How Turkish apparel manufacturers adapt to more sustainable supply chain model

Turkey’s apparel industry is recognised the world over for its manufacturing prowess and competitiveness. It is the 6th largest clothing exporter in the world and the 3rd largest supplier to the EU, having exported nearly US$18 billion in 2019 and with more than 10. 000 manufacturing companies which are supplying some of the biggest international brands and buyers.

The country’s Aegean region is one of the most important manufacturing centers for textiles and apparel and has a lead role within the Turkish clothing industry. The Aegean Apparel Exporters’ Association is a non-governmental organisation working in close collaboration with the Republic of Turkey’s Ministry of Trade. The Association represents over 1.000 member companies which are located in or around the Aegean region and manufacture and export a wide range of high-quality apparel, with womenswear making up the biggest share. Exports by members of the Association total up to US$1.3 billion per year, and its members export to 154 countries, with 85% of all exports to European countries. The role of the Aegean Apparel Exporters’ Association is to promote its members’ manufacturing and export capacity, expand and diversify the range of export products, as well as identify new markets. Seray Seyfeli, Vice Chairperson of the Aegean Apparel Exporters’ Association, tells FashionUnited why its members are ideally placed to meet the demand of international brands, particularly in a Covid-19 era which throws up new challenges around sustainability, supply chains and digitisation.

What are the advantages for European fashion companies to source and manufacture in the Aegean Region?

Compared with many other manufacturing countries, Aegean apparel manufacturers have many competitive advantages in terms of design and production capabilities, thanks to a wealth of talented designers, a highly skilled workforce and good transport links, as well as generally the solid infrastructure in the region and geographical proximity to the European market. Fashion companies benefit from a high degree of flexibility that our companies offer, which means they are able to produce large and small quantities across a wealth of product categories. Our region is a reliable production partner for many world leading brands and retail chains who are increasingly sourcing in Turkey, and specifically from Aegian apparel manufacturers.

The region specialises in organic textiles and apparel. Is this more and more in demand?

Indeed, our region specialises in the manufacture of organic textiles and apparel, and many of our members have GOT (Global Organic Textile Standard) Certification and are part of The Better Cotton Programme. In this respect, our region has huge advantages as organic cotton is cultivated here, which means we have direct access and short supply routes, and there are many companies that specialise in both organic cotton cultivation and garment production with organic cotton. This also feeds into our general commitment to sustainability and to reducing the environmental impact of textile production. Recycling of cotton and other materials is also becoming an increasing focus for Aegean textile manufacturers, especially cotton, but also polyester, for example. Furthermore, huge efforts are under way regarding more sustainable production processes such as cutting water and energy consumption during manufacturing, as well as the use of fewer dyes and chemicals and reduction of industrial waste. These are all crucial developments which our members are embracing, and which are going to become increasingly important in the future.

You mention sustainability. What is being done in this respect?

Sustainability is definitely the most important topic on the agenda of our association and most of our activities and projects are implemented with sustainability in mind. We declared the year 2020 as the ‘Year of Sustainability’ for our association and established a Sustainability Committee and Sustainabiliy Cluster of around 30 companies to carry out our activities in this area and implement a sustainable vision. With financial support from the Ministry of Trade, we will deliver technical consultancy services for selected apparel exporters for two years to improve their sustainability performance. We are also preparing for a project which is set to receive support from European Union funds and aims to strengthen the entrepreneurship culture in our region. We will facilitate the transformation of sustainability-based business ideas in the fashion sector into successful start-ups. Furthermore, we will also continue to collaborate with relevant companies and institutions to develop new projects. In addition, we organise a number of information dissemination activities such as training programmes and webinars in order to increase the awareness of our member companies in the area of sustainability, to inform them about the latest developments and to increase their level of competence.

Finally, we became a member of the United Nations Global Compact network in order to support our work in the field of sustainability, to bring new dimensions to our activities by participating in national and international networks and to communicate our commitment to sustainability more effectively.

Even before the Covid-19 outbreak, there was a noticeable trend towards nearshoring in apparel manufacturing. Do you feel that supply chains are changing post pandemic, and how is the Aegean region positioned to respond to this development?

