| China, the
world's largest denim garment supplier, produced 30
percent of total global output in 2004.
That year, the country's 4,000 manufacturers
shipped US$1.8 billion worth of denim garments,
mainly to the United States and Europe. Exports were
up 10 percent over the previous year. They are
forecast to grow an additional 20 percent in 2005 as
demand for China-made denim garments is expected to
increase significantly in the months following quota
elimination.
Exports in 2005 could even be higher than the 20
percent projected growth, but suppliers are wary of
being overly optimistic given the threat of US
safeguards and recently imposed export taxes.
The following
are some of the key trends and issues we see
in China's denim garment export
manufacturing industry:
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The future of some denim
garment suppliers in China is uncertain.
Increased competition and possible US
safeguards may significantly impact
companies that embarked on capacity
expansions. These companies might not be
able to recover their investments in
additional machinery, which they purchased
to boost capacity and become more
competitive. |
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Small suppliers that focus
on low-end production will be the most
affected by the new government-imposed
export tax. In the keenly competitive
free-market environment, raising prices to
compensate for lost profits could translate
to lost orders. |
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Many low-end suppliers are
moving up the value chain, focusing
production on midrange and even high-end
denim garments. These suppliers are
investing more in R&D in order to develop
more upscale products. |
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These factors have also led
many midsize companies to vertically
integrate production and improve
manufacturing efficiency. Most large
companies already conduct most, if not all,
production processes in-house. Doing so has
given these large companies a little more
room to absorb unforeseen additional costs,
such as export taxes. |
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Nearly all denim garment manufacturers in China
produce jeans, and most of them also offer shorts,
skirts, dresses and shirts. All of the companies
featured in this report offer jeans as their main
product line. At some companies, jeans account for
about 90 percent of total production.
Jeans and shorts account for 64 percent of the
denim garment exports by suppliers in this report.
Jackets make up 16 percent, skirts and dresses 13
percent and shirts 7 percent.
The Products & Prices section explains the
differences among low-end, midrange and high-end
denim garments in each product category, including
price ranges. The Manufacturing module discusses the
different washing methods done at the factories and
reviews quality standards followed by China
suppliers. The Fabrics section details fabric
weights and fiber blends used by suppliers and how
the use of functional fibers affects product
performance and price.
And more... To see the full Executive Summary
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