Buying houses are a strong bridge between apparel manufacturers and international brands and retailers. In this critical phase, they have more responsibility to fetch orders from overseas and keep motivating suppliers. They are trying the same, but Indian Government’s unstable rules and regulations, as well as the reluctance to support even on small issues are making the situation all the more challenging for them – issues like shipping the goods at the ports, dilly-dallying the resumption of factory operations, decisions regarding migrant workers and not allowing the export of simple masks, etc. All these are hurting the opportunities, which if handled well could have a positive impact in this phase of the COVID-19 pandemic. As the Government is at the core of all of this, all eyes are on it to take the necessary actions.
COVID-19 has become a harsh reality, effects of which will not leave us for long, and so, we have to learn to live with it and continue working to survive – of course keeping in mind all the precautionary measures. Everybody wants to see factories open and get back to work again. But the current condition doesn’t seem to be very hopeful, as the orders that are in the hands or in the pipeline are losing.
A lot of vendors have had products lying since the last 3 to 4 weeks at Chennai and JNPT, but they have not been able to load these goods on vessels because these goods come from various places and must be consolidated into a container. Due to all this delay, some orders are now getting cancelled.
It is pertinent to mention here that Tuticorin Port (one of the 12 major ports in India and the second largest port in Tamil Nadu) is operating comparatively better than other ports.
As per buying houses and buying agents, the other big problem is that there is merchandise that factories have tried to finish. In some cases, there are opportunities for full-price acceptance from the clients, but due to the extended lockdown, now it will also not go on time, ultimately creating losses.
Moving forward, the buying community strongly believes that despite the availability of orders, India is losing. This is again owing to the Government’s slow decision process, as exporters still can’t commit the exact delivery dates.
Jyoti Saikia, MD, Triburg, shares, “Looking ahead, we see that some brands will place orders for the Fall season, and go into sampling and closure for the Holiday and Winter season, but due to the lockdown and our inability to project them sensibly as to how much labour will come in week after week, these orders are moving out and a lot of them go to Vietnam. If an order is moving out of China, it is not coming to India but going to Vietnam. We are not able to tell the customer when we can ship (even new orders), so how can India take these orders? Anybody can check the growth of Vietnam in the next few weeks.”
Buying leaders also add that there will be a requirement for delivery in the business during the months of June and July, but that too seems to have come under stress now, as we have work but no workers. Even where factories have started, factory owners are not sure about labour availability for the next 4 to 5 weeks. Whatever orders were in the process, they are now shifting, as clients source from many countries.
Christine E. Rai, Chairperson, Buying Agent Association (BAA), raised another issue about the future opportunities that India is losing on. “There are good opportunities for fashion mask, but we can’t export these masks. We have discussed with the Directorate General of Foreign Trade (DGFT) that a simple fashion mask has nothing to do with any specific mask like N-95, etc. Even the export of eyes mask is not allowed. Fabric lying in factories can be used to make fashion masks, but the Government is not allowing the export of simple masks, and clearly, the industry is suffering,” she commented.
The Buying Agents Association is quite active to fulfil the expressed needs of buying agents to get together formally and work to improve their standards and growth avenues. It is one of the most respected associations of the buying community in India.
Buying community leaders strongly underline that the Government should leave things to market forces now because there is no labour, so the number of people going to factories is going to be automatically calibrated. Approvals and such formalities are only wasting the time.
Elangovan Viswanathan, CEO – SNQS International, Tirupur, opines that even if a factory (without hostel and dormitories) can get 30 per cent of its workforce, it is an achievement, so the Government should do something to encourage that can push migrant labour to come back.
Rohini Suri, Member – Governing Body, BAA, shares “Workers are asking – if liquor shops can open, why can’t we work in our factories? Is there any cut-off date for factories to start working? The industry has to live with COVID-19 now. Exporters are suffering, be it ECGC cover cost, forward cover cost and fabric lying on the shop floor, mills… so the industry should now allow businesses unilaterally.”
Some buying houses also shared that though there are issues with the sampling of Holiday season, they have managed things, except for physical sampling, with the advanced technologies like 3D. Few buyers are even ready to buy on the basis of 3D sampling, but eventually in next few weeks, physical samples will be required. So, despite the best use of all the available technology, offices/factories will require to be fully operational as before.
In this scenario, rather than the industry looking towards the Government for support every day, especially regarding the frequent changes in rules and regulations at all levels, the Government should take necessary actions in favour of the industry.
“The biggest takeaway for the industry during COVID-19 is that the Government support is must for the industry, especially for the ease of doing business. Indian apparel manufacturers will bounce back, but only with the Government support,” Rohini concludes.