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Director of Europe China Ting Group Holdings Ltd.
Which is the latest technology that helps in raw silk processing and weaving?
Silk is a natural fibre linked more to agriculture than technology and processing this material and weaving has remained relatively unchanged over the years. The economic tsunami of 2008 has seen a change in consumer habits taking a downturn and the appeal of silk has dropped significantly because of its price as a luxury quality. Consequently, the number of silk farms have also diminished due to the lack of demand.
What business risks are involved in the business of apparel exporting? What kind of risk management is required in this business?
Things are not always what they seem nowadays and one of the biggest risks in export is the fact that, often, buyers live on the credit of suppliers while others, frequently, default on payments. When markets are faring poorly, some unscrupulous customers also summarily cancel orders for no valid reason or demand substantial discounts from suppliers. Credit insurance possibilities exist but this is costly and not applicable in all circumstances, only to customers that are not considered high risk.
In our case, we have a solid base of customers who have histories with us, some between 10-15 years, and we mutually support each other in times of difficulties.
The cost of apparel production has increased a lot recently. Cost of which resources have drastically increased and affected the business?
China’s factory overheads – electricity, water, logistics - have all increased exponentially. Rising costs of land prices, environmental and safety regulations and taxes all play a part and translate down the production line to raw materials. The biggest factor, though, is labour, of which there is a serious shortage thus driving hefty increases in wages despite the fact that productivity in China, overall, remains high.
What is the market size of luxury apparels in China?
I am afraid that I do not have the actual numbers for this. So far, luxury goods, including apparel, are a status symbol for the Chinese who are mostly self-employed or professionals. As the country progresses, so, relatively, does the expenditure of those who can afford and need to reflect prestige. This has, however, slowed since last year when the government clamped down on unnecessary expenses on luxury gifts and has had a significant impact on luxury retail in China, especially imports. Local luxury apparel received a boost this year when the president’s wife, Peng Liyuan, preferred a local luxury apparel brand over the usual imports, thus setting off a trend that is driving a different sector of the Chinese economy.
According to your opinion, what is the scope for smart textiles and optical fibre clothing?
I think that, although the market is still relatively in its infancy compared to other qualities, there is a future for this. I am aware that there already exists smart textiles made into healthcare garments for the elderly, the fabrics of which are technologically constructed to emit signals (e.g. heartbeats) to doctors and distanced relatives, permitting them to monitor closely the health of the person wearing the clothes. China is a big country and young people today are forced to migrate for better prospects and jobs, leaving a large part of the aging population to fend for themselves. Recently, China passed a new rule to enforce elderly care but it is still difficult. If, one day, these special textiles and clothing can be more accessible in price and availability, I see it taking on a whole new dimension.
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