Planning Needed to Create Demand for the Global Textile Industry
October 25, 2024 The global textile industry needs mid- to long-term planning to help create demand.
New York Cotton Futures sitting in the low 70-cent range for December delivery highlight the issues with demand. With inflation coming down, a demand uptick is expected in the later part of the fourth quarter. Moving into panic mode to find solutions to counter such problems with a short-term approach will not serve the industry well, while problem solving in a timely manner is important.
Industry associations all over the world are calling for supportive policies from their respective governments to grow the sector, as it has positive economic ripple effects in terms of trade and employment.
Short-term planning, which looks at ways and means to boost demand without long-term vision and plans, will come to hurt the industry.
A recent two-day event, “intexcon 2024,” was organized in Ahmedabad, India by Diagonal Consulting (India) and ATIRA with the support of the Ministry of Textiles, Government of India. The American Association of Textile Chemists and Colorists supported the event, and INDA served as a knowledge partner.
About 230 participants from industry, research organizations, government, and academia interacted and discussed the new developments and needs for the sector. Chief Guest, Mr. Rajeev Saxena, Joint Secretary of Ministry of Textiles, India, spoke about India’s policies to grow the advanced textiles sector.
I was privileged to deliver an inaugural speech to start the event. My address – “Platform for Opportunity and Growth” (available on YouTube) – focused on how to plan for the growth. Borrowing the long-term growth model of Amazon, I argued for mid- to long-term planning to avoid frequent crises our industry faces.
Planning should involve four factors: expansion, improvement, innovation, and diversification.
Expansion should not be just vertical by adding capacity, it should be horizontal. In the case of India, the industry should enhance its product offerings and expand its markets beyond the United States and Europe. Opportunities in Africa and South America must be explored.
Improvement should be focused on productivity enhancement, quality, timely delivery, and cost reduction. This will help advanced and emerging nations to compete with low-wage nations. A case in point is the concerted effort by the United States’ cotton sector to avoid plastic contamination and improve traceability. Even in developed economies like the United States, a push to revive manufacturing is happening as it can provide millions of jobs.
Innovation is key for growth, and the textile sector needs to enhance its financial commitment towards research and development. Overall, in countries like India, the government provides a heavy lift for research.
The textile industry needs to go for product and market diversification. In this aspect, advanced textiles and affordable sustainability, applications in health care, lifestyle enhancement, and environmental protection are avenues that will yield positive results.
In my view, technology companies like Amazon have been successful by adopting these growth steps and planning for long-term.
It is reported that when Amazon went public in 1997, Jeff Bezos sent a letter to shareholders emphasizing the importance of long-term investing. Today, Amazon is a global giant taking care of its customers, shareholders, and employees. From its start as a bookstore, its focus on speedy delivery with Amazon Prime to its current efforts in cloud computing provides the textile sector with clues to grow by adopting a plan which involves expansion to diversification.
A global platform is needed for the textile industry to come together (either physically or virtually) to plan for immediate needs while not neglecting mid-to long-term planning.
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