Blog: Apparel industry reacts to Russia tensions
Michelle Russell | 18 August 2014
Retail shares have been among the biggest fallers in the last two weeks as financial markets react to President Vladimir Putin's retaliation to the imposition of sanctions on Russia. While the ban was imposed on food and agricultural imports, analysts believe the apparel industry is unlikely to be immune from the effects of the standoff, with majors like Adidas already suffering long-standing issues in the country.
UK value fashion retailer New Look is one company already exercising caution, having put the brakes on its expansion into Russia, citing concerns over the worsening political situation in the country.
In Canada, retailer Target has been busy tackling its supply chain and merchandising issues as part of broader plans to try to fix its operations in the country. Analysts are optimistic the company is finally heading in the right direction as it focuses on three main areas: improving in-stocks, sharpening its pricing strategy and enhancing its merchandise assortment.
Elsewhere, Hong Kong-based Crystal Group published its sustainability report, in which the company said that, as business expands, it is determined to leverage on its global presence to "influence more people" and "create greater impact throughout the world".
Its global presence saw the company ship 300m garments in 2013 from its factories in China, Vietnam, Sri Lanka, Bangladesh and Cambodia - a production hike of 30% year-on-year - and lift turnover by 26% to a record US$1.6bn.
In Cambodia, unions and garment factory owners remain "at odds" over plans to increase the minimum wage, with recent talks reportedly ending in stalemate. Unions are insisting wages should increase to US$177 per month, but factory owners say they can't afford such a sharp rise.
A union is also claiming that the country's garment workers are "dying on the job" because of a combination of overwork, poor working conditions and poverty wages.
Meanwhile, changes to Chinese policy on building up its reserve of cotton stocks could create more available supply, and keep prices down in the future, a new report by Cotton Inc has suggested
Companies: New Look
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