GLOBAL EVENTS FOR FASHION PROFESSIONALS​

GLOBAL EVENTS FOR FASHION PROFESSIONALS​

Special report – Spain

Special report – Spain 🇪🇸

Live from the Market

The textile and clothing industries in Spain were severely disrupted, as in many other countries, by the Covid-19 pandemic, the effects of which were felt in a major way in 2020. These industries quickly recovered to previous levels of activity, but stagnated in the last year.

A resilient sector that faces stagnation.

Due to the decline in the domestic market and disruptions in international freight traffic, some companies closed permanently during the 20-21 biennium, and the trend towards a decrease in the number of players (which had already begun before the pandemic) has continued subsequently. However, the reduction in the number of companies has been less than might have been feared, being -8% in the last four years (2023 compared to 2019, the year before the pandemic), and -3% in the last year (2023 compared to 2022), with currently 7.600 companies working in the textile (3.500) and clothing (4.100) industries.

The capacity for resilience, understood as the ability to recover positions prior to a disturbance, has been remarkable. The turnover had already recovered in 2021 practically the same level as before the pandemic, and in 2022 it grew again, although 2023 has been a year of stagnation, even with a slight decline. Indeed, the turnover of Textile/Clothing in 2023 was 11.613 million euros, with a decrease of -2%, but maintaining an increase of +11% over the figure for 2019, prior to Covid.

Picture: Arthur Bomfim

This is not surprising, since something similar has happened in many of the surrounding markets. Changes in consumption patterns, the effects of the war in Europe due to the invasion of Ukraine by Russia, and other factors, are affecting activity levels in many countries.

Within this, the performance of the clothing sector (+17% in the period 2019-2023) has been better than that of the textile industries (+6%). However, there is some inconsistency between the evolution of production and sales in the clothing industry, suggesting an increase in supplies from foreign manufacturers, by Spanish brands, to maintain or increase a level of sales in value, with less physical production of their own.

Although there were movements during the pandemic, particularly in the home textiles sector, aimed at increasing the weight of technical textiles in sales, no significant or permanent change has been perceived at the sector level. Certainly, in some textile companies that work in both fashion and technical textiles, the latter has increased its weight in total sales over the last two years, but the sector as a whole has learned the hard way that technical textiles, although less seasonal and volatile, have markets dependent on government contracts that require large volumes and are very sensitive to prices, and on the behavior of outside sectors, such as construction, which are also not linear.

A textile/clothing exporter, albeit in deficit.

Foreign trade has evolved in a manner consistent with the trajectory of the sector as a whole. After a -20% drop in textile + clothing exports during the year of the pandemic, in 2021 these had already recovered, exceeding the figure for 2019. Growth continued in 2022, but the following year it returned to levels slightly higher than those of 2021.

If we take the total for the 2019-2023 period, textile exports (4.733 million euros) are 10% higher than those of 2019, but 5% lower than those of 2022.

Within this, with a slightly increasing figure, which moves in a range of 1.000 to 1.200 million euros, articles of technical use represent just under a quarter of textile exports.

In clothing, exports amounted to 18.823 billion euros: +8% over 2019, -5% over 2022.

The foreign trade balance is in deficit, as imports are 30% higher than exports in value.

Over the last four years, the value of textile imports (4.930 million euros) grew +11%, that of clothing (18.823 million) +8%, and the sum of imports (23.753 million) increased +9%.

Within this, the data for 2023 have been negative, with double-digit declines in imports.

The sector has its own statistical office, the «Centro de Información Textil y Confección» (Textile and Clothing Information Centre) – CITYC, which collects data from different sources and prepares its own estimates.

Picture: Kaspars Upmanis

Current situation, shopping tourism and transition.

The textile and clothing sector in Spain is in a moment of transition characterised by uncertainty, as several alternatives are being explored. Highly dependent on the domestic market in elder times, it has been trying hard to push abroad for four decades, with an increased effort since the beginning of the current millennium and, in particular, after the financial and real estate crisis of 2008, which almost collapsed the domestic market and forced companies to look abroad to compensate for lost sales within Spain.

Traditionally, companies operated mainly in the fashion market, although there has always been an important sector of home textiles, which suffered greatly in the years of the fall in the real estate market, but which is currently performing solidly.

The fashion sector suffers in the domestic market from the change in consumer attitudes. Consumers currently prioritize leisure activities in their spending, and spend less money on clothing. In return, it benefits from shopping tourism.

