The apparel and textile business blog from Petah Marian
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Sri Lanka Design Festival kicks off
15 Nov 2012 16:32
I'm in sunny Sri Lanka. Sadly, I'm not poolside sipping on cocktails, but hard at work bringing you the latest from the 2012 Sri Lanka Design Festival, which began last night (15 November).
Sri Lanka's garment industry has always differentiated itself by its sustainable and ethical credentials, and this year that focus is set to continue, with today featuring a sustainable fashion symposium, and a visit to the Hirdaramani Eco Factory.
Saturday, the Mount Lavinia Hotel will play host to the South Asian Leadership Forum. The programme will focus on speed to market as Sri Lanka becomes a fast fashion hub, not only for its own manufacturers but also for manufacturers based in India and Bangladesh looking for an easier route to Europe.
Speakers will include the heads of local manufacturers Brandix and MAS - Ashroff Omar and Mahesh Amalean.
Ultimo founder and CEO Michelle Mone will also be speaking about how to build brands, while Copenhagen Fashion Summit chairman Jonas Eder-Hansen will talk about the sustainability imperative.
Meanwhile, industry stalwart David Birnbaum is speaking, as is American Apparel Producers Network (AAPN) MD Mike Todaro, PVH's global supply chain VP Mark Green, Coats Thread global sales chief Stephen Forte and Tradecard CEO Kurt Cavano.
Today, I also visited the Brandix Eco Factory and met with Timex to learn about their plans. Stories on these, and more, will be going up in the coming days, so please check back often.
If you're attending the festival and want to say hi, I'm the the one that vaguely resembles an over-ripe tomato (the Sri Lankan sun has a bite).
And finally, if you have any tips on how to get rid of sunburn, please leave them in the comments.
Weather falls in line with the seasons
16 Oct 2012 18:41
UK retail watchers last week breathed a collective sigh of relief as the weather finally begin to cooperate with the fashion seasons, with demand for clothing and footwear helping to lift retail sales growth by 1.5%.
The colder September gave clothing retailers a "major boost", with consumers stocking up early on coats, boots and knitwear, according to the BRC/KPMG sales monitor.
Burberry's first-half results also offered some relief as the luxury brand recorded an improvement in like-for-like sales after it had earlier issued a profit warning at the 10-week point of its second quarter. CFO Stacy Cartwright said that while footfall was down, its more "aspirational luxury customer" has been harder hit by the economic environment.
Speculation about where former Marks & Spencer general merchandise boss Kate Bostock would land was also laid to rest last week, with her appointment as executive director of product and trading at online clothing retailer Asos.
Uniqlo owner Fast Retailing again signalled its ambitions last week, saying it expects sales to top JPY1trn in 2013, as it continues to aggressively pursue growth outside its Japanese home market. The announcement came as the company recorded a 31.8% increase in full-year income to reach JPY71.6bn.
However, the news for Australian surfwear brand Billabong was less positive, as private equity firm TPG Capital withdrew its AUD1.45 per share bid for the company last week.
Meanwhile, Puma revealed in its latest Product Environmental Profit and Loss findings that the environmental impact of its biodegradable InCycle Basket shoe was 31% less than its conventionally made Suede shoe. However, costs were offset by higher import duties on the biodegradable plastic used in the product. Chairman Jochen Zeitz wants governments to reduce import duties on synthetic materials in an effort to encourage the manufacture of greener shoes and clothing.
US clothing retail sees growth despite looming headwinds
08 Oct 2012 14:57
Clothing retailers in the US look set to see growth continue into the holiday season despite economic and political uncertainty continuing to hang over forecasts.
Yet, a slowdown in consumer spending could be looming in the US, unless the lawmakers can reach an agreement to avoid the "fiscal cliff", which is approaching at the end of the year.
A combination of tax increases and across-the-board spending cuts are set to take effect from the beginning of January unless the president and Congress can agree on a new deficit-reduction plan.
If steps are not taken to avoid the situation, as much as 4-5% could be lost from the country's GDP, warns National Retail Federation President Matthew Shay.
