Textile and Apparel Weekly April 10, 2012 EXTRACT

Content: Mercedes-Benz Fashion Week light lifestyle - Fashion Week achieved new breakthroughs Three major exhibitions of Chinese Textile Industry concluded The Top 20 Movers, Shakers and Decision-Makers in China Fashion Fashionable Pollution in China Malawi woos Chinese investment in cotton industry Why China's sewing machines could go silent China's textile industry in crisis

Mercedes-Benz Fashion Week light lifestyle - Fashion Week achieved new breakthroughs DATE: 2012-04-10

March 24, Mercedes-Benz China International Fashion Week (2012/2013 autumn and winter series) opened in Beijing. During the nine days Fashion Week, more than 60 activities were held, of which 46 brands and institutions from home and abroad, more than 30 Chinese and foreign designers and nearly 400 designs and models rookie participated in 41 fashion publishings and entered 6 professional contest finals. Compare with the event last year, the size of the current China International Fashion Week was not only improved significantly, but also achieved new breakthroughs.

This year’s China International Fashion Week showed distinctive features: the organizers increased the support for young designers, not only more and more designers had begun works on the theme of environmental protection, but also compared with previous years, this year’ s fashion week, there had been some creative release. It was worth mentioning that 14 brands on the current China International Fashion Week debut, including nine brands from Jiangsu and Zhejiang, this phenomenon made Zhejiang, following after Guangdong and Fujian, had become a new focus on participation in Fashion Week with numerous brands from this area. Source: CNTEX

Three major exhibitions of Chinese Textile Industry concluded DATE: 2012-04-10

March 26 to 29 the 20th China International Clothing & Accessories Fair (CHIC 2012) was held in Beijing China International Exhibition Center (new Hall), which was co-hosted by the China National Garment Association, China World Trade Center Co., Ltd. and Textile Industry Branch of China International Trade Promotion Council. The expo covered an area of nearly 110,000 square meters, divided into 10 specialized exhibition sections for men, women, casual wear, children’s clothing, underwear, leather / fur / feather, fashion resources, boutiques, designer galleries, overseas exhibition, including more than 1,000 brands from 21 countries and regions like China, the United States, France, Italy, Germany, Spain, South Korea, Japan, Hong Kong, Greece, Turkey, Israel and other clothing brand exhibitors. There were more than 60 activities such as Jack the 8th Chinese

Source: China Textile Network Company - 1 - clothing brand of the Year Award, Ruyi • 2012 China Fashion Forum, CHIC the 20th anniversary of birthday the PARTY, Korean fashion Fair (Preview in China) and other related games had more than 100,000 professional visitors to visit the exhibition.

The 18th China International Textile fabrics and accessories(Spring) Fair was held in Beijing China international Exhibition Center from March 28 to 30, sponsored by the China National Textile and Apparel Council, co-hosted by Textile Industry Branch of China International Trade Promotion Council, China Textile Information Center and Frankfurt Expo (HK) Limited. The exposition occupied eight exhibition halls, an exhibition area of 50,000 square meters. 1284 exhibitors from 16 countries and regions brought their latest products. There were 974 domestic exhibitors, 51 more than last year, and 310 overseas exhibitors, 39 more than last year.

March 29 to March 31, China International Trade Fair for Fibres and Yarns (2012 Spring ) was held in Beijing China International Trade Center 1 & 2 as scheduled, with an exhibition area of 5500 square meters, and a total of 146 exhibitors from 10 countries and regions . Source: CNTEX

The Top 20 Movers, Shakers and Decision-Makers in China Fashion DATE: 2012-04-09

For the past few years, all eyes have been on China. Captivated by the country’s rapidly expanding economy, large population and seemingly insatiable appetite for luxury goods, global fashion brands have focused their efforts on the Middle Kingdom, opening glittering stores in megacities like Beijing and Shanghai, as well as fast growing middleweight cities like Guangzhou, Hangzhou, Shenzhen and Tianjin, and hosting high-profile public relations events, from exclusive VIP dinners to famously large- scale productions like Fendi’s runway spectacular on The Great Wall. And judging from recent figures, the results have been strong. According to the Boston Consulting Group, sales of luxury fashion goods in China increased by 33 percent to $40 billion last year, while experts estimate that the country will surpass the US to become the world’s largest luxury market by 2020.

