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EMERGING OPPORTUNITIES IN FASHION INDUSTRY
Dr. M.MADHAVANASST. PROF. OF ECONOMICS
ARIGNAR ANNA GOVT. ARTS COLLEGENAMAKKAL, TAMIL NADU
THE FASHION Consumer acceptance of a
particular style at a particular period of time
DemographicsPsychographics
Fashion SociologicalPsychological
FUTURE OF FASHION & TEXTILE INDUSTRY DEPENDS ON
TECHNOLOGICAL UP GRADATION ROLE OF GOVERNMENT EXPLORING NEW MARKETS & PRODUCT
INNOVATION / DEVELOPMENTS
TEXTILES
WOVEN KNITS NON WOVEN (felt) (bond)
THE STEPS TOWARDS FREEING INTERNATIONAL TRADE SO FAR
ATC (Agreement on textiles and clothing – since 1995)
WTO (Member signatories removed quotas from Jan 1, 2005)
Step Period % to be brought under GATT
I 1.1. 1995 to 31.12.1997 16%
II 1.1.1998 to 31.12.2001 17%
III 1.1.2002 to 31.12.2004 18%
IV 1.1.2005 49%
Who can win?
The person who can produce quality products at competitive price
How to achieve? Productivity improvement Technological up gradation Stringent control over quality Frequent training Sourcing new markets and introducing
new strategies in marketing Own design & Brand development
The Indian scenario
“OUR COUNTRY IS CONSISTENTLY LOSING EVERY OPPORTUNITY TO MEET
THE INTERNATIONAL FRATERNITY, TO IMBIBE GLOBAL WORK PRACTICES,
TO ACQUIRE GLOBAL VISION, FORM STRATEGIC ALLIANCE AND JOINT UNITS,
TO REACH OUT NEW CUSTOMERS, OR MARKETS, KEEPING ALOOF IN
INTERNATIONAL SEMINARS, CONVENTIONS, INDUSTRY FORUM.
IN CASE OF GARMENT INDUSTRY WE REPRODUCE THE DESIGNS GIVEN BY THE
BUYERS & NOT DEVELOPING OUR OWN STYLES AND DESIGNS.
OPINION OF TRADE EXPERTS ABOUT INDIAN TRADE
PARAMETER / SECTOR INDIA GLOBAL COTTON CONTAMINATION 30 – 50% 15 – 18%
COTTON PRODUCTIVITY 300 KG / HA 580 KG / HA
SPINNING CAPACITY 36% 90%ITALY 50% USA
SHUTTLE LESS LOOM 9550 85,800 CHINA 29,000 KOREA
EXPENDITURE ON R & D 0.2% 1.5 TO 2%
PROCESSING TECHNOLOGY MANUAL AND SEMI AUTOMATIC ADVANSED MECHANISED
TESTING OF MATERIALS CLIENT ORIENTED INTEGRAL PART OF THE SYSTEM
MANUAL VS. POWER MACHINES 31% : 69% 0.1% : 99.9%
ISO 9000 462 3,673INFRASTRUCTURE 20 52
WORKERS TRAINING AD – HOC SYSTEMATIC AND INDUSTRY COMMITTED
GLOBAL COMPARISON
Average cost per operator hour (in cents)
India 0.58
Pakistan 0.37
China 0.69
LABOUR COST COMPARISON
(COMPLED BY: WEMER, USA)
Man-made Textiles 7.67% 7.67%Silk Textiles 2.09% 2.09%Woollen Textiles 2.5% 2.50%Coir 0.49% 0.49%Jute 1.22% 1.22%Handicrafts 13.3% 13.30%Cotton Textiles 32.4% 32.40%Readymade Garments 40.2% 40.20%
INDIA'S Textile Exports
Coir 0.49%
Jute 1.22%
Man-made Textiles 7.67%
Silk Textiles 2.09%
Woollen Textiles 2.5%
Handicrafts 13.3%Cotton Textiles 32.4%
Readymade Garments 40.2%
CHINA VS. INDIA TEXTILES – PRESENT STATUSŒ VERY HIGH DISCIPLINE
Œ LOW POWER COST
Œ LOW INTEREST COST
Œ HIGH MODERNIZATION
Œ SIMPLE REGULATIONS
Œ HIGHLY DEVELOPED INFRA-STRUCTURE
Œ EXIT POLICY
Œ STRONG RE-TRAINING
Œ ECONOMY OF SCALE UNIT
Œ HIGH QUALITY PRODUCT
Œ TARGET 40% OF WORLD SHARE
VERY AVERAGE DISCIPLINE
HIGHER BY 54%
14.5% TO 18% AS AGAINST 6%
SLOW RESPONSE
COMPLEX AND COMPLICATED
POOR INFRA-STRUCTURE
UNCERTAIN POLICIES
TOTAL ABSENCE OF TRAINING
SLOW RESPONSE
CASUAL WEARS
PROVIDING 15% BUT NOT REACHING EVEN 2%
Undeveloped infrastructure
Low productivity / high absenteeism
Uncooperative labour
Environmental issues
Highly regulated sector
UNCERTAIN FUTURE
PRODUCTIVITY - YIELD
COTTON
Factor Unit China India Difference
Area (‘000) hectare 4,600 8806 + 4206
Production (‘000) tons 4,600 2805 _ 1795
Yield / hectare tons 1,000 318 _ 682
COUNTRY % of share in world trade apparel
World 198940
USA 66392 33.4
EU 85909 43.2
SOURCE WTO STATISTICS
APPAREL IMPORTS (MILLION US $)
CANADA5%
N.QC16%
EU39%
USA40%
CANADA
N.QC
EU
USA
INDIA’S Share of Market Segments
Marketwise Analysis
Exports to USA have gone down substantially by (-) 12.92% in value, and by (-) 6.01% in quantity terms. Canada has also registered a substantial loss of (-) 15.10% in terms of value and (-) 16.93% in terms of quantity. EU has seen an decrease of (-) 4.87% in terms of value and a increase of 1.55% in terms of quantity. Non-Quota countries have registered a decline of (-) 52.45% in quantity terms and of (-) 57.07% in value terms.
