FEATURE PROJECT CARGO FASHION
companies have very aggressive plans for expansion in the Chinese market”
“High-end fashion KEVIN LAM
shortage of air freight capacity due to a surge in demand from technology manufacturers located there, then we might ship fashion goods by sea to Singapore to connect with international air freight services.”
He added that SEKO tends to
outsource the actual final delivery of those products to major integrators like DHL, FedEx and UPS, postal organisations and re-mail companies. “Consumer delivery demands depend a bit on the product involved but if it is a luxury item, for example you have just spent US$500 on a handbag, you tend to want it delivered the next day. So when it comes to b2c business, the requirement is primarily for express delivery.” A third fashion industry trend which
has major significance for the international air freight industry is the ever-changing geography of both production sources and end markets. In the case of the former, a lot of manufacturing operations previously
established in China and India are now migrating to lower cost countries like Vietnam, Cambodia, Indonesia and Bangladesh. Meanwhile, China, India and other developing countries in Asia, along with some in Latin America and elsewhere, are becoming increasingly important consumer markets for luxury and other fashion goods. In the case of fashion industry
production operations, the continuing move to different locations is constantly presenting new logistics challenges, reported DHL’s Lau. “In some countries, the infrastructure and air freight capacity has not kept pace with the growth in manufacturing activities, so we have to be creative with our solutions,” he stated. “In the case of Cambodia, for
“The higher-end textiles … require faster
solutions and shorter transit times”
CARSTEN HERNIG
instance, we truck some merchandise into Vietnam and then air freight from there to destination markets like Europe and the US. Or if you are talking about the Hanoi region of Vietnam, where there is also a
28 AIR LOGISTICS MANAGEMENT
Emerging markets Meanwhile, a recent downturn in general consumer demand in established major fashion goods markets like Europe and North America has encouraged many multinational brand retailers to intensify their already growing focus on new emerging markets, particularly in Asia and Latin America – with resulting new business opportunities for the international air freight industry. “Fashion retailers are generally very
sceptical about immediate prospects for consumer markets in Europe and the US,” remarked Kerry’s Lam. “As a result, a lot of retailers and high-end fashion companies have very aggressive plans for expansion in the Chinese market. Tat will in turn generate increased demand for air freight movements into China because speed to market is a crucial factor for high-end fashion products, in particular.” Tat point was reinforced by Cathay
Pacific’s Woodrow. “Demand for luxury and fashion items in Asia is strong and the longer term future also looks bright as large numbers of Asian people become truly middle class.” Commenting specifically on the situation in China, he pointed out that both Cathay Pacific and sister carrier Dragonair are increasing their service frequencies to inland centres like Chengdu and Chongqing and while that is being driven by the growing volumes of high-tech products being
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