Naturally, China’s emergence as a powerhouse market for fashion has given rise to a number of key figures who have been highly instrumental in driving and harnessing the spectacular momentum. Here, we present, in no particular order, The Business of Fashion’s Top 20 movers, shakers and decision makers in China fashion. They are entrepreneurs, luxury executives, PR mavens, retail experts, editors, media moguls, models, bloggers and others who each have tremendous expertise and insight in their chosen domain and, collectively, form the backbone of the country’s fast growing fashion ecosystem.

SILAS CHOU, the elder statesman who has helped create billions in financial value Hong Kong tycoon Silas Chou hails from a renowned family of textile and apparel manufacturers, but it was only when he acquired Tommy Hilfiger in 1989 with associate Lawrence Stroll that he became a big player in the global fashion industry. Over the years he has invested in brands including Karl Lagerfeld and Pepe Jeans, and opened Iconix China Group, run by his daughter Veronica, which distributes fashion brands in the country. The jewel in his crown, though, is Michael

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Kors, which went public last year and is currently valued at over $9 billion. But his influence goes beyond acquiring and growing fashion brands. It was recently announced that he would provide financial support for the CFDA/Vogue Fashion Fund’s China Exchange programme, underscoring Mr Chou’s emergence as something of an elder statesman in China fashion.

MELVIN CHUA, the PR and events guru Almost all major fashion events in China are organized through Melvin Chua and his company Ink Pak Communication Group. This ex-advertising executive has a Rolodex full of names like Giambattista Valli, Kate Moss and Alber Elbaz (the latter with whom he is hosting a 10th anniversary celebration in Beijing this month). But Chua does more than just PR. He also manages the country’s top talent, including clients like actress Maggie Cheung and supermodel Du Juan. In fact, Chua is the force behind most luxury brand-celebrity partnerships in China, making him quite the man to know.

HUNG HUANG, the media mogul who can make or break a young designer Sometimes called “the Oprah of China,” outspoken media mogul Hung Huang wears many hats, from television host and blogger to publisher and retailer. Although she spent her formative years in New York, she returned to Beijing in 1998 and took the helm at _Look_ magazine (now iLook), which has since become one of the most popular lifestyle titles in China. Huang also pens a weekly column for trade newspaper WWD called ChinaFile, providing insight into the workings of China’s fashion industry. But most importantly, Huang is a tireless promoter of emerging Chinese designers who she supports through Brand New China (BNC), her multi-label boutique in Beijing. She also offers an iLook/BNCscholarship for young designers in partnership with ESMOD Beijing. Indeed, if you’re a young designer in China, Ms. Huang can make you – or break you.

ANGELICA CHEUNG, the leading voice of fashion in China Like her US counterpart Anna Wintour, Angelica Cheung, editorial director of Vogue China, is the country’s most influential editorial authority and educator. The Beijing University graduate and former Elle and Marie Claire editor has been in the top job at Vogue China since 2005 and if numbers are anything to go by, her power is only set to grow. Vogue China is the country’s fastest growing fashion magazine with a circulation that’s jumped from 300,000 to 700,000 since launch. Her endorsement and support is critical for any international fashion brand looking to gain visibility in the burgeoning Chinese market.

JENNIFER WOO, the heiress who oversees the country’s most powerful luxury retail group As the daughter of property tycoon Peter Woo, Jennifer Woo is one of the youngest and most powerful retailers in Asian fashion. But Ms Woo’s influence goes beyond the privilege of her birth. This is a woman who has made a name as force to be reckoned with in her own right. Previously the president of Lane Crawford, Woo now oversees the operations of multi-brand designer fashion retailers Lane Crawford and Joyce, accessories specialist The Pedder Group, and brand management and distribution arm, the ImagineX Group, giving her a virtual monopoly on fashion in the region. With stores and points of sales across 50 cities in Greater China and South East Asia, all four companies achieved historic, record-breaking sales in 2011. As the Chinese luxury market continues to grow in leaps and bounds, Ms. Woo is a woman who will undoubtedly continue to shape China’s luxury retail revolution.

