Large South African textiles manufacturers are struggling against imports while competition from non-compliant factories are also eating into their market-share.
Non-compliant textile manufacturers have been problematic for the industry, especially in rural and peri-urban areas, where unfair labour practices and poor remuneration have become the order of the day, according to recent findings.
The Southern African Textile and Workers’ Union (Sactwu) said last week that big South African clothing and apparel retailers should shoulder the blame for the “deplorable and terrible working conditions” in the country’s textiles industry.
Now, some large textile producers have called for an investigation into the industry to root out operators flouting labour and health standards.
Ajit Valjee, a director for JMV Textiles, told Business Report in an interview, “There are most definitely non-compliant factories and I suggest an investigation and name and shame of these non-compliant factories.”
Manufacturers in smaller cities and in rural areas were taking advantage of the inability of labour inspectors and unions to reach these areas. They also often move from one place to the next as part of their evasion tactics, an official with Sactwu said.
Etienne Vlok, the National Industrial Policy Officer of Sactwu, said, “Unlike other industries, the textiles industry is less capital intensive so operators, especially in rural and per-urban move from one place to the other. This makes it difficult to track them and for us to enforce standards on behalf of workers.”
However, competition from cheaper imports, load-shedding and slowing down demand were also occasioning bigger problems for the industry, especially the bigger producers who also carry the burden of paying taxes.
“Its industry being a large and organised factory because there is so much unfair competition from smaller players, especially those who are importing from other countries. There is so much cheaply imported food from as far as China and also from the region,” a manager with a Johannesburg-based textiles manufacturer said on Saturday.
According to Valjee, the South African textiles manufacturers are “struggling on prices and competing locally with non-compliant factories” a situation that was stretching operators to the limit by cutting out a large portion of their margins.
“With regards pricing we are continuously striving to meet required prices. Cheaper imports and load-shedding are most definitely challenging,” he said.
The industry has been ion the doldrums for a long time. Data from Statistics South Africa points to sustained decline in jobs across the sector over the past few years.
Between 2005 and 2021, the South African textiles and clothing industry lost 121 000 jobs, although the decline in 2021 was “most likely the result of the Covid-19 pandemic” which affected the South African and global economies.
Despite these challenges, the South African parallel market is expected to hit almost $6 billion in market revenue, data from Statista shows. Over the next three years, the industry is projected to notch up compounded annual growth of 5.8%.
“The largest segment within the market is Women's Apparel, with a market volume of $2.57bn (R49bn) in 2024. Considering the population, the per person revenue in South Africa's Apparel market is estimated to be $96.83 in 2024,” says the report.
In terms of volumes, South Africa’s apparel market is expected to reach 1.6 billion pieces by 2027 at a 1.3% growth rate anticipated from next year. Local manufacturers are upbeat that electricity load-shedding which has been problematic for the industry will ease starting this year while consumers are expected to have some spending power to boost demand.
"South Africa's apparel market is experiencing a surge in demand for sustainable and ethically produced clothing, driven by conscious consumerism and increased awareness of environmental and social issues," says the report.