Do you think in the coming times, people are going to spend more on home wear as they are spending too much time at home? Vasco
If you know, we work a lot for IKEA and Zara home, so for us, it’s a market that is going to be very successful for home textile. The home textile is growing in terms of importance for the people because they are also evolving as a product, so you see, especially on the textiles, on carpet, rugs, on bedsheets. The brands and the clients are choosing and are looking at many options available.
IKEA brought the possibility that we can have a lot of different furniture at an affordable price if people started to turn their attention more on how they can make their house beautiful, so yes there will be more demand for home textiles in the coming times.
Sandeep
What do you think are the biggest positives of this situation, although this is very unfortunate?
Vasco
I think if there’s any good thing which will come out of this would be the ability to analyze yourself and the company and the market in a status that nobody wants to be in.
Sandeep
There are many stores are closing down, it may lead to a reduction in production, also consumers may look at lower consumption of clothes post-pandemic, How will it re-balance the whole chain?
Vasco I think what the last crisis taught us is that the bigger companies stay stronger and the smaller will normally not survive. I believe that in terms of this equilibrium that we need to hold out, I think it will be very tough for most of us but I believe that the biggest players in whatever market will be the ones benefiting the most. I believe that if you stay and if you have the ability to endure this time it can be very beneficial for you in the future.
I believe that brands we’ll also have to be more aware that they cannot squeeze the margins of the producers because this is showing us are that nobody is safe. But I really hope and we all really hope that in next 1 or 2 months we can come back to normal in some way,even if we have to take precautions .
Sandeep
Yes, we all believe that, let’s cross our fingers and hope for the best. It has been always pleasure talking to you, I hope we see you again soon
Continuing our series of talks during our current COVID 19 times, Sandeep Agarwal speaks to Katsu Manabe from Momotaro Group,Japan and he shares his thought on how the current situation is evolving and how it is affecting and will affect our industry in the future. With a special emphasis on situation in Japan, Katsu Manabe shares his views.
Sandee​p:
Hi Katsu, Welcome to our Instagram Live, How are you and how is the situation in Japan? Katsu:
We are still working and taking care. But situation is still getting worse and government is taking more measures now. Sandeep:
So currently you are not in lockdown and you are still going to your offices and still working?
Katsu:
Yes, most of them go and working.
Sandeep:
What about the stalls and shops everything is open still ?
Katsu:
Yeah, many stay open
Sandeep:
Okay, so how do you think this situation of Coronavirus is affecting your business specially in denim sector in Japan?
Katsu: The situation is quite hard on workers. For us , we need to decide ourselves. The govt is not supporting the business , they can’t guarantee the benefits , therefore most of the people need to decide themselves. People are visiting head offices stores in Okayama , which is on outskirts of Tokyo . Many people are not going to the other stores so right now we closed the store for cleanups.
Sandeep: So , the jeans street is still working and on with many stores open.?
Katsu:
Yes, it is open. In March and April, most of the people want to change the clothing and enjoy the spring summer season. Many people are still preferring to stay home , but due to long holidays of students and younger generation , they tend to go out for clothing and shopping. So we still have some sale.
Sandeep: It is a cherry blossom time in Japan this time. It is very pity that in such a beautiful environment in Japan , people have to stay inside.
Katsu: Yes it is blossom season in Japan but very few people are going out.
Sandeep:
I think you also have good business in China, Europe and US -probably the most Japanese companies have . Is it closed in terms of business and
China was also closed and it is opening a little now so international
business for you is also like almost closed or working at some places?
Katsu: It depends on how the international quarter works for us. Considering some countries, we already have got some heard from them. Some of the stores and countries have asked us to stop .We don’t know what will happen but we can say Europe is worst . We can see most of the countries and cities are lockdown but in Asia and China, some parts like Shanghai still working .It is very difficult time for US as well.
Sandeep:
I’ve been talking to so many different people around the world and they’ve been talking about a lot of changes in fashion even after we come back from this crisis. So do you think from your point of view
there’s going to be a change in terms of fashion from the consumer
point of view.
How people will look forward for new products and like Japanese products
are already season less , they don’t really create work for seasons much but like international brands and also many retailers they work for
seasons so I mean many of them say that the seasons will go out . How do you think your way of working and your consumers will be affected because of this?
Katsu:
Our products which we sell to oversees are mainly the basic and regular items. SO, we are not doing much for the seasons . Of course, the international market is looking for the season fashion.As most of the exhibitions have been cancelled, we need to try hard to get the buyers otherwise it will be very difficult for us.This is the good time for everybody to make the communication online.
Sandeep:
What are the positive things you feel from the situation ? Any positive things which are coming out because every difficult situation also creates some positive things.
Katsu: As I already told you , we need to decide to change how to communicate.We have to use digital way to communicate with people.The export can be made smoother because we can contact online and can support afterwards also. Secondly, we need to focus on production , because after this many people would have lose their job and it is very difficult. We need to see how this situation can be overcome by making ourselves.
Sandeep:
So any message you want to give to so many people watching this and
anything for the fashion industry specially for our industry.
We already said that we need to go sustainable and any other thing you
would like to say We discussed digital and second thing sustainability and high quality. So any other thing you would like to say?
Katsu: The industry has to keep going and we have to survive ourselves.The denim business is all around the world ,so people need to enjoy themselves.Stay safe and healthy and enjoy your denim at home.In your lifestyles , if you see denim you will feel good.What we can do is support the people with better life and make them happy .
Sandeep: You also stay safe and healthy and all the best to your family and the Momotaro group.
