Brazilian textile and clothing from the perspective of the
global value chain - present and future possibilities
March 20th, 2017
Fernando Pimentel President
Page 2 October 2016, Zürich
Brazilian textile and clothing
from the perspective of the
global value chain - present
and future possibilities
2017
The specific objectives of this study have been listed in the Terms of
References published by SENAI-CETIQT:
1 Describe and characterize the textile and clothing industry - processes, products and consumption - in
Brazil and worldwide, emphasizing their performance in global, regional and local value networks
2 Mapping the Global Value Chain of the textiles and clothing industry as its main concepts, actors, forms of
governance and production strategies, distribution and new markets
3 Identify the main trends of leadership, governance and business models styles of the main local and
regional firms that coordinate global value chains in the industry
4 Identify opportunities and assess the skills of the Brazilian industry in the different links and segments for
integration into the Global Value Chain
6 Provide SENAI-CETIQT with vocational training dynamic guidelines, service and investment delivery in
research and technological innovation - that meet the international standards set by global value chains -
to support the sector in its dynamic integration planned in the world production and consumption
7 Produce a SWOT analysis (strengths, weaknesses, opportunities and threats) that shows the impacts of
entry of the sector in that Global Value Chain
5 Propose public and / or private policies and outline strategic actions to Brazil be integrated into the Global
Value Chain in the textiles and clothing industry
A 4-phase approach will be implemented by Gherzi
Overview of global and
Brazilian TAS and mapping of the
value chain
Assessing the role and situation
of the Brazilian textile and
apparel sector
Opportunities and challenges for the Brazilian
textile and apparel sector
Global value chain and a
competitiveness agenda for textile
and apparel industries
4 3 2 1
Key issues to be addressed
Phases
• How is the textile and apparel industry organized globally?
• How is Brazil taking part in it?
• Which value-chain links and segments hold the greatest opportunities for Brazil?
• Which bottlenecks must be addressed to increase the sector’s competitiveness and integrate it into the global value chain, and how can they be overcome?
The core team will coordinate the different tasks and reports to the Steering
Committee
Brazil expert team
- Herbert Schmid -
Brazil team leader
IEMI
- Laurent Aucouturier -
team leader
Gherzi network
US & Europe & Asia
International
research team
Core Team - Gherzi
Laurent Aucouturier - Core Team Leader
Herbert Schmid - Strategy
H. van Delden - Technical Textiles (incl. nonwovens and composites)
N.S. Sodhi - Textile policy expert
Karim Shafei - Marketing
Simon Hugentobler - Textile technology
Ettore Donadio - Textile manufacturing
All the core team members are familiar with the Brazilian textile & garment industry through
different textile assignments carried out in this country
Steering Committee
Team • Tracks and validates progress
• Arbitrates conflicts
• Analyses
• Interviews
• Researches
• Drafts
• Plans, coordinates, organizes, communicates
• Reports to Steering Committee
• Ensures consistency
• Carries out interviews, analysis, researches
Organisation Duties
The mission will last 7 months starting in October 2016
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Overview of global and Brazilian TAS and mapping of
the value chain
Assessing the role and influence of the Brazilian textile
and apparel sector
Opportunities and challenges for the Brazilian textile and
apparel sector
Global value chain and a competitiveness agenda for textile and apparel industries
October November December January February March April
2016 2017
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R0 : Research Executive Project
R1 : Report #1
R2 : Report #2
FR : Report #3 (Final report)
CC1 : Conference Call #1
CC2 : Conference Call #2
CC3 : Conference Call #3
CC4 : Conference Call #4
KO : Kick-off Meeting
M1 : Meeting #1
M2 : Meeting #2
M3 : Meeting #3
Report Conference
Call
Meeting in
Brazil
19.10.2016
11.01.2017
22.02.2017
26.04.2017
Gherzi has reviewed three main topics in order to assess the World and Brazil TAS
Product
overview
Technology World trade
Production
capacities Key success
factors
Raw
materials
World TAS
Business
models
End of life
Consumption
Retail Production
Design
Resources Systems thinking
Overview of the World TAS Overview of the TAS in Brazil Mapping the global value chain for the TAS
Raw materials, investments and
international trade are going through
structural changes
Despite economic upheaval, the Brazilian
TAS remains robust but needs to address
its weaknesses
The World TAS and Brazil will be impacted
by 33 trends segmented in 7
categories
Overview of the World TAS
01
02
03
04
05
06
07
Focus on 12 products in
apparel and home
textiles
Product overview
Promising developments
in all process steps
Technology Growth and heavyweights
World trade
Asian domination for
textile machine
investments
Production capacities Key success factors
Raw materials
World TAS
Business models
Strengthening of MMF at the
expense of natural fibers
11 KSF for the TAS
4 major business models
Increasing per capita consumption on textiles should be the result of the
growth in expenses in textiles by developing countries
Global retail market for apparel is forecast to grow by 2.5% annually till
2020 wherein India will be the fastest growing market positioned at 4th
The intra-Asia textile trade is gaining importance due to shifting of
garment industry and increasing sourcing options
Textile worldwide trade in 2014 (bn US$ and percent change 2013-2014 / 2004-2005)
In 2014, the intra-Europe trade represented more than 25% of the total
World trade in apparel
Apparel worldwide trade in 2014 (bn US$ and percent change 2013-2014 / 2004-2005)
Future sourcing: Industry shifting from China to other cost competitive countries
Number of apparel factories in 2014
Many FTAs have been signed by the EU and several important negotiations for
new ones have already started
Vietnam is the highest ranked country for supplying garments to brands followed by Cambodia
China
Vietnam
Cambodia
Thailand
Indonesia
India
Sri Lanka
Bangladesh
Pakistan
Myanmar
[…Our sourcing priorities are determined by ranking along 6
criteria per country (like a traffic light system)…]
[…Raising costs in China are forcing us to evaluate sourcing
alternatives…]
[…At the moment Vietnam looks promising…]
Source: Adidas Good Medium Weak
The importance of the different Key Success Factors (KSF) varies in
dependence of the process step within the TAS
23 sub-segments of the Brazil TAS have been analyzed in order to identify their respective export readiness and potential
The regulatory framework has been assessed to determine the positive and negative impacts on the Brazil TAS and the future priorities for changes