"We're in this together" – How the IAF rallied round in the crisis - Just Style
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“We’re in this together” – How the IAF rallied round in the crisis

By Leonie Barrie 28 May 2021 (Last Updated May 28th, 2021 12:36)

The International Apparel Federation is reaching the end of an era, with one of its longest-serving champions stepping down later this year.

It’s hard to overstate Han Bekke’s impact at the IAF, where he has been a driving force since its inception in 1972. Most recently he’s served as its secretary general (2006), its treasurer (2014) and has been president since 2016, with his tenure extended by a year due to the coronavirus pandemic.

He’s also president of MODINT, the Dutch trade association for fashion, textiles and interiors – another role he’s preparing to leave at the beginning of July.

“It’s an interesting time,” he says, with some understatement.

Bekke’s commitment to the IAF comes from his conviction that the global apparel industry needs a global federation to tackle cross-sector challenges on a global level.

Fragmentation of rules and regulations, a supply chain reset to break the constant pressure on price, real collaboration to share profits and risks, and the key role played by education are all topics he has been passionate about for most of his career.

But the past year also marked a turning point that saw the IAF raise its voice for perhaps the first time in its near-50-year history.

“We are not a political association, we do not lobby – our founders decided that should be done by the national associations,” he explains. “But because of Covid and what happened in the supply chain, where many suppliers were set aside by their customers, IAF made a strong statement standing up against misuse of buying power.”

With its member associations representing more than one hundred thousand companies and millions of workers, the IAF joined a Call for Action to push for emergency funding to support garment factories and workers through the Covid-19 pandemic. It also helped secure a pledge from signatory brands and retailers to pay manufacturers for finished goods and those in production.

“So there you see the importance of a federation. I also see that on a national level there is more connection with members, and what we can do together. In a time of crisis people stick together and see the value that an association can have.”

Business network

Founded as a business network by industry leaders from Europe, Japan and the US, the IAF’s core members are national industry associations in nearly 40 countries – but also include suppliers, educational institutes and even brands and retailers.

“We have a membership on five continents, and still, after nearly 50 years, the main reason is to be connected to the rest of the world, meet colleagues, and talk about common issues, and also see how they can learn from each other. And that is the role IAF has played and is still playing.”

One of the biggest challenges, though, is that while IAF presents a united front on the supply side, “on the customer side there is no international retail association we can talk to. We have to talk to the retailers one by one. For us, that’s what’s missing. But it’s the reality and we have to deal with it.”

Nevertheless, the federation is leading the way on a new ‘Manufacturers Payment and Delivery Terms’ initiative focused on improving brand and retailer purchasing practices and strengthening the position of suppliers across the textile and garment industry.

Launched earlier this year with the STAR Network, an inter-Asia Network of Producer Associations from Bangladesh, China, Cambodia, Myanmar, Pakistan and Vietnam – most of whom are, not surprisingly, members of the IAF – it has been steadily gathering momentum.

With additional support from German development agency GIZ Fabric and the Better Buying Institute, it has now expanded to 13 apparel and textile industry manufacturing associations from nine countries across Asia, the Middle East and North Africa, whose combined membership accounts for close to 70% of global apparel exports.

Participants are currently working to raise the bar on ‘commercial compliance’ by setting out certain red lines that payment and delivery conditions must not cross.

“IAF’s stance is that we are in this together; we need more cooperation to get a better balance between profit and risk,” Bekke explains. It’s also more commercially sustainable when “the risk is not on the table of one factory.

“Based on the experience we have in countries like the Netherlands and Germany, we are combining forces to see how we can help manufacturers on payment and delivery terms. With Covid it was absolutely clear that what happened was not acceptable for the future. It’s a good beginning to see where we can cooperate between members and non-members of IAF.

“We know retailers have an interest in what’s happening. You cannot intervene in price negotiations between a customer and a supplier, but you can collectively agree on what to do when there is a crisis or force majeure.”

The project might still be in its infancy, but “it’s a start.” And while there remains a lot of work to be done, “this is where IAF is representing and strengthening the interests of the apparel industry.”

Bekke adds: “The constant pressure on prices is killing our business and it has to come to an end. This attitude ignores the growing pressure from politics, from consumers, from our industry to be more sustainable, to produce cleaner, to promote circularity.”

Transparency priority

The wider issue of supply chain transparency – especially linked to sustainability and increased oversight by governments and stakeholders – is something else IAF is keeping a close eye on. “It’s another high priority to see how we can improve the industry’s image and performance. Are we really interested in making it more sustainable or is it just greenwashing?”

The growing global tendency towards due diligence legislation, for example, has already seen laws passed in France, the Netherlands, the UK, the US and Switzerland requiring companies to comply with social and environmental rules along their global supply chains. Similar moves are also underway in Germany, Hong Kong and Canada.

“This is something our supply chain has to be aware of. We cannot escape from this pressure, so we have to do something…and better. Of course there are a lot of issues: how far does this responsibility go to make your supply chain more transparent? Tier-1 can be easily done, but then tier-2 and who’s making the buttons, the yarns, the fabrics?

