Home / Knowledge / News / Textiles / Cashmere exporters shift focus to domestic sales

Cashmere exporters shift focus to domestic sales

09
Sep '08
After gaining a global reputation for being a leading cashmere manufacturer, China now boasts of having over 2,000 established companies engaged in the industry. However, due to unsatisfactory payback from the international market, the cashmere industry is now shifting its focus from expanding exports to increasing domestic sales.

The change although gradual, is perceptible from the strategies being adopted by large-scale enterprises like The Erdos Group, who has already slashed its initial export plan from 4.5 million garments to 2.5 million his year. On the contrary, it has plans to invest 800 million yuan in domestic market over a period of five years to set up 100 flagship shops.

Xinjiang Tianshan Wool Tex Stock Co Ltd, combined for the first time its international and domestic order fairs into a single event, hoping to boost domestic sales to equal its exports.

Statistics have revealed that China supplies more than 75 percent of the world's cashmere and 90 percent of the high-quality goat cashmere and after about 20 years of development, the country's manufacturing system can churn out 40 million items annually. Last year, China's cashmere garment exports amounted to 20.37 million garment pieces worth US $623 million.

From being a major exporter of the raw material, the country in the preceding years has strengthened its production base for finished products. But what has been concerning entrepreneurs is that the international market did not offer China benefits equaling its abundant resources and robust production system.
The value of expensive material did not reflect in export prices. The average export price of a cashmere garment was only $30.58 in 2007 which did escalate but to a mere $32.5 in the early months of this year, but only due to the strong currency.

Over a period of time, it was observed that profit margins in export-oriented processing trade was less than 10 percent which was definitely not enough for sustaining operations. However, it was realized that the figures could be pulled up to 40-50 percent by enhancing domestic sales.

A survey conducted on the market showed that a cashmere garment sold in domestic market would reap profit four times higher than if exported. On the flip side, a section of market observers held strongly that domestic market may not be large enough to consume all the products actually meant for being exported, besides, perpetuating inflation has dampened the willingness of consumers to buy expensive luxury goods.

This was amply borne out from the fact that domestic sales of cashmere and woolen sweaters sore by only 4.3 percent during the first four months of this year, while garment sales grew by 15.2 percent.

In a bid to resolve this paradox, the industry has been recommended to shift from quantity to an emphasis on higher value-added products and branding as only this would help achieve a stable growth and create strong brand identities.


Interviews View All

Jim Desai, Blaiva Fabricaa

Jim Desai
Blaiva Fabricaa

Fashion industry likely to remain labour-intensive in coming years

Top executives, Fabric manufacturers

Top executives
Fabric manufacturers

Domestic manufacturers would get an edge over imported products

Mandeep Nagi, Shades of India

Mandeep Nagi
Shades of India

Women value something that is unique and has a flavour of India

Christiane Thies,

Christiane Thies

Founded in 1892, Thies has concentrated on the fabrication of high-quality ...

Apurva Kothari,

Apurva Kothari

No Nasties was the first fashion brand in India to make 100 per cent...

Shivani Swamy,

Shivani Swamy

The Livinguard Technology is owned by Green Impact Holding AG based in...

Pierre Wiertz, EDANA

Pierre Wiertz
EDANA

EDANA, the international association serving the nonwovens and related...

Pierre Wiertz, EDANA

Pierre Wiertz
EDANA

Pierre Wiertz talks about the vast world of sustainable nonwovens and...

Karl Zelik, Vanderbilt University

Karl Zelik
Vanderbilt University

A team of engineers at the Vanderbilt University has designed a smart...

Chandani Sahi, By Chandani

Chandani Sahi
By Chandani

By Chandani is a womenswear prêt couture brand with fusion silhouettes by...

Divvya and Nidhhi Gambhir, Walnut

Divvya and Nidhhi Gambhir
Walnut

<b>Divvya and Nidhhi Gambhir</b> started their career with the launch of...

Aneeth Arora, Péro

Aneeth Arora
Péro

The Woolmark Company has partnered with handmade fashion label Péro and...

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

Leave your Comments


October 2019

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

news category


Related Categories:

Follow us on instagram

Follow

Follow Fibre2Fashion On


Advanced Search