ADRIENNE MA, the fashion e-commerce expert Adrienne Ma hails from Asian fashion royalty – she is daughter of legendary fashion retailer Joyce Ma, who founded concept boutique Joyce. For years, Adrienne worked alongside her mother as president of Joyce before becoming a consultant in 2008. She emerged as one of China’s first digital pioneers when she launched flash sale website Shouke.com, which was acquired by The Net-A- Porter Group in 2011 as a platform from which to build its Asia-Pacific business. Ma is now one of three key leaders at Net-a-Porter Asia Pacific and will be spearheading the retailer’s digital launch in China, building a name for herself as the country’s leading fashion e-commerce expert.

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ADRIAN CHENG, the visionary heir who is reshaping retail Grandson of New World Development billionaire founder Cheng Yu-tung, Harvard-educated Adrian Cheng is the third-generation heir of one of China’s most influential business families and the mastermind behind Chow Tai Fook, one of the world’s most successful jewellery brands, boasting 1,500 outlets in Greater China and a market capitalisation double that of Tiffany & Co. The 32-year- old is on his way to becoming a billionaire himself after listing 10 percent of the family’s stock on the local market last year, raising around $2 billion. And while jewellery constitutes the bulk of Cheng’s business, he has also set about boldly reimagining the future of retail, introducing avant-garde experiential concepts to the region, including art- and eco-malls.

DR. VICTOR FUNG, the man building China’s first luxury group Dr. Victor Fung (along with his brother William) is known for his leadership of Li & Fung Group, which includes Li & Fung Limited, one of the world’s largest manufacturers of consumer goods, and Trinity Limited, a luxury menswear retailer managing brands such as Cerruti 1881, Gieves & Hawkes and Kent & Curwen in China. Most recently the Fungs have made headlines with Fung Brands Ltd (Victor is a private investor), which has taken majority shareholdings in brands including Belgian leather specialists Delvaux, French accessories brand Robert Clergerie and, most recently, Sonia Rykiel. Industry insiders speculate that, together, the Fungs are developing the first Chinese- owned international luxury goods conglomerate.

ANDREW WU, Mr. Arnault’s man in China Born and raised in Shanghai, Andrew Wu worked for the Ontario Ministry of Intergovernmental Affairs and Maple Leaf Foods in Canada before returning to China in 1993 to join LVMH, starting as general manager and managing director of Parfums Christian Dior where he pioneered a direct subsidiary allowing the brand to develop their own retail distribution network across the country. In 2005, after leaving to work for Sony, Wu returned to LVMH as group head for China, reporting directly to the conglomerate’s chief executive, Bernard Arnault, perhaps the most powerful man in the global luxury goods sector. Since then Wu has managed the group’s interests in the Chinese marketplace including growing and developing their 60-plus brands. If anyone knows the ins and outs of how the luxury sector works in China, it’s Wu.

SHAM KAR WAI, the retail revolutionary who knows what’s next Hong Kong-born Sham Kar Wai started I.T in 1988 as a small boutique featuring funky, street wear labels that were unavailable elsewhere. Primarily by appealing to a new generation looking to express their individuality, he has managed to build a veritable fashion empire with an annual turnover of HK$4 billion (2011) and 500 points of sales worldwide, half of them in China. Championing new and underground talents, I.T has brought many experimental brands to Asia, including Comme des Garçons, Maison Martin Margiela, Gareth Pugh and Ann Demeulemeester. The company also boasts several in-house brands and retail concepts including Izzue, I.T and Double Park. A true innovator and pioneer, Wai still has the one of China’s keenest eyes for what the next generation wants.

