IMPRESSIONS from a Cross-section

India and China are the two key engines of growth in the Asian region's rising economic growth. Both the countries have a huge middle class whose purchasing power is getting better each day. Education and globalization are also factors fueling this growth.  The textile industry which is poised to grow at 14-16% by 2012  will inject growth into  the Logistics Industry too as textiles and ready made garments do contribute to a significant share of any 3PL operator's portfolio.

Today, leading fashion brands follow a twin supply chain system, one which is driven by cost and efficiency to handle basics and the other which is driven by short production cycles, flexibility, and a quick delivery system to their customers. Logistics companies will thus need to be alert to such needs of their customers and cannot have a 'one size fits all' sort of service to offer.

The textile and fashion industry is very sensitive to trends and styles which makes the unpredictable factor of demand very high, as a result of which the manufacturer or the distributor may need to have a forecast that is near to real life so that goods reach their customers in season. Product obsolescence is very high in this industry and can cause huge losses if not watched carefully.

Most textiles and garments are manufactured in the countries where labor is cheap but most of these countries baring China, suffer from poor or outdated infrastructure which can be a big bottleneck into running a tight logistics operation. Longer lead times for raw materials to reach these factories and for finished goods to reach markets push the cost of end product up which makes top brands to then look at their supply chain costs with a fine comb. We can now even see that manufacturing is being shifted from south China and is moving upwards or even moving to cheaper countries like Vietnam and Cambodia, which will again bring challenges to the logistics industry if offering a quality service at an acceptable price to their customers.