Textination Newsline

• “Keep it up! is not an option"

The textile printing company Mayer is a family business on the Swabian Alb. As a leader in textile printing, in screen, rouleaux, rotary, sublimation and flock printing and as well as in 3D coating, the enterprise is increasingly applying its leading expertise to the field of technical textiles. An in-house quality management system ensures the traceability of all production processes, an environmental portfolio the efficient use of energy, sustainability and resources. Textination talked to Managing Director Michael Steidle.

Textildruckerei Heinrich Mayer GmbH is a family business that has been active in textile printing and finishing for 45 years. If you had to introduce yourself in 100 words to someone who doesn't know the company, what makes you unique?
Over the past ten years or so, our family-owned company based in rural Baden-Wurttemberg has changed from a classic textile printing company into a system supplier. A central precondition for this is our knowledge of our own strengths. We rely on proven printing solutions. We do not rush into exchanging them with the latest trend. Instead, we examine whether another, innovative application can be found for them. Or whether one it is possible to combine the tried and tested with a new approach. For example, we were able to solve electronic requirements by printing technology. This area is our second focus. I am a Master of electronic engineering and completed my apprenticeship at Bizerba, a worldwide leading specialist in industrial weighing and labeling technologies. My wife brought me to the textile industry.

In which product area do market and customers challenge you in particular? And on which socially relevant areas do you see a particularly great need for innovation in the upcoming 10 years? What is your assessment that textile finishing will be able to offer solutions?
Mobility is an issue that will be of great concern to all of us in the coming years. In this area trump is what brings little weight, can be produced in a resource-saving way and is easy to shape. All these requirements are met by textile carrier materials and composites. However, textiles as a pure material are still not well-known in public and in our target industries. This understanding should be promoted.

Were fashion and clothing yesterday and do hybrid product developments like your ceramic-coated high-tech fabrics represent the future? When would the company name have to be adjusted, and how long will you keep your broad range of products and services?
In any case, it is true that the textile market, especially the clothing sector, is becoming smaller and smaller in Germany, while the market for technical textile solutions is growing. Of course, this also has an impact on our business and our priorities. Textiles are now found in so many products - we would never have dreamed about before!

As far as the company name is concerned, we have discussed it extensively. We decided to keep it because it is still right. The textiles we talk about are mostly a functional material, but they still remain textiles. And the technology with which we manufacture our high-tech coatings continues to be the printing technology ...

"Without innovation no future" - In five years time, you celebrate the company’s 50th anniversary, with which fundamental corporate decisions will you then have secured the future of your customers and employees?
You already mentioned the landmark decision: "Innovation, innovation, innovation." We can secure our future through innovation only. This means that we must constantly question ourselves and be prepared to be widely interested in attending trade fairs and exhibitions and find out what people are looking for.

Innovation manager or tinkering: What does it mean for a medium-sized family business high up on the Swabian Alb having to profile on specialties in the niche? What advantages do you see compared to large companies?
The Swabian Alb is a traditional textile region. In 1980, about 30,000 people worked here in the textile industry. In 2005 it was barely a sixth. There is not much else left to do than to look for profitable niches and to show a clear profile. Perhaps the special thing about it is that we are not alone in this. Basically, all successful textile companies in our region have undergone a similar process.

As a small - and owner-managed - company, we have the shortest and fastest decision-making channels. That makes us more flexible than a big company. A budget is not questioned five times, but it is decided. If we make a trial, we can evaluate it in the evening and react the very next day. If something doesn't work, we don't need a meeting – then that's it.

At the same time, we do not automatically have a budget for research and development. We first have to carve this out elsewhere. And we do so in the knowledge that it can also be for the trash can. Within the framework of this budget, entrepreneurs have the greatest possible freedom.

To break new ground means decisiveness, overcoming fears - and thus the courage to fail. Not every project can succeed. Which entrepreneurial decision are you particularly glad to have made in retrospect? What makes you proud?
That's easy (Michael Steidle laughs)! We have realized a company’s request that has driven us for months, which in the end has also awakened personal ambition. That was the introduction to these technical coatings, the key and door opener for technical textiles in general. In doing so, I revived old resources, almost by chance. Meaning: my knowledge in electronics. That's when I realized that with a textile you can do completely different things. When you see the finished product on sale after two or three years, it makes the whole team proud!

