PARIS — After weathering the recent economic downturn with less damage than expected, Europe’s textile industry still faces a rough road ahead.
This story first appeared in the February 7, 2012 issue of WWD. Subscribe Today.
With the euro zone debt crisis, sluggish consumption and global financial turbulence clouding the industry’s outlook and affecting confidence, for many fabric firms preparing for next week’s Première Vision and Texworld trade shows here, the recovery period has been too short for them to fully reconstitute operations.
“Many companies lowered their break-even point (to get through the last economic crisis)…the biggest problem going forward will be financing,” said Philippe Pasquet, chief executive officer of Première Vision, which will hold its next Paris edition Feb. 14 to 16. “For companies that were already fragile, it’s going to be tough.”
Specifically, it’s a risky situation for a number of Italian weavers who are insufficiently capitalized, he said. Italian firms account for 320 out of the 675 weavers due to show at PV.
With cotton trading at half the record prices set last spring, the cost of raw materials is leaving a smaller dent on profit margins, but competing on price alone is not an option, said Michael Scherpe, president of Messe Frankfurt France, the organizer of the Texworld and Apparel Sourcing shows that will run Feb. 13 to 16 at Le Bourget.
“Today, we are witnessing a period of stabilization, with signs that any upward pressure on prices is being canceled out by other factors, such as the reality of the market, which is less than euphoric,” Scherpe said. “But I don’t think [sellers] will be able to lower their prices as they did in the past.”
Europe’s textile and clothing activity in 2011 weakened significantly as the year progressed, mirroring challenges in the larger macroeconomic environment, according to a report by Euratex. Output in the textile sector turned negative over the January to September period, down 0.9 percent year-over-year, Euratex said. The EU production index in the man-made fiber industry was down 2.7 percent in the same period.
Erring on the side of caution, PV in January said it has “indefinitely postponed” the first edition of its annual congress, the PV Global Meetings, citing a “climate of heightened anxiety in the textile and fashion sector.” Pasquet insisted that it’s not all doom and gloom, however. While Europe may be in the doldrums, golden opportunities beckon in other markets, new and old.
“Our January salons in New York and São Paulo proved that for other important zones, it’s a different mood entirely,” he said. “The North American market is more vibrant than expected and as for Brazil, the dynamism of this emerging market continues to surprise us.”
China also continues to exhibit a strong appetite for European luxury and mainstream fabrics.
“For years, there was all this talk of China and now it’s become a reality, there is a real business opportunity,” Pasquet said. “European weavers today are generating significant turnover there.”
In turn, PV is increasing its presence there. The company, which in March will stage the 17th edition of its Première Vision China trade show, in October will launch Denim by Première Vision Asia, showcasing around 40 premium denim weavers, mainly from Europe. The biannual event will be held in Shanghai.
Attendance levels of Chinese buyers at PV’s Paris show, meanwhile, are almost on a par with the number of American visitors. In September, the show registered a 35 percent uptick in Chinese buyers, to around 1,500 visitors, bringing the total of visitors from the Greater China region to around 2,000.
“It’s these buyers who are selecting the most expensive and sophisticated product — their buying power is substantial,” said Pasquet.
At Texworld, artistic directors Louis Gérin and Grégory Lamaud have redoubled their efforts to make the fair’s offerings more creative.
“The challenge is educating our Chinese exhibitors to the idea that there is no point in presenting the same product as your next-door neighbor, even if it is selling very well, and putting it on the market 2 cents cheaper in the hope that you will then end up selling more,” Gérin said. “That’s not what European buyers are interested in. Of course, they are looking for low prices, but above all, they are looking for quality and innovation. Nowadays, if your textiles firm does have a creative department, it is becoming difficult to compete on the European market.”
The Paris edition of PV later will welcome 24 new exhibitors. They include Italian knitter Maglificio Maggia, which specializes in high-end jersey and piqué knits for luxury brands; L’Amore Tessuto Srl, a new division of Top Wool specializing in fantasy designs for the luxury women’s wear market; Turkey’s Elyaf Tekstil, a specialist in viscose blends that has developed a collection of silks targeting fluid women’s wear pieces for the mass market, and France’s Senszo Dimatex, a specialist in printing and finishings aimed at mass market women’s and children’s fashion.
Among the improvements at Texworld are fresh offshoots of the Fabric Experience trend forums, with separate spaces for each of the fair’s sections: Casual View for urbanwear; Attractive Spirit for women’s clothing, and Strict Essence for men’s.
Trends for spring-summer 2013 are influenced by exotic travel, with a rich palette of spice shades and patterns that evoke sacred markings and traditional symbols. Fabrics on offer include silk and cotton in a variety of textures, including voile, muslin and batiste with frayed edges, and silks and synthetics used to fluid effect. Pastels will also make a strong showing, in sugary shades inspired by the Fifties or the 18th century, and textures ranging from matte velvety effects to iridescent satin.
Texworld organizers have also put together a special circuit for emerging designers dubbed Creative Path that allows them to buy fabric in small quantities. Of the more than 600 exhibitors expected to attend, 123 have agreed to supply lengths ranging from 50 to 200 meters, or 54 to 218 yards.
“Companies are gradually starting to understand the benefit of distributing a product in small quantities in order to have access to designer silhouettes for their look books,” said Gérin.