Source: The Stitch Times, December 2008

The complete sector of textile processors is once again experiencing radical changes. Around the world, production locations are being newly organized. Energy costs have risen and labor costs in some low-wage countries have also risen significantly. At the same time the sector is counting on more flexibility and productivity within the whole production chain, from suppliers to distribution. The trend toward individualization is accompanied by an increased awareness of quality. Protection of the environment and its resources as well as social responsibility, are further important topics for the whole sector.

Production closer to sales locations are becoming more important

Manufacturing costs in the textile and clothing industries have increased significantly on a global scale. The reasons are increasing energy and labor costs, which are having an impact on production particularly in low-wage countries. This is especially evident in the People's Republic of China, where in addition to statutory social contributions; a shortage of labor has raised wages considerably since the beginning of 2008.

Furthermore, the role of logistics throughout the entire value chain is currently being rethought. Ever increasing transport and logistic costs in relation to cheap products are being scrutinized, particularly in regard to environmental protection. Production centers closer to sales locations are becoming more important, especially for high quality products or for small batches that must be made quickly accessible.

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About the Author:

The author is the Managing Director of VDMA, Munich.

The article was originally published in "The Stitch Times", December 2008 edition