28th June 2018
New foreign clothing and textiles investment collapses in Vietnam
There’s an awful lot less to two recent, apparently game-changing, announcements about our industry than you’d imagine at first glance. However flaky the assumptions they’re based on, though, they highlight one undoubted truth:
Over the past twenty years, our business has become all about importing clothes from low-income countries. There’s no guarantee it’ll stay that way.
Apparent game-changer 1: apparel onshoring
Britain’s Textile Growth Programme (TGF) – largely financed by commercial apparel buyers like M&S, ASOS and N Brown – announced in April what it saw as the beginning of a boom in UK production. In the five years since the programme was first conceived, the TGF claims, UK textile production (in British pounds) has grown 28%.
Clearly anyone thinking in 2012 that textile manufacturing in Britain was doomed to disappear was wrong. But, even on TGF’s numbers, growth has slowed lately: since 2014, total textile production has grown just 2.5%
Apparel making in the UK isn’t showing much sign of a boom either. The value of Britain’s apparel imports grew 21% over those five years – and despite an encouraging but temporary surge in 2015, the volume of apparel made in the UK during 2016 was 9% down on 2014 and 16% down on 2012.
TGF’s definition of “textile” covers a lot more than garment making: it supports British businesses making footwear, soft furnishings and carpets, as well as spinners, weavers and dyers.
Many UK apparel retailers would love to buy more fast fashion made locally, for faster turnaround and to avoid the problems of a devaluing pound. However, it’s a far bigger challenge for UK apparel makers to remain competitive with low-wage economies in Eastern Europe or Asia than in capital-intensive parts of the textile industry like weaving or carpet-making.
That challenge in apparel making is likely to get worse. Political pressure for higher minimum wages is getting greater – and there are signs Brexit is already persuading many minimum-wage migrants to return to Eastern Europe.
There are huge opportunities for more British manufacture in the wider textile industry the TGF sponsors. The problem in apparel making, though, is like the probable outcome if Trump’s most extreme plans to discourage imports into the US ever materialise: there simply aren’t the local workers in either the UK or US to support labour-intensive manufacturing.
Which brings us on to:
Apparent game-changer 2: challenging labour-intensive manufacture
For the past 20 years, Western buyers have been getting lower prices by switching production to countries with exceptionally low wages than they could possibly have got from using more automated factories locally .
How long can this go on? During April, two sets of development implied we might be approaching Peak Labour: the point when the number of people employed worldwide in garment making might start declining:
Adidas has done two things to movie its automated manufacturing plans up the development curve from a slow, one-off, pilot. It announced a project with a Silicon Valley 3D printer to produce 100,000 personalised midsoles for its Futurecraft shoe by the end of 2018. Separately, it announced a partnership with the Siemens electricals company to produce a digital twin of its initial Speedfactory installation.
Amazon have an extraordinarily elaborate concept, involving a huge production line that integrates fabric printing, cutting, sewing and despatch to a customer into one, computer-controlled, process. The company applied for a patent for the concept in 2015: it was granted in mid-April.
Amazon has made no statement about the patent, and the application carries no indication of likely costs. But the application’s preamble makes it clear that the driver behind the patent is the perceived benefit of beginning to cut fabric only once an end customer has placed the order.
The assumption is that aggregating huge numbers of orders into one process can produce economies of scale – while delaying cutting to the last possible moment will slash the costs of inventory holding and markdowns, while eliminating today’s lengthy factory-to-store lead times. And almost eliminating human labour from the process
Almost simultaneously, though, came a third, with a completely different approach to using e-commerce, algorithms and meticulously re-engineered manufacturing processes:
Son of a Tailor (SOAT) believes the five T-shirt sizes currently available in most stores simply don’t meet most people’s demands for comfort and style. So it takes detailed customer measurements and a few days later delivers a perfectly fitting shirt for between GBP 34 ($44) and GBP 46 ($60) each: pricey for a T shirt, but good value for a fashionable, comfortable top.
For all the technology used in the process, though, the labour content in assembling the shirt is actually higher than it is in a conventional mass-produced T-shirt: SOAT believes its superior comfort easily justifies its premium price, and its early history in Scandinavia seems to reflect this.
But how long do games take to change?
In the late 1990’s, Jarno Fonsen’s Finnish company Pomarfin conceived a similar service for shoes to the one SOAT offers for T-shirts. For two to three times the price of mass-market shoes (or about a sixth the price of fully bespoke shoes), his business would deliver handcrafted shoes, using miniature body scanners for exceptionally accurate and detailed foot measurements.
Since then, the business has opened and closed in Japan and the US, changed its name a couple of times and launched crowdfunding campaigns to fund self-scanning with mobile phones or tablets. It’s now the Left Shoe Company – essentially two stores in London.
In 2012, the team behind Amazon’s patent designed the technology for Mixee Labs: a New York-based 3D printing operation, still selling personalised gew-gaws on the web.
Both Fonsen’s and Mixee Labs’ technology may still transform the manufacturing universe. But after years of effort, their businesses are still marginal players.
Will assembly workers see this century out?
Who knows? Automated manufacturing is going to grow. But my bet is ithat Amazon’s and Adidas’ ideas will be in a race with at least three other horses.
As in any good horserace, the leader after the first furlong may be nowhere by the end