Order for cricket merchandise decline 10%, poll apparels not yielding margins
In an year when a part of the Indian Premier League (IPL) has moved out of country resulting in decline in orders for apparel manufacturers, the textile industry has not benefited from election either. With the election commission tightening reins on election spending by parties, garmenters are hardly able to earn a margin of 5 per cent over political apparel merchandise as against the 15-20 per cent that they used to earn in IPL merchandise.
According to apparel manufacturers based out of Mumbai, Tirupur and Ludhiana, orders for cricketing apparel merchandise that include knitted jerseys, caps, wrist bands and other accessories which offered high margins have declined by around 10 per cent. On the other hand, orders from political parties for apparel merchandise surrounding elections such as caps and t-shirts are also not yielding enough margins.
"Political parties, especially like ours, run on donations. There is definitely budgeting constraints hence we have to look to order apparel merchandise that are as cost effective as possible. This leads to squeezed margins for garmenters. However, being the election year, the volumes should work in their favour," said a spokesperson from the Aam Aadmi Party (AAP)'s Delhi main unit.
From IPL perspective, garmenters are, however, unsure on matching last year's volumes. For instance, Mumbai-based SVG Fashion which received orders to the tune of roughly five million pieces is not hopeful to match that figure this year.
"Only the basic minimum orders have come from the brands. The orders will be less than last year and there will definitely be loss for us and sponsors for the initial 15 days since the IPL would be played outside the country," said Rajkumar Agrawal managing director of SVG Fashion.
Manufacturers fear earnings from orders for apparel merchandise may fall by 5-10 per cent due to the scenario.
"Manufacturing apparel merchandise is not as exciting this year as last year, despite at least three events such as T20 World Cup, IPL and elections. This is because of much of the IPL being moved out of the country to UAE as well as low spending by political parties," said Ajit Lakra, president of Ludhiana Knitters' Association (LKA).
While a Puma spokesperson said that this year the brand had stayed away from sponsoring IPL and thereby ordering manufacture of apparel merchandise, spokespersons of Adidas, Reebok and Nike could not be reached.
Meanwhile, according a Ludhiana-based apparel manufacturer who sources to brands like Adidas, Reebok and Nike, it is also the last minute scheduling that is likely to impact merchandise sales this year.
"With each passing season, planning of sponsored apparel orders has taken a hit with last minute IPL planning and scheduling. Even this year, the venue was decided pretty late. Luckily, second half of the season is in India. Even frequent last minute additions in sponsorships forces garmenters to make several changes in the apparel orders which delays the supply as well," the manufacturer added.
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