BALBINA WONG, the old hand with a knack for charting new frontiers The sometimes imposing, always bejewelled Balbina Wong is an old hand when it comes to luxury brand experience in China and Hong Kong. Born in Singapore, Wong became sole distributor for Salvatore Ferragamo in Greater China, engineering the brand’s early and highly successful entry into the market. Today, Wong is the deputy chairman and CEO of luxury management and distribution group ImagineX — which now represents 18 international brands, including Marc Jacobs and Donna Karan, with 450 points of sales across Asia — as well as retail management sister company, the Walton Brown Group, both part of the Lane Crawford Joyce Group. Wong’s combination of vision, business acumen and talent for quanxi have paid off handsomely for the brands she has brought to China. Always the pioneer, Wong was the force behind a luxury retail development at one of fashion’s newest frontiers, Urumqi, an oil-rich desert town near the Kazakhstan border.

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UMA WANG, China’s hottest emerging designer Fashion designer Uma Wang is the first of a new generation of cutting-edge Chinese designers to receive global acclaim. Wang studied at China Textile University and London’s Central Saint Martins, launching her own label in 2005. Since then she has won several fashion awards, caught the eye of influential magazines such as Italian Vogue and become a regular at Shanghai Fashion Week. This season, she debuted her work at Paris Fashion Week and is taking part in the CFDA’s inaugural China Exchange programme. Thanks to her breakthrough success, Wang has become both an inspiration and a symbol for a new generation of young designers across China.

CHEN MAN, the most in-demand fashion photographer in China Born in 1980 in Beijing, photographer Chen Man was just 23 when she exploded onto the fashion scene with a series of fantastical covers for the Shanghai-based fashion magazine Vision. Soon the graduate of the Central Academy of Fine Arts, who is known for her colour-saturated images, was contributing editorials to key Chinese fashion titles including Vogue, Elle, Bazaar, Marie Claire, Cosmopolitan and Esquire, and exhibiting her work at international galleries and museums. Most recently, she made headlines with a series of striking covers for i-D magazine’s Pre-Spring 2012 issue and is collaborating with cosmetics giant MAC on a line of makeup. If there is a Chinese fashion photographer that’s set to joins the ranks of fashion industry giants like Mario Testino or Steven Meisel, Chen Man is the one to watch.

HAN HOUHOU, the star blogger who influences millions Most people know him as China’s uber fashion blogger, but Han Huohuo has some serious fashion pedigree. A former fashion editor at Marie Claire China, he rose to notoriety when he was photographed by The Sartorialist in Milan in 2009. Armed with one of the country’s most popular blogs, which boasts three million followers, Huohuo has been invited to sit front row at Chanel, pen columns in a number of fashion magazines and host TV shows. More recently he designed a collection with fashion retailer I.T and is currently working on his first book, set to launch in September. For brands seeking to forge relationships in the growing world of Chinese fashion blogging, Huohuo is the first and most important name to know.

LIU WEN, the face that redefined Chinese beauty While Du Juan was China’s first supermodel, Liu Wen is the face of its future. Hailing from a small town in Hunan province in China, Wen was discovered in 2005, at the age of 18, and got her big break when she was cast for a Burberry runway show. Wen has since become the first Asian face to represent Estée Lauder internationally and the first Chinese model to walk in a Victoria’s Secret runway show. Her striking looks have made her the most popular model in Asia and have helped to redefine traditional perceptions of beauty, not only in China, but across the world.

LUCIA LIU, China’s most sought-after stylist Even though fashion stylists are a relatively new phenomenon in China, Lucia Liu has already cornered the market thanks to her edgy editorial for Glass Magazine and i-D. Based between Beijing and London, she currently holds the position of style director of Harper’s Bazaar China, has worked with high-profile Chinese celebrities and fashion icons including Maggie Cheung, Faye Wong, Fan Bing Bing, Yao Chen, and Ziyi Zhang. She also collaborates with luxury brands on advertising and commercial campaigns, making her one of China’s most sought after stylists.

PAULINE SU, the woman behind China Fashion Week Pauline Su, a graduate of Xiamen University, has been the driving force behind the China Fashion Association, the country’s national governing body for the fashion industry, since 2000. Overseeing several committees that deal with everything from retail consultancy to fashion schools, Su is also known for championing Chinese designers in China and beyond. Among her influential projects is the twice-yearly China Fashion Week which has raised its profile in the last few years. She has recently signed agreements with similar governing bodies in Italy and France to promote and develop China’s fashion industry abroad.

