The global kidswear market is booming
India-based MS CAFSEW COLOURS is custom made product house where any client can share their idea and place order in their own brand design & label. The company manufactures kidswear, women’s scarves, block printed quilts, bedsheets, cushion covers, table clothes and curtains. In an interview with Fibre2Fashion, MS CAFSEW’s Managing Director Pratibha Sethi discusses kidswear and home textiles market.
How would you describe the export markets for kidswear and home textiles?
Kidswear segment accounts for nearly 17 per cent of the total garment exports from India. At a time when the rest of the apparel industry was reeling under the economic slowdown due to recessionary forces, kidswear continued to show an upward swing. This sector is growing at the rate of 12 per cent per annum, which makes it one of the fastest growing segments in the apparel industry, leaving room for huge untapped potential for organised players to grow in the future. The major international clients for India’s kidswear are from the EU (France, Germany, the UK, Italy and Spain) and the US, Canada, Japan and Australia, as their demand for high quality cotton garments is well catered by the Indian manufacturers.
Till some years ago, there were few players in this segment, but many players have entered in the recent years to cater to the growing demand in the global market. The driving factors for this growth in demand lately is due to the change in global trends, where children’s wear has become a major focus of international brands such as Gap, Ralph Lauren, Armani, Gucci and Fendi, who have introduced kidswear as their product line extensions.
India is the second largest producer of cotton yarn and has been a favourite destination for sourcing of all kinds of apparel by the international buyers. Other drivers, that helped to boost the growth, can be seen in the capabilities of the manufacturers to offer innovative designs, host of value additions, highly integrated infrastructure, personalised quality control, unbeatable prices, skilled workforce at reasonable wages, flexibility in handling small orders, strong economy and robust domestic market.
On other hand, the home textiles market in India is growing with leaps and bounds, especially the bed linen market has been growing at a significant rate over the last few years across all price and quality segments. Indian bed linen exporters cater majorly to the US and the EU markets. There is also a healthy growth in consumer demand in the Indian market for bed linen.
Which are the challenges you face as an apparel manufacturer for the export markets?
India’s garment factories face multiple problems which are hampering their growth and inhibiting their performance comparing to international competition:
1. Limited size – Most of the factories have 150 employees and 80 machines due to local laws, which is much lesser than those in Bangladesh and Vietnam.
2. Outdated technologies – This leads to loss of productivity and inefficient utilisation of resources.
3. Rigid labour laws – While changes to Apprentice Act and modifications in labour law have been brought at central level, at state level complexities still persist.
4. Peter Pan syndrome – Different laws distinguishing between companies on basis of size and turnover and lesser rebates to larger companies has led to companies exhibiting Peter Pan syndrome.
5. Banking system - Banks are reluctant to extend credit to small and medium size businesses to manage NPAs. This issue has been addressed in Start-Up India and by providing more liquidity to banks in recent Budget.
6. Infrastructure bottlenecks – Use of outdated technology at ports as well as their restricted capacity has led to increased average dwell time.
7. Global partnerships – Indian textile sector is not part of major free trade agreements and thus faces higher tariffs in many countries which its competitors do not. For example, Vietnam is a part of CPTPP.
In recent years, Bangladesh and Vietnam have become hub for apparel manufacturing by aligning their infrastructure and policies to support the apparel industry. Some of the steps taken are:
(A) Use of larger number of employees which helps in time bound completion of work and catering to larger orders.
(B) Lesser bureaucratic and administrative hurdles.
(C) Aligning credit system to industries’ needs by taking steps like offsetting the factor of delayed payment.
(D) Entry of Vietnam into CPTPP has assured tariff free exports to its garments.
(E) Duty free space giving access to EU.
Therefore, India needs to diversify its trade and pay much attention to development of organic cotton and technical textiles, which are promising areas for the future.
What are the major trends in kidswear in the export markets?
The global fashion sector has taken a battering in the last two years due to the COVID-19 pandemic. While most of the attire section fell and couldn’t reach towards business expectation level, one segment—the children’s wear market—stood out as it didn’t face much trouble; rather it has been going from strong to a stronger position. Today, the kidswear arena is growing, diversifying, and rapidly becoming one of the key drivers of the industry.
Knits for kids - Knit has huge scope to make a versatile product range for kids. Boys’ polo, deflated or bat sleeves, printed t-shirts, sweatshirt sets, and rompers are heating the market.
Prints - Designers have found unique prints that will be seen on a variety of clothes like polka dots of various sizes, photo prints of animals and flower themes.