Katsu: We are trying to go home and develop something beneficial digitally for our industry.
COVID-19 has now infected over a million people and killed over 53000 people in the world. The world powers and some of the most advanced regions including the USA and Europe are facing a complete shutdown for over a week now and in the coming weeks also, the situation may escalate further.
Apart from this, some of the biggest economies of SEA including China and India are also still in great stress due to ongoing panic caused by pandemic, while China seems to come back on track slowly but the rest of the world is still struggling and finding ways to stop the further spread of the virus. The battle is not going to be as easy as it appeared, a lot has been happening and a lot will happen post-pandemic.
The crisis in some of the manufacturing countries including Cambodia, Myanmar, and Bangladesh has been worsening by the day due to cancellation of orders. . Since the majority of the stores in all buying countries are closed, no new orders are expected to arrive in the coming weeks as many brands have refused to pay for the already manufactured orders which further worsened the situation.Â
According to Human Rights Watch,
Over 20,000 workers employed in Garment factories have already fired and 70,000 workers could lose the job by the next week of April. Additionally,200,000 garment workers are also on the verge of losing their jobs.Â
TIMELINE – THE RISE AND FALL OF CAMBODIA
Cambodia has been growing as a garment manufacturing hub since the 1990s when many bilateral trade agreements and duty exemptions added pace to the growth. International retailers like Nike have 12 factories and employ 37,540 people in Cambodia.
VFC sources 11% of its products from Cambodia. Other brands like Levis, PVH, and Adidas had expanded their sourcing base into Cambodia. However, all these companies have constantly raised the issue of labor standards in the country and asked the government to take measures to ensure a healthy life for garment workers.
According to the Labor Ministry, The garment and footwear industry employs over 800 thousand people in Cambodia and earns $9.3bn annually.
The EU is the country’s largest trading partner, and over 45% of the country’s exports in 2018 went to the EU alone. In 2013, the export to the EU was £2.1bn which galloped to £4.7bn in 2018.
The sheer apathy of the Cambodian government made Cambodia pay a heavy price. This year in the month of Feb, the special trade preferences by the EU were partially revoked due to alleged serious and systemic human rights violations.
The decision of partial suspension came as a blow for the country’s growing garment industry. Many retailers are expected to move to Bangladesh and Vietnam to get the duty free access to EU regions now.
The partial suspension of the “Everything But Arms†(EBA) scheme which grants “least developed countriesâ€, such as Ethiopia, Bangladesh and Myanmar, duty- and quota-free access to the European single market.
The situation in Cambodia further worsened recently when they found it difficult to source raw materials due to the lockdown in China from where they procure 60% of raw materials and now due to the global lockdown, the country is in a huge crisis.Â
The duration, scale and impact of Cambodia’s violations of the rights of political participation and to the freedoms of expression and association left the EU with no other choice than to partially withdraw trade preferences,†said Josep Borrell, high representative for foreign affairs at the European Commission. “The EU will not stand and watch as democracy is eroded, human rights curtailed, and free debate silenced.
The situation in Cambodia further worsened recently when they found it difficult to source raw materials due to the lockdown in China from where they procure 60% of raw materials and now due to the global lockdown, the country is in a huge crisis. The orders from global buyers also started cancelling in a big way.
The Garment Manufacturers Association in Cambodia (GMAC) pleaded and requested all global buyers/retailers not to cancel their purchasing contracts in order to save the livelihoods of millions of garment workers.
Meanwhile, H&M announced that it will review its sourcing strategy in the country. H&M has been sourcing from Cambodia since 1990 and has been working with over 50 factories in Cambodia.
“Due to the lack of adequate initiatives in developing the Cambodian textile industry and a partial withdrawal of the EBA privileges, we will now further evaluate how the EU’s decision will impact our business and production strategy in Cambodia.†company said in a statement.
THE COVID 19 IMPACT
More than 90 garment factories in Cambodia have reportedly suspended their operations due to coronavirus which affected 61,500 workers so far however more than 250 thousand workers are expected to be affected by mid of April.
In a report released by Asian Development Bank, due to pandemic, Cambodia’s economic growth will witness a fall of 2.3% after twenty years of strong performance. It further added that industry growth is forecast to slow to 6.5 percent, with a deceleration in garment production for exports and slower growth in construction.
THE DENIM INDUSTRY IN BRIEF
As far as the Jeans is concerned, Jeans export from Cambodia to the EU has been reducing since 2017Â and by the end of 2019, it is expected to witness a total fall of approx 36 %(Final data is yet to come).
Comparing the export figures, this is to be noted that Cambodia’s denim export saw an upward movement of 1% in the year 2018. In 2016, the export was 38.93 million pcs which dropped down to the level of 33.98 million pcs. The country manufactures more Women Denim and shares approx. 72-73 % of the total export of Jeans.
We hope in the coming times, Cambodia recovers and bounces back, strong measures are expected to be taken to ensure the prosperity of the Garment Industry. In the fight against COVID 19 all stakeholders including brands, govt, supply chain and others will have to execute strong roles to ensure survival.
Our prayers are with all and we hope collective efforts will help us to win this battle against COVID-19 pandemic.
Continuing our series of talks during our current COVID 19 times, Sandeep Agarwal speaks to Tricia Carey from Lenzing and she shares her thought on how the current situation is evolving and how it is affecting and will affect our industry in the future.
Sandee​p: Hi Tricia, Welcome to our Instagram Live, How are you and how is the situation in New York?
Tricia ​Hi Sandeep, ​I have to say thank you to so many people for reaching out to check and see how we’re doing in New York. How I’m doing​,​ that outpouring and has been amazing.