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ALAN FANG, the man behind China’s most influential trade show Alan Fang is from the third generation of one of Hong Kong’s most important textile families, The Fangs, who own Pringle of Scotland and are founders of Hong Kong’s successful apparel retailer the Toppy Group. Fang is carrying on the family’s legacy with Novo, China’s first multi-brand retailer specialising in street fashion catering to a new generation. He is also the founder of Novo Mania, one of China’s first international trade fairs dedicated to contemporary and urban fashion which could soon rival international counterparts like Bread and Butter. Indeed, for contemporary brands looking to showcase their products in China, Novo Mania is the place to be.

TERRY SIO, the woman who holds the key to Macau Very much under the radar, fashion entrepreneur Terry Sio thrived in Macau’s gambling boom. She set up Rainbow Group in 1979, which has since grown to become the special administrative region’s largest distributor of luxury brands, establishing names such as Emporio Armani, Escada, Cartier, Versace, Bally and Zegna in shopping malls attached to leading casinos, like Wynn and MGM. Now, she is expanding many of these same brands into China, with a focus on middleweight cities such as Chengdu, Chongqing, Guangzhou, Hangzhou, Harbin and Shenzhen. For brands eyeing expansion in China’s answer to Las Vegas, Terry Sio is the most important woman to know.

JIMIN LEE, the expert in store development Shanghai-based consultancy Translatio was founded by Korean-born Jimin Lee and partner Angelo Negro in 2003 and helps luxury brands navigate the often murky waters of China retail. With over 20 years experience in the industry, working for stalwarts such as Saks Fifth Avenue and Joyce, Lee’s areas of expertise include retail operations, business development, merchandising, and marketing and communications. Her clients include luxury development Three on the Bund in Shanghai and brands like Marni, Balenciaga, Moncler and Alexander Wang, often making her the first port of call for brands wanting to open stores in China. Source: CNTEX

Fashionable Pollution in China DATE: 2012-04-06

Early one morning in 2011, environmentalist Lei Yuting was crouched by the side of the Fenghua River, which snakes through the Chinese province of Ningbo. Despite his face mask and protective goggles he could smell the chemical dyes that polluted the water. His gear drew the attention of a few locals passing by on their morning exercise. They stopped to tell him that the area always smells bad, and that the color of the wastewater changes throughout the day.

Moments later they hurried off. Lei says he got the feeling few chose to linger by a river that a few decades ago would have been clear and teeming with fisherman, tourists and local children. Now, nothing broke the lifelessness except the occasional freight-carrying barge and a couple of lonely white egrets, perched on the muddy banks. There were certainly no more fishing boats.

Lei is a campaigner with Greenpeace, and was in the area collecting water samples for an investigation that would eventually reveal how two textile manufacturers, supplying some of the world’s biggest fashion brands, are discharging hazardous substances such as nonylphenol (NP) into Chinese waterways. NP is a chemical with hormone-disrupting properties that’s persistent (i.e. doesn’t readily break down in the environment), moderately bioaccumulative (it builds up in the food chain), and hazardous to aquatic life even at very low levels.

The use of NP in clothing manufacturing has effectively been banned within the EU, with similar restrictions also in place in the United States and Canada. Of course, this is hardly the first time

Source: China Textile Network Company - 6 - multinational companies have taken advantage of lax standards in other countries. Exporting the manufacturing industry hasn’t been accompanied by the export of high environmental protection standards, and has led to a host of pollution problems in China, most pressingly water pollution. Ask any local, it seems, and it’s hard to find a river clean enough to swim in in this country.

“These are supposed to be some of the most scenic mountains and clearest waters in China. How is it that they are now poisoned by industry and filled with sorrow?” Lei asks.

Consumers often find it easy to turn a blind eye to the conditions in which their clothes were manufactured, but when a good produced using hazardous chemicals means those items themselves contain hazardous chemicals, then it unsurprisingly becomes a little harder to ignore.

