Garments exporters hope to hit $1.5 bn in revenues this year as it captures demand for niche products, orders from the US which is shifting preference away from China and lost market by competitor Myanmar due to its political issues. The Philippine Exporters Confederation Inc. (Philexport) sees the industry gaining headway, although this year’s projection is almost flat from 2022.
The group said the Philippines stands to gain from the lack of production appetite for the smaller volume orders which the countries like Vietnam and China tend to reject as they are more geared for bigger quantities due to their robotics and automation system. Philexport also said the ongoing US campaign of “anything but China” tends to spread production among Asian countries including Philippines. The group added the political issues in Myanmar cause apparel orders to shift to other countries, a few of which are now in the Philippines.
Robert Young, Philexport trustee for textile, yarn and fabric sector, said more foreign buyers of garments and textiles are expected to expand sourcing to the Philippines provided prices are lower than what competitors offer.
Energy cost is of particular concern. “We have to rush the other forms of energy such as solar, wind and all these kinds of renewable energy, thereby lowering the electricity cost,” Young said, adding that power costs comprise 5 to 10 percent of a firm’s total production costs depending on the product. Young said industry players need to implement upskilling programs to keep up with demand of buyers.
“Our laborers are behind on this modern and automated way of manufacturing…we are talking about robotics but that is still very far for the Philippines to apply…but somehow we should be already semi-automated now. Because if the foreign garment buyers are coming in, they will definitely ask for a shorter timeframe for production, lead time. We might not get the orders if we will be dictating again the usual lead time that we require which is 60 days,” he added.
Meanwhile, Young bared Japan’s Nichiun Co. Ltd. of Konoike Group has placed new orders worth $6.48 million from the country’s garments sector.
Young said Konoike Group, through Nichiun deputy general manager Kenichi Yamada, indicated the order during the Philippine-Japan business matching event on the sidelines of the official working visit of President Ferdinand Marcos Jr. to Tokyo, Japan early this month. The orders are for men’s dress shirts for Nichiun Co. Ltd.’s contract with a shirt brand company called Flex Japan Inc.
“They will buy the fabric, they will ship it to us, and then we will stitch it and ship it to Japan,” said Young, also President of Foreign Buyers Association of the Philippines. He said the Japanese firm wants the Philippines to ship nine 20-foot containers, with each container loading 5,000 pieces of men’s dress shirts, for 12 months.
“The order has still to be confirmed through the approval of the final sample. We are now working on the sample. (We will start shipping) as soon as the sample is approved,” he added. Young said he is now in talks with three specialized factories in Bataan, Batangas and Clark, Pampanga about meeting the securable order of the Konoike Group.
