SA's clothing industry trying to stitch itself together following worst decline to date

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The economic impact of the Covid-19 pandemic on consumers has led to less demand for clothing.
The economic impact of the Covid-19 pandemic on consumers has led to less demand for clothing.
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  • The economic impact of the Covid-19 pandemic on consumers has led to less demand for clothing.
  • This has impacted SA's already battling clothing industry.
  • But local industry players point to various ways the local industry is trying to beat imports.


South Africa's clothing industry has not escaped the impact of the Covid-19 pandemic on heavily burdened consumers, with retail sales in the SA clothing and textile industry reaching the worst decline ever recorded in 2020.

But, say local manufacturers, they are pulling out all the stops to snatch back market share from imports, as they continue to face supply chain disruptions brought on by the pandemic.

Graham Choice, managing director of merchandise supply chain at clothing retailer TFG (formerly The Foschini Group), says some of the country's leading apparel retailers have tried to tackle the problem by localising and shortening lead times.

But, he says, there has been little on offer from the local manufacturing sector, which he describes as "decimated".

"Overall, the local CTFL [clothing, textile, footwear and leather] value chain in SA has come under extreme pressure as the Covid-19 pandemic significantly constrained demand for retail goods," says Choice.

"Retail sales in the SA clothing and textile industry fell 6.9% overall during 2020. This is the worst decline ever recorded and the only year of contraction apart from 2009 at the height of the global financial crisis when sales declined 3.2%, according to StatsSA."

There have long been calls to revitalise garment manufacturing in South Africa, which has battled to compete with China and other cheap importers. The Retail Clothing, Textile, Footwear and Leather Master Plan, which was signed by government and local retailers in 2019, is also expected to give local manufacturers a leg up.

But the CTFL sector has seen several plant closures and associated job losses in the past year, reducing local capacity to produce.

And, in the meantime, retailers continue to face logistical hurdles.  

"Retailers continue to face a range of operational challenges, most notably supply chain disruptions causing huge delays and further losses due to shipping challenges, port congestion and rising logistical costs.

"This pressure on local retail demand has had a trickle-down effect on local suppliers where contracting order books placed significant strain on cash flow and financial sustainability of many businesses in the local supply chain," says Choice.

According to Choice, TFG responded with a "quick response" retail model that would allow for popular clothing items to be made or adjusted quickly, in-season.

But that doesn't solve the problem of local manufacturing capacity.

This is where the Retail CTFL masterplan comes in. Its implementation kicked off in 2020, and it aims to increase the proportion of locally manufactured products sold in-store from 44% (in 2018) to 65% by 2030.

The plan also aims to create jobs.

Thandi Phele, acting deputy director-general of the division for industrial competitiveness and growth of the Department of Trade, Industry and Competition (dtic) says the masterplan was based on extensive consultation with stakeholders including including government, representative associations, large retailers, manufacturers and the organised labour.

According to Phele, manufacturers have committed to ramp up productivity and invest in production, while organised labour has agreed to adaptable working hours.

"Even though the industry was under pressure, clothing imports took bigger hit than locally manufactured clothing as retailers are buying goods more locally and local manufacturers are benefiting from this.

"[I]t is important to keep working on this to make sure factories are ready and tooled when demand increases again," explains Etienne Vlok, national industrial policy officer of the Southern African Clothing and Textile Workers' Union (SACTWU).

"Government has also committed to creating an enabling environment for investment in the South African clothing, textile, footwear and leather industry, through strategic tariff support, appropriate manufacturing incentives, and clamping down on illegal imports," Phele adds.

Meanwhile, the SA Revenue Service – which has vowed to crack down on illicit trade – has its hands full levelling the playing field as part of the masterplan.

Phele explains: "Often CTFL goods imported to South Africa are declared at a much lower value than their production value at source. This has the impact of reducing tax receipts for the fiscus and unfairly pricing imported goods below the local production cost, thereby driving out the local industry."

It is estimated that in 2019, clothing with an export value of R35.9 billion was imported into South Africa at a declared cost of R27.8 billion - an under-declaration of 23%.

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