For the current year 2024, the number of international tourists is expected to exceed 90 million visits, a forecast that seems to be confirmed after the figures for the first half of the year. This is a significant amount for a country with almost 48 million inhabitants, and Spain is the second country in the world with the highest number of visitors, behind France.

Of course, many of these tourists, among whom there are many low-cost travellers, spend little or nothing in clothing and footwear shops in Spain, but many others visit the shops on the shopping streets and in coastal tourist towns and make purchases.

The number of international professional events held in Spanish cities is also increasing, with a professional public with greater purchasing power. And there is also a luxury tourist who spends a significant amount individually.

Retail market, at the retail level, depressed in historical terms.

Despite all this, the domestic textile and fashion retail market is at levels clearly lower than those it had before the pandemic.

In Spain there was an association that represented the entire fashion trade, Acotex. This still exists, but another one called ARTE (Retail Association Spain) has recently appeared, which brings together only large companies, whose vision of the business is different from that of small and medium-sized retailers. Its assessment of the market is also different.

Acotex provides a long statistical series that shows the collapse of the market to half its value in the year of the pandemic, with retail sales falling from 18.000 to less than 9.000 million euros. According to its figures, the market has slowly recovered, and 2023 has closed with sales of more than 11.300 million euros, still 37% below the pre-pandemic value.

For its own, the ARTE association is more optimistic, reflecting sales of more than 12.500 million euros in 2023, but this figure is still much lower than the value assumed to be the reference one for 2019.

The big shadow of the big (Spanish) world retailing.

The entire fashion sector is under the umbrella of the fast fashion retail giant Inditex, which in 2023 had a turnover of nearly 36.000 million euros. This group is an international leader that for years has been a driving force for suppliers in Spain and Portugal, as well as many other countries around the world.

It is characterized by exerting strong pressure on prices and by placing its suppliers at the limit of profitability. Additionally, its global procurement policy continually modifies the weight of purchases in the different areas, which can cause difficulties for those suppliers that are no longer competitive on a comparative basis.

Spain also has other retail groups that, while following different policies and being considerably smaller than Inditex, are also characterised by their global sourcing scheme.

Picture: Biel Morro

During the year of the pandemic, and subsequently with the disruptions in the supply chain caused by various reasons (China’s delay in reversing restrictive anti-Covid19 policies, incidents on the Suez Canal route), it was thought that the return to local sourcing would benefit suppliers regionally close to large Spanish retailers on a global scale, but these benefits have been temporary, at least for the most immediate geographical circle.

A textile industry geared towards investing in Transformation.

On a different area, one consequence of Covid-19 was the European awareness that it would be necessary to financially support policies aimed at increasing the resilience of productive sectors, and help them adapt to the changes that are imposed, whether due to the normal evolution of markets and technology, or due to eco-social demands.

The Spanish Government has launched various PERTEs (Recovery, Transformation and Resilience Plans), financed with Next Generation Funds from the European Union, some of them sector-focused and others of a transversal nature.

The Spanish textile and clothing organisations lobbied to obtain a sector-only plan, which they did not obtain. However, textile/fashion is contemplated within the Circular Economy PERTE. This helps to face the challenges of the 2030 agenda and the sustainability demands contemplated by the EU, in particular those that concern the recovery and recycling of textiles.

There are other transversal PERTEs to which textile/clothing can also benefit.

The sector has created an Observatory that cooperates with national and regional governments within Spain to take advantage of this and other instruments that help a green and digital transformation of the sector. It also hopes to participate in the European programme on Textiles for the Future planned for 2025-26 within the framework of Horizon Europe, the details of which have not yet been revealed.

All this aims to mobilise public and private investments to transform the sector and ensure the future competitiveness of Spanish textiles/clothing in a global market.

Article written by Humberto Martínez,TEXTIL EXPRES.

Ones to watch (very) closely…

Discover our selection of brands making waves on the Spanish market

The Desigual brand was founded in 1984, and since 2002 it has been operated by the firm Abasic, always within the same core shareholder of the founder, who had previously marketed second-hand clothing.

Its first own creation was an early example of recycling, made from denim scraps. It was subsequently characterised for years by a «patchwork» style, as well as colourful prints and designs. Lately its collections have become broad-spectrum. In 2019 it redefined the brand image and logo, as well as the pattern design, seeking to expand its consumer audience.

It maintains collaborations with external designers, being remarkable its alliance with Christian Lacroix, established in 2011 and still in force today.

