The novel coronavirus pandemic has affected several industries across the world, and looks like, the situation isn’t going to get back to normal before at least 3-4 months; in fact, it may take even longer. As the apparel sector has never faced such a challenging situation, nobody has any clue as to what will happen eventually. At the same time, industry experts are trying their best to get a business direction. Clothing Manufacturers Association of India’s (CMAI) core team has also come up with some suggestions and tips to survive.
One of the most significant suggestions to minimise the impact of COVID-19 on apparel business is that the brands and retailers should delay their end-of-season sales (EOSS) offers. A similar approach is also applicable to apparel exporters, as many overseas buyers pushed them to ship goods on discounted rates before the lockdown.
Rakesh Biyani, President, CMAI, who is also the Joint MD of Future Group (Indian retail giant), has said that taking into account the entire supply chain of the textile industry, it looks quite challenging to see new goods at the stores before August, and so, there is no point offering EOSS on summer collection on the early basis (unlike earlier when the offer used to be made available in mid-June or early July). By delaying the EOSS, the industry will have more time to recover for the next season.
It is pertinent to mention here that India’s leading apparel and lifestyle retailers (both online and offline) offer even 80 per cent discounts to clear their inventories.
In a webinar, Rakesh – along with Rahul Mehta, Chief Mentor of CMAI and MD of Creative Garments; Premal Udani, Ex-President of AEPC and CMD, Kaytee Corporation; and Rajesh Masand, VP of CMAI and Director of Gambit Clothing – suggested more such steps that can minimise the damage caused by COVID-19 on the Indian apparel market. All strongly emphasised that everyone must show unity and support each other during the unprecedented time.
It was very emphatically communicated to the participants to not expect much and on an immediate basis from the Government because their hands are already full in dealing with coronavirus and taking care of the poor and macro economy. On the other hand, the situation is very different in Bangladesh since garment exports happens to be the main industry there, so quite obviously, one can expect the Government’s emphasis and focus on safeguarding its prime business.
Rakesh also shared that he is not very hopeful of seeing increased online sales. “There is no demand in the market, and as people follow social distancing, shopping is likely to be affected in the next three-four months. So, I don’t think that online platforms will have any extra advantage.”
He also insisted that if a store is not viable for a retailer, it can’t be viable for others too, and so, retailers should not get greedy this time. Instead, retailers and landlords need to be more supportive during this difficult phase.
Rakesh was hopeful that during the next festive season, especially from October to December, the market will regain momentum. Fortunately, Diwali –the biggest Indian festival – is set to fall at a comparatively later date this year (14th November), so the entire value chain has more time to prepare.
Rahul Mehta shared a strong view that manufacturers should have top priority to increase productivity as it will decrease their cost of production. “Now manufacturers should produce only what is liked by customers rather than an old practice to produce whatever they themselves liked. Small orders and quick deliveries will be the key for every segment of the domestic market,” he said.
Premal Udani highlighted that every stakeholder of the industry should have a Plan B ready considering all positive as well as negative conditions once the lockdown is lifted and businesses start as usual. “Our industry may or may not get the Government support, so everyone must have plans ready to face even the worst of situations in future,” he maintained, urging all to not let their emotions dictate their actions.
It was also underlined that in order to keep the morale of the professionals high at this tough time, companies should have enough communication with their core team members. “If entrepreneurs have resources, they must pay salaries to their core team members, failing to which, they might lose their support once the market picks up,” insisted Rajesh Masand. One can keep crucial people with an offer of pay cuts, he further suggested.
All these top officials of CMAI ensured they will organise the July edition of National Garment Fair, which might get delayed depending on the situation.
BS Nagesh, Chairman, Shoppers Shop, suggested that to protect the interest of small manufacturers and job workers, the CMAI can work as Amul Cooperative Society (a cooperative brand managed by a cooperative body, which is jointly owned by 3.6 million milk producers in Gujarat).
To avoid payment default, the CMAI can work as a rating agency and rate clients. It will help garment manufacturers to work with ethical clients.
Well-moderated by Basesh Gala, Founder and MD of 39 Solutions, it was the first ever webinar by CMAI. The event received an overwhelming response – nearly 2,000 people from the industry participated and shared their questions and suggestions during the live session on YouTube. The CMAI assured to hold more such webinars with the focus on offering solutions to the challenges raised by COVID-19.