Performance Apparel Markets Business and market analysis of worldwide trends in high performance activewear and corporate apparel No16 1st quarter 2006 Inside this issue: • Fast track: environmental issues for performance apparel: earth first, profits second • Product developments and innovations • Seamless knitting and stitch-free seaming technologies in performance apparel: less chafing, more comfort • Profile of Bemis: a leader in bonded seam technology for stitch-free apparel • Business update: corporate restructuring; corporate strategy; counterfeit goods; financial results; investments; joint ventures, cooperation and distribution agreements; markets; mergers, acquisitions and divestments; patent and trademark disputes; trade fairs and conferences • Glossary: terms and definitions Performance Apparel Markets ISSN 1477-6456 No 16 1st quarter 2006 Contents 3 Fast track: environmental issues for performance apparel: earth first, profits second 9 Product developments and innovations 9 Fabric treatments 9 Health promoting apparel 10 Performance footwear 11 Personal protective apparel 11 Smart fabrics 12 Sports apparel 13 Temperature regulating materials 15 Waterproof breathable technology 15 Wearable technology 17 Seamless knitting and stitch-free seaming technologies in performance apparel 17 Summary 17 Introduction 21 Development of seamless knitting and stitch-free seaming technologies 22 Stitch-free seaming methods and seamless knitting 25 Seamless knitting 27 The market for seamless and stitch-free apparel 28 Key producers 35 Outlook 38 Profile of Bemis: a leader in bonded seam technology for stitch-free apparel 38 Summary 38 Introduction 40 Products 47 Outlook 48 Business update 48 Corporate restructuring 48 Corporate strategy 49 Counterfeit goods 50 Financial results 59 Investments 59 Joint ventures, cooperation and distribution agreements 60 Markets 64 Mergers, acquisitions and divestments 65 Patent and trademark disputes 65 Trade fairs and conferences 67 Glossary 76 Index Planned for forthcoming issues ... Cleanroom textiles; chemical protection; corporate wear; flame retardants; footwear fabrics; high performance socks; next-to-skin wear; organic clothing; radiation protection; sensory technology; stain repellency; weather- and water-resistant technologies ... plus regular features: Fast track; Corporate profiles; Product developments and innovations; Business update ©2006TextilesIntelligenceLimited Performance Apparel Markets ISSN 1477-6456 This publication is available electronically and in printed format Details from Textiles Intelligence Limited International Subscriptions 10 Beech Lane, Wilmslow SK9 5ER United Kingdom Telephone +44 (0)1625 536136 Facsimile +44 (0)1625 536137 Email [email protected] The editor This issue of Performance Apparel Markets has been researched, compiled and edited by Virginia Thorp, a freelance editor who also works for the Economist Intelligence Unit. Statistics All statistics are drawn from official national and international sources unless otherwise indicated All tons are metric tons unless otherwise stated n/a = not available or not applicable Textiles Intelligence Textiles Intelligence Limited is a company formed to handle the portfolio of fibres, textiles and clothing publications previously produced by the Economist Intelligence Unit. It is our commitment, through a wide range of Special Reports and three regular titles, Performance Apparel Markets, Technical Textile Markets and Textile Outlook International, to supply you with the highest quality business information about the international fibres, textiles and clothing industries. TextilesIntelligenceLimitedis,unlessotherwisestated,theownerofcopyrightanddatabaserightinthispublicationand itscontents.Nopartofthispublicationmaybepublished,distributed,extracted,re-utilisedorreproducedinanymaterial form(includingphotocopyingorstoringitinanymediumbyelectronicmeansandwhetherornottransientlyor incidentallytosomeotheruseofthispublication)exceptaspermittedbytheCopyrightDesignsandPatentsAct1988or theCopyrightandRightsinDatabasesRegulation1997(asapplicable). ©2006TextilesIntelligenceLimited. PerformanceApparelMarkets,1stquarter2006 Fasttrack:environmentalissuesforperformanceapparel Fast track ENVIRONMENTAL ISSUES FOR PERFORMANCE APPAREL: EARTH FIRST, PROFITS SECOND ENVIRONMENTAL Investment in “We are investing in environmentally cleaner technology because it environmentally cleaner will increase our revenue, our value and our profits ... Not because it technology