​W​e have a facility here in the United States which is still running ​and ​all of our factories are still running and so I think overall the company has done a lot on crisis management and what we needed to do so we had different plans​.​ ​Even for the New York office, we have six people ​and​​ we had already started to plan different scenarios of how we would handle it and then it was a little over two weeks ago that we switched into working from home ​to ensure the safety of us and to make sure that our families are also safe during this time​.
​From a business perspective, we’ve seen this change ​,​we went through talking with partners, ​a lot of ​cancelation of orders happening ​due to the shutdowns of retail​ stores​ in the past few weeks ​. We’ve also been very​ ​busy soliciting and dealing with questions that the market has around how to​ ​connect for gowns and masks​.​ ​We’re reaching out to the supply chain and​ ​many of them are also coming to us too, what can we do? Our fibers are used in different nonwovens not necessarily for masks​ but for other nonwoven applications. What fabrics with our fibers could be used for gowns and how we could help with the medical protective wear. That is needed now and this is happening also in Europe because everyone’s looking within​ ​their region on how they can support these products ​.
​Sandeep : What do you think after​ ​looking at all the kind of cancellation in terms of the stores ​are​ closing​ and there are lots ​cancelation coming ​out, how is the supply chain going to be affected by this​.​ I ​am speaking ​to Mills as ​well as ​garment manufacturers​ and​ everybody is in a big mess​.​
Tricia : Yes, It’s a huge mess right now​.​ ​No one can plan​ There’s such uncertainty about when the stores will reopen ​and when orders will start to come ​through again. When I spoke with customers and at first, it was 50%​ ​of their orders were canceled​,​ then 75​%​ and ​now ​it’s up to 90 percent or​ ​completely canceled​, I mean how does someone run a business this way​ ,​ you​ ​just can’t​. ​ I think we all know that there was already an overcapacity of​ ​denim in the market​,​ we had much more capacity than what was really needed. Also as consumers you know we have to look at our consumption factor too ​. So I see this is a chance for us to hit the reset button. I hope collectively this happens​ ​within the industry and other industries too. I feel it’s a chance for the retail industry to change some of their ways.
​We have so much inventory coming into the stores in the United States.​ We have this terrible way of promotion all the time​, you need to have 60% off in order to sell apparel because customers are just trained that way​.​ I wish that the US retailers operated more like some of the European retailers and with sales twice a year and that’s it. Start fresh in some ways​.​ I​t’s a reflection time that we can then reorganize and react in the right way that we need to build a stronger market. This is kind of the time of survival of the fittest​ and​ I really believe that we have this chance now in order to change​.​ ​
Sandeep If you look at one perspective that even after the recovery from this situation do you think the ​kind of volume​ and​ the kind of business that we ​had experienced​ in the industry​ so far is going to be affected. Do you think so​?
TRICIA Yes​, We’ve already seen some of the smaller companies​ struggling and​ there are rumors in the market about some mergers that may happen. What will be the mentality of the consumer coming out of this​? What does post-pandemic​ look like? I think now we reached a time where we also have our own definition of conscious living​,​ so sustainability will take on a different meaning ​​because we’ve all gone back to basics​.​​
W​e will have this time to re-evaluate and look for clothing which will become more of protection. Now we look at how we can protect ourselves against getting this virus. Whether that’s masks or other apparel. Also now we look at how our apparel protects us and keeps us safe. This is also a mindset change.
SANDEEP​ ​Do you think post-pandemic, people are going to look at less quantity and higher quality​ products?
TRICIA​ Y​es​, I​ do think ​so. People will return to value ​and also an understanding of the social side of the apparel industry. We were starting to engage in more of this before Corona who made our clothes​? Where are products coming from? I think that will continue to be questioned​​ because now we have a greater sense of how we are interconnected in the world. This is where it’s important that the consumers want to know who was involved in making this garment. I think that transparency and the building of the stories around transparency will only continue after Corona because now there’s a heightened awareness​.
​There is some news floating that Americans have to ​wear face masks ​every time they are in public. Now we have three hundred and thirty million people that are going to be buying face masks and we know that not everyone is going to buy disposable masks ​and we’ll see some changes there as well.
​SANDEEP​ So maybe designing ​of ​clothing will be greatly affected​,In terms of as you said towards making protective clothing and ​also industry may look at a different kind of masks​ ​,​different kind of other designs coming up ​, What do you think?
TRICIA Yes, and you start to see that already. Now there is creativeness that is happening. As we’ve moved into​ ​this focus on how we can protect ourselves. In the past few weeks, the supply chain has been trying to find materials that currently exist for masks​.​
​I​t’s not about selling a fiber​,​ it’s about how we can support our partners. If there is yarn available or fabric available and we have those connections, we are trying to help. But you already start to see some of the innovation in ​masks​. I had one customer reach out to me that Gerber is using their machines to actually develop a mask and it’s one piece of fabric that then goes behind your ears without the need for elastic. You might have seen on social media​, some of the medical personnel are complaining about wearing the elastic behind their ears and if could they somehow attach it to a headband. I think these are innovations that come out of this time. That’s where application innovation that can also happen within this segment of the industry and many of our denim mill partners are looking at how they can support providing fabrics for medical applications ​​now​.
SANDEEP Are we going seasonless? ​
TRICIA Yes, we are. ​In the past two weeks​, people are staying in their workout wear or pajamas all day long with this work from home.