It has opted for digitalisation, and has created an accelerator laboratory for emerging companies to promote innovations which might find application in this industry.

In 2020 it published the list of suppliers to provide transparency to its global value chain.

According to its latest figures, in 2022 it had a turnover of around 239 million euros (-4,6%). It is, therefore, a good-sized company although with a stagnant trajectory, pending more updated data. Its sales were declining between the record year, 2014 (529 million) and 2019 (341 million). Then came the pandemic setback and it remains somewhat stagnant.

Website: https://www.desigual.com

Bimba y Lola is a solid women’s fashion brand, which last year reached a sales level of 227 million euros (+1%), with a strong focus on the international market (44% of its business). It operates through 290 shops in 28 countries. It sells online in 50 markets. E-commerce accounts for 19% of sales.

Website: https://www.bimbaylola.com

A well-known brand on the international market for a long time, Adolfo Domínguez became known almost half a century ago with the advertising slogan «wrinkles are beautiful», which is part of its particular mythology although no longer has anything to do with its collections, which in the early days made a distinctive use of linen.

With the involvement of the second generation of the family in management, it has recovered from an identity crisis and a bad time regarding its financial figures. Currently (2023-24) it has a turnover of just under 127 million euros (+11%) and, for the second consecutive year, it has returned to the path of positive net profit, according to group figures provided by the company. The main one, Adolfo Domínguez SA, had a turnover of nearly 109 million euros (+16%), although with a negative result.

Website: https://www.adolfodominguez.com

A brilliant idea can emerge from the crisis of a project. The entrepreneur who went bankrupt with his fashion accessories brand «Fun and Basics» re-emerged five years ago with a brand based exclusively on sustainability. «EcoAlf» distinguished itself from the beginning by making garments from fabrics made with recycled fiber, from marine plastic waste recovered by fishing vessels. Today it works with various sources of materials, always recycled.

Its turnover was 45,5 million euros in 2023 (+22%). The year before the pandemic (2019) it had a turnover of 14,6 million.

It is worth highlighting the fact that it enjoys a notable media presence.

Website: https://ecoalf.com

Created in 2007, and with a turnover of just over 46 million euros in 2023 (about 22 million in 2020), Textiles y Confecciones Brownie is interesting because of its rapid image success among a teenage audience, to the point that it has been described in the media as «the Spanish Brandy Melville».

It is investing in logistics to accelerate its international expansion, focused on France, Portugal and Latin American markets.

Website: https://www.browniespain.com

Another case of rebirth from failure is that of the entrepreneurs of Hoss Intropia, a firm that entered into crisis in 2019, the brand being rescued by Grupo Tendam, which incorporated it into its portfolio in 2021.

The owners of the former company then launched the «Is Coming» project with elegant women’s fashion for the so-called «female guest person» market, with had a turbulent start in the midst of the Covid pandemic, and is now a small size brand with a bold will for growth.

It designs clothing in knitwear, poplin, corduroy, denim, and sells through multi-brand retailers in Spain, with a vocation for international expansion, and strong growth in online sales. Its size is minimal, compared to other operators, with sales of only 1,3 million euros, but it arouses interest among the fashion community, as an eventually promising startup company.

Website: https://iscoming.es

By Humberto Martínez,TEXTIL EXPRES.

The eye of Tranoï

Tranoï, the trade show partner specializing in young international designers, shares its pick of emerging Spain-based brands to follow

AILANTO

Ready-to-wear / High-end

Named after an ornamental tree known as the “tree of heaven”, the Ailanto brand was founded in 1995 by twin brothers Iñaki and Aitor.  It is known for its unique prints, handcrafted designs and use of fine materials.

Both brothers hold degrees from Barcelona’s University of Fine Arts. Iñaki graduated with a degree in fashion design, while Aitor specialized in landscaping and botany.

Their passion for art and beauty reflects the precious universes of painters, sculptors and landscape artists from 19th- and 20th-century art movements.

Instagram →

MIUUR

Accessories / High-end

Founded in 2021 by architect Ignacio Cristofori and fashion expert Tamara Maestro, MIUUR combines contemporary design and meticulous Spanish craftsmanship to create sustainable pieces from the finest quality materials.

Living between Europe and Asia, the husband-and-wife duo are developing their own signature fusion of an eclectic Mediterranean lifestyle with an attention to detail that infuses the essence of the brand.

Instagram

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