will istrendyormoral,butbecauseitwillaccelerateourgrowthandmake accelerate growth for us more competitive” said Jeff Immelt, the chairman and chief General Electric executive officer of General Electric—one of the world’s largest companies. Pressure for “green” Growing pressure from consumer action groups and governments, products is also forcing combined with growing consumer demand for “green” products, is other companies to forcing other companies to consider their environmental impact consider the environment too—including ones in the textile industry. The textile industry is Harmful substances associated with textile production can have a taking measures to detrimentaleffectonhumanhealthortheenvironment.Consequently, eliminate or reduce the the textile industry is taking measures to eliminate or reduce the presence of harmful presence of these harmful substances and finding ways to prove its substances environmentally-friendly credentials. Environmental concerns Environmental concerns in relation to performance apparel include: include the effects of pesticides— (cid:1) the effects of pesticides used during the cultivation of raw materials such as cotton; —pollutants— (cid:1) pollutants emitted during production; (cid:1) the use of dangerous substances in textiles; —dangerous (cid:1) the use of substances in textiles which may become dangerous in substances— response to environmental stimuli; (cid:1) the emission of pollutants at the time of textiles disposal; —biodegradability, waste (cid:1) the biodegradability of substances; disposal and (cid:1) waste disposal; and bioaccumulation (cid:1) the bioaccumulation of substances. “Greenhouse gases” are During the production of polyamide (nylon), nitrous oxide—one of emitted during the “greenhouse gases” which contributes to global warming—is polyamide production emitted. Potentially hazardous Another concern is with substances in textiles which pose a potential substances in textiles, hazard to health or to the environment. The heavy metal antimony is such as antimony, are typically found in textiles made from polyester because it is used as another concern a catalyst during manufacture and is sometimes used as a flame retardant. © TextilesIntelligenceLimited 3 PerformanceApparelMarkets,1stquarter2006 Fasttrack:environmentalissuesforperformanceapparel Antimony has been Antimony has been linked with a number of health problems. For linked with health example,antimonytrioxide(awidespreadcatalyst)isontheEuropean problems and can be Unions’s list of dangerous substances because of its carcinogenic dissolved out of fabrics properties. Although there is no danger from the general use of and into sweat, saliva polyester textiles, it has been shown that antimony can be dissolved and blood outoffabricsatrelativelylowtemperaturesandintosweat,salivaand blood. Teijin has developed an Ever wary of environmental and health concerns, the large polyester antimony-free polyester producers are searching for alternatives to antimony. The Japanese production method company Teijin—faced with strict environmental controls on the use which uses of antimony in its home country—has developed an antimony-free titanium-based catalysts polyester production method which uses titanium-based catalysts. Producers who do not In relation to the production of polyester, the EU Eco-label (see use antimony can label below) requires that the amount of antimony present should not their products as being exceed260ppm(partspermillion).However,toencouragetheuseof antimony-free alternatives, producers who do not use antimony are allowed to label their products as being antimony-free. The number of specialist While there are environmental issues relating to the production of coatings, laminates, these fibres, there are also concerns given the number of specialist finishes and membranes coatings, laminates, finishes and membranes in the performance in performance apparel apparel market. Garments which are affected by these issues include is giving cause for those with waterproof, breathable, windproof, anti-microbial or concern UV-protectionfinishes.Inparticular,aproliferationofgarmentsmade from textiles which have anti-microbial properties has heightened the debate about the use of biocides. RAISING ENVIRONMENTAL STANDARDS The industry needs a It is necessary for the industry to have a universal system which: universal system of standards for consumers (cid:1) enables consumers to identify those products that are and manufacturers environmentally-safe; and (cid:1) providesmanufacturerswithasetofguidelinestowhichtheymust adhere. The EU’s Eco-label is In1993theEuropeanUnionlaunchedtheEco-label.Thisusesagreen available for a range of flower symbol which is awarded to companies that pass various industries and product criteria.TheEU’slabelisavailableforawiderangeofindustries and categories, including product categories including one specifically for clothing. However, clothing, although it has ithasbeencriticisedbecausetheprocessofobtainingthelabelislong been criticised winded, labour intensive, and expensive. Switzerland-based Another organisation, Switzerland-based Oeko-Tex (International Oeko-Tex exists Association for Research and Testing in the Field of Textiles specifically for the textile Ecology),existsspecificallyforthetextileindustry.Intheearly1990s industry it set itself up as an independent certification body to ensure that consumers and manufacturers know that what they are making or buying poses no perceivable health risks. 4 © TextilesIntelligenceLimited Performance Apparel Markets, 1st quarter 2006 Fast track: environmental issues for performance apparel The Oeko-Tex label is The organisation developed the Oeko-Tex label which is an internationally registered internationally registered trade mark, and—it is claimed—the most commonly found label of its type. With environmentally-friendly criteria set out for manufacturers to follow, a company may achieve certification stating that its products are “clean” of harmful substances. Such certification is known as Oeko-Tex Standard 100 and is granted in the form of 12 month licences. Textiles carrying the Textiles carrying the Oeko-Tex Standard 100 label (see Figure 1) are Oeko-Tex Standard 100 guaranteed to conform to the following: label are guaranteed to (cid:1) conform to certain criteria they do not contain allergenic or carcinogenic dyestuffs; (cid:1) chlorine-free bleaching techniques have been used in their manufacture; (cid:1) they are free from formaldehyde or contain only trace amounts (significantly lower than legal limits); (cid:1) a selection of pesticide-free and metal-free materials have been used in their manufacture; (cid:1) they have a skin-friendly pH; and (cid:1) textiles used in garments are free from biologically active finishes. Figure 1 Oeko-Tex label Source: Oeko-Tex Oeko-Tex has four classes For certification standards, Oeko-Tex has four classes of product of product— according to their intended use. (cid:1) —Class I covering goods Class I includes all articles, materials and accessories (with the for babies— exception of leather clothing) for babies up to 36 months old. (cid:1) —Class II covering Class II includes garments in direct contact with the skin—defined garments in direct contact as those which have a large part of their surface in contact with the with the skin— body. Examples include shirts and underwear. (cid:1) —Class III covering Class III includes products which are not in direct contact with the products which are not in skin—defined as those which may have only a small part of their direct contact with the surface area in direct contact. Examples include stuffings and skin, and— linings. (cid:1) —Class IV covering Class IV includes decoration material—defined as all articles decoration material including initial products and accessories which are used in decoration. Examples include table cloths, floor coverings, © Textiles Intelligence Limited 5 PerformanceApparelMarkets,1stquarter2006 Fasttrack:environmentalissuesforperformanceapparel mattresses and furnishing fabrics. Oeko-Tex 100 also covers fib- As well as finished garments, components such as fibres, yarns, res, textiles and accessories fabrics and accessories may be certified with Oeko-Tex 100. Oeko-Tex also runs an Oeko-Tex also runs an accreditation system for environmentally- accreditation system, and friendly factories, known as Oeko-Tex 1000. Since 1992 Oeko-Tex has issued 50,000 has issued 50,000 certificates to around 6,500 companies. Almost certificates to around two-thirds of these companies are based in Europe and many of the 6,500 companies remaining third are based in Asia. Moreover, Oeko-Tex reports that interest in certification is growing fastest in Asia. The organisation has Theorganisationhasrecentlyembarkedonacampaigntopubliciseits embarked on a campaign environmentalservicestotheUSmarket.Theseincludeaseminarfor to publicise its textile manufacturers which was held in New York in November environmental services to 2005. At