Maximising its eco-credentials and targeting an aging market with clothing able to measure parameters such as blood pressure are key factors in Taiwan’s strategy for maintaining and growing its knitwear business in the face of Chinese and south east Asian competition
The knitwear manufacturers of Taiwan are being challenged by headwinds from the global economic downturn, which has undermined their high-end export strategy. Last year was not a good one – as indicated by drops in exports of circular-knit fabric and knitted clothing apparel of 2.74% to $1.265bn and 10.97% to $178m, respectively, in the first eight months compared with the corresponding period of 2011. This comes against the backdrop of a simultaneous 9% decrease in overall textile outbound shipments.
To compete with nearby rivals in low labour cost countries, Taiwanese-owned production has long ago been shifted to upmarket goods and some manufacturers have established factories in the Philippines, Cambodia, Vietnam, China and Central America, while leaving research and development (R&D) and management in Taiwan. So, as these off-shoring tactics appear to no longer guarantee good earnings, some companies are exploring high-tech green production.
Indeed, what sends chills down the spines of most textile manufacturers elsewhere is now considered a major opportunity in Taiwan. Amid the ongoing brouhaha surrounding Greenpeace’s “detox” campaign, Taiwan’s knitwear manufacturers are confident that consumers’ panicking over chemicals that may harm human health will make Levi’s, Nike, Puma, H&M, Esprit, ZARA and other high street brands rely more on the island for sourcing.
“When dealing with Taiwanese knitwear makers, foreign brands can feel at ease because very much unlike in China, regulations and management are not chaotic here,” says Chen I Chuang, chairman of the Taiwan Knitting Industry Association, who is confident that this will help Taiwan’s knitting industry grow its sales again. “Our strength is that rules are followed and standards are met – and this is exactly what global brands are increasingly after.”
Chuang Feng Nien of Fong Yi Knitting is also confident, insisting that none of the supposedly objectionable yarns and fabrics highlighted by Greenpeace and others can be traced to Taiwan.
“This is a dyestuff issue – yarn and fabrics that are dyed in Taiwan are not toxic,” he says. “All this media attention on Greenpeace’s campaigns is a tremendous chance for us to tell the world that we do it better.”
Mr Chen also says there is an equally important factor behind his optimism for the future – ongoing technological investment. According to him, some 250 Taiwanese knitwear factories have shown a firm commitment to upgrading their technology. Computerised machinery from Germany’s Mayer & Cie, Terrot and Karl Mayer, Japan’s Fukuhara, Italy’s Orizio as well as Taiwan’s Pai Lung, Jiunn Long and Tien Yang is what the Taiwanese have been placing their bets on. And that helps a good deal in crafting superior products, he says.
Besides being backed by top-notch knitting machinery, the island’s government also plays a very weighty role in supporting the industry. Two major research institutes are sponsored with public money – the Taiwan Textile Research Institute (TTRI) and the Taiwan Textile Federation (TTF), the former mastering critical R&D, the latter aiming to improve design and marketing techniques for yarn, knitwear manufacturers and garment producers.
To tap into TTRI and TTF’s R&D, local clothing and fabric businesses must undergo an evaluation and can then are usually only required to shoulder 20-30% of the R&D cost, a significant advantage they have over their competitors in the region’s developed countries and particularly over Taiwan’s arch rival in trade South Korea, whose textile industry is supported by Seoul’s free trade agreements with the US and European Union (EU), says Mr Chen.
As dyeing is the by far least eco-friendly part of the clothing and fabric production process, with its significant water consumption, chemical use and greenhouse gas emissions, the Taiwanese have been turning to solution dyed yarn, which is produced by mixing the dye with the plastic polymer before webbing and knitting, thereby cutting water, energy, effluents and waste gas by as much as 70-82%, according to several studies.
Major local suppliers of such yarn are Nan Ya Plastics and Libolon, the latter of which is also renowned for being Asia’s largest producer of fabrics made from recycled polyethylene terephtalate (RPET) bottles.
Taiwan’s small and medium-sized dyeing factories have also been improving their environmental performance, reducing the ecological footprint of their local knitwear industry customers. A good example is Mian Pin, which acquired the strict Global Organic Textile Standard (GOTS), which only certifies dyestuffs and auxiliaries meeting certain environmental and toxicological criteria. “We have invested in this because this is the way Taiwan’s textile industry had to go,” says Mian Pin’s director, Hong Qing Feng.
“GOTS and other eco-certifications for dyes enable Taiwanese companies to take centre stage at specialised eco-trade shows, most prominently of which is Interstoff Asia Essential in Hong Kong.”
Another must-participate for the members of the Taiwan Knitting Industry Association is the European Outdoor Trade Fair in Friedrichshafen, Germany. In summer 2012, seven of the island’s knitwear manufacturers presented a range of eco-friendly and functional products, from those made with moisture absorbent and cooling fabric to warming and anti-UV products.
Such publicity can however be a double-edged sword – especially in east Asia. The Taiwan industry complains that rival manufacturers from nearby jurisdictions copy or steal their technology.
The industry association’s chairman Mr Chen pointed a finger particularly at south-east Asia and China. “There is nothing we could do against it; Taiwan and China do have an IPR protection agreement in place, but that sort of paperwork is of use only when signed with US and EU, not with China,” he says.
And this could equally apply to any green production innovations applied by the island’s industry. So, what comes next for Taiwan’s knitwear industry after competitors have caught up on multi-functionality and eco-friendliness?
Mr Chuang pointed to east Asia and Europe’s aging population as yet another golden opportunity for the R&D and precision machinery-backed Taiwanese. “It’s clothing for the old and infirm – measuring pulse, blood pressure, body temperature and so on,” he says.