Blog: Leonie BarrieMakers assess Haiti quake damage

Leonie Barrie | 18 January 2010

Apparel firms with ties to Haiti have rallied with offers of support for local colleagues and suppliers after an earthquake devastated the country's capital city last Tuesday. But they also admit the impact the earthquake has had on the region means it is likely to have lasting economic reverberations – not least for the clothing industry which is the single largest sector in the Haitian economy.

Industry executives told just-style that Haiti's crucial apparel industry has seen production fall 50-70% in the wake of the earthquake, and that it will take at least three months for most of it to resume. Many factories have been destroyed and the country's main port is paralysed, keeping the bulk of its production at bay.

Before the disaster, Haiti was the seventeenth largest supplier by volume of apparel products sold in the United States, with exports valued at $412m in 2008, helped by its close proximity, low-cost production and a beneficial trade pact. Rebuilding its apparel industry will now be key to reconstructing Haiti after this devastating event.

In other news, more robust Christmas trading figures from Tesco, Primark and Debenhams seem to support the British Retail Consortium’s view that December’s sales were “stronger than we dared hope for.” In fact, wintry weather provided such a boost to UK clothing and footwear sales last month that they helped lift total sales to a five-year December high, while like-for-like sales rose 4.2% from the same month a year earlier.

Supermarket giant Tesco enjoyed its strongest Christmas trading in three years, with growth in clothing helping to boost group sales by 7.5%. Value clothing retailer Primark saw sales rise 19% in the 16 weeks to 2 January, while transactions at Debenhams were up 1.6%.

But all continue to warn that the rise in VAT, pending General Election and economic worries continue to herald uncertainty in the year ahead.

Buoyant clothing sales also helped US retail revenues to beat expectations of a holiday decline, according to the National Retail Federation (NRF). Preliminary figures suggest that holiday sales – covering the months of November and December – were up 1.1% on last year to US$446.8bn. Apparel was a key driver of sales, with revenues from clothing and clothing accessories stores rising 7% year-on-year in December.

But as Swedish fashion retailer H&M has found to its cost, actions speak louder than words after it was caught dumping unworn garments outside a New York store. The retailer has now vowed to improve its disposal of ‘damaged’ garments, and to donate as many as possible to charitable groups. The discovery is particularly embarrassing for the firm which has built a reputation for environmental and social responsibility.


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