‘New Normal’ has changed the apparel and fashion industry and across the globe, brands are expanding work from home collections and also promoting ‘business casuals’ for those who are busy making appearances for online meetings. Online sales have grown and in particular sleepwear and loungewear category have gone up significantly. Overall knitted garments are selling more than woven as comfortwear has seen a massive spike across genders (T-shirts, track pants, shorts and athleisure in general). A large chunk of the Indian as well as Bangladeshi apparel export industry believe that there is less demand for high value-added garments. Whatever the reasons, the apparel manufacturers are managing by coping up with these changes.
More orders of knitting garments
In discussion with Apparel Resources, various knitted apparel manufacturers accept the fact that knitted products, and even within knits, basic and low-price casual products are much in demand, and essentials are doing good. Interestingly few of the companies have also changed their production system accordingly.
One of the factories of Arvind Ltd. (India) which was making formal shirts has now shifted to knits. Now this factory is majorly producing knitted products; though the buyers are the same for the factory. It took almost a month for this shift as rather than hiring any new workforce, the factory-trained its workers accordingly and made changes in overall infrastructure. After initial hiccups, the factory is producing knitted garment comfortably. At the same time, it is also an important fact that most of the factories or even companies focus on dedicated segment either knitted or woven, and shifting for them can be a herculean task.
Data of previous months also strengthens this fact as after continuously being down since past few months, in September 2020, export of the knitted garments saw recovery compared to the same month of last year. In September 2019, India exported knitted garments worth US $ 591.82 million, while the amount was US $ 651.16 million in September 2020.
Even in last 3 months, the export of knitted garments was more compared to woven apparels, while in the last two fiscal years, India has been exporting more woven garments.
|Month (2020)||Knitted garments||Woven garments|
|Year||Knitted garment||Woven garments|
Source: Govt. of India (All figures in US $ million)
On the other side, this growing demand of knitted garments is not only being seen in Indian apparel export industry, but the trend is almost same in Bangladesh also as in October, Bangladesh’s export of woven items fell by 14.43 per cent, while knitwear marked a decline of just 2.19 per cent.
Comparing the export figures of July-October 2019-20 and 2020-2021, export of knitted garments has performed quite well compared to woven. Export of woven garments to US fell by 6.82 per cent while in this same period there was growth of 28.06 per cent in the export of knitted garment. Exporting to the EU, there was growth of 3.84 per cent in export of knitted garment, while export of woven garment was down by 6.41 per cent. Overall Bangladesh’s total export of woven export was down by 7.76 per cent and knitted segment grew by 4.76 per cent.
Bangladesh export of knitted and woven garment to US and EU
|Market||July-Oct. 2019-20||July-Oct. 2020-21||EU July-Oct. 2019-20||July-Oct. 2020-21|
Bangladesh’s overall RMG export
|Month (2020)||Knitted garments||Woven garments|
All figures in US $ million
Even from July 2020 to September 2020, Bangladesh’s export of knitted garments has increased (value-wise) from the same period of last year.
It is also important to mention here that as per the data of BGMEA, from 2011-2012 to 2019-2020, Bangladesh has continuously exported woven garments more compared to knitted garments, with T-shirt being one of the major export products of Bangladesh.
Leading apparel exporters of Bangladesh also agree with this observation. Dhaka-based exporters too believe that the demand for products like jacket, shirts and trousers is relatively less as people in the western world are staying at home and working from home. The garments having embellishment are not in much demand. It is also noticed that in tees or other knitted products, value addition by cost-effective ways like enzyme wash or cool dye is not much in demand as they used to be earlier.
Value-added garments impacted; North India faces heat
At various platforms, leading exporters and representatives have clearly said that since past few months, fashion items are not doing good, as such value-added items sell more in bricks-and-mortar stores rather than online as while buying online, the customer is always little hesitant in buying value-added garments. Customer needs a feel of embroidery, fit while basic garments sell more online.
On the contrary, few other exporters feel that such products’ demand has not reduced much, at least at the end of global brands that have stores across different countries. If one particular country or region doesn’t perform well for such brands, they compensate it with any other country or region.
Even in e-commerce, deep detailing about the products helps customers to understand the same and customers are used to buying similar products from the stores from years so they are well aware about the sizing or fitting. The only difference is that now the consumer has fewer opportunities to wear such garments as outing is not preferred as earlier.
As per the official data, average UVR in the January to September 2020 period was US $ 2.81 as against US $ 3.02 in the same period last year, which is around 7 per cent as far as global apparel import by US is concerned.
Leading apparel exporters to mid-level export houses are of the view that they have seen comparatively less demand of highly value-added garments. People are still buying less from stores and preferring e-commerce. He or she would like to see embroidery, fit while basic garments sell more through online. Being a hub for value-added garments, this is a challenge for North India.
Some of the exporters who are well known for their highly value-added garments and often attract buyers for the same at various sourcing fairs believe that demand for such garments is now very less. They have changed accordingly and are producing dresses which have nominal value addition or are kind of basic garments. It has badly impacted their profit percentage as value-added garments bring good value.
Earlier they had a view that this is a temporary phase and things will get back on track once the situation improves but now with the second wave of lockdown in many countries, they are worried in this regard.
Underutilisation of capacity, focusing on new product categories, having fewer embellishments in garments are some of the steps taken by the garment exporters who are majorly into this value addition category. And many exporters are not much bothered about this shift as they believe that this is just for time being and revenge shopping will boost the demand again, no matter when.