S​o I think we will be back to basics. That​’s​ happening. People will be​ ​again looking for comfort. They will be looking for fabrics that can protect​ ​them, whether it’s antimicrobial or antibacterial finishes. So I think​ ​there will be some changes. I also think knits will increase because there’s a comfort that you get from the knit​s which could be very interesting even for the denim market using indigo ​knits. This was a category that was starting to evolve prior to Corona and I think it will continue​. There’s a comment here about a season less also being long-lasting and this goes back to consumption changes.
​SANDEEP​ ​So if we look at the keys now the keywords which are coming out are​-​ one is seasonless ​and the other ​is nearshoring ​.​ Any other keywords which you strongly feel​ are relevant during this time? Also about sustainability. Of course, your​ ​company has made such a huge contribution towards this cause what we’re trying to achieve but how really sustainability would be affected by this ​co​rana thing positively or negatively ​.​
​TRICIA​ I would add to that performance. Regional or near sourcing definitely. Sustainability environmental and social concerns. I think now the two are going to be tied so closely. For Len​zing, we’ve been working around circularity as a part of sustainability with our REFIBRA™.
I think again there is heightened awareness around sustainability. Also a chance to step back and reflect. I also think another key concept out of this time will be more around collaboration. Because we see how we’re interconnected. When you have the forces behind a common​ ​goal and how you can reach them. I think our collaboration will only be​ ​heightened through all of this pandemic. We really need to work together to​ ​make these changes. I’d like to see that all of these forces us to work together faster.
We were going along and we’ve been​ ​talking about sustainability. You know who is greenwashing or now​ ​there’s also ethical washing that is happening. Let’s use​ ​this time for a strong momentum and a real force to make that change​.​
​Sandeep​ I agree with you completely and would globalization be one of the things which would take a backseat. What do you think?​
​Tricia​ Yes, we were saying regional​ ​sourcing. I think we will see also a tightening up of supply chain partners​ ​we had seen this over the years. That will​ ​definitely continue.
​Sandeep And what do you think of the best positive ​things which will come out post-pandemic and how it affects professionally ​?​
​Tricia​ I think​ ​personally​,​ I have a greater strength ​being with ​my family​. ​Now my kids are both​ ​home from school. I was really impressed with how my kids have handled everything​.​ My son is in high school and my daughter came home from college. She’s studying fashion​, and it is​ easy for me to help her with some of her projects. We do have a greater sense of our family​ ​.
​I think also from a professional standpoint​,​ it’s how we use digital tools more now. Connecting through video cameras and our team meetings are online​. Why do we need to be traveling​ ​so much?
I think that will be very interesting to see what we change. Let’s face it​ ​we’re not flipping a switch and suddenly all hopping on an airplane. This is going to take a bit of time for everyone to come back. We will reassess this kind of hamster wheel we were on constantly going​.
I​ ​know for me it’s strange to have no trade shows planned right now, no flights to board, no physical meetings with customers. Another very strange thing is not having garments telling the story. To demonstrate that, now we have to come up with new ways of getting details across. I think there’ll be some changes to how we work on a daily basis and​ how designers’ creative process is changing right now. Because​ ​the inspiration no longer comes from immersing themselves and going to a different location.
We will see what changes. It will be interesting to what happens to our ​design and development calendar. If we work more regionally how will that affect us​?
​Sandeep I think we all of us will come out with flying colors in and innovate in our own ways to deal with the situation and we need to all get-together and fight it out​.​
​Tricia We have to stay strong, stay home, stay healthy, and keep our minds clear. I think this is how we will get through it. Thank you for this opportunity to talk today it’s always great to see your guests. I look forward to hearing more from your series that you’re doing on Instagram live thanks so much Sandeep!
​Sandeep ​Thank You Tri​cia, thank you so much​.​
Continuing our series of #COVIDTIMES instagram live talks, Sandeep Agarwal spoke to Stefano Aldihieri – well known denim designer and consultant- from USA. He gave an idea of what he feels of the situation and how he feels it will affect our industry and working. We bring a synopsis of discussion held with him below .
Hey Stefano, how are you doing? Hope you and all your family and friends are ok?
Hey Stefano, how are you doing? Hope you and all your family and friends are ok?
Everything is ok. I am At home in a Lockdown. Things are pretty relaxed over here and that is why I think that’s actually going to be a real problem going forward . The way you guys in India doing it seems to be a little bit tighter, more similar to what China did, and I know it’s going to be really difficult for a lot of people in India.
So what do you think I mean how are you coping with this and what are you doing at a personal and professional level?
I came back from Europe, they blocked all the travels from Europe and the thing is I don’t think I’d be able to travel back to Europe for a while now, because it’s going to take a while for them to get things sorted. I’m pretty much in the same boat as most people. We cannot travel and we have to try and do some work from home. In our job, it’s difficult to do everything remotely but I am sure we can use the technology to communicate but when it comes to product there’s not much you can do.
You cannot really show a garment or you cannot touch it and you cannot really have a good feel. On top of that pretty much everything is frozen, as you know all the stores in Europe, in the states, in many parts of Asia are shut down, so there is absolutely zero commerce going on to trade.
What do you think about how much time it will take for the situation to come back to normal?
Nobody knows. If you look at what happened in other places: in China it took about two and a half months of lockdown for them to pretty much eradicate it. Now they have to be careful about the people traveling into the country. I think it’s pretty much under control, most factories have come back to work and the stores are reopening, so life is slowly going back to normal. Other countries, like if you look at Italy or Spain or other places in Europe, I think they have reached the peak of the spread, and so things will probably start to get better over the next few weeks.