In the latest toxics report to be commissioned by Greenpeace, simulations of standard domestic laundering on 14 clothing samples found that a single wash can wash out a substantial amount of the nonylphenol ethoxylates (NPE) residues present within textile products. More than 80 percent were washed out for half of the plain fabric samples tested. This suggests that all residues of NPEs within textile products will be washed out over their lifetime, and that in many cases this will have occurred after just the first few washes.

These NPEs are then discharged to wastewater treatment plants, which don’t effectively treat or prevent the release of these hazardous substances into the environment. Indeed, they can break down NPEs to form toxic and hormone-disrupting NPs that are then released within the treated water.

In short, brands are making their consumers unsuspecting accomplices in the release of these hazardous substances into public water supplies. And, let’s not forget, we’re talking about a substance that has been effectively banned or heavily restricted in the EU, United States and Canada.

NPEs are a compound belonging to a broader group of chemicals known as alkylphenol ethoxylates (APEs). It’s not enough to set a lower limit for the concentration of APEs in finished products (although we need this as well.) Suppliers could attempt to give the final product additional rinsing, which may help reduce the chemical levels in the product. But this would still be discharged into the rivers, lakes and seas of the manufacturing countries. That’s why the chemicals should be eliminated from the process entirely.

Greenpeace has already convinced six major brands – Puma, Nike, Adidas, Li-Ning, H&M and C&A – to collaborate on a “draft joint roadmap towards zero discharge of hazardous chemicals.” This roadmap sets out the steps that the brands commit to take to achieve the zero discharge of hazardous chemicals, and invites others to partner in this endeavor. However, the roadmap doesn’t yet include a specific commitment or a date to eliminate all uses of APEs.

In Europe, restrictions on the marketing of products with NPEs above a specified level are under development. Equally important is that measures are taken to restrict the use of APEs in manufacture for the countries where the majority of manufacturing takes place, such as in East Asia and Southeast Asia.

As global citizens, it’s surely time to start applying some pressure. Source: Greenpeace via CNTEX

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Malawi woos Chinese investment in cotton industry DATE: 2012-04-06

Malawi on Tuesday expressed its willingness to attract more Chinese investment in its cotton industry, stressing that more value addition is needed.

The Malawian Minister of Industry and Trade John Bande told Xinhua in an exclusive interview that the southern African country wants to see more value addition to cotton where they would want Chinese companies establishing textile mills to produce textiles for exports to regional markets and other important markets.

"The Malawian government allocated large sums of resources in the cotton sector, and the aim is to add value to cotton before exports," the minister said.

"Malawi would be willing to work with the Chinese in areas that are supposed to promote diversification and exports, such as agro processing and manufacturing sectors," Bande added.

He said Malawi would want to cooperate with the Chinese in the service sectors including energy, tourism, information technology and construction, which would contribute a lot to the country's GDP.

For the time being, China has invested in a cotton growing and processing project in Balaka, southern Malawi, which Bande said was "complimenting the government's vision where cotton is processed and exported."

On the China-Malawi trade relations, Bande said Malawi's trade with China continues to grow significantly in terms of both imports and exports.

"Notably Malawi's exports to China grew by 294 percent between 2009 and 2010 from 1.3 billion Malawian kwacha (around 7.7 million U.S. dollars) to 5 billion kwacha," he said.

The minister said the major exports include tobacco, cotton, tea, minerals, wood and other products.

He also heaped praises on China's zero-tariff treatment to Malawi. "In March 2010, an agreement was reached between China and Malawi, whereby China phased in zero-tariff treatment of 95 percent of the products originating in Malawi and exported to China," Bande said.

"Under this agreement, 60 percent of the products listed gained duty free status in 2010. Crops which benefited from this treatment included coffee, tea, soy beans, groundnuts, honey and many other product," he said.

In terms of the recent withdraw of aid by the Western countries, including suspension of major aid packages, Bande said it has put the costs of doing business in Malawi even higher than before. Source: CNTEX

Why China's sewing machines could go silent DATE: 2012-04-05

It’s an inevitable march: With exports falling, and the costs of production including materials, labour and the need for cleaner technology rising, companies in China’s own garment industry will be the next generation to move their production offshore.

