The Structure of the Textile and Clothing Sector

By Hildegunn Kyvik Nordas

The clothing sector is both a labour-intensive, low wage industry and a dynamic, innovative sector, depending on which market segments one focuses upon. In the high-quality fashion market, the industry is characterized by modern technology, relatively well-paid workers and designers and a high degree of flexibility. The competitive advantage of firms in this market segment is related to the ability to produce designs that capture tastes and preferences, and even better – influence such tastes and preferences – in addition to cost effectiveness. The core functions of firms servicing this market segment are largely located in developed countries and often in limited geographical areas or clusters within these countries. The Emilia-Romagna district in the so-called Third Italy is one of the most prominent and prosperous textile and clothing clusters in the world, while Italy is the second largest exporter of both textiles and clothing when intra-EU trade is included. However, this market segment has also seen a significant amount of relocation of production and outsourcing to lower-cost producers, often in geographical proximity to the major market (Navaretti et al., 2001).

The other major market segment is mass production of lower-quality and/or standard products such as t-shirts, uniforms, white underwear etc. Manufacturers for this market segment are largely found in developing countries, often in export processing zones and/or under so-called outward processing agreements with major importers. They employ mainly female workers – semi-skilled and unskilled – and outsourcing to household production is quite common in the low end of the market. In the low to middle priced market, the role of the retailer has become increasingly prominent in the organization of the supply chain. The retail market has become more concentrated, leaving more market power to multinational retailers. These have market power not only in the consumer market, but perhaps more importantly they have considerable buying power. In addition, high-volume discount chains have developed their own brands and source their clothing directly from the suppliers, whether foreign or local. According to Gereffi (2001), retailers accounted for half of total garment imports in the European Union in the mid-1990s, a trend that probably has continued during the second half of the 1990s.

Consumers spend a smaller share of their income on clothing than in the past, although consumers shop more frequently and buy a larger number of clothing items than before. The response from producers to the challenge of slow growth in total demand is to build on consumers' love of variety and provide new fashions and a broad variety of sizes, colours, designs etc. at a frequent rate. The details of these developments and their impact on international trade in textiles and clothing are discussed in the rest of this section.

 

Made in Europe

By Jo Johnson, Fred Kapner and Richard McGregor

Almost every fashion label outside top superluxury brands is either already manufacturing in Asia or thinking of it. Coach, the US leather goods maker, is a classic example. Over the past five years, it has lifted all its gross margins by manufacturing solely in lowcost markets. In March 2002 it closed its factories in Lares, Puerto Rico, its last companyowned plant, and outsorces all its products.

Burberry has many Asian licensing arrangements. In 2000 it decided to renew Sanyo's Japanese licence for ten years. This means that almost half of Burberry's sales at retail value will continue to be produced under licence in Asia. At same time however, Japanese consumers prefer the group's Europianmade products.

Sanyo is now reacting to this demand for a snob alternative to the Burberry products made in its factories across Asia by opening a flagship store in Tokyo's Ginza, where it sells Burberry products imported from Europe.

In interviews with the FT, many executives say the top luxury brands will continue to be seen, particulary in Asia, as European. Domenico De Sole of Gucci says: ‘the Asian consumer really does believe – weather it’s true or not – that luxury comes from Europe and must be made there to be best.’

Serge Weinberg, Chief Executive of Pinault Printemps Redoute, which controls Gucci, says it will not move Gucci’s production offshore. Yet some in the industry recognize that change may be round the corner even for the superluxury brands. Patrizio Bertelli, Chief Executive of Prada, says: ‘The “Made in Italy” label is important but what we are really offering is a style, and style is an expression of culture.’ He therefore recognises that quality fashion items may not always need to be produced in Italy.

Amitava Chattopadhyay, Professor of Marketing at Insead, the business school, says: ‘A brand is a set of associations in the mind of the consumer and one of these is country of origin. For luxury goods, the role of the brand is crucial. To damage it is a cardinal sin and no brand manager will want to get the balance between manufacturing location and the brand image wrong.’

From the Financial Times

 

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FOOTWEARE PRODUCTION

Long before history was written shoes were being made. The earliest dawn of civilization in all the diverse corners of the world has almost invariably seen men contriving some sort of foot-covering.

Shoes were unnecessary in warm climates. Primitive man perhaps as early as 20,000 b. c., learned to pre­serve pelts and to bind them about himself or to cut and sew them together for garments. He also wove strips into baskets and molded wet leather around a foot or hard core to make shoes.

Inancient Egyptian wall paintings only kings and priests are shown wearing sandals, made of plaited reeds or, as in the case of Tutankhamen, of finely tooled leather.

People in cooler climates wore shoes much earlier. Egyptian wall paintings at Beni Hassan (2000 b. c.) and at Thebes (1450 b. c.) depict Syrians, and Minoans from Crete, wearing an assortment of elaborate sandals and boots. The meticulous art of the Assyrians has left us detailed designs of their elaborate and sophisticated sandals on the reliefs from Calah (modern Nimrud) and Nine­veh (about 800 b c.).

The general term for different types of foot coverings is footwear. But within this category there exist a number of articles. Shoe, a form of footgear that covers the foot up to the ankle and that is intended as a protection from cold, dampness, or rough terrain. In addition to shoes, other basic types of footgear are sandals, moccasins, boots, slippers, and mules. The sandal has a flat sole of leather or wood fastened to the foot by straps, thongs, or a knob between the toes. The moccasin is distinguished by a sole that extends up around the foot to form some part or all of the upper section of the shoe. This is a primitive form of footgear that is still worn by hunters because of its flexibility and because it gives greater protection against dampness than shoes with a seam between the sole and the uppers. The boot consists of a sole and an upper part that extends above the ankle to protect the leg from cold, wetness, or dan­gerous conditions, such as snakebite or thorny plants. The slipper is a soft shoe, often intended for indoor wear, with uppers generally made of fabric and sometimes lined for winter wear with wool or fur. Mules are slippers that consist of a sole and an upper that covers only the toes.

Until the age or cheap mass production, shoes were generally considered a mark of rank or prestige. Common men walked bare­foot, and their feet became callous, helping them to escape much of the discomfort that would result from not wearing shoes. The nobil­ity, on the other hand, felt obliged to wear shoes as a proof of gentility, that they could not bear roughness or dirt. In ancient China, in order to indicate their incapacity for physical work, upper-class parents bound their daughters' feet to prevent normal growth and to produce a small, twisted "lily foot." As a result, wealthy Chinese women could scarcely walk in their tiny shoes.

As the structure of leather is a vast random network of coil-like molecules linked in fibrous strands, leather is one of the strongest flexible sheet materials known. It resists tearing and puncture, yet it can be stretched. As a porous substance, it can absorb moisture and "breathe," and it has insu­lating qualities. Also, leather is easily worked. It may, for example, be wrapped, rolled, molded, or folded. It may be puckered, crinkled, pierced, sewn, embossed, braided, knotted, glued, nailed. In addition, it is abundantly available in endless variety all over the world.

In view of all these advantages, it is readily seen why leather is widely used for such things as clothing, shelter, upholstery, hangings, har­nesses, saddles, and bookbindings. Often these utilitarian objects are decorated to produce works of art.

Thick leather is wetted and bent or molded into sculptural forms. In addition, leather is woven with other materials on looms, built into collages and reliefs, and tied into macramé-knotted three-dimensional forms.