When companies close down, people lose jobs. It is not a question of labour or jobs or workers - it is people, and their families, whom are going to have to deal with a very real loss of income. I think it is a fair assumption that the group tried everything to make the books balance. Unfortunately, given the environment in which they were operating, Frame Textiles was not economically viable and had to be closed down.
The group has publicly stated that there was a lack of support of the industry by government, leaving many thinking that government could have prevented this closure.
I wrote about tariffs and quotas in an earlier post and about how the government could evaluate which industries were most deserving of support. Is it not possible that the government has undergone such an exercise and determined that this industry, in its current form, is not sustainable, and that the impetus for making it sustainable lies with business and not government?
According to the South African Clothing and Textile Workers Union (SACTWU) website , 70 000 jobs have been lost since 2003. In a paper by E.Vlok, The Clothing and Textile Industry (2004) the author refers to an estimated total number of job losses of 85 190 from 1996 to 2004. The unions have been unable to prevent job losses.
So with tariffs and quotas, strong union representation, a bargaining council, capital injections by large corporates, strategy workshops by industry stake-holders, research by academics, etc....with all of this, this industry remains in crisis mode.
I would ask you to consider that government is at present trying to deal with a global and (therefore) national economic crisis. It too has a budget and books to balance. There are not unlimited resources available in South Africa. We are a poor country with many challenges. So when one advocates that government redirects money from other areas to the clothing and textile industry, one is de facto taking away school books, running water, electricity infrastructure, university laboratories, road works, policemen.... I would suggest that anyone tasked with making such decisions will not have an easy time of it.
I do not believe that the government is without criticism with respect to its economic policies and do not in any way suggest so here. I merely wish to point out that government is (and should be) the least able to ensure this industry's survival.
With all the media focus on the clothing and textile industry, very little refers to our roles as designers in helping the industry. Is that because we're churning out great designs and someone (the government?) needs to sort out the industry so we can all prosper? Hmm... I could sum up my responsibility as 1) providing great designs and products 2) building relationships and networks in the industry and 3) sharing information and knowledge in those networks. And I suspect that list might grow over time.
I think when times are tough we play our cards close to our chest. It's natural enough. You want to keep your competitive edge. I've read (and conducted) many interviews with a similar thread: designers are sometimes reluctant to share sources. (I've also experienced many instances where the opposite is true - and this is the environment we need to build!)
For example, if you've found a great button supplier, you may be tempted to keep it to yourself. Good move, right? Wrong. In a small - and shrinking - industry like ours in SA, your button supplier might not be in business down the road. And then you have no great buttons. Suppliers depend on customers and you're helping your supplier by referring more customers. I understand that you don't want anyone using your buttons, but think about it like this. Perhaps there would be a greater variety of buttons if your supplier had more customers. Because he'll be able to put bigger orders through to his supplier, and maybe get price discounts on shipping larger volumes which he can use to up variety or drop price. And the great supplier will become the greatest button supplier. Maybe. It is better than the alternative, no?
Following on from the last blog, its easy to see why I think iFashion is absolutely critical for our fashion industry. It has a profile in South Africa, and it helps us connect easily and quickly. It also gives us the opportunity of being part of the development of the industry. By assisting someone you're automatically improving their chances of success. And if they succeed, the industry grows. Yay!
That's pretty cool if you think about like that. Something that you posted on a forum - and there are tons of great nuggets of info in the forum - has an impact. So I am urging everyone to post and to respond to posts, to add comments, to rate what you read, and to make connections. You will make a difference...and I'm a great believer in good karma!
Next Post: Frame: What Should the Government Have Done?
I thought I'd comment on the retail sales statistics that were released for Feb '09 yesterday. Stats SA www.statssa.gov.za releases statistics from data collected in many facets of the economy including the retail sector, manufacturing, etc. According to Stats SA, Feb '09 showed a decline from Feb '08 - 4.5%. The economist I saw interviewed on Summit TV last night echoed the sentiments of the Fin24 article "Shock fall in retail sales"
Stats SA highlighted in their report that the 3 months ending Feb '09, retail trade sales were 1.9% lower than the same period in '08 for the clothing, textiles, footwear and leather goods retailers (these retail sales figures are grouped together). This group equates to 20% of total retail trade sales in the South African economy.Total retail trade sales - all categories - were down 1.0% for this period Economists were surprised by the magnitude (the 4.5%) of the contraction - it was a much bigger decrease than they expected. I'd like to point out that economists are also flummoxed in general. We are in unchartered territory as a global economy. Nobody can say with any certainty when we're going to recover and how bad it is going to get before we do. Nobody.
Now there is some positive for anyone looking to start-up in all of this: you're not losing ground to the competition. Established businesses are in a holding phase, not expanding and taking over the world. So you can take your time to plan your business, and gain some ground for when the economy starts to turns around. A sliver of a silver lining perhaps - but it is all about keeping your chin up!
It is hard to plan for the unexpected. Companies around the world will tell you that they didn't anticipate the financial crisis and so they weren't prepared for it. What ever happened to the good times helping you through the bad? Isn't storing food for the winter (in a manner of speaking) is an absolutely essential part of running a business?
I pondered this as I was lying in bed these past few days having been struck down on Saturday with the most awful flu (I thought I was toast but here I am). If I had been working on a collection, or planning a fashion show, or producing garments for delivery I would have been in trouble. I was unable to get out of bed for 2 days - there would have been no walk of glory down the ramp post-models for me!
So I took it as an early lesson in building in some fat into your planning. Deadlines always create pressure but don't add to the pressure by not factoring in mishaps (if you can!).
I am an absolute fashionista! I love the feeling of wearing clothes that make you feel sexy and succesful. This is always important in the Corporate world. I am looking for a new job as my current position is wasting away my talents. It is so frustrating to know that you are capable of so much more but is stuck in something boring!
I am just praying that the right position comes my way soon! I am vibey, energetic and a very hardworking girl with a great personality. I have been thrown into the deep end doing more than three poeople's job at once for a whole month and have come out on top. But growth opportunities are so minimal that you will take one small step in three years!! I can't wait that long to make a success. I DO NOT WANT MY TALENTS TO BE WAISTED!!
God help me please.
Following on from my blog yesterday Notes on quotas and tariffs in the clothing industry I thought it pertinent to refer to this article from Fin24.com 'Company bailouts 'unneccessary'published 8 April 2009.I copied the following paragraphs from the piece (but read it if you can, it's not too long):
The global economic downturn has ravaged many industries the world over. Businesses are shutting down and the fashion industry is no exception either. A couple of weeks ago we were greeted by the news that Chanel was cutting 200 jobs and New York Fashion Week cut down on a large number of shows as designers could not afford to exhibit their collections. It puzzles me then how many South African designers, or at least those I have spoken to, have no strategies to shield their businesses from the storm, because as much as they say they haven't yet been affected, who's to say it won't happen.
It smacks to me of a lack of business savvy to just sit back and wait for the signs of negative impact before one starts applying strategies to sustain their business. It is also surprising to find a fashion student who couldn't care less about what the current economic climate means to, not only their future in the fashion industry, but also what it means generally.
We live in a globalised world. Everything is interconnected and fashion, as special as one might think it is, is not all that isolated from the rest of the world. What affects the mining industry, will eventually spill over to the rest of us. What happens in politics will manifest itself in your life in one way or another. Fashionistas need to start being conscious of the fact that the world is not just about pretty clothes and schmoozing with a glass of champaign in hand. Economics is a reality that cannot be ignored, especially now.