Fashion Apparel Industry Overview
The global fashion apparel industry is one of the most important sectors of the
economy in terms of investment, revenue, trade and employment generation
all over the world. Apparel industry has short product life cycles,
tremendous product variety, volatile and unpredictable demand, long and
inflexible supply processes. The industry has been in a transition over
the last 20 years. Some of the its major contributors are:
- Significant consolidation in retail,
- Increasing use of electronic commerce in retail, and
- Wholesale trade
The clothing and apparel industry produces finished clothing products made from both
natural and manmade fibers like cotton, silk, wool, lenin, polyester,
rayon, lycra and denim. The important segments covered in apparel
industry include kids clothing, mens clothing, clothing for women, bridal wear
, mens wedding wear
and intimate apparel. The apparel is sold
through three major channels, which includes, brick & mortar,
catalog and through internet. The market share of the different channels
is shown below:
Apparel Sales by Channel
Industry Supply Chain
||Sales $ Billion
||Market Share (%)
|Brick and Mortar
The apparel industry supply chain can be broadly categorized into five
major components as raw materials, textile plants, apparel plants,
export chains, apparel manufacturers, retail stores and customers
Major Manufacturers and their
In 2006, the largest apparel manufacturers and exporters were
countries from the Asia-Pacific region which included countries like
China, Hong Kong, Phillipines, Malaysia, Indonesia, Bangladesh,
Srilanka, Pakistan, Thailand and India. The other major apparel
manufacturing nations were USA, Italy, Germany and Mexico.
Figure : Country-wise Market Share
Global Trade Volume and
As the apparel manufacturing industry has become more labour intensive and
requires less capital investment, its concentration is shifting more
towards the developing countries and even constituting large amount of
their exports. This can be analyzed by the fact that the apparel
production in industrialized countries decreased between 1980 and 1996,
where as the production increased in developing countries during the
same period. Similar trend was seen in exports, the apparel exports of
developing countries increased six times between 1980 and 1997, and that
of developed economies rose by 150%.
The global apparel industrys total revenue in 2006 was US $ 1,
252.8 billion, which was approximately 68% of the overall industry
value. Asia Pacific constitutes the largest amount of production and
trade in the apparel industry worlwide. The percentage share of
different regions of the world in the total trade revenue in the year
|Rest of the world
China had captured 65% of the global market share towards the end of
2006 in total apparel exports. The other major apparel exporting nations
include USA, Germany, Hong Kong, Italy, Malaysia, Pakistan, Thailand and
India. Some of the apparel trade statistics are presented below:
Exports in 2006
Apparel Industry is growing at a very high rate but still there are some
barriers, which are hindering the growth of this industry. Some of them
- Though the demand for garments is increasing day by day but the
production rate has still not been able to match with the ever rising demand.
More production facilities are needed to meet the demand.
- Most of the raw material needed for apparel manufacturing is
available in the developing or under developed countries and these
countries do not have enough resources and manpower to explore them.
These countries also do not have finance to set up factories for
clothing and garment production.
- Globalization has helped the trade in many ways but due to
globalization the competition has increased and so it is not very
easy for the firms to cope up with so much competition, as they have
to meet the deadlines and also maintain quality.
- The importers of developed economies are facing very stiff
competition as countries like China are producing good quality
products in low prices due to availability of very cheap labour.
- Some trade laws still are very much in favor of developed
countries and they need to be reviewed, to facilitate imports from
the developing countries.
- As apparel industry is fashion driven, and fashion keeps
changing, the firms have to cope with the changing apparel industry trends and still complete orders in time. Thus
they usually have to work under pressure.
global apparel manufacturing industry is expected to grow more than ever
in times to come. According to an estimate, the global apparel industry
will reach a value of US $ 1,781.7 billion by the end of 2010. The
apparel manufacturers are now adopting new techniques to increase their trade.
New business models and competitive strategies are used to enhance
profits and growth. The consumer is more aware and more demanding with
the development of media like television and Internet. They have more
choices in quality, price and design. This is the reason why apparel
chains all over the world are focussing more on improving the quality of
the product and offering in varied range of fashion designs. Apparel
manufacturers are developing methods to keep up with the pace of change like offering on wholesale prices to survive in the global competition.
Though the above trends show a very positive picture but according to
some experts, the dilution of MFA (Multi Fiber Agreement) will make a
lot of apparel workers to loose their jobs, in many regions of USA,
Asia, Central and Latin America and these jobs will shift to China.
According to an article published in the Business week magazine, 30
million jobs will be lost to China, the hardest hit countries would be
Turkey, Mexico and some African nations. The World Bank report says,
this will be one of the largest short-term transfers in history. Despite
these developments the apparel industry is estimated to grow at very
high pace and will provide employment to a large number of people all
across the world.