TEXTILES

Lower consumer spending for clothing and subdued industrial demand to weigh on sales

S

SENSITIVE RISK for entreprises

  • Fragmentation

  • Internationalization

  • Capital Intensity

  • Profitability

  • Growing consumer base in emerging economies
  • Strong taste for fashion among mature economy consumers
  • Many niche segments seeing healthy growth (luxury, sportswear)
  • Global supply chains vulnerable to external shocks (pandemics, trade tensions)
  • Very strong pressure from large clients (clothing retailers)
  • Changing consumer preferences hurt demand
  • Competition from the fast-growing second-hand market in mature economies
  • Challenging relocation of manufacturing from China to other countries (Vietnam, Bangladesh, Indonesia, etc.)
  • Adaption of new ESG standards could inflate operating costs

Key players

Country Role Sector risk
China

#1 Producer

C

Sensitive risk

India

#2 Producer

B

Medium risk

Italy

#4 Producer

C

Sensitive risk

Turkey

#5 Producer

D

High risk

Contact Euler Hermes

Economic Research Team

research@eulerhermes.com

Sector Risk Analyst

Aurélien Duthoit

aurelien.duthoit@eulerhermes.com

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