Every man for himself, God for us all: With which sectors in the textile industry and from neighboring sectors do you want to get closer cooperation beyond competitive borders? For which higher-level problems do you consider this to be indispensable?
Actually, it is not so much a matter of competitive boundaries - cooperation with innovative competitors would always be good for the end product, but that is the case in every industry!

For us, cooperation with other companies in the textile chain is important, i.e. the upstream company. Let’s assume that I am looking for a special fabric for my coating, which in turn has to be made from a special yarn. Then I am already dependent on two companies. Fortunately, we have innovative companies right on our doorstep. But sometimes we have to go further to find the right partner. Characteristics such as willingness to take risks, a common entrepreneurial interest and a passion for the final product are enormously important in a successful cooperation.

Together with your customers, universities, specialist institutes and research institutes, porject-related you work on market-ready solutions. Do you think Germany is a good breeding ground for innovative entrepreneurs? What should happen to stay successful in international competition?
The cooperation with the institutes makes perfect sense; after all, it is their task to carry out research for companies that cannot shoulder such assignments on their own. This includes testing facilities as well as applying for funding, which is only possible in cooperation with research institutes. However, they are public institutions and therefore per se have a different objective than a company: We need to bring a promising idea to market as soon as possible so that it generates a return. A research institute does not have this pressure.

And Germany as a location? Germany is a brilliant location! But we have an infrastructure bottleneck: I mean roads and internet connections as well as access to funding or venture capital. That does not exist in Germany in the true sense anyway. Finding investors for an idea is therefore extremely difficult.

Let me give you an example: Over the years, I have received around 14,000 euros in subsidies for a coating innovation. An American entrepreneur had a very similar idea. He was able to raise about $ 35 million within three years through venture capital, crowd funding, and grants. In the end, he did not even know what he should spend the whole money on!

In addition, for us as a company in Germany, the large, open economic area of Europe is important!

You are the first textile printing company to be certified for screen printing as well as for rotary and rouleaux printing according to the GOTS standard. How important do you consider such certification as a unique selling point in the competition?
Such certifications are important because we work with clients in the upper and premium segments. Especially in times in which - undoubtedly justified - ever greater demands are placed on sustainable business and also the external presentation receives a steadily growing attention, we can support our clients this way. We therefore offer different printing methods, all of which are certified. One thing we have to be aware of is, that if we - and all the other members of the textile chain – charge the additional costs, the price mark-up would be so enormous that nobody would accept it anymore.

How do you feel about the willingness to perform of the succeeding generation? And who would you recommend to join the textile industry and to whom would you dissuade from it?
We work a lot with students and interns. Every year we give two students the opportunity to work and research in our company for their master's thesis. With these young talents, we often experience great commitment and the ambition to bring their own project to a meaningful completion. At the same time, it is difficult for us to fill our apprenticeships; the idea of working eight hours daily, five days a week seems daunting.

And who would I recommend to join the textile industry? For decades, we vehemently discouraged our offspring from working in the textile industry, because one said it has no future ... As a true high-tech industry, it is interesting for engineers, process engineers, chemists or electronic engenieers. Very important: for people with visions! If you are looking for the classic textile industry you have to be prepared to work worldwide and you will not be unemployed. Many companies are desperately looking for plant managers or managing directors for their non-European branches.

• Rethinking in traditional industry

Italy's shoe and shoe technology manufacturers are losing market share in important markets and want to make their production more efficient and digital. German companies score points in niches.

Even though 9 out of 10 shoes today come from Asia, Europe's largest shoe producer Italy still ranks among the top ten of the world's largest shoe producers and is the undisputed market leader in the luxury segment. Nevertheless, sales in terms of volume at home and abroad are falling and so is production. At the moment, the sector can only secure its turnover through higher prices.

The decline in export demand, which accounts for around 85 percent of Italian footwear, is particularly painful. According to the sector association Assocalzaturifici, international sales fell by around 4 million pairs between January and October 2018. Only an average price increase of 6.4 percent enabled a year-on-year increase. On the German sales market, sales of Italian shoes also stagnated at around EUR 1 billion, while German shoe exports to Italy, with a plus of 34.5 percent to around EUR 485 million, achieved one of the highest growth rates in German trade with Italy.

