Garment Industry in China

China has the largest garment/ apparel industry in the world and is also the largest exporter of garments to the rest of the world. The overall industry including men's wear, women's wear and kids wear has grown rapidly over the last 2 decades.

China has become the world leader in apparels owing to its policy of economic reform and also due to the prevailing low labour costs. The government has also helped domestic manufacturers by introducing restructuring and consolidation programmes. Foreign investments have also helped the Chinese men's apparel industry grow.

After becoming a member of the World Trade Organisation (WTO) in late 2001, the opportunities have become even more lucrative for the country to increase its exports. China will also face fierce competition in the international markets and lowering of the trade barriers will also result in more competition for the domestic market.

Most of the apparel manufacturers and dealers pay more attention to women clothing market and neglecting men's clothing markets. This has lead to an underdeveloped market for men's apparels. With the coming of foreign companies in China, there has been a shift of focus on the men's apparel segment. These companies are planning to set up exclusive retail stores for men's clothing in both casual and formal wear.

Most of the apparels that are exported are designed by foreign customers and these apparels are made from high quality imported fabrics. These garments are made for the mass market and are thus moderately priced. Some manufacturers also manufacture high quality and high- priced clothing for men.

Imports
Some of the largest importers of Chinese men's apparels are:

• Japan
• Hongkong
• USA

Men's Apparel Industry: Geographic Distribution in China
The majority of apparel manufacturers have factories located in coastal areas, followed by the midland provinces, and the smallest number of factories are located in the western provinces.

Factors driving the geographic distribution of Apparel manufacturers in China:

• Traditionally, the coastal area has been China's best and most suited location for apparel industry as well as for upstream industries like the textile industry and synthetic fiber industry. There is also large number of skilled labour availability in the region.
  
  
• The first and main Economic Development Zones were opened in the coastal region. Ningbo, Qingdao, Zhuhai, Haikou, Shenzhen, Shanghai, Dalian, Xiamen are all located in coastal areas.
  
  
• The coastal area has high population density with higher income and people in this region are also more conscious of fashion than in other areas, thereby leading to better market potential.

Source: Esquel Group 2005

Men's Apparel Industry Analysis Strengths

• The country is a low cost producer of men's wear
  
  
• The country manufactures high quality garments, relative to cost
  
  
• The manufacturers in the industry require short lead-time, owing to large capacity and well-developed infrastructure
  
  
• The manufacturers provide flexibility in product offerings
  
  

Weakness

• Manufacturers lay less stress on innovation and R&D;
• Slow pace in adopting international standards (e.g. cotton grading)
• Manufacturers invest less in brand equity