Other parts of the world, like where we live and where you live, are going to take much longer because we’ve only just started. So here I’m afraid that we’re going to see the same situation as in Italy or Spain within the next couple of weeks, it’s going to be real bad real soon. I think we have just seen the beginning of it. In New York, It’s faster because of course, it’s a much more densely populated place and there’s a lot of people traveling from all over the place, so yes, this country is going to take a little bit longer. California is speeding up, although not as fast as New York, but it’s going to get up here and so yeah it’s not good. Obviously your guess is as good as mine, but I think we’re looking at months, not weeks.
How’s Industry gonna cope up?
It’s a catastrophe. All the stores have closed, the retailers are not selling anything, of course, they have started canceling all the orders because, while we can say it’s a horrible thing, we also need to consider that, there’s no point getting goods if you’re not going to sell them, and if you don’t have a place to store them, you’re not going to send it to the stores, when you know you’re not going to sell them now.
One could argue jeans are not a seasonal product, so you could say, yeah if I don’t sell it now, I can sell it in one month, two months from now. It’ll still be okay it’s not a perishable goods. Other product is going out of fashion fast, but at the same time if there are no people working in the warehouse, then how do you even take the goods in. Also, all the retailers, especially in Europe, still have to pay all their employees –it is not like here, where they fire everybody overnight and then possibly rehire them when things reopen. So European retailers are all carrying huge costs right now – huge overheads, and even without working they still have to pay rent, still have to pay utilities and salaries.
We just read this morning that Primark is refusing to pay millions and millions of dollars of rent, and I think that’s just the tip of the iceberg. Few more will follow you and one can imagine what happens when all the big retailers stop paying rent in those big malls. The other end the really tragic side is along the supply chain, because everybody’s now pushing the buck to the next stop, and of course factories are not making anything now, they’re not getting paid for the work they’ve done. And fabric companies can’t count on any new orders going forward, so they’re going to going to be stuck for a while, and then the yarn, and the dyestuff, and the finishing product… So the whole chain is affected, which is tragic.
Once this is over and people out again do you think there will be some changes in the way people will do the shopping and do you think the habits will change
Well, that’s a really good question because I’ve been thinking about that myself, on one hand, there’s going to be possibly an issue with the availability of goods because if you stop everything it’s not like you can turn the switch on, and everything starts flowing into your stores right away, especially with production being done so far from the markets. It takes time -it takes time – for fabric mills to restart, and then they’ll have to ship the fabrics the factories, and factories have to make the goods, and then either ship or fly them. Now even if you fly them, you’re looking at several weeks of gap between when we reopen and when goods can start flowing in again, there might be a temporary advantage for the factories that are close to the markets, so for the US, I think there will be Mexican factories. For Europe, you’re going to probably see Turkey, unless they get hit very badly – and maybe parts of Eastern Europe and North Africa; those could have a temporary advantage, but of course if they don’t have fabric then there’s no advantage.
On the other hand, for people going to stores, that is going to be interesting, because we’re going to have people who will come out after weeks or months and there could be two different reactions.
One is that people will have gotten used to it and will say, well, maybe I don’t need to buy all the stuff, and I don’t need to go to the stores every other day and pick up something that I don’t really need, and maybe I have different priorities now in life and I realize there are other things that are more important. Or there could be people that are so desperate to go back to and will go crazy again, but I think, even in such a case, availability is going to be an issue. Availability is going to be an issue if all the orders are going to be canceled, then there is going to be a gap when we re-open.
It’s going to be a really really bad year, as we may lose the entire summer season and we really have no idea, I think by winter we might be back to normal, but there will still be some issues, because of the forced closure. I have a feeling that some of the brands and retailers that were already shaky before, they probably shut down now and are not going to be able to reopen, and some of the factories that are being hit now by the cancellations will not really have the means to go back to work, so they won’t be able to rehire their workers. Some governments will have to take extraordinary measures to make up for the difference and they will try to prioritize what is best for their countries.
For the retailers who are canceling currently, I thought that instead of canceling if they just offered a kind of a moratorium for two months or three months and then restart the dialogue again, what your thoughts on it?
There’s no easy solution, but what is going to be interesting to see is how committed they will still be to the whole sustainability and ethical principles, all these companies. Because one thing is to say that you are you’re committed to doing everything socially right, and ethically right, and environmentally right when things go relatively well, but when you’re into an emergency like this you tend to forget those things.
You know they were all racing to who was the most sustainable company out there up to a few weeks ago? I want to see how many of those are really, really serious about it, and how many will not stick to those principles because being sustainable means also taking care of your partners in the supply chain, and I know it’s a really really difficult thing to do, because at some point you have to decide what you’re going to cut, what are you going to sacrifice, and unfortunately it is human nature to take care of the ones that are closer to you than the ones who are far away.
Positive takeaways from this situation and your advice?
Well, we have to try and be optimistic and I think this situation can bring out the worst in us, like people price gouging or taking advantage of this is, which is absolutely unforgivable, but there’s also a lot of people who are showing a lot of compassion towards the others. Finally realizing how much incredible work all the other people in the health care world are doing, like all these nurses and doctors and janitors who work in the hospitals.
They live really really hard lives for not such a great financial retribution, and they don’t even get a lot of satisfaction most of the time, we take those things for granted. Also, people will try to go and find something that is more durable and better quality than disposable, and that is great. I don’t know if you hear the birds here, nature is blooming right now, with less pollution, even my friend in Milano said the air is clean in Milano, we can breed finally, I even saw pictures of the canals in Venice with the water so clean and it’s incredible.