Orders received by the Italian footwear industry in the fourth quarter of 2018 declined both domestic (-2.5 percent) and abroad (-0.9 percent). The only market segment that is still growing in Italy itself are sports shoes/sneakers. According to experts, the falling number of units drives manufacturers to find solutions that help to reduce production costs.

Opportunities for Germans in Digital Change and in niches
In the shoe and leather technology domestic manufacturers dominate. Assomac, the Association for Shoe and Leather Technology, estimates, that in 2018 the approximately 240 Italian companies in the sector achieved a turnover of around EUR 760 million. By contrast, exports of shoe and leather machinery, which account for around three quarters of the sector sales, fell by around 6.2 percent in 2018. Italy is by far the most important exporter of leather and shoe technology in the world. In 2018, shoe and leather machinery worth of around EUR 439 billion went abroad, particularly to China, Vietnam and India.

German deliveries of shoe and leather technology to Italy are at a low level and, according to the VDMA trade association Textile Care, Fabric and Leather Technologies, reached around EUR 4 million in 2018. Italy thus ranked fourth behind China, the USA and Mexico in terms of export destinations. With foreign deliveries of around EUR 50 million per year, Germany is the world's fifth largest exporter.

Market experts see opportunities for German companies in Italy with components that help domestic companies in international competition, for example the use of intelligent and networking machines. Despite their great competence, Italian manufacturers are very traditional and are struggling with the digital changes. But industry experts report that the companies are rethinking and interested in new solutions.
"We support our Italian customers in installing more software solutions for sewing machines and in networking machines," says Sebastian Feges, sales engineer at the Schwetzingen-based company EFKA, one of the last German companies in the sewing industry.  EFKA supplies Italian shoe and leather machine manufacturers with sewing drive controls. The company scores particularly well in areas where maximum precision is essential and every wrong stitch leads to expensive scrap, such as leather seats for Ferrari. According to Feges, money for investments in Italy is not easy to get at the moment. However, he sees an interesting perspective in the promotion of the Italian government for the purchase of industry 4.0 equipment and software, the so-called Iperammortamento, which is not yet sufficiently known.

Further opportunities exist in niches that are gaining in importance due to current industry trends such as digital printing on leather. The machines of Hansa Mixer from Bremen produce foam for textile and digital printing and the sealing of leather hides. "We offer a niche product that can be used anywhere," General Sales Manager Achim Schmidt says. In addition to the shoe and leather industry, Hansa Mixer also supplies food manufacturers such as Ferrero. "Italy is an interesting market for us and we expect good orders."

Another industry trend is greater sustainability, especially in the often-criticized leather industry. Assomac is expressly committed to this goal and has – next to other thing - introduced the new Targa Verde certificate.

Sources: Assocalzaturifici, Instat

The Italian footwear industry consists of about 4,700 companies with about 77,000 employees. According to the industry association Assocalzaturifici, sector sales in 2017 amounted to about EUR 14.2 billion. Industry clusters are the regions of Venice, Tuscany, Marche, Lombardy, Campania, Apulia and Emilia Romagna. The cluster in Brento, Veneto produces about 11 percent of the national output. Also International manufacturers such as LVMH and Louis Vuitton are investing and producing in Italy.

• Eports grow slowly
• Industry needs new concepts

Dhaka (GTAI) - The garment industry is the main industry in Bangladesh. The state of the companies has improved since 2013 - when a building with several factories collapsed. Domestic and foreign companies have invested in new processes. Government and associations want to further increase the security. Exports are growing slower. The international competition forces the companies to produce not only more sustainable, but also more efficient and innovative.

On April 24th 2013, north of the Bangladeshi capital Dhaka, the Rana Plaza building collapsed, housing five clothing factories. The disaster claimed 1,138 lives and more injuries. The disaster in-cised deep into the country's largest industrial sector. The massive problems with building and safety as well as violations of workers' rights became internationally visible at once and then vigor-ously tackled.