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“They definitely are worried about what they’re going to do with costs rising. They are not expanding fast, but they are wondering what their next step will be as the market expands,” said Wang Jun, secretary general of the China National Garment Association, in Beijing this week. “I think in future it will appear that Chinese factories will move their production base offshore.”

The Chinese garment industry has had a difficult start to the year: This month’s HSBC flash PMI dipped to a four-year low this month, driven down in part by slowing export growth of just 7 per cent year-on-year for January and February – half as fast as in December. China’s own powerhouse GDP growth is also expected to slow this year, to around 8 per cent, down from an average 10 per cent a year for most of the last decade.

Meanwhile, costs of production are rising. China’s southern manufacturing belt is facing labour shortages. Wages are beginning to rise, after employees fed up with low pay and often terrible working conditions began staging successful walkouts. And China’s central government is placing an increasing focus on clean technologies, in an effort to address the impact of severe pollution caused by poorly regulated manufacturing. It’s good news for the workers’ own buying power, and much-needed for the battered environment, but it means the days of China as the bargain-basement manufacturer to the world are numbered.

That leaves garment industry executives, gathering in Beijing this week for the annual China Fashion Forum, worried and in search of new ways to revitalize their industry and develop new, homegrown brands that will appeal to China’s masses and help manufacturers make up for the losses in foreign markets.

Mass-market brands like Japan’s Uniqlo and Spain’s Zara have developed a loyal and growing following among China’s young and upwardly mobile set. But there is no Chinese equivalent; the closest is a jeans-and-T-shirt chain, Metersbonwe, which has the largest market share of any Chinese retail brand but is targeted at the university crowd rather than the young urban professional.

But there is potential. In 1990, the average Chinese urban resident had around 1,279 yuan in disposable income (just over $200 U.S. at today’s exchange rate), of which they spent almost 180 yuan ($28.60) on clothing. By 2010 those numbers had risen to 13,471 yuan and 1,444 yuan, respectively – a tenfold increase.

E-commerce is a key platform; so are redoubled efforts at marketing and branding in a county where foreign labels still hold more cachet than local ones.

Ultimately, though, the pressure is on Chinese designers to come up with a new Brand China that will appeal to the hopes and dreams of the Chinese middle class.

“The mainstream belongs to people who want to build their own brands, rather than copying others,” Mr. Wang said. Source: CNTEX

China's textile industry in crisis DATE: 2012-03-31

The Chinese textile industry is facing crisis as current typical profit margin in the sector is lower than the cost of finance. During 2011, more than 30 percent of textile and clothing firms in Jiangsu and Zhejiang are reported to have gone out of business, according to China Business Daily.

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Rising labour costs are cited most frequently as a cause of the industry's difficulties. Low technology, labour-intensive processes have increasingly been transferred to cheaper production sources in South East Asia, such as Cambodia and Vietnam, or to eastern European countries, such as Bulgaria and Poland.

Industry sources also comment that the corporate tax burden is excessive. The difference between sales tax on processed goods (17 percent) and the purchase tax payable on cotton (13 percent) cannot be recouped, for instance.

The decline in textile sector optimism is reflected by falling enthusiasm for cotton production, notwithstanding the recent announcement of the increased support purchasing price for next season. That increase, it is suggested, is insufficient to offset rising costs of production and bring an increase in farmers' incomes, hence a turn toward more lucrative crops. As previously reported, farmers in Dezhou, Shandong province, for instance, foresee a decline in cotton area this year of no less than 25 percent. Earlier this week, it will be recalled, a second survey by the farmers' branch of the China Cotton Association predicted a decline of 16.7 percent in plantings nationwide,

However, industry participants appear rather gloomy about prospects for the next several months, owing, in particular, to a poor outlook for demand from the euro-zone countries. The call for tax concessions appears thus to be increasing.

Yesterday, the National Bureau of Statistics reported that industry profitability in general (enterprises above a designated size) has declined sharply this year. Unlike the previous contraction (in 2009), which was a temporary phenomenon resulting from the financial crisis, rising costs of production, such as energy and labour, are this time proving to be more problematical. State price controls on consumer goods, it is noted, make it very difficult to recoup higher costs. Source: Moneycontrol.com via CNTEX

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