the seminar, Patricia Aburdene, the author of Megatrends the US market 2010, introduced the term “values-driven consumer” to describe the 63 mnconsumers inthe USAwhichshe estimatesfeel stronglyabout the environment. Environmental issues will Ms Aburdene predicts that, over the next few years, environmental become more important issues will become more important in the USA in a way which will in the USA be similar to the developments experienced in Europe in the late 1990s. PATAGONIA—AN ENVIRONMENTAL LEADER USA-based outdoor Patagonia is a USA-based outdoor apparel specialist. The company, apparel specialist founded by Yvon Chouinard, is renowned for its dedication to Patagonia is renowned for environmental issues. In November 2004 Fortune magazine named its dedication to Yvon Chouinard as one of its “innovation entrepreneurs”. Mr environmental issues Chouinard summarises his philosophy as “earth first, profits second”. Patagonia is also a Patagoniaisafoundingmemberof“1%ForThePlanet”—analliance founding member of “1% of companies which contribute 1% of their net annual sales to For The Planet” environmentalgroups.Thealliancewasfoundedin2001andnowhas 235 members. Mr Chouinard is always Mr Chouinard is always looking for eco-friendly ways to make looking for eco-friendly sportswear—for example, by using pesticide-free cotton and using ways to make sportswear recycled bottles to make jackets. The most damaging Patagonia conducted an analysis in the mid-1990s of all the different apparel fibre is fibres it used in making apparel. The most damaging was found to be industrially grown industrially grown cotton, which had a high concentration of cotton, which has a high pesticides. Indeed, 10% of all agricultural chemicals consumed in the concentration of USA are used to produce cotton. Such chemicals include synthetic pesticides fertilisers, soil additives, defoliants and pesticides. 6 © TextilesIntelligenceLimited PerformanceApparelMarkets,1stquarter2006 Fasttrack:environmentalissuesforperformanceapparel In 1996 Patagonia In1996Patagoniastartedmakingitsentiresportswearlinefrom100% converted its entire organically grown cotton which is cultivated without harmful sportswear line to 100% chemicals.AccordingtoMrChouinard,movinginthis“eco-direction” organically-grown cotton has made the company more profitable because it has put it in a unique position. Gap, Nike and Levi Strauss Other companies have taken notice. Indeed some larger and higher have been influenced by profile companies—such as Gap, Nike and Levi Strauss—have been Patagonia’s lead influenced by Patagonia’s lead. Patagonia also uses PCR Patagonia also uses post-consumer recycled (PCR) products in its products in its garments garments. It was the first to make Indeed, in 1993 it was the first outdoor clothing company to make fleece from PCR plastic fleece from PCR plastic bottles. In 2006 it began using PCR filament bottles yarn sourced from Teijin. The company is working to PCR filament yarn contains between 30% and 50% post-consumer create a fully recyclable feedstock—intheformofplasticbottles,polyesteruniforms,tentsand garment garments—and post-industrial feedstock from yarn and polymer factory waste products. In fact, Patagonia is working to create a fully recyclable garment but until it achieves this goal it will continue to make clothes out of recyclable materials. The office buildings Thecompany’sofficebuildingsthemselvesarealsodesignedwiththe themselves are also environment in mind. In 1996 Patagonia built a new service centre designed with the using recycled and reclaimed materials as well as energy efficient environment in mind lighting systems. THE BIGGER PICTURE Companies are under Environmental concerns are just one of a number of key issues pressure regarding affecting apparel companies globally. Many companies are under ethical practices in their pressurefromconsumers,governmentsandthemediaonthequestion manufacturing of ethical practices in their manufacturing. Consequently they have Theseethicalissuesincludeworkplaceregulations,factoryconditions been forced to develop and labour standards. When these have been substandard, they have and implement sets of attractedalotofnegativemediaattention.Asaresultcompanieshave ethical standards been forced to develop and implement sets of ethical standards. WRAP principles were In order to remove inconsistencies which might occur between developed to remove companies, and to provide one set of standards, the Worldwide inconsistencies and Responsible