Foreign companies have invested heavily in the textile and clothing industry in recent years, with a record high in the year after the disaster. According to the Central Bank, foreign direct investment (FDI) in the textile and clothing industry in June 2017 reached a respectable USD 2.6 billion. Com-panies from South Korea have been the largest contributors with USD 766 million, followed by Hong Kong investors with USD 448 million and the United Kingdom with USD 243 million

      *) Financial year from July 1st to June 30th

Several successful programs for more security
Government and international organizations responded with many measures and initiatives at Rana Plaza. The International Labor Organization (ILO) launched programs to improve work-ing conditions. Buyers and industry representatives were looking for solutions.

International traders, trade unions and non-governmental organi-zations finally signed a binding agreement for more fire and building safety in 2013 (Accord on Fire and Building Safety). Employees of Accord have since reviewed more than 1,600 tex-tile and garment factories. Approximately 86 percent of the iden-tified deficiencies were eliminated according to an interim report dated January 2018. Accord will expire in November 2018 after five years. Some participants of the alliance have agreed an ex-tension of the program of three years.

In particular North American importers launched the Alliance (Al-liance for Bangladesh Worker Safety) program in 2013. The Al-liance has since reviewed 666 factories that, as of February 2018, have remedied approximately 87 percent of the deficien-cies. The program will expire also after five years in May 2018.
Representatives of industry and government, trade unions, ILO, the Bangladesh Garment Manufacturers and Exporters Association (BGMEA) and international buyers want to co-ordinate the control and rehabilitation measures together. The BGMEA and the government rely on the NI National Initiative, which they developed together with ILO. The Department of Inspection of Factories and Establishments is responsible for NI controls. Under the NI program 1,500 factories have been inspected which are working for do-mestic customers. The program is to be extended to exporting companies and will replace Accord and Alliance.

Workers demand more rights and higher wages
The government made it easier to found and to engage in trade unions after the Rana Plaza disas-ter. According to observers, the approximately 4 million workers in the textile and clothing industry continue to have little formal organization and went repeatedly on strike for higher wages.

A government commission recently increased the monthly minimum wage in the garment industry from Taka 3,000 to 5,300 in 2013. This amount corresponds currently with EUR 52 only. (1 EU-RO = Taka 102.13, exchange rate of March 5th 2018). Trade unions demanded tripling of the minimum wage at the beginning of 2018, because unskilled workers are given this low pay when they are first employed, which is barely enough to survive. The reward grows only later with the skills and experience.

Employees often change their jobs. According to observers, the fluctuation should average be-tween 5 and 7 percent per month. Fair wages and good working conditions would give a good in-fluence on this issue in the companies concerned.

Bangladesh is the second largest exporter of clothing after China
The globally active clothing retailers are buying in Bangladesh on a large scale. Some have offices with hundreds of employees. Major clients include Inditex (Spain), H & M (Sweden), C & A and Tchibo (Germany).

Clothing exports, however, stagnated in the financial year 2016/17. One reason for the weak growth was the strengthened exchange rate. Taka's national currency increased against the US dollar, making exports more expensive and less competitive.

The government is targeting an export growth of 8.1 percent to USD 30.2 billion in 2017/18. The industry is on track indeed, reaching 7.8 percent in the second half of 2017 compared to the same period of the year before. The most important customers are the USA and Germany.

*) Financial year from July 1st to June 30th
Sources: Export Promotion Bureau, Bangladesh Garment Manufacturers and Exporters Association

Exports from this emerging country enjoy exemption from duty in many developed countries. The European Union grants duty-free and quota-free access. Australia and Japan grant preferential access to the Generalized Scheme of Preferences (GSP). , The USA however has suspended the GSP status in 2013 and imposed tariffs and duties on imports from Bangladesh.

Companies want to grow and become more efficient
The Association of Garment Export Companies BGMEA estimates that over 3,000 garment factories work exclusively for international clients. Another 800 to 1,000 companies sew for local retailers who sell clothing to the country's 160 million inhabitants.

There are no data on company sizes or on the companies with the highest turnover. Clothing companies are mostly registered as private companies and do not publish business figures. The larger ones belong to local conglomerates operating in different economic sectors.

The companies are investing in more modern production facilities to process larger orders faster and at lower unit costs. Imports of machinery and equipment for the textile and clothing industry totaled USD 1.4 billion in 2015. The BGMEA believes that the garment industry has increased its purchases of equipment since.

