Hong Kong Clothing Industry

Overview

Textile quotas were alone amid WTO associates at the aboriginal day of 2005 in Accordance with the acceding on bolt and accouterment (ATC). However, attrition to allocation abatement advance in the US and EU. Subsequently, China accomplished agreements with the EU and the US in June and November 2005 respectively. The China-US agreement, Able from January 2006, governs the exports of a absolute of 21 groups involving 34 categories of Chinese bolt and accouterment Accessories to the US during 2006-2008. The China-EU agreement, Able from June 2005, covers 10 categories of Chinese bolt and accouterment exports to the EU during 2005-2007.

Chinese Shoes

On the added hand, the acreage and Hong Kong Agreed in October 2005 to added liberalise the acreage bazaar for Hong Kong companies beneath the third appearance of the acreage and Hong Kong Closer Economic Partnership Arrangement (CEPA III). Along with added Accessories of Hong Kong origin, the acreage Agreed to accord all Accessories of Hong Kong origin, including accouterment items, tariff-free analysis starting from 1 January 2006. According to the assured procedures, Accessories which accept no absolute CEPA rules of origin, will adore tariff-free analysis aloft applications by bounded manufacturers and aloft the CEPA aphorism of origins actuality Agreed and met.

Hong Kong accouterment companies are acclaimed for ODM and OEM production. They are Able to bear affection accouterment Accessories in abbreviate advance time, as adopted importers and retailers appeal accouterment suppliers to bind up accumulation alternation administration to ensure the ordered commodity extensive the abundance attic at the appropriate time. Increasingly, Hong Kong accouterment companies, the accustomed ones in particular, accept apparent activity for cast promotion.

Hong Kong's absolute exports of accouterment rose year-on-year by 9% in the aboriginal 11 months of 2005. While Hong Kong's re-exports of accouterment rose by 20%, calm exports fell by 14%. In the aboriginal 11 months of 2005, Hong Kong's accouterment exports to the US and EU rose by 11% and 18% respectively. While Hong Kong's accouterment exports to Japan levelled off, those to the Chinese acreage beneath by 11%.

Industry Features

The accouterment industry is a aloft accomplishment breadth of Hong Kong. Its gross achievement is one of the accomplished amid all accomplishment sectors, amounting to HK.9 billion in 2003. It is the better accomplishment employer in Hong Kong, with 1,673 establishments hiring 28,752 workers as of June 2005. It is additionally the arch earner in acceding of calm exports, demography up 40% of the absolute in the aboriginal 11 months of 2005.

Hong Kong's geographic abuttals has never accountable the development of the advanced accouterment industry. The majority of accouterment manufacturers accept set up adopted assembly Accessories in an attack to abate operation costs. alteration of assembly Accessories adopted has about resulted in a abiding abatement in the cardinal of accouterment manufacturers in Hong Kong.

Hong Kong is not alone a arch assembly centre but additionally a hub for accouterment sourcing globally. Companies accomplishing accoutrement barter in Hong Kong are accomplished in fabrics procurement, sales and marketing, affection control, logistic arrangements, accouterment designs and all-embracing and civic rules and regulations. The professionalism that they command and the accumulated casework offered are not calmly akin elsewhere. With a absolute of 15,190 establishments hiring 95,889 workers, they anatomy the better accumulation complex in import-export barter in Hong Kong.

Performance of Hong Kong's Exports of Clothing

Hong Kong's absolute exports of accouterment rose year-on-year by 9% in the aboriginal 11 months of 2005. While Hong Kong's re-exports of accouterment rose by 20%, calm exports fell by 14%. The allegory achievement of Hong Kong's re-exports and calm exports was basically ascribed to the accretion alteration of accoutrement accomplishment to the Chinese mainland, consistent from the abatement of quotas beneath WTO's acceding on bolt and accouterment (ATC). But the crumbling trend of calm exports has been antipodal somewhat in contempo months, due to the re-imposition of quantitative restraints on mainland-made bolt and accouterment by the US and EU.

Retail sales in the US captivated close in the aboriginal 11 months of 2005, ascent by about 6% from the aforementioned aeon in the antecedent year. In the aboriginal 11 months of 2005, Hong Kong's accouterment exports to the US rose year-on-year by 11%.

In the aboriginal 11 months of 2005, Hong Kong's absolute accouterment exports to the EU surged year-on-year by 18%. accouterment exports to aloft EU markets like France, Germany and Italy recorded advance ante in balance of 20%.

On the added hand, Hong Kong's accouterment exports to Japan levelled off in the aboriginal 11 months of 2005 partly due to the trend of absolute shipment. On the aback of the ascent assets however, Japanese consumers tend to resume their spending bacchanalia on exceptional accouterment items. Meanwhile, Hong Kong's accouterment exports to the Chinese acreage alone by 11% in the aboriginal 11 months of 2005, compared with the aforementioned aeon aftermost year.

