Home / Knowledge / News / Textiles / Producers forced to sell at low margins to keep wheels running
Producers forced to sell at low margins to keep wheels running
16
Jun '09
The textile and garment sector has been hit hard due to the recessionary trends prevailing in global markets. But it has taken a worse hit at a place which hurts the most; profit margins. Increasing cost of raw materials and at the same time domestic as well as overseas buyers demanding lower prices, the manufacturer is squeezed from both sides. Fibre2fashion spoke to a few companies in India and Pakistan to find out how much the current crisis has impacted the industry players. We spoke to Mr Zeeshan Sattar, Director of Pakistan based Towellers Ltd and Mr Ajay Agarwal, Director of P.S Apparels in India.

We began by asking as to what was the main reason for shrinking margins to which Mr Agarwal said, “The customers due to global recession are looking at cheaper garments whereas our cost of production in India especially the labour cost has been going up, while Mr Sattar replied by saying, “Main reason being liquidity crunch due to which consumer spending has reduced considerably and retailers have to markdown the merchandise to sell. This result in surplus goods with stores having high inventory so less new demands and manufacturers in order to keep the production busy are pushed to sell at lower or even no margins”.

Next we asked them to comment on the actual hit in margins the industry has taken to which Mr Sattar said, “Any where from 10% to 20% depending on the item”. To conclude the interview we asked them as to when they foresee this crisis to end to which Mr Agarwal said, “There has been a substantial reduction in production capacity overall in the last 2 years which should hopefully swing the sourcing in favour of the vendors once the market demand picks up and Mr Sattar winded up the interview by giving a short and sweet answer “By end of 2010”.


Fibre2fashion News Desk - India

Must ReadView All

Courtesy: American Apparel

Apparel/Garments | On 25th Feb 2017

Gildan to make some American Apparel products outside US

Gildan Activewear, which recently acquired US fashion brand American...

Courtesy: Kolon Sport

Apparel/Garments | On 25th Feb 2017

Kolon Sport to set up JV with ANTA for Chinese market

Kolon Sport, an outdoor gear and clothing brand of Korea based Kolon...

Designer Karishma Jumani with Niraj Jawanjal, founder and director of IIFW. Courtesy: IIFW

Textiles | On 25th Feb 2017

IIFW to bring together premium lingerie brands

India Intimate fashion Week (IIFW), dedicated to showcasing the...

Interviews View All

Amit Jain
Shingora Textiles Ltd

‘In terms of fabric, the fastest growing category for us is a blend of...

Md Hanifur Rahman
Aman Group

The level of understanding the job role and organisational requirements...

Yash Agarwal
Hitansh Online

Every market region has its own culture and trends

Silke Brand-Kirsch
Schlegel und Partner

Silke Brand-Kirsch, executive partner of Schlegel und Partner, a leading...

Mohammad Hassan
Biax Fiberfilm

About one in every 20 patients picks up an infection while hospitalised....

Giorgio Mantovani
Corman S.p.A

Giorgio Mantovani, MD of Corman, with a presence in both Milano and New...

Silvia Venturini Fendi
Fendi s.r.l

"Yes, my confidence and positive attitude are my strengths and should be...

Madhu Jain
Madhu Jain

She grew up in the walled city of Old Delhi, completed her studies, and...

Igor Chapurin
Chapurin

"Now we can see the Russian trend in international fashion. And Russian...

Press Release

Press Release

Letter to Editor

Letter to Editor

RSS Feed

RSS Feed

Submit your press release on


editorial@fibre2fashion.com

Letter To Editor






(Max. 8000 char.)

Search Companies





SEARCH
February 2017

February 2017

Subscribe today and get the latest update on Textiles, Fashion, Apparel and so on.

SUBSCRIBE


Browse Our Archives

GO


eNEWS
Insights
Subscribe today and get the latest News update in your mail box.
Advanced Search