However, the federation is estimating sales will rise 4.1% over the the holiday season to reach US$586.1bn this year, down on the 5.6% increase recorded last year. Yet the news is not all bad, as this forecast is higher than the ten-year average of 3.5% growth.
One victim of the tough US retail environment was Bakers Footwear, which filed for Chapter 11 protection last week after falling sales led to it defaulting on its credit line. The move comes less than two months after Bakers Footwear revealed plans to shed more than 70 stores and up to one-third of its staff in a bid to turnaround the business.
Meanwhile, Gap is set to introduce new fire safety standards at supplier factories in Bangladesh. The proposal will mean hiring a fire safety inspector to oversee garment factories making its brands, loaning vendors up to $20m to make safety improvements and providing up to $2m in compensation to workers at its biggest producers who are displaced while factories are being improved, the company said.
Adidas is looking into the possibility of setting up an industry insurance fund to help workers who are left with no wages or benefits when supplier factories close. This follows the sportswear brand coming under pressure earlier this year to make US$108m in severance payments to workers at a former Indonesian supplier factory after its owner fled without paying them.
Marks and Spencer has continued to push its sustainability credentials, launching the first garment made through the closed loop production process from recycled clothes donated through its Shwopping scheme. The coat, which is made using wool from old or unwanted clothing donated by M&S customers, will be sold for GBP89, which the retailer says is half the price it would be if made using virgin wool.
The battle for British clothing manufacturing wages on
26 Sep 2012 15:30
The battle for the future of British clothing and textile industry took centre stage at a conference organised yesterday (25 September) by the Association of Suppliers to the British Clothing Industry (ASBCI).
The Olympics has shone a spotlight on the best of British over the past year, and there remains a great affection and interest for this country's heritage brands and textiles abroad.
The commonly held view has been that UK manufacturing plays an essential role for premium heritage brands like Burberry, Johnson's of Elgin or Barbour, but less so for the high street.
However, with turnaround times becoming ever-faster, and the cost of manufacturing in China increasing, some are suggesting that a UK renaissance might be due.
UK manufacturer Buff Clothing's creative design director, Sangita Khan, argued that her company is proof you can produce large volumes in the UK and still make a profit. Her company works with retailers like Next, River Island and Matalan, and emphasised the benefits of producing locally.
Fashion Enter director Jenny Holloway is another backing the UK industry, with her not-for-profit group servicing between 4,500-5,000 pieces a week for companies like John Lewis, Oasis and Asos.
However, Michael Spenley, who is director of Shop Direct subsidiary Compliance Direct, warned against companies assuming that the made in Britain sign assures products have been produced to higher ethical standards.
He said Shop Direct has chosen not to work with certain factories after unannounced visits found one factory's entire staff was off with TB, while another was conducting business and had staff living out of a derelict school, with bedrolls and gas stoves alongside machinery in the factory.
Yet for all the enthusiasm for UK manufacturing, there remains a number of challenges, not least the ageing workforce.
Spenley put it best when he said: "If good intentions and positive headlines were bankable assets - the UK clothing manufacturers would be in terrific financial shape".
This renaissance may still be a few years off.
Europe is not the world
19 Sep 2012 11:43
The global retail industry is looking to London over the next three days as senior executives converge on the city to discuss the issues facing the sector at the World Retail Congress.
Of late, many of the stories about UK retail in particular have focused on doom and gloom, after the Olympics failed to provide retailers with a much anticipated sales boost.
However, in his keynote speech this morning, Sir Roger Carr, president of the Confederation of British Industry (CBI), emphasised "the condition of Europe is not the condition of the world".
Countries like China, India and Africa are enjoying the kind of growth that the West can only dream about, he explained.
However, the astronomical growth seen in these countries is now moderating, with Carr describing a "reduced appetite for luxury" in many of these emerging markets.
And with growth in these markets slowing, a presence here is no definite recipe for success. Regardless of which markets retailers are operating in, or looking to operate in, it is clear that they have a "fight on their hands" for consumers' hearts and minds, argued Carr.
Slowing growth is not the only challenge retailers have to contend with. As Tesco CEO Philip Clarke said in his speech this morning: "Change is increasingly complex", and includes the shift online and the pursuit of a true omnichannel offer.
