After Bangladesh, the garment importers are pressing Indian garment manufacturers and exporters for extra discounts on orders placed previously. This is considered practice unethical to seek discounts on confirmed orders. International brands are citing poor demand at their retail stores in the United States and Europe for this demand. The exporters are asking for governmental support to navigate these economic issues.
In Ludhiana a major domestic brand is demanding an extra 5 percent discount. The brand, which placed orders for summer garments in February. Manufacturers are seeking assistance from the members of parliament in Punjab and officials in the ministries of textiles and MSME to counter this pressure.
Exporters say such demands for additional discounts are unethical from domestic brands and retailers. It is happening not only in Ludhiana but in the entire north India when the garment manufacturers are already working with low margins.
Moreover, global brands are also pressuring for lower prices on their orders. The situation presents significant challenges, particularly for small and medium-sized manufacturers and exporters. Still, some exporters are optimistic that things would improve after India International Garment Fair (IIGF) for the Spring/Summer 2024 season will take place in Noida from June 26-28, 2023.
A Tiruppur Exporters Association spokesman said they are getting limited orders from global buyers, but have refused to give additional discounts to attract buyers. He said that garment exporters and manufacturers cannot offer lower prices due to the high cost of production. He added that the situation demands an increase in prices as the cost of production has increased substantially while the prices offered are at the same level as last year.
Tiruppur Exporters expect orders for winter garments will arrive in the coming months as exporters can meet Christmas supply deadlines, provided they receive orders by the end of July. They are also expecting local demand to improve that will reduce pressure on manufacturers.
The current situation is far from favourable for many exporters. Many garment manufacturers across the country had to scale down their production due to a lack of orders from both domestic and global markets. Fabric and yarn manufacturers are similarly experiencing reduced demand, compelling them to cut down on production.
Brands seek discounts as Indian garment manufacturers face low global and domestic demand