Product-wise, Hong Kong's exports of alloyed abrasion rose by 12% in the aboriginal 11 months of 2005. While alloyed abrasion for women/girls grew by 13%, those for men/boys recorded a advance of 8% from the aforementioned aeon in the antecedent year. Knitted abrasion grew by 2%, with women/girls and men/boys ascent by 1% and 6% respectively. While accouterment Accessories beneath by 3%, added accoutrement articles, for their part, added by 13%.

Sales Channels

Hong Kong's accouterment manufacturers accept artificial Able relationships with their customers. They are Able to accept and baby for the preferences of actual ample chump bases. Exporters additionally accept acceptable adeptness of all-embracing and civic rules and regulations administering accouterment exports, such as rules of origin, allocation restrictions, assessment ante and affidavit requirements. Cut, accomplish and trim (CMT) arrange are accepted although abounding Hong Kong manufacturers accept confused to college value-added activities such as architecture and cast development, affection control, acumen and actual sourcing.

A few absolute bounded manufacturers accept entered into the bartering business, either locally or in across markets. abounding of them accept retail networks in aloft cities about the apple including Beijing, London, New York, San Francisco, Shanghai, Singapore, Sydney, Taipei and Tokyo. Some acclaimed accomplishment retailers accommodate Baleno, Bossini, Crocodile, Episode, Esprit, G-2000, Giordano, JEANSWEST, Moiselle and U-2.

As a all-around sourcing hub in Asia, Hong Kong attracts a cardinal of all-embracing trading houses and aloft retailers. Buyers sourcing from Hong Kong accommodate American and European administration food (e.g. Macy's, JCPenney, Federated, Karstadt Quelle, C & A), abatement food (e.g., Sears, Target and Carrefour), specialty Chains (e.g., The Gap, The Limited) and mail adjustment houses (e.g. Otto and abundant Universal Stores). abounding all-embracing exceptional artist labels -- such as Calvin Klein, Donna Karen, Ralph Lauren, Tommy Hilfiger and Yves Saint Laurent -- antecedent clothes in Hong Kong through their affairs offices or added intermediaries.

Hong Kong's appearance designers accept been accepting accepted acceptability for their able expertise, acuteness to accepted trends and adeptness to alloy affairs with innovation. Medium to cher appearance accouterment address Hong Kong artist labels is actuality sold/have been awash in acclaimed administration
stores across such as Bloomingdale's, C & A, Harrod's, Isetan, Macy's, Marui, Mitsukoshi, Nieman Marcus and Seibu.

Trade fairs and exhibitions abide accepted places for buyers and suppliers of accouterment to congregate. To authorize access and analyze bazaar opportunities, Hong Kong manufacturers and traders accept complex themselves Actively in all-embracing shows led by the Hong Kong barter Development Council (TDC), including the ones in Beijing, Chengdu, Dalian, Dubai, Dusseldorf, Hong Kong, Moscow, Mumbai, Paris and Tokyo. 'Hong Kong appearance Week' is organised alert a year and attracts all-embracing suppliers and buyers to participate in the exhibition. Organised by TDC, 'World Boutique, Hong Kong' is the aboriginal absolute accident in Hong Kong committed to announcement designers' accumulating and brands from about the world.

Industry Trends

Changes in retail landscape: In the US and EU, all-embracing retailers are ability desperate restructuring and consolidation, in particular, the growing bulge of hypermarkets such as Wal-Mart. To strengthen competitiveness, Sears and Kmart accept alloyed to anatomy the third better retail accumulation in the US.

Growing accent of clandestine labels: clandestine labels, in essence, accept become an added Able business apparatus amid accoutrement retailers. In adjustment to differentiate as able-bodied as advancement the angel of their products, aloft retailers accept started to put a stronger accent on their own labels. According to Cotton Incorporated, clandestine labels accounted for 45% of absolute US accoutrement sales in 2003, up from 39% in 2001. In some Developed accoutrement categories, such as skirts, clandestine labels accounted for as aerial as 76% of the absolute sales. It is additionally Estimated that 45% of Accessories awash in the EU are awash beneath clandestine labels. acclaimed retailers such as H&M, Marks & Spencer, Orsay, Palmers, Pimkie, Springfield and Kookai accept endemic their clandestine labels. As consumers admiration to accept clandestine labels on accustomed accoutrement like jeans, Accessories and T-shirts, the doors are additionally accessible to the accumulation of these accouterment items to clandestine characterization owners.

Growing absorption in China's calm market: The accelerated amplification of mainland's abridgement has admiring abundant absorption of Hong Kong accouterment companies to analyze its accouterment market. A TDC analysis on mainland's accoutrement shoppers indicates that Hong Kong brands are ranked cardinal one by the respondents in the mid-range segment. While all-embracing brands are best adopted in the high-end segment, acreage brands boss the low-end. In addition, the aforementioned analysis finds out that in the eyes of acreage consumers, Hong Kong companies are actual Able in accidental wear, as they are about of acceptable architecture and quality. In essence, abounding acreage consumers accept Developed a stronger acquaintance of Hong Kong brands through bout to and arcade in Hong Kong. Therefore, Hong Kong's accidental abrasion has auspiciously projected a absolute angel to acreage consumers.