These and many more issues will be discussed by some of the brightest minds in the business over the next three days - with just-style here to bring you the latest insight as it emerges.
Mary Katranzou in Vodafone partnership
15 Aug 2012 16:36
Telecoms company Vodafone UK is shoring up its support of British fashion after signing a two-season partnership with designer Mary Katranzou in collaboration with the British Fashion Council.
The collaboration follows similar partnerships with designers Richard Nicoll and Christopher Kane, and will allow fans exclusive access to Katranzou's London Fashion Week show, as well as the chance to meet the designer backstage.
"Their innovation elements really appeal to me and it felt a natural fit to join forces," Katranzou said. "I'm really looking forward to be able to widen the fashion net to their customers and bring them to the front line of fashion week."
Did the Olympics boost London retail sales?
13 Aug 2012 16:43
The curtain has come down on the London 2012 Olympics, and it seems concerns that consumers were avoiding the capital may have been overblown, with more than half of retailers there reporting an increase in demand, according to research released by Deloitte.
The study found that 59% of retailers surveyed reported a rise in demand, and 32% recorded a decline.
"As the heart of London moved east, location has clearly been important, especially for smaller businesses with fewer locations," said Deloitte partner Heather Hancock.
"But for large chains with stores, hotels and restaurants across the capital, opportunities have been there to exploit and it appears sharp, nimble businesses have responded by changing trading hours and moving staff to service their busiest locations."
Indeed, John Lewis experienced a boost, reporting a 22.4% jump in sales over the week ended 4 August. Clothing sales jumped 25.5% over the week, with men's wear and sportswear recording the greatest gains. Meanwhile, sales of London 2012 merchandise soared 51% on the prior week.
"Undoubtedly, the feel-good factor of Team GB's medal success has had a direct impact in uplifting sales, not only in our London shops but also in our branches throughout the country - certainly a great way to start the new half year," the retailer said.
However, Experian Footfall's numbers told a different story. It found retail footfall declined by 9.6% in the first week, and 8.6% in the second week in London against the same period of last year. West London fared better, with a 2.9% decline in the first week, and a 0.94% rise in the second.
"The unparalleled sporting event for a generation brought huge numbers of visitors into London, although their impact in terms of expenditure in the shops remains to be seen," said Experian UK regional director Steve Richardson.
Nike nicks Adidas' thunder
07 Aug 2012 15:13
Nike's Volt shoes
While Adidas is the official Olympic sportswear sponsor, Nike is doing a pretty good job of stealing the German brand's thunder.
Watching the athletics over the past couple of days, it's been pretty difficult to miss the sea of fluorescent yellow running shoes on the track. And unfortunately for Adidas, these eye-catching shoes are part of Nike's Volt range.
A spokesperson for Nike told just-style today that over 400 athletes (mostly Nike sponsored) are wearing the Volt range in the games, with the majority in athletics, but also boxing and fencing. Even South African sprinter Oscar Pistorius' prosthetic spike plates have the ubiquitous Nike swoosh on them.
Nike says over 20 medals have been awarded to those wearing the shoes as of this morning.
The company's 'Find your Greatness' campaign also seems to be getting a positive response. The campaign features ordinary athletes competing around the world (outside the UK) in places that happen to be called London.
Indeed, an online survey of over 1,000 US consumers at the end of July found some 37% of respondents thought Nike was an Olympic sponsor, and only 24% answered correctly that Adidas is one, Ad Age reported.
The importance will not be lost on either brand, with research by the NPD Group (unsurprisingly) finding a spike in sports footwear sales during the months of high-profile sporting events.
It said that over the past four years, basketball footwear sales increased in February, the month of the NBA Basketball All Star game, during the back-to-school period in August and during the December holidays.
NPD chief industry analyst Marshal Cohen highlights the issue faced by Adidas at the moment, saying that using platforms like the World Cup or the Olympics to give a brand a lift is "never a guarantee due to the oversaturation of brand sponsorships".
"The ultimate prize is the emotional association award - the needle will move when consumers connect your brand with an event, team, and athlete they are very passionate about," Cohen adds, something Nike seems to be doing quite well, despite not having paid for the privilege.