“But it’s coming, and it might also help our supply chain to really be sustainable.”

Other work to help suppliers is trying to tackle the fragmentation and sheer volume of global initiatives in areas like audits and standards.

In response, the Standards Convergence Initiative (SCI) was unveiled in February by the IAF and the International Textile Manufacturers Federation (ITMF) to measure and monitor the main standard holders, brands and retailers, and the extent to which they are contributing to fatigue.

“We’re working to see how we can bring down all the number of audits, because there are too many and a lot of cost is involved,” Bekke says.

Retail restructuring

Also top of mind is the way the Covid pandemic has pushed clothing sales onto the internet, “and what that means for the shops on the street and for the viability of cities?

“I do not know how we will come out of this crisis, how many customers we will have, because I expect a lot of small shops to disappear, but also the big retail chains are closing stores and relying more on internet sales. A small country like the Netherlands is putting in EUR60bn to keep the economy alive, but only when this stops we will see who will survive.

“In the long term I see a chance for smaller shops to be more service-oriented to customers. Some online only businesses are opening physical stores. The retail structure will definitely change, in my view.”

On the upside, Bekke believes the new retail landscape will open up opportunities to bring some production back to Europe from the Far East. “Not in the same numbers, but why not produce when there is real demand…not necessarily in the Netherlands or the UK, it could be in Portugal.

“But also from a sustainability point of view, when you see how many products are not sold at the end of the day. There’s also political pressure to lower the amount of clothing ending up in landfill, increasing circularity programmes: why not do that closer to the market?”

Not surprisingly this is another area where IAF is looking to forge links between members. “For example, Turkey is setting up a recycling facility; the Netherlands is looking for recycling capacity. MODINT and Sistema Moda in Italy signed a declaration of cooperation in the field of sustainability and circularity.

“In that sense I’m positive that our supply chain will find new ways to be sustainable, more circular, and that’s why I think we should support start-ups.

“I see a lot of people graduating from our fashion universities, and I’m inspired every time by how they look at our business, how they look at the opportunities of digitalisation to make processes easier.

“The production of clothing is still labour intensive, despite the efforts with robotisation; we still have the Toyota system where we move it from one machine to another. But in the design and preparation of samples a lot of profit is to be gained from digitalisation, and in that respect I think there is a future.”

Connecting business with education is another priority. “Education is very important, because we’re training the new designers and managers of the future. But the problem is always the gap between schools and universities and businesses, so we have to find ways to bring them together.”

Flow fashion

Underpinning all of this, of course, are the questions of whether consumers are willing to alter their behaviour, buy clothes as and when they need them, and if they will be prepared to pay for the extra cost?

“The same goes for our supply chain. It’s the consumer who makes the switch to more quality products and less collections. The striking point is that there is a growing market for vintage clothing or second-hand clothing, and it’s interesting to see how that will develop.

“At MODINT we talk about ‘flow fashion,’ where the supply chain flows in line with consumer demand, and that is different to fast fashion or slow fashion. It’s a nice expression, because fast fashion has the connotation of being produced in very bad circumstances, which is absolutely not always the fact.

“Does that help in bringing production back? It’s still too expensive in the western hemisphere, unless the consumer is asking for quality products where price is less important.”

The cusp of change

Bekke hands over the IAF presidency later this year to Cem Altan, founder of Aycem Textiles and member of the board of directors of both the Istanbul Apparel Exporters Association (IHKIB) and the Turkish Clothing Manufacturers Association (TCMA).

So while not quite yet contemplating life without the IAF – as a past-president Bekke will remain active on the executive committee while his successor is serving – he is certainly in a reflective mood.

“I’ve seen the whole process of globalisation and I think we’re at the eve of change.

“When I graduated from textile university 50 years ago, a professor said, ‘I have good news and bad news for you. The bad news is that the number of workers in textiles and clothing in the Netherlands will disappear because it’s labour intensive and will move to where it can be best done, and that’s the Far East. But there will be a time when it will come back, because the standard of living in the areas we now see as low wage countries will go up, and the West will go down, and we’ll probably produce for them.’

“And that’s something I’m still thinking about. At that time, Hong Kong was the place to be, then it got too expensive and went to China, and then Bangladesh. Now people are going to Ethiopia…always looking for the lowest point.”

But it’s already starting to come back full circle. “When I talk to my colleagues in Turkey, in Portugal, they say some buyers are coming back from the Far East.

“Production might not return to Northern European countries like the UK, Denmark, Sweden, Netherlands, Germany, the Netherlands, who were the first to move offshore, but I guess we are at the beginning of something that is at least examining what the possibilities of re-shoring are.

“And Covid has made this clear, not only in our sector. The question is, do we go back to the former normal, or will we have a new normal? Will we be doing less travelling? Will we keep some of the lessons we have learned from the pandemic?”

Aptly, the theme of the next and 36th IAF World Fashion Convention is ‘Transition in the Global Fashion System.’ Taking place in the Belgian city of Antwerp on 8 November it is this year being followed by the annual general meeting of Euratex, the European Apparel and Textile Confederation, on 9 November.