Before the crisis, the fashion industry had already started to change its sourcing models, which so far have been characterised by long lead times, huge order sizes and relatively low flexibility. It was very clear a significant shift was needed to make sourcing more demand-driven and more sustainable in terms of both, social and environmental aspects.

The Covid-19 pandemic presents an opportunity to reshape our business models, our lives and our habits. A demand-driven, flexible supply chain will be more important than ever. Our analysis has shown that consumers’ shopping habits are changing – we see this, for instance, particularly in the rise of e-commerce. Logistics are also changing as a result of all these developments, which means a complete re-mapping of the sourcing mix towards a better model is inevitable. Companies will consider factors such as risk management, costs, cashflow and flexibility far more carefully. Integrated value chains with an emphasis on geographical proximity and flexibility will become more important. Therefore, sourcing volumes for European fashion companies will likely shift from traditional offshore production centres to more nearshore countries, predominantly in the Mediterranean basin, with Turkey offering distinct advantages, as mentioned above. Closer, collaborative relationships and strategic partnerships will be key, as will a stronger emphasis on innovative products and digital platforms.

In this context, is digitisation also an increased focus for your association?

Absolutely. Digitisation is paramount as it will inevitably shape our businesses in a post-Covid-19 era. We recognise the importance of digitisation and aim to support the digital transformation of our members. Pre-pandemic, we would have normally organised participation at a minimum of three international trade fairs and two trade delegations per year. Obviously, due to the coronavirus outbreak, it was impossible to conduct physical events, so we have focused on organising virtual fairs, digital trade delegations and expert panels. For instance, between July 15 and August 14 we supported 30 of our members in their participation in the digital edition of the Global Apparel Sourcing Expo, and we are also planning to organise a digital trade mission to the Netherlands and surrounding countries with 25 members between 27 and 28 October 2020. We continue to improve our members’ managerial and operational process towards digitisation and support them actively in adapting to this new world order.

Can you give more details on the digital trade mission? What will this format look like?

Yes, as the Aegean Apparel Exporters’ Association, we are organising a digital matchmaking event on 27 and 28 October. The aim is to have a virtual platform which brings together Aegean apparel companies and brands from mainly the Netherlands and surrounding countries such as Germany, United Kingdom, Belgium and France. 25 exclusive apparel manufacturers from our Aegean region will attend the event and we expect around 30 selected, high-calibre buyers.

How has Covid-19 generally impacted the industry in your region?

I think it is fair to say that this year has been extraordinary and unprecedented on so many levels. At the start of the year, Turkey’s and our region's export performance was fine and we saw growth of 6.7% for the first two months for Turkey’s apparel exports and 11% for Aegan apparel exports. Based on these figures, we expected a continued positive performance for the rest of the year. Unfortunately, by the middle of March Covid-19 started to spread to Turkey, and, like so many other countries, we encountered a completely different scenario. We felt the effects of Covid-19 intensely in our export figures in March-April-May 2020. However, with the relaxation of lockdowns across the world, and especially Europe, things started to pick up again from June onwards. Turkey’s total garment exports increased by around 10%, and our region’s increased by 29%. This bounce-back also continued in July, with Turkey’s overall garment exports further rising by 8.5% and our region by 17%, even breaking a record. One of the biggest factors to attribute this to is the fact that many of our manufacturers changed their production and started to export medical textiles to meet the global demand, which has fueled the growth of the sector and is further proof of the unrivaled flexibility, adaptability and competence of our member companies.

What is your outlook for the short to mid-term future?

Overall, I feel stronger supplier-buyer partnerships will be more significant than ever. Buyers will want to develop strategic partnerships with flexible, advanced suppliers to create innovative new products, and innovation will dominate every aspect of the fashion value chain, from design to merchandising and planning to sourcing and supply chain management. Companies must therefore shift towards a more agile and intelligent sourcing model. For us, as the Aegean Apparel Exporters’ Association, I feel our members are ideally placed to meet all of these demands, and we look forward to building even stronger relationships with our customers.