CLOTHING & TEXTILES INDUSTRY
1. Why is it currently cheaper to import clothing?
South African manufacturers cannot compete with the cheap, mass-produced clothing produced in countries like China, Swaziland, Lesotho, Bangladesh, Vietnam, and India.
South Africa’s labour laws and minimum wage requirements, implemented to prevent the exploitation of its labour force, make the cost of manufacturing significantly higher than in some other countries.
Many South African textile mills closed when the market was flooded with cheap, imported clothing at the end of apartheid when international trade restrictions were lifted. This reduced the availability of textiles for use in South African clothing manufacturing, which increased the cost of locally made products.
2. Clothing manufacturing used to be a large part of our economy. What happened?
In the early 1990s, South Africa had a booming clothing and textile industry which accounted for a quarter of a million jobs. When apartheid ended in South Africa, restrictions around international trade were lifted. This allowed South African companies to import clothing and other manufactured goods. These goods cost less and were produced more quickly than locally manufactured products.
South Africa’s clothing manufacturers suffered a further blow in 2001, when China was included in the World Trade Organisation, and the country began importing cheap textiles and clothing from there too.
South Africa’s labour laws introduced after apartheid and intended to improve working conditions and wages, also contributed to the high cost of local manufacturing. This caused many production facilities to move their operations to other countries, including neighbours Lesotho and Swaziland.
Two-thirds of jobs were lost in the textiles and clothing manufacturing industry in South Africa in the two decades after the end of apartheid.
3. What is the impact of importing clothing and textiles on the economy?
The influx of cheap, mass-produced, imported clothing has had a dire effect on South Africa’s economy. Many local production facilities moved their operations to other countries when they could no longer compete with the imported clothing market. More than 100,000 jobs were lost in the clothing and textile industry between 2002 and 2013, dealing a devastating blow to a country which already suffers from high unemployment rates.
The clothing and textile industry now accounts for around 14% of manufacturing employment in South Africa, according to the Cape Clothing and Textile Cluster. This equates to between 60,000 and 80,000 jobs and a contribution of around 8% to the country’s GDP.
The Clothing and Textiles Competitiveness Programme (CTCP), which was launched in 2009, is helping to recover the industry. A disbursement scheme of more than R7.1 billion for the 2019/20 financial year is breathing new life into South Africa’s clothing and textiles industries.
In November 2019, major retailers committed to increase the percentage of their clothing retail products that are produced or procured locally from 44% to 65% by 2030. This will have a positive impact on the economy.
4. Is local clothing manufacturing becoming more competitive compared to importing?
Yes. Various initiatives have been launched to boost the competitiveness and quality of the clothing, textile, footwear and leather manufacturing industries in the Western Cape and the country.
The Cape Clothing and Textile Cluster (CCTC) comprises of manufacturers and retailers committed to developing the local manufacturing industry. They pool their resources to make manufacturing more efficient and globally competitive. They drive sustainable and quick manufacturing models that supports domestic and export growth.
Government sponsored programs have played a positive role in improving the competitiveness of SA firms through skills and technology development. The Clothing and Textiles Competitiveness Programme (CTCP) is a manufacturing support programme which helps firms improve their overall operational performance and competitiveness. It is funded by the Department of Trade, Industry and Competition (dtic) and administered by the Industrial Development Corporation of South Africa (IDC).
Support and funding from the CTCP has prevented the complete collapse of the country’s clothing and textiles industry, which is today able to compete with global competitors.
5. Is the standard of clothing manufactured in Cape Town improving?
Yes. Programmes run by the Clothing and Textiles Competitiveness Programme have helped to improve the quality of clothing produced in the Western Cape and the country. Investment in manufacturers and helping to better production processes, skills, and equipment is allowing them to produce superior quality products.
6. How do I start a clothing business in South Africa?
To start a clothing business, you will need to have a product which people want to buy. It’s important to make sure you not only have unique ideas, but that there is a market that will buy your clothes.
Knowledge of clothing design and sewing will be important. You will also have to research where to source raw materials, where to produce your products, and how to reach your target market. This means creating a business plan and setting goals.
Start out small to test the market and keep costs low. You can upscale production once you’ve established that your clothing will be successful.
Entrepreneur magazine startupAFRICA goes into detail on how to start an online clothing business.
It’s worth getting hold of organisations like The Craft and Design Institute (CDI). This non-profit organisation supports more than 5,600 businesses and individuals in the craft and design sector in South Africa.
The CDI will help you develop the right product for the right market using appropriate business and production systems. It also assists with access to national and international market opportunities. The CDI has various business, personal, and creative development programmes, as well as a coaching and mentoring programme.
7. How do I register a clothing business in South Africa?
You can register your business online at the Companies and Intellectual Property Commission (CIPC) website or at a bank.
The business development workshops at The Craft and Design Institute also cover how to set up and register your new business.
Invest Cape Town’s The Business Hub can help you to find the information, resources and support you need to grow your business.
