Covid-19 briefing

Further lockdowns in the West are hitting apparel brands who have physical stores yet again. The shift online continues but cannot compensate entirely for the loss of store sales. The vaccination rollout is good news, but a return to a more social life and the demand for smart clothing and occasionwear is unlikely to materialise until the end of the year.

In the meantime, leisure and comfort clothing continues to dominate. While the West suffers, APAC countries are offering more potential for Western brands as the recovery in the region advances.

The European Outdoor Group (EOG) has called for continued unity and tolerance amid the sustained global impact on supply chains as a result of the Covid-19 pandemic.

The EOG noted the “immense pressure” on the integrity of “normally robust supply chains” as a result of repeated Covid-19 lockdowns, transport price surges and raw material price rises.

“EOG members and businesses in other sectors are reporting very significant issues in Asia,” explains EOG president Mark Held. “For example, in Vietnam almost 50% of factories are closed due to the pandemic, which is especially concerning for all involved in the textile industry value chain, but the problem does not stop there. Reports from Goldman Sachs indicate that ‘according to press reports and comments in the purchasing managers’ indexes, restrictions have included temporary factory closures in Malaysia, Thailand, Indonesia, and Vietnam, as well as closures of ports where outbreaks occurred.”

Sri Lanka’s apparel industry association has outlined a five-point framework aimed at coordinating the sector’s response to challenges stemming from the pandemic and to help drive its long-term growth.

The Joint Apparel Associations Forum (JAAF) has prioritised safe working environments for Sri Lanka’s garment employees, enhanced backward integration, high-level collaboration with authorities on retaining and improving export market access, and positioning Sri Lanka’s apparel industry globally for the future. It will also focus on developing the competitiveness of Small and Medium Enterprise (SME) players in the sector.

“At this crucial juncture, the entire industry must collaborate if we are to address challenges stemming from the pandemic effectively and create conducive conditions for long-term growth of the sector,” says JAAF secretary general, Tuli Cooray. “This Five-Point Plan is a framework which all industry stakeholders can use to  achieve our shared vision for Sri Lanka.”

The US economic recovery is under threat as supply chains, including apparel and textile, continue to suffer “unprecedented disruptions”, according to the American Apparel and Footwear Association (AAFA).

The AAFA’s president and CEO Steve Lamar said disruptions are a result of factory closures linked to Covid-19, “legendary price gouging” from carriers and freight lines, and huge backlogs at the ports.

“This is already meaning empty store shelves, price increases for your favourite products and frankly people being laid off,” he told CNBC in an interview.