Hey Stefano, how are you doing? Hope you and all your family and friends are ok?
Everything is ok. I am At home in a Lockdown. Things are pretty relaxed over here and that I think that’s actually going to be a real problem going forward . The way you guys in India doing it seems to be a little bit tighter more similar to what China did and I know it’s going to be really difficult for a lot of people in India
So what do you think I mean how are you coping with this and what are you doing at a personal and professional level?
I came back from Europe, they blocked all the of the travels from Europe and the thing is I don’t think I’d be able to travel back to New York for a while now because it’s going to take a while for them to get things sorted. I’m pretty much in the same boat as most people. We cannot travel and we have to try and do some work from home. In our job, it’s difficult to do everything remotely but I am sure we can use the technology to communicate but when it comes to product there’s not much you can do.
You cannot really show a garment or you cannot touch it and you cannot really have a good feel. On top of that pretty much everything is frozen, so as you know all the stores in Europe in the state in many parts of Asia are shut down so there is absolutely zero commerce going on to trade.
What do you think about how much time it will take for the situation to come back to normal?
Nobody knows. If you look at what happened in other places in China it took about two and a half months of lockdown for them to pretty much eradicate it. Now they have to be careful about the people traveling into the country. I think it’s pretty much under control, most factories have come back to work and the stores are reopening, so life is slowly going back to normal. Other countries I think if you look at Italy or Spain or in other places in Europe I think they reach the peak of the spread and so things will probably start to get better over the next few weeks.
Other parts of the world like where we live and where you live, are going to take much longer because we’ve only just started. So here I’m afraid that we’re going to see the same situation as in Italy or Spain within the next couple of weeks, it’s going to be real bad real soon. I think we have just seen the beginning of it. In New York, It’s faster because of course, it’s a much more densely populated place and there’s a lot of people traveling from all over the place that I so the country is going to take a little bit longer. California is speeding up to not as fast as in New York but it’s going to get up here and so yeah it’s not. Obviously your guess is as good as mine but I think we’re looking at months not weeks
How’s Industry gonna cope up?
It’s a catastrophe. All the stores have closed, the retailers are not selling anything, of course, they have started canceling all the orders because, well we can say it’s a horrible thing we also need to consider that, there’s no point getting goods if you’re not going to sell them and if you don’t have a place to store them you’re not going to send it to the stores, you know you’re not going to sell them now.
One could argue there is no such a season what seasonal product so you could say yeah if I don’t sell it now I can sell it in one month two months from now. It’ll still be okay it’s not a perishable good. It’s really going out of fashion so fast but at the same time if there are no people working in the warehouse then how do you even take the goods in. Although all the retailers, especially in Europe, still have to pay all their employees – not like here what they can do is fire everybody overnight and then possibly rehire them when things they open. So European retailers are all carrying huge costs right now – huge overheads and even without working they still have to pay rent, still have to pay utilities and salaries.
We just read this morning that Primark is it’s refusing to pay millions and millions of dollars of rent and I think that’s just the tip of the iceberg. Few more will follow you and can imagine when all the big retailers stopped paying rent in those big malls. The other end the really tragic side is along the supply chain because everybody’s now pushing the buck to the next and of course factories are not making anything now, they’re not getting paid for the work they’ve done. And fabric companies can’t count on any new orders going forward so they’re going to going to be stuck for a while and then the yarn and the dyestuff and the finishing product। So the whole chain is affected which is tragic.
Once this is over and people out again do you think there will be some changes in the way people will do the shopping and do you think the habits will change
Well, that’s a really good question because I’ve been thinking about that myself, on one hand, there’s going to be possibly an issue with the availability of goods because if you stop everything it’s not like you can turn the switch on anything stop flowing into your stores right away especially with production being done so far from the market it. It takes time -it takes time – for fabric mills to restart and then they’ll have to ship the fabrics the factories have factories have to make the goods and then here to either Ship or fly them. Now even if you fly them you’re looking at several weeks of the gap between when we reopen and when Goods can start flowing in again, there might be a temporary advantage for the sort of factories that are close to the market, so for the US, I think they will see Mexican factories. For Europe, you’re going to probably see Turkey unless they hit very badly – and maybe parts of Eastern Europe and North Africa those could have a temporary advantage but of course if they don’t have fabric and there’s no advantage.
On the other hand, for people going to stores, that is going to be interesting, because we’re going to have people who will come out after weeks or months and there could be two different reactions.
One is that people will get used to it and we say well maybe I don’t need to buy all the stuff and I don’t need to go to the stores every other day and pick up something that I don’t really need and maybe I have different priorities now in life and I realize there are other things that are more important. Or there could be people that are so desperate to go back to and go crazy again but I think in such a case availability is going to be an issue. But availability is going to be an issue if all the orders going to be canceled, then there is going to be a gap when we re-open.
It’s going to be a really really bad year as we may lose the entire summer season and we really have no idea, I think by winter we might be back to normal but there will still be some issues, because of the forced closure. So I have a feeling that some of the brands and the retailers that were already shaky before, they probably shut down and are not going to be able to truly open and some of the factories that are being hit now by the cancellations will not really have the means to go back to work, so they won’t be able to rehire their workers. Some governments will have to take extraordinary measures to make up for the difference and they will try to prioritize what is best for their countries.
For the retailers who are canceling currently, I thought that instead of canceling if they just offered a kind of a moratorium for two months or three months and then restart the dialogue again, what your thoughts on it?