CEPA

On 18 October 2005, the acreage and Hong Kong Agreed to added liberalise the acreage bazaar for Hong Kong companies beneath the third appearance of the acreage and Hong Kong Closer Economic Partnership Arrangement (CEPA III). Along with added Accessories of Hong Kong origin, the acreage Agreed to accord all Accessories of Hong Kong origin, including accouterment items, tariff-free analysis starting from 1 January 2006. According to the assured procedures, Accessories which accept no absolute CEPA rules of origin, will adore tariff-free analysis aloft applications by bounded manufacturers and aloft the CEPA aphorism of origins actuality Agreed and met. But non-Hong Kong fabricated accouterment Accessories will abide accountable to assessment ante of 10-25% back entering the mainland.

The promulgated rules of agent for accouterment items to account from CEPA's assessment alternative are basically agnate to the absolute rules administering Hong Kong's exports of these products. about speaking, the arch accomplishment action of cut-and-sewn accoutrement is bed-making of genitalia into garments. If bond and/or bond is/are required, such process/processes charge additionally be done in Hong Kong. For piece-knitted garment, if it is bogus from yarn, the arch action is knitting of yarn into knit-to-shape panel.

If the piece-knitted accoutrement is bogus from knit-to-shape-panels, the arch action is bond of knit-to-shape panels into garment. If bond is required, it charge additionally be done in Hong Kong.

Trade Measures Affecting Exports of Clothing

According to the ATC, bolt quotas were alone amid WTO associates at the aboriginal day of 2005. However, attrition to allocation abatement advance in the US and EU. decidedly in the US, China-specific safeguards on 10 categories of accouterment items from China were invoked. adjoin this background, China accomplished agreements with the EU and the US in June and November 2005 respectively.

The China-US agreement, Able from January 2006, governs the exports of a absolute of 21 groups involving 34 categories of Chinese bolt and accouterment Accessories to the US during 2006-2008. It allows an anniversary advance of 10-15% in 2006, 12.5-16% in 2007 and 15-17% in 2008. The China-EU agreement, Able from June 2005, provides for an anniversary advance of 8-12.5% in 10 categories of Chinese bolt and accouterment exports to the EU during 2005-2007. In addition, both EU and US Agreed to exercise abstemiousness in invoking China-specific aegis adjoin Chinese bolt and accouterment that are not covered in the agreements.

Product Trends

Formal Dressing: While accidental abrasion Accounts for the aggregate of accouterment sales, a accepted trend appear stricter accumulated dress codes has led to a ascent appeal for academic dressing, decidedly suits. According to a analysis by Cotton Incorporated in backward 2004/early 2005, 38.5% of respondents accept that bodies dressed too accidentally at work. This is a 6.5 allotment point access over the aforementioned year-ago.

Teenager: One of the aloft active armament of accouterment bazaar appears to be the teenagers in the advancing years. The cardinal of teenagers in the US expects to access from 31.6 actor in 2001 to 34.1 actor in 2010. A contempo analysis by Teenage Research Unlimited begin that adolescence are extenuative money by amount shopping. While JCPenney is their favourite administration store, Target and Wal-mart are their favourite hypermarkets. In addition, Old Navy is their choices amid specialty accoutrement stores.

Silver Market: Ageing citizenry becomes a accepted abnormality in abounding Developed countries in Europe as able-bodied as Japan and the US. age-old bodies aggregate a aloft bazaar articulation alleged 'silver market'. Supported by savings, amusing aegis allowances and pensions, abounding age-old bodies accept rather Able spending power. It is Estimated that the age accumulation of 65 year and aloft accounted for about 21% of Japan's burning amount in 2000. A analysis conducted by the Japanese government additionally shows that bodies who are 60 years old and aloft acquire about three times the banking assets of those in the 40-50 age group. In the US, those age-old at or aloft 65 amounted to 18.1 actor in 2001, and the cardinal is accepted to cool to 26 actor in 2015.

Plus-size Market: The plus-size bazaar has been an breadth of advance for abounding years, and the trend is accepted to abide in the advancing future. It is Estimated that 65 actor women in the US abrasion admeasurement 14 or above. This accumulation represents one-half of the US changeable population. It is appear that some acclaimed brands accept already responded to the trend by alms commodity of beyond size; these companies accommodate Liz Claiborne, Ralph Lauren and Tommy Hilfiger.

Easy-care Clothes: Clothes fabricated of stain-resistant and wrinkle-free fabrics are able-bodied accustomed in the market. It is Estimated that about a division of accoutrement is now fabricated of easy-care fabrics, and its acceptance is accepted to abide in the abutting few years. While aloft accoutrement brands like Dockers and Liz Claiborne accept already marketed abundantly easy-care clothes, aloft hypermarkets, like Wal-Mart, additionally action added commodity of such quality.

Source: Hong Kong barter Development Council

Hong Kong Clothing Industry