Apparel Production (WRAP) principles were developed provide one set of in the mid-1990s by the American Apparel Manufacturing standards Association. WRAP is an independent, Today WRAP is an independent, non-profit making organisation non-profit organisation whichexistsforthepromotionandcertificationoflawful,humaneand which promotes and ethical manufacturing. Factories apply (for a fee of US$825) to go certifies lawful, humane through the certification process which involves self-assessment and ethical manufacturing followed by an independent evaluation when the factory is ready. © TextilesIntelligenceLimited 7 PerformanceApparelMarkets,1stquarter2006 Fasttrack:environmentalissuesforperformanceapparel Certification is founded on Certificationisfoundedon12guidingprinciples—undertheheadings 12 guiding principles which labour practices, factory conditions, environment and customs address labour practices, compliance—namely: factory conditions, the environment and customs (cid:1) compliance with workplace laws and regulations; compliance (cid:1) prohibition of child labour; (cid:1) prohibition of forced labour; (cid:1) prohibition of harassment and abuse; (cid:1) compensation and benefits; (cid:1) hours of work; (cid:1) prohibition of discrimination; (cid:1) health and safety; (cid:1) freedom of association and collective bargaining; (cid:1) environment standards; (cid:1) customs compliance and; (cid:1) security. Although borne out of the Although borne out of the USA, WRAP is becoming globally USA, WRAP is becoming accepted and has been endorsed by groups representing apparel globally accepted manufacturers in 18 countries. Currently there are Currently, there are WRAP monitors in 20 countries who visit WRAP monitors in 20 factories and ensure that they are meeting the criteria. Certification is countries who visit valid for 12 months, during which time a WRAP monitor may revisit factories the factory unannounced. WRAP’s aims are not to However, WRAP promotes the line that compliance should not cause cause undue stress each undue stress each year—its principles represent a change of mindset year but to change rather than a set of criteria which have to be met annually. Much the mindsets same can be said for environmental issues. 8 © TextilesIntelligenceLimited PerformanceApparelMarkets,1stquarter2006 Productdevelopmentsandinnovations Product developments and innovations FABRIC TREATMENTS ARCH CHEMICALS: PURISTA ANTI-MICROBIAL TREATMENT FOR SYNTHETICS A new version of USA-based Arch Chemicals—a speciality chemicals company—has Purista can be applied developed a version of its branded anti-microbial treatment, Purista, to synthetics which can be applied to synthetics. Until now it has been used Since its launch in 2001, Purista has been applied only to cotton. The only on cotton treatment has been used on items such as socks and suit linings. But demand has grown for But, with the rise in sportswear and activewear made from synthetic an anti-microbial treatment fibres (such as football shirts and fleeces), demand has risen for an for synthetic fibre anti-microbialtreatmentwhichisaseffectiveforgarmentsmadefrom sportswear and activewear synthetics as for those made from natural fibres. The Purista treatment for A spokesman from the company describes the Purista treatment for synthetics is an important syntheticsasanimportanttechnicalbreakthrough.Ittookthecompany technical breakthrough two years to develop a treatment which could be applied to 100% syntheticfibres orto majorityblendswhich containa highpercentage of polyester or nylon. It can be applied directly Unlike some anti-microbial treatments, Purista is applied directly to to fabric and used with the fabric. It can also be applied with other finishing treatments such other finishing treatments as non-iron and easy-care finishes, and can work alongside other and technologies performance technologies such as Coolmax, anti-static and Lycra. HEALTH PROMOTING APPAREL MILLIKEN: ANTI-ITCH CLOTHING DermaSmart provides The USA-based textile and chemical company Milliken has launched relief from various skin DermaSmart—a rangeofgarments designedtoproviderelief tothose conditions suffering from various skin conditions. It reduces itching, The company claims that DermaSmart reduces itching, dryness, dryness, peeling and peelingandscaling,whichcanbeassociatedwithskinconditionssuch scaling as eczema, atopic dermatitis and psoriasis. © TextilesIntelligenceLimited 9
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