Global apparel markets: business update, 4th quarter 2008

Abstract

VIETNAM' S TEXTILE AND APPAREL INDUSTRY HAS BEEN SET AN EXPORT TARGET OF US$25 BN BY 2020

Vietnam' s Ministry of Trade and Industry (MOIT) has set an export target for the Vietnamese textile and apparel industry of US$18 bn by 2015 and US$25 bn by 2020. To meet these targets, total exports are set to grow by an average of 20% a year during 2008-10 and by 15% a year during 2011-20.

In November 2008 the MOIT approved an investment scheme known as the Cloth Investment and Production Programme. The scheme stipulates plans to establish new manufacturing facilities as well as programmes for the training and development of personnel. As part of the programme, up to 15 large-scale weaving and dyeing facilities will be built during 2008-15.

The programme will also focus on training and development. Indeed, plans are in place to establish a new university which will specialise in textiles, apparel and fashion in order to develop the skills of professional fashion designers and manual workers in the textile and clothing industry.

Table of Contents

• International trade
• Markets
• Acquisitions, divestments and mergers
• Company restructuring and reorganisation
• Strategic ventures
• Investments
• Trademark infringement
• Corporate social responsibility
• Financial results

INTERNATIONAL TRADE

• Indonesia' s textile exports are forecast to rise by 2.6% in volume terms during 2009
• Vietnam' s textile and apparel industry has been set an export target of US$25 bn by 2020

MARKETS

• Demand for organic cotton is forecast to increase by 54% during the 2008/09 crop year

ACQUISITIONS, DIVESTMENTS AND MERGERS

• BankInvest has signed an agreement to acquire a 20% stake in Son Kim Fashion (SKF)
• Gap has completed the acquisition of Athleta
• Li & Fung has completed the acquisition of Miles Fashion Group
• Ningxia Zhongyin Cashmere has agreed to acquire Todd & Duncan

COMPANY RESTRUCTURING AND REORGANISATION

• La Redoute plans to refocus its efforts towards Internet sales

STRATEGIC VENTURES

• Aeffe Group has signed a franchise agreement in South Korea with SE International
• Australian Wool Innovation (AWI) and Reliance Industries are planning to collaborate in order to develop a new fabric for men' s wear
• Cherokee has launched its Cherokee brand in Peru
• Gap has expanded its outlet business to Canada
• H&M has entered into a franchise agreement with Match Retail to open H&M stores in Israel
• Iconix Brand Group has entered into a licensing agreement with US sportswear firm ECI
• Marc Jacobs International and Sumitomo have entered into an agreement to set up a joint venture distribution company in Japan
• Marks & Spencer (M&S) has opened its first store in Mainland China
• Moschino and Altana have signed a licensing agreement relating to Moschino children' s wear
• UPM Raflatac has opened a manufacturing site in Guangzhou, China, for the production of radio frequency identification (RFID) tags
• Wacoal Holdings is planning to open 20 retail stores in Vietnam by 2011 INVESTMENTS
• Carvico Jersey Lomellina Group has invested US$27 mn in a new knitting plant in Vietnam
• Fingen is planning to invest Euro100 mn (US$131.6 mn) in the establishment of a new department store in Turkey
• Future Group will focus on strengthening its apparel brands in India during 2009-12

TRADEMARK INFRINGEMENT

• Brighton Collectibles has won a trademark infringement case against Coldwater Creek

CORPORATE SOCIAL RESPONSIBILITY

• Garment workers in Bangladesh are on "poverty wages", claims a UK charity

FINANCIAL RESULTS

• Abercrombie & Fitch has reported a 6% decrease in total net sales for the whole of its 2008/09 financial year
• Benetton Group has reported a 3.9% increase in net revenues for the whole of its 2008 financial year
• Gap has reported an 8% decline in net sales for the whole of its 2008/09 financial year
• Gildan has reported a 29.6% increase in sales for the whole of its 2007/08 financial year
• H&M has posted an 18% rise in sales during the first quarter of its 2008/09 financial year
• JC Penney has reported a 6.9% decline in sales for the whole of its 2008/09 financial year
• Levi Strauss & Co has reported a slight rise in net revenues for the whole of its 2007/08 financial year
• Marks & Spencer (M&S) has reported a 1.2% decline in total sales during the third quarter of its 2008/09 financial year
• Perry Ellis International has reported a 1.5% drop in total revenues for the whole of its 2008/09 financial year
• TJX Companies has reported a 4% rise in net sales for the whole of its 2008/09 financial year