The effects of Corona Pandemic on Textile Industry

The textile industry is an ever-growing market and there are really big competitors such as the U.S., China, India, and the European Union. The business networks of the textile industry are really spread and connected to each other in the world. The industry grew noteworthy for the years and it was really attractive for the new investments and technological developments. The textile industry is an outward-oriented industry even if we do not face the pandemic, any event that happened in one of the biggest players of the industry would affect the overall industry as well. Since the industry is so big with manufacturers, retailers, distributors, suppliers, etc. this makes the business networks more fragile and sensitive for the outgoing events such as the corona pandemic we are going through right now.

Current Situation of the Partners

Due to outbreaks in countries, the overall industry with each side partners are having difficulties. Total exports and imports are decreased significantly overall in the world. The decreasing in the demand, lockdown in countries, and broken supply chains directly affected the industry.

Because of the lockdowns in countries, most retailers and brands are closed their stores across the world. These causes dramatically decrease in sales of them. Even if most of the biggest retailers and brands have their own websites and are able to sell online, it’s not enough to cover total sales when we compare with the expected levels in a stable situation or previous data. There are some reasons for this. Possible reasons are

• Consumers' health-related concerns.
• Textile products are not generally daily-need.
• Consumers are lack of habit of buying online.

Retailers and brands are complaining about full-shelves and closed stores but until taking this pandemic under control, the stores will remain closed for sure. Throughout this time, they have to come up with a brand-new strategy to overcome the effects of this pandemic. They should better understand the changing consumer behaviors and make new market researches to develop strategic plans.

When we look at the other side of the network, manufacturers are shaking as well. Although closed factories affect their business and their profit, ready-to-ship products or in-progress products are creating bigger problems for them. Since their stores closed and their sales decreases, retailers/brands are not willing to buy those products from manufacturers. They ask for longer credit terms or unrealistic discounts. Also for the agreed orders, retailers cancel them because of the uncertainty created by the coronavirus.

The uncertainty created by a coronavirus still affects the industry and the countries and the biggest plays are still trying to develop a strategy to overcome this pandemic. Since all parts of the industry are dealing with these issues, these create an unsolvable node.

How to plan the next step?

Each partner in the business networks of the textile industry should keep and protect their long-term perspective. They never forget that they are not the only one that faces the effects of corona pandemic. Before asking unrealistic sacrifices to their partners, they have to think twice and make their long-term strategic plan, revise their goals, strategic alliances, and so on. These days will pass and when this pandemic is over, they would look for long-term and loyal partners.

While creating their strategic plans, they better work with their closest partners to overcome the effects of the pandemic with equal and affordable sacrifices. Unless getting over this uncertainty, they better watch the market closely and take care of their cash flows.