Positive slogans - Brands understand that parents are becoming more aware of the importance of diversity, and sound mental health and they want to show solidarity through their clothes. Optimistic and meaningful slogans, such as ‘Inspiring Young Mind’ and ‘Positive Vibes Only’, will bring a dose of empowerment and empathy to their casual wear.
Fashion with Blues - Denim has once again proved its versatility, appearing in the summer collection. Washed blue jeans are always in style. Coloured denim jacket or vest with distressed or embellished soft denim is a great way to add a pop of colour to a kid’s look. Jeans have a high degree of compatibility with T-shirts and shirts. Knit denim is becoming a thing this year and competing with the regular denim. Lightweight denim is the choice to wear (0-4 years) this coming summer season. Dungaree with knit tops, fancy & wide-leg trousers, baggy, romper, skirt, cargo pants, decorative frilled tops are all big winners this year.
What is the impact of rise in raw material prices on the apparel and home textiles industries?
When was the last time that the textile-apparel industry did not face any challenge? This industry always had to deal with some or the other issue like the pandemic, labour scarcity, dyes and chemicals, power, wages, compliance, law, etc. However, this industry also has the history and reputation of overcoming each of these challenges and come out victorious each time. Now, the latest challenge is the increase in raw material prices.
From September onwards, both in domestic and international markets, buyers have started regaining their business momentum as consumers re-started their buying after the pandemic. However, increase in price of raw material and steep rise in prices of yarn are creating significant challenges for the apparel and textile industry. This has led to a drastic increase in fabric prices. The price of woven fabric has gone up by ₹15-20 per metre for top weight and ₹20-25 per metre for bottom weight and denim fabrics. For knits, the price has risen by ₹35-40 per kg for top weight and ₹40-50 per kg for bottom weight. As a result, prices of garments have increased by ₹15-30 per piece, which is huge.
In the present scenario, mills are afraid to book any new orders, and price validity offered by mills is not more than two days. Non-mill sector vendors are not able to get the yarn deliveries promptly which is forcing them to stop taking any new orders. This has made it difficult to meet the required delivery timelines. On the whole there is a good amount of uncertainty on how the market is going to behave further and how long this upward trend will continue.
In order to sustain and grab the opportunities, textile-apparel industry stakeholders need to cohesively look for solutions. I hope that this challenge of raw material price increase and shortage of supply gets addressed quickly.
Have you seen the business in India increase owing to the crisis in Sri Lanka?
Sri Lanka exports $5.22 billion worth of garments to the global markets annually. The textile hub of Tiruppur in Tamil Nadu is witnessing a surge in overseas orders as some export demand has got diverted to India from Sri Lanka owing to the economic and political crisis in the island nation.
Global brands such as Zara, Mango and H&M place orders with Asian countries, including India, Sri Lanka, Bangladesh, Cambodia and Vietnam. Of these, Bangladesh, Vietnam and Cambodia have huge orders in their hands, hence they are diverting their orders to India.
How big is the kidswear market? Is it growing?
The global kidswear market is booming and is becoming one of the most profitable businesses. In the second half of 2020, children’s clothing grew to $252 billion in global sales, and it is predicted to reach $325 billion by 2025. According to studies, the children’s apparel sector grew faster than men’s and women’s apparel.
The rapidly increasing global population is one of the key factors driving the growth of the market. Furthermore, the rising consumer demand for premium and branded apparel is also providing a boost to the market. Owing to the increasing expenditure capacities and changing lifestyles, parents prefer to purchase high-quality premium apparel to ensure the optimum comfort and safety for their child. Additionally, the emerging trend of matching outfits such as mommy and me and mini-me dresses, along with the introduction of clothing lines influenced by increasing exposure to celebrities, is positively impacting the product sales.
Vendors are manufacturing small replicas of adult-size dresses for kids that are similar to the outfits worn by parents or celebrities. Moreover, factors such as rapid urbanisation, aggressive promotional activities by manufacturers, along with the development of online retailing market that provides a hassle-free shopping experience, while offering a wide range of options to the consumers, are projected to drive the market further.
Other factors driving the market growth include rising brand-consciousness among children and parents, the growing impact of television and mass media, and active participation of celebrities in campaigns and advertisements of different brands.
Do you plan to diversify your product offerings? If yes, please share a few details.
Fashion is a very broad industry. There are many different categories and each of these categories has many different subcategories. All fashion brands need to plan their business in a way that is profitable in the long term. So, we will be doing a vertical diversification.
We will be adding new twist to our existing product line, which you will get to know in early next year.
We will be producing totally different designs for kidswear section, which will look trendy while being affordable.
Which major countries do you export to?
Currently we are exporting to Taiwan, Australia, Switzerland and many states in the US, and also Europe.
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