The added value along the local textile chain is expandable. Simple fabrics and materials are produced locally. The production capacities for fabrics however are not sufficient and need to be increased. The clothing industry is also switching to higher quality synthetic fiber products. Producers hope for higher margins, if, for example, they produce clothing made of elastic fibers or functional clothing made from mixed fibers.

Many pre-products are imported from China and South Korea. Imports however are difficult due to the limited handling capacities of seaports and airports. Logistics costs are high. The clothing sector still has some challenges to overcome.

• INTERNATIONAL COMPETITION INCREASES
• COMPANIES HAVE TO MODERNIZE PRODUCTION AND INCREASE DEPTH OF PROCESSING

Dubai / Islamabad (GTAI) - Pakistan's textile and clothing industry has urgently to invest. The international competition has intensified. The companies need to modernize their technology and increase their processing depth. The country wants to get away from the production of simple fabrics and yarns. The GSP Plus agreement with the EU and an improvement in the security situation have improved the investment climate. In high-end machines Pakistan is dependent on imports. 

Pakistan's textile and clothing industry expects better sales opportunities abroad in the next few years, particularly with the European Union. Early 2014 Pakistan has received from the EU the GSP Plus status (Generalized System of Preferences) that allows the country to supply goods at a lower rate of duty or even with a completely duty exempt in the EU. Particularly the textile and clothing industry benefits from the agreement, as the sector provides almost 80% of Pakistan's exports to the EU. The government even hopes on additional exports for the sector worth USD 1 billion per year.

Following the latest available trade figures, Pakistan increased in 2014, the year in which the GSP Plus agreement came into force, its total exports of clothing by almost 10% to around USD 5 billion. Official figures of exports to the EU are not available. According to the foreign trade statistics, in any case exports to Germany have increased in clothing by 13% to almost USD 500 million, in textiles by 18% to USD 434 million and in footwear by 27% to USD 34 million.

Source: UN Comtrade

Demand for textile machinery rises
Market observers anticipate increased investments in machinery. A particular dynamic effort is expected in the demand for textile printing machines, dyeing machines, tenter frames and other finishing techniques. Positive for the investment climate will be the effect of the expected increase in textile exports to the EU and the improvement of the security situation. In recent years power shortages and a precarious security situation have inhibited the production and investment activity.

The market for textile machinery (SITC 724) grew significantly since 2014. In the country itself only relatively simple machines are being manufactured. High-end equipment is mostly imported. The import of textile machinery rose to USD 585 million in 2014, an increase of 17% compared to 2013.

*) SITC 724, including pieces
Source: UN Comtrade

*) SITC 724, including pieces

Investments urgently needed
Competition from PR China, Bangladesh, India and Sri Lanka has intensified. Pakistan's textile industry needs to modernize and upgrade, to increase its productivity and the added value. Pakistan covers the entire value chain from fiber preparation from to the end product. Despite this well-position predominantly simple products are being produced. Only an estimated 40 companies are vertically integrated and cover the entire textile processing.
With an annual harvest of about 13 million bales Pakistan is the world's fourth largest cotton producer. In addition about 600.000 tons of synthetic fibers are being manufactured in the country. According to reports there are 21 manufacturers of filament yarn with a capacity of 100.000 t; the production is supported by a PTA plant with a capacity of 500.000 t.

Sources: Pakistan Bureau of Statistics; TMA - Towel Manufacturers Association

Yarn production has lost competitiveness
According to sector experts In the past decade yarn manufacturers made no larger investments to upgrade their production, although money would have been available for such investments.  The reason for that should have been the heavy competition from China, India and Bangladesch.  Ten years ago Pakistan used to be one of the most efficient yarn manufacturers worldwide. Because modernization investments failed to materialize, this technique applies as outdated in Pakistan today.

The companies complain about high production costs and are demanding more favorable electricity tariffs and protectionist measures against import competition. A negative effect on the production and the investment climate in the country also have the electricity shortages and the tense security Situation.

The textile sector in Pakistan is characterized by numerous large textile companies with quite a large number of small businesses opposite which mostly belong to the so-called informal sector. The informal sector, for example, includes small family companies or small productions, which are not taxable. The informal sector produces mainly simple products for the domestic market. It works with discarded equipment of the larger companies, imported used machinery or cheap equipment from China. The official statistics do not take the informal sector into account.