VOM CHINA INDIA
EXPORTS $ bn 194.8 34.5
IMPORTS $ bn 165.8 44.46
BOP $ bn + 29.0 -9.96Source – clothesline Jy / 01
SWOT
ANALYSIS
STRENGTH
FIBRE
LABOUR COST
HUMAN RESOURCE
WEAKNESS
QUALITY
DELIVERY SCHEDULEABSENCE OF QUALITY PROFESSIONALISM
LIBERALISATION
EXHIBITIONS
POLITICAL -
UNDERSTANDINGS
POPULATION
PHASING OUT QUOTA
REGULAR BUYERS
NEIBOURING COUNTRIES
PHASING OUT OF QUOTA
INTERNATIONAL PRICING
SLOW RESPONSE
LACK OF TRAINING CENTRE
INCREASING COST
UNSTABLE POLITICAL
ENVIRONMENT
OPPORTUNITY THREAT
SWOT ANALYSIS
EXPORTERS PRESENT SITUATION
Attitude To change
Quota Quality, Delivery,lead time
Subsidies World class Manufacturing
Price Customer focus, quality, Agility
Transparency Sourcing
Sourcing Trust, partnership
Delayed delivery speed, service
Quality Strategy
POSITIVE SIDE OF INDUSTRY HAVING GREAT HOPE WITH EXISTING BUYERS
& STILL MAINTAIN THE GOOD RELATIONS STARTED TO REALISE THE IMPORTANCE OF
TECHNICAL UP GRADATION STARTED TO REALISE THE IMPORTANCE OF
TRAINED MAN POWER VERY GOOD QUALITY, ENVIRONMENT &
SOCIAL ACCOUNTABILITY AWARENESS(ISO –9000,14000, SA-8000)
THE ROLE OF GOVERNMENT THE NATIONAL TEXTILE POLICY
Aim to develop a strong and vibrant industry that can produce cloth of good quality at acceptable prices to meet the growing needs of the people.
Employment generation Compete with confidence for an
increasing share of the global market.
THE MAIN OBJECTIVES OF NATIONAL TEXTILE POLICY To equip the industry to withstand pressures of import penetration and maintain a dominant presence in the domestic market.
Liberalize controls and regulations so that the different segments of the industry are enabled to perform in a greater competitive environment.
Enable the industry to build world class state – of – the – art manufacturing capabilities in conformity with environmental standards.
The National Textile Policy2000
The endeavor will be To achieve the target of textile and apparel
exports from the present level of 11 billion dollar to $50 billion by 2010 of which the share of garment will be $25 billion.
To assist the private sector to set up specialized financial arrangements to fund the diverse needs of the textiles.
To set up a venture capital fund for tapping knowledge based entrepreneurs of the industry, facilitate the growth and strengthen HRD institutions like NIFT, NIFT-TEA, NID, etc., on innovation lines.
The Highlights of the PolicyGarments The highly export oriented sector has been taken
off the SSI(small scale industries) reservation list, enabling corporates to invest large amounts in garment manufacturing.
The deservation also enables free flow of FDI (Foreign Direct Investment) to the extent of 100%.
This will prepare Indian garment exporters to face the fierce international competition that is likely to ensure once the export quota regime is dismantled.
Employment generation In the light of 2004 regime the exporters are
showing much interest with trained Fashion designers, Merchandisers, Production managers etc,
In the case of fashion designing, so far the industry people are using the design supplied by the buyers.
Now the awareness of fashion designing is taken place due to the brand promotion activities.
The new domestic brands are showing keen interest in developing new designs.
Each and every day the new entrepreneurs are entering in to the field.
Since the growth export sector is positive, the growth of the industries which are concentrate the production of accessories are also increasing.
Careers in Fashion Industry
Whole sale Trade Retail Designing Opportunities in Fabrics and fashion Opportunities in Fashion Illustration Opportunities in Fashion Writing Opportunities in Modeling Merchandiser Quality controller Production Manager, Supervisor Fabric Coordinator Sampling Incharge
THANK [email protected] during 2004-2005