“Our textile industry has almost exclusively focused on exports. But the recent crisis and reduction in profitability caused by the slumping overseas sales has forced the exporters to look to the domestic market,” says S.M. Nabeel, a third generation yarn producer who has recently launched his label, BTW, to enter the lucrative domestic branded apparel market and opened his first store in Lahore.
There could be a paradigm shift underway in the ailing Pakistani textile sector. With falling exports and diminishing returns, many factory owners in Punjab province are taking money out of their textile business and investing in the fast growing retail markets to cash in on the booming consumption: real estate, education, entertainment, #
“Local market is getting more and more attractive on the back of rising income of middle class households. Therefore, more textile producers are consciously making efforts to increase their exposure in the local retail apparel market,” he argues.
Pakistan's population of almost 200 million, two-thirds of which is under 35 years of age also makes domestic retail an attractive proposition for textile tycoons.
Khurram Mukhtar, a major Faisalabad-based exporter who launched his retail chain Khas sometime ago across the country, says the local retail textiles and clothing market had expanded very rapidly in the last five years.
“It is time to introduce our own brands and go into the retail segment,” he contends. He is of the view that success in the local market will help textile manufacturers to also expand in the foreign markets, especially in countries with large population of Pakistani workers.
“The textile manufacturers are expanding into retail markets because textile manufacturing and exports have become unviable owing to a steep rise in the cost of doing business mainly on account of sharp increase in energy prices and shortages in the last three years,” said Aptma leader Gohar Ejaz.
The textile producers now understand that success in the domestic market could increase their ability to diversify their products and compete with their regional rivals. With their domestic sales revenues helping them cover the fixed costs of exporting, they feel that they can also increase their earnings and profitability. (SH)
Fibre2Fashion News Desk – India
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