There’s no easy solution but what is going to be interesting is to see how committed they will still be to the whole sustainability and ethical principle of all these companies. Because one thing is to say that you are you’re committed to doing everything socially right and ethically right and environmentally right things relatively well but when you’re into an emergency like this you tend to forget those things.
You know they were all racing to who was the most a sustainable company out there up to a few weeks ago I want to see how many of those are really really serious about it and how many will not stick to those principles because being sustainable means also taking care of your partners in the supply chain and I know it’s a really really difficult thing to do because at some point you have to decide what you’re going to cut what are you going to sacrifice and an unfortunate human nature is to take care of the ones that are closer to you than the ones who are far away.
Positive takeaways from this situation and your advice?
Well, we have to try and be optimistic and I think this situation can bring out the worst of us the worst in us like people price gouging or taking advantage of this is absolutely unforgivable but there’s also a lot of people who are showing a lot of compassion towards the other. Finally realizing how much incredible work all the other people in the health care world are doing like all the other nurses and doctors and janitors who work in the hospitals.
They live really really hard lives for not such a great financial retribution and they don’t even get a lot of satisfaction most of the time we take those things for granted. Also, people will try to go and find something that is more durable and better quality than disposable and the other thing that is great. I don’t know if you hear the bird thing in nature is blooming right now but with less pollution, my friend in Milano said the air is clean in Milano we can breed finally I saw pictures of the canals in Venice with the water so clean and it’s incredible.
Do join us for our next session with Vasco Pizarro from Portugal in our #Covidtimes talks at DENIMSANDJEANS INSTAGRAM at 4pm Portugal time on 3rd April . Follow our page to join the discussion today.
We are all going through unprecedented times. One month back nobody thought that most of the countries would be in lockdown , stores would be closed globally , factories and businesses would be unable to continue and supply chains would be broken. Happening too fast, the sequence of events is forcing us to think hard – where are we, what are we going to do , what is coming next , What effect will be there on our industry and so on. To have more clarity on these questions, Denimsandjeans started a series of live talks with global denim personalities from different countries to understand their perspective on the situation and how they are coping and what see in the future. Such live talks can be followed at DENIMSANDJEANS INSTAGRAM and we bring the transcript of the discussions . The first one here is a transcript of talk between Lucia Rosin (LR) from Italy and Sandeep Agarwal (SA) to get important insights.
S.A : Hi Lucia , How are you here and how’s everything at your end .
L.R : Ciao ! Sandeep, We are in lock down and are at home right now since more than two weeks . In this moment, we need to be more connected with the clients and look for different perspective. What we realize is the need for digital presentation and many companies are moving from regular to digital presentation. Now, we have to accelerate everything. There is no other solution and it may change the future of working in a different way.
It is difficult to travel nowadays, therefore we should use our intelligence and ways especially in Italy to overcome the situation and come out in a positive way. It is not easy to work from home because you do not have all the things handy but it contains different value now.
S.A : We have to manage like this because we do not know if this is the new normal.
L.R : We have to understand from this new normality what is going for the future of denim and fashion industry. We have to use this problem to be better and to create a new vision especially for fashion. This is the time to create real sustainability in fashion which is the real problem in environment as the better health needs to have better environment. As we know, there is no passport for virus and it has been increasing alarmingly across the world.
S.A: Many people do not realize the gravity of the situation how it can affect our lives and our work.
From this bad thing to we need to re-start in a different way for fashion. We need to take care of the real value even for garments. We should really react about sustainability with new values like durability, long lasting, traceability etc. I am sure, after all this mass tragedy, the companies that are doing well will get back if you act in a good and practical way. The new generation is really taking care about that and this will be a new revolution. Many people will be without work but new work will come up with difference. So we should see the positive point.
As most of the stores are shutting down in USA, EUROPE and other countries, most of the orders placed are getting cancelled in Bangladesh, Pakistan, China , India etc. So, what do think will happen to our industry in next few months?
This huge cancellation really creates big problem for the workers. Some brands , retailers , need to cancel because they have no orders / garments in the shop. But on the other hand, for all the poor workers , especially in poor countries like Bangladesh, we have to see deeply the new way to act for their future because it’s not possible now to put these people into poverty again. So, for the future, some brands have already started focusing on basic products, well done products. Focus more in long lasting products, non-seasonal products because we have SS currently , we need to be ready for winters but some companies are closed. So , we need to create collection with no season according to my view.
For now, I see big problem for the workers and I hope some big brands take consideration the relation that they establish in many years. If I buy garments from Bangladesh for 10 years , I cannot just cancel like that. May be we can buy 10 % – 20 % and give some money to workers otherwise there will be no company.
Yes , the government support is also very crucial as the damage has to be minimal. But what happens after the things are back to normal. How are we going to change our way of working ? Is it going to change forever?
What we can do is to do our best . We need to be more connected with each other. If something happens to China, the virus spreads and the effect is global. We try to support the company we are working and we try to be positive and create intelligent solutions, be fast to react and react immediately. We have to act quick and think about health and workers first then work comes because if there is no people , then no work. And hence no business.
It seems there might be 2 options post crisis, people might jump for shopping because of the shopping desire or people might change their view and they focus on more important aspects of life and reduce shopping.
Healthy and wellness are the keywords for the future. So, this will be the view of the shoppers as we need to create fashion. When you have partner in some countries, you have to take them as employee. These are going to push retailers to push in fast manner. Also, young generation knows how to use technologies and tools or they will be forced to do it
Consider a worrisome scenario – With orders getting cancelled, factories not working , workers are getting fired and suddenly after 2 months ,things get normal and there is high demand and you restart the whole thing again.
