Essay About Market Segment And Low Salary

The Structure of the Textile and Clothing Sector
3. THE STRUCTURE OF THE TEXTILE AND CLOTHING SECTORThe clothing sector is a low salary, labor-intensive industry and also active, innovative sector, depending on which market segments one directs attention toward. The industry is described by modern technology, in some degree a high degree of flexibility, high-paid employees and designers, in the well-quality fashion market. The competitive advantage of businesses in this market segment is connected to be able to produce designs that consumers like and prefer, and provide cost efficiency. The most important functions of businesses that service this market segment are mostly settled down in developed countries. While Italy is the second largest textile and clothing exporter, The Emilia-Romagna district – is an administrative Region of Northern Italy, comprising the historical regions of Emilia and Romagna – is one of the most wealthy and foremost textile and clothing clusters in the world. However, this market segment has also seen an important amount of resettlement of production and outsourcing to not higher-cost producers. [Navaretti, G.B., Falzoni, A., Turrini, A., 2001. The decision to invest in a low wage country: Evidence from Italian textiles and clothing multinationals, Journal of International Trade and Economic Development, Vol. 10, p. 451-70.]The other large market segment is series production of standard products and/or lower quality such as underwear, t-shirts, uniforms, etc. Producers for this segment are mostly found in developing countries, mostly in export processing areas and/or under outward processing agreements in major importers. They give work primarily female workers, generally unskilled, and outsourcing to household production is common in the low-end-market consisting of lower-priced products suitable for customers who are not willing or able to spend large amounts of money. The role of retailer has started to be more often important in the organization of the supply chain in the low-to-mid priced market. The retail market has started to be more focused, giving more market power to multinational retailers. These retailers have market power not only in the consumer market, but more significantly they have buying power. Moreover, large-quantity discount chains have grown their own brands and source their clothing from the suppliers. According to Gereffi (2001), retailers accounted for half of total garment imports in the European Union in the mid-1990s, a trend that probably has continued during the second half of the 1990s [Gereffi, G., 2001. Global sourcing in the US apparel industry, Journal of Textile and Apparel, Technology and Management, Vol. 2, p.1-5.]Consumers spend a less share of their income on clothing than in the past, despite the fact that they shop more common and buy a more number of clothing things than before. The response from producers to the challenge of slow growth in total demand is to build on consumers love of variety and provide new fashions and a broad variety of sizes, colors, designs etc. at a frequent rate. [Gereffi, G., 2001. Global sourcing in the US apparel industry, Journal of Textile and Apparel, Technology and Management, Vol. 2, p.1-5.]