Wednesday 1 December 2010

How the global economy affects school uniform, raw materials, labour rates, manufacturing capacity


The price of clothing and footwear has risen for first time since the early 1990s, according to official figures, raising the fear that the era of cheap imports from the Far East is over. The weak sterling exchange rate and higher shipping costs from China have contributed. The exchange rate is crucial for British retailers because the great majority of clothes are bought from the Far East, particularly China and Bangladesh, in dollars but sold in Britain in sterling. Rising wages in traditionally cheaper labour markets – such as China and India – are also having a slight impact on prices and are likely to become a more prominent factor in the months ahead.
The price of cotton has vaulted above the key $1 a pound level for the second time in history as worries about a shortage of the fibre prompted textile mills to scramble for supplies. The rise in cotton prices has easily outpaced increases in more industrial commodities such as oil or copper. Tight supply conditions have been exacerbated by losses in Pakistan, the world’s fourth-largest grower, after it suffered devastating flooding. The sharp rise in the price of cotton has increased pricing pressures on clothing manufacturers, adding to concerns over higher labour and energy prices.
The price increase in wool is said to be due to a combination of factors. A world decline in sheep numbers has resulted in a fall in the volume of fleeces – since 2000 there has been a 40 per cent fall in the UK production - meaning less wool is available to the textile industry. The economic downturn has led to de-stocking in the textile industry, so manufacturers and spinners have no reserve stock to call on.

This tough economic back drop seems to vindicate Perry Uniform’s continuing Leeds based factory making us less dependent on an overseas supply base and capable of greater manufacturing flexibility.

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