The report emphasizes the importance of implementing manufacturing excellence by outlining the various factors affecting the manufacturing costs and their benchmarking in the textile industry.
In the aftermath of covid 19 pandemic, businesses have been significantly impacted by trade uncertainties, political instability and intensive competition in the industry. This has forced businesses to challenge and rethink their manufacturing practices. In the past, manufacturing prioritized efficiency and higher production volumes. However, the paradigm is shifting towards other critical factors such as the quality of products delivered and cost-effectiveness to meet customer demand and remain cost competitive in the industry.
The cost of manufacturing holds significant importance in the textile & apparel industry due to the various factors involved in its manufacturing including complex and labour-intensive processes. Textile & apparel manufacturing has witnessed historic shifts towards developing nations over the decades. US, Europe, UK and Japan leveraged a global trade share of 45% in the 1990s which reduced majorly to only 12% in the 2020s. Developing countries such as China, India, Bangladesh, Vietnam and Turkey became attractive destinations and this is evident through the increase in their combined trade share from 29% in the 1990s to 55% in the 2020s. This relocation is majorly driven by several factors including lower cost of manufacturing, availability of skilled labour and favourable business environment.
In recent years, inflation, price volatility in raw material cost and increased competition in the industry have been driving down end-user pricing. To remain cost-competitive, businesses must focus on manufacturing excellence and targeting the improvement in minuscule areas in any business at each step can result in reduced manufacturing costs and improved EBITDA margins. By implementing manufacturing excellence organizations can achieve significant cost savings, improved reliability, increased productivity, superior quality, and enhanced supply chain performance.
Wazir Advisors, the Gurugram-based management consulting firm, will release its report – titled “Manufacturing Excellence: The Path to Profitability in Textiles” at ITMA 2023. The report talks about the importance of manufacturing excellence and how it can help enhance profitability by reducing manufacturing costs. The report will have a detailed account of the factors affecting the cost of manufacturing and benchmarking norms of various parameters in the various segments of the textile industry.