We have to use this big problem as a good way to change otherwise there is no future for new generation. Better and healthy environment is future .We have been working since many years on this topic and now will be more rigid with people. We have to be more careful for the future. Everybody should think better health for all. Its not just marketing tool but a core tool for future. We will have better environment , high quality , we will create more local brands which will be created and designed in Italy with more sustainable products .More local means more quality and more sustainability to create a better future.
Some Interesting Comments During the Talk
Viewers engaged well with the talk and gave various comments which reflects how the opinion of the industry is changing. We share some of the comments which came up during these talks .
Coronavirus spread is hugely affecting all of us. A large part of humanity is under lockdown and businesses are shut. Stores in most of the western countries have shut down and retailers are canceling orders en masse. The entire supply chain is crippled and people are totally confused.
The impact of the corona is being felt across all industries and our industry is no exception. Denim professionals are confused about what they need to do and how to prepare for the future. The nature of the industry is likely to be changed in the coming months and we all need to prepare for the same. Even though the coronavirus situation might improve in the near future, the working patterns of our (and other) industry will change. The logics which seemed so apparent before may not apply now.
Keeping all this in mind, we had started our Live Chat on Instagram webinars with some important denim personalities globally so that we, and the others, could make out some sense of what is happening and get some idea of what will happen in the future.
Our recent live interaction discussions are as follow, please have a look and do not forget to follow our Instagram page at https://www.instagram.com/denimsandjeans/?hl=en
Live Interactive Discussion With Lucia Rosin
Stefano Aldighieri
Tricia Carey
You can also listen to the podcast of all upcoming episodes of Covid Times at on Spotify at https://lnkd.in/fb8RQMR
We have the following talks coming out on 1st April. The first one is with Katsu Manabe of Momotaro group. Sandeep Agarwal will speak to him and will try to understand from him the situation in Japan and how it is changing the industry. Timing Japan time : 8.30 pm HK Time : 7.30 pm India time : 5.00 pm Pakistan time : 4.30 pm UK time : 12.30pm EST time : 7.30 am
The second Live cast will be with Neeraj Sachdeva ex- Creative Design | Head of design, merchandising BENETTON. The timings will be as below on 1st April :
EST Time: 9.00 am UK time: 2.00 pm Pakistan time: 6.00 pm India time: 6.30 pm HK time: 9.00 pm Japan time: 10.00 pm
On April 2nd, we shall be in a live discussion with Ms. Dilek Erik from Turkey, details of which are as follows : Turkey time : 4.00 pm EST Time : 9.00 am UK Time : 2.00 pm Pakistan time : 6.00 pm India time : 6.30 pm HK Time : 9.00 pm
Bangladesh, the 2nd largest garment exporter in the world and one of the fastest-growing economies in Southeast Asia, seemed to be in a very serious problem due to Covid 19 which caused lockdowns in the USA and Europe.
The government has sanctioned a bailout package of Tk 50 billion($600 million) for the RMG sector to ensure the timely payment of wages to the workers, however, an industry which earns $34 billion annually, contributes more than 13% in the country’s GDP and also employs over four millions of workers, have its own apprehensions regarding its survival in the long run.
Last week, Ms. Rubana Huq, BGMEA president, confirmed that due to the lockdown in the USA and Europe, orders of 864.17 million pcs valued at $3bn have been canceled which added panic to over 1000 garment factories which were exposed to this loss. The majority of canceling orders are from C&A, Inditex, Primark, Marks & Spencer, Tesco, Walmart, and Target.
Ms. Rubana Haq Urging Brands not to cancel the orders
Amid all such hustle and bustle, H&M came to the rescue and assured its garment suppliers of taking shipment of goods that have already been manufactured, however, the brand has categorically stated that they are not going to place any new orders and also going to review the potential changes on recently placed orders as the COVID-19 outbreak impacted their business supply chain.
During March 21-25, a survey was conducted by the Center for Global Workers’ Rights and the Worker Rights Consortium, a Washington, D.C.-based labor rights organization, findings of which are very worrying.
Credit: Getty Images
The Survey included approx 200 large suppliers that mainly manufacture garments for EU brands and retailers and employ over 750 workers.
The finding suggested that nearly all buyers refused to contribute to wages for those workers, and more than 70% of those furloughed were sent home without pay. Of the workers who were fired, less than 20% were given severance pay.
The 1st case of Covid 19 was reported on March 8 and as of now the country has reported only 49 confirmed cases and 5 deaths, the government has asked people to stay at their homes and practice social distancing, however considering the population density of Bangladesh, social distancing will not be easy.
Credit: Witness Image
Bangladesh is one of the most densely populated countries in the world and is packed into 147629 square kilometers and it accommodates approx. 164 million people out of which 21 million lives in Dhaka, the capital of Bangladesh.
“In other countries, people can isolate. Our people don’t have that possibility. Workers live in houses that are a 10 x 10 room where 5 or 6 people live. If one person gets infected in a community, everyone will be infected.†said Kalpona Akter, Executive Director, Bangladesh Centre for Worker Solidarity
In current times , even the most developed countries are finding it difficult to handle the COVID situation. Every country has its own challenges and so Bangladesh has its own. The govt . seems to be taking all measures to control the disease and resultant damage. The brands and retailers need to extend their help to this country as well other important garment exporting countries like India, Pakistan, Sri Lanka etc which have been seamlessly delivering to the brands over decades. We all need to stand in solidarity to fight this battle collectively.
Read all the latest industry updates on Covid19 at https://www.denimsandjeans.com/recovery/corona-denim-fashion-industry-updates