I doubt that Adidas would suggest its US$201m sponsorship was a waste, as it emphasised last week that it is closing the gap on Nike in the UK, increasing its market share by two percentage points, with UK sales up 24% so far this year.
Nike seems to be pinning its hopes on gold in the field, and Adidas may just have to settle for silver.
What drives the world's largest retailer's success?
01 Aug 2012 17:18
Zara, which opened its first store in 1975, has taken its pioneering fast fashion approach global, becoming the world's largest retailer in the process.
While Zara has become ubiquitious on high streets around the world, its founder, Armancio Ortega, has remained fiercely private. In the recently released book 'The Man From Zara', Covadonga O'Shea looks to understand the man behind the brand. Here are five strategies that have driven the retailer's success:
- Zara constantly renews its stock - 40% of stock is changed each week -while stock in the stores is replenished every three days. Each year it offers 20,000 SKUs and and aims for a complete turnover of stock in its stores every 28 days.
- The company's strategy is to create a climate of scarcity and opportunity in its stores, which means that customers must purchase items they like when they first see them, as the same product is unlikely to be in stock a week later.
- Vertical integration means Inditex has much more control over the production of its products. Inditex owns some 99 companies covering not just textiles and fabrication, but also logistics, marketing, construction, real estate, finance and power generation. It produces over 50% of its collections in its own factories and in Spanish and Portuguese co-operatives.
- Ortega goes out of his way not to see other retailers' collections to avoid claims of copying. "They can accuse us of plagiarists if they like, but the truth is that among all the great brands, and the not so great ones, there are always areas where they coincide. It might be better to refer to that process of mutual influence as 'inspiration," Ortega reportedly said.
- Stores are largely autonomous: managers decide which stock to carry and are responsible for their smooth running. There are six fundamental things that Ortega expects from his stores at a minimum: always wear a pleasant expression, smile at the cash desk, have a pen in the hand, the manager should attend to customers most, the changing rooms are treated as an important point of sale, and in-store staff must be patient.
Channelling the Olympic spirit
18 Jul 2012 11:36
A colleague expressed horror earlier this week on realising that the only entry to the Olympic stadiums in London will be through a purpose-built Westfield Mall. She was surprised at the rampant commercialism of the games.
However, the furore following news that the US Olympic team's uniforms were made in China instead of on home soil, only emphasises just how important the Olympics are to the apparel and footwear sectors.
After an outpouring of opprobrium on Friday and over the weekend, Ralph Lauren promised that the American team uniforms for the opening and closing ceremonies for the 2014 Winter Olympics would be produced by US firms.
While this particular issue has caught the public's imagination, the road to 2012 has been marred by scandal, with NGOs alleging child labour use and worker exploitation in factories producing licenced goods for the Olympics.
The Olympics are expected to be watched by 4bn people around the world, and with a lack of perimeter advertising, the clothes on the athletes' backs (and shoes on their feet) offer sportswear companies the greatest opportunity to promote their wares.
And how better to do so than to take some of the credit for athletes' success, through designing products that will make them harder, better, faster, stronger, and so on.
In recent months, major sportswear brands have been keen to tout their latest innovations, some of which have improved athletes' performances to such a degree that they've been banned.
For example, Speedo's LZR Racer Swimsuit was prohibited because it provides an unfair advantage over non-LZR wearers. According to Euromonitor analyst Magdalena Kondej, the suit reduces drag by up to 6% on swimmers and is made using a fabric containing woven elastane-nylon and polyurethane.
However the brand will see the benefit of its latest suit, the Fastskin3, which claims to offer full-body passive drag reduction of up to 16.6%, an 11% improvement in the swimmer's oxygen economy, and a 5.2% reduction in body active drag.
Patriotism, particularly well highlighted by the manufacturing furore in the US, should not be underestimated. Kondej predicts that based on average apparel spend, population size, sports attitudes and strength of the national teams, GB, US, China, Russia and German team branded apparel will be particularly strong sellers.
In a year when the consumer environment means that companies are scrabbling for every dollar or pound they can get their hands on, the Olympics provide companies with a magnificent opportunity. Here's hoping the sector gets the gold this Olympics.