January 23, 2024 Ludhiana’s hosiery and knitwear sector is in trouble and facing losses because of slow demand for winter apparel in the ongoing winter season.
Several hosiery and knitwear manufacturers say they faced a lack of repeat orders as well as the return of stocks from traders in several states.
Ludhiana’s hosiery and knitwear sector, which is one of the oldest industry verticals, is famous for winter garments like sweaters, jackets, thermals, cardigans, pullovers, innerwear, shawls, etc.
“The industry representatives said they started offering discounts to wholesalers in December when the demand was not picking up,” PTI reported.
“Because of the delayed winter, the manufacturers started giving discounts to wholesalers in December to push sales,” said Shyam Bansal of Rage, a premium brand of women’s wear.
A hosiery goods manufacturer said a factory unit runs at an average margin of 10 percent and if it had to give that much discount to wholesalers then it would not be in a position to earn anything except to clear its stocks.
The manufacturer said there is stiff competition in the market and no matter how good one’s product is, wholesalers press for discounts.
The industry representatives further said initially discounts at retail counters were offered at 20 percent in December to increase sales. Later these were hiked to 30 percent.
“At present, several big brands are selling their winter wear items at 40 percent discount at retail shops. Given this situation, how can a manufacturer earn with such heavy discounts,” asked the industry representative.
Hosiery and knitwear goods manufacturers also blame dumping of China-made winter wear items, available at much lower prices, for adding to their woes.
“China-made winter wear items are also hitting the local hosiery industry hard. If an item costs us Rs 1,000, a Chinese item is available at Rs 600-700,” Bansal said pointing out the competition posed by Chinese goods to the Ludhiana knitwear sector.
Navin Sood, another hosiery goods manufacturer, said many manufacturers in Ludhiana are facing a lack of repeat orders from traders in many states like Bihar, Odisha, Madhya Pradesh, Rajasthan, and West Bengal.
Raja Dhir, president of Daal Bazaar Merchant Association, said many traders in Uttar Pradesh, Kolkata, and some southern states returned hosiery items as there was slack demand for winter garments.
“When we demand payment from a trader in other states they threaten to return goods,” said Dhir.
However, bone-chilling cold wave weather conditions currently prevailing in the northern region have given some sort of relief as they anticipate a pickup in demand which may lead to clearance of stocks.
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