Textile and garment companies need to be more innovative in design, Chinese lawmakers and industrial leaders have suggested, as the country faces continued competition from Asian neighbors with lower labor costs, such as India and Cambodia.
Gianni Zhang, president of Hwa Yi Fashion Group, said the old business model that focused on the manufacturing, but ignored design and brand building, no longer works.
China's garment industry saw its slowest growth in a decade in 2012, according to data released by the China National Commerce Information Central.
Garment sales volume at 100 major retailers increased by 2 percent year-on-year in 2012, 2.9 percentage points slower than the previous year.
Sales values rose by 12.3 percent year-on-year, 8.1 percentage points lower than 2011.
Profits at Metersbonwe Group, which is marketed as Meters/bonwe, China's leading casualwear apparel company, dropped 38 percent year-on-year in 2012, according to its yearly performance report.
Shenzhen-listed Zhejiang Semir Garment, one of China's largest home-grown fashion retailers, saw a year-on-year drop of 39.9 percent in profits.
Sun Huaibin, deputy general secretary of the China National Textile and Apparel Council, said the Chinese garment industry experienced a tough year in 2012, which he attributed to weak international demand, the price gap between domestic and foreign cotton, and rising costs.
Sun added that he does not consider China's textile industry in its current form as a low-end sector as a lot of sophisticated technology has been introduced to the industry as well as new designs.
He said he believes the industry will face a better environment in 2013, driven by improved demand at home.
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