Last month, we asked local brand owners that manufacture in New Zealand what are the most significant problems they face in business today. The response was not unexpected, with the most challenging problem coming through as the competition with fast fashion and international e-retailers (such as ASOS). It is hoped that the proposed changes to GST on imported goods will alleviate this to some extent but more needs to be done to support the local fashion industry. Government support would be welcome to help the industry sustain a presence in the NZ Made market. Fashion retailers have fallen into the on-sale trap that is prevalent in New Zealand retailing. Supermarkets are an excellent example of the on-sale mentality, something that New Zealand has in common with the Czech Republic, and this has been detrimental in the FMCG sector for many years. Seeing the fashion industry take the same path is a worry.
Money, money, money - well we know it makes the world go round but lack of capital, poor cash-flow and the increasing cost of manufacturing squeezing profit margins makes for challenging times for most NZ Made brands. Almost all of the big banks are offering invoice finance along with the more well-known capital raising options from a variety of players in the market. With technology, has come innovation in the area of invoice finance and being able to access up to 80% of the face value of approved invoices, the ability to free up cash and reduce relying on more traditional forms of security such as the family home is a welcome option to some brand owners.
The lack of consumer awareness of the practices and working conditions associated with offshore manufacturing and how this differs from local manufacturing and what this means to the price of a garment is a story that most feel has not been well covered in consumer media. We live in a culture where time and talent is no longer factored into the cost of the garment, and the cheap price tag is more appealing to consumers than a garment made with thought, creatively, longevity of use and good conditions and wages for staff. A big complaint is also the lack of sustainable textiles available locally and the loss of Charles Parsons fabrics recently is a blow to the fashion sector. Genuine local NZ Made competing with those brands that are designed here but made offshore while sustaining the price point is not only a challenge, in some instances, it has been the death of the brand.
Finding skilled staff continues to be a headache for the industry, with many education providers pushing design courses and not specialised training. Lack of specialised machines translates to a shortage of specialised workers. Denim, intimates, swimwear - are but a few areas where there is a dearth of skilled talent. A consumer’s chance of finding a locally made pair of jeans or a bra is practically non-existent. If we can't manufacture here, then more must be done to educate designers on near-shoring and far-shoring. The lack of support for local manufacturing is driving designers off-shore. Many industry pundits repeatedly have over the past twenty years called for help - hopefully, this government will hear, if we don't move in the very near future to make changes then the future of the NZ Made fashion industry is hanging by a thread.