A View from the Inside Out: How Other Parts of the World Are Responding to Covid-19
Updated: Aug 5, 2020
By SPESA
Over the last few months, we’ve seen the sewn products industry in the United States quickly adapt to the changing world and seek opportunities to maintain business and support the production of personal protective equipment (PPE) stateside. Watching these companies pivot workflow and come together as a united force in the fight against Covid-19 has reinforced the importance of the Made in America movement. It also underscored the need for collaboration across the industry. Working in silos was no longer an option.
However, we operate in a global economy, so when the Covid-19 pandemic hit, it impacted us all. It quickly derailed how businesses function around the world and introduced new challenges for how those businesses operated across borders. This was especially true for the sewn products industry.
We asked a few of our non-U.S. SPESA members to share insights on how their companies and their countries have responded. We started with our neighbors in Canada and Central America (specifically Honduras) and then turned our gaze to Europe (specifically Italy, one of the original Covid-19 epicenters). Here’s what we learned:
From Chuck deSousa of Automatex, Inc. in Canada:
What was Canada’s response to Covid-19?
CD: Canada is slowly opening to the public. Stringent rules still apply with social distancing and face masks becoming compulsory in certain provinces. The country has entered a downward curve in cases, but everyone suspects a 2nd wave of the pandemic when September rolls in.
What was the impact on the industry and Automatex, specifically?
CD: We thankfully have a bag division where we manufacture automated sewing units attributing to the food/produce industry such as potatoes, onions, oranges, etc. (see image). We also developed a face mask machine for washable and reusable face masks. Apart from that, the hospitality industry – such as hotels and restaurants – has been hardest hit with machine orders that have been temporarily suspended until the industry starts picking up.
What do you anticipate the next 12 months look like?
CD: No one can predict what will happen in 12 months. Everyone however believes that if a 2nd wave does hit, it will be economically impossible to shut down again. We will continue to practice social distancing and wear face masks. The economy will have to adapt to working from home and buying online. Our spending habits will change, and we will become more selective in our choices.
From David Handal of Agencia J.E. Handal, S.A. de C.V. in Honduras:
What was Honduras’ and Central America’s response to Covid-19?
DH: Honduras and Central America, like other regions in the world, have been heavily affected by Covid-19. The government of Honduras has implemented strict security safety protocols to avoid virus propagation, mass testing is taking place, and a mandatory lockdown has been enforced since March that requires people to stay in their homes for all but a few hours a week.
What was the impact on the industry and Agencia J.E. Handal specifically?
DH: All garment factories in Honduras and Central America shut down in mid-March, and almost all of them suspended labor. The Government of Honduras did however allow garment factories with strict health and safety protocols to reopen with a limited number of workers to supply the demand for masks and PPE garments.
Because garment factories are not full, most of them cannot cover overhead costs. Another big issue is that retail brands have canceled most of the orders to garment factories due to the lack of demand for products in the U.S. and other regions. Customer-canceled orders have forced garment factories to reduce their labor force and therefore look for new opportunities that could generate extra capacity that has been lost during this period.
In the case of Agencia J.E. Handal – where we supply cutting, sewing and finishing equipment – several orders have been canceled with many machines and spare parts in stock not being able to be delivered because demand is low.
What do you anticipate the next 12 months look like?
DH: It will take time to go back to a “new normal”. I anticipate factories will continue to produce PPE-related garments for the next 12 months, and I do not envision “core garments” will be produced during this period of time until the market stabilizes and goes back to normal.
Covid-19 has forced factories to re-convert production and flow in the direction of the market’s need. Eventually, more garment factories in the region will increase jobs to satisfy the market’s demand for Covid-19 related products.
From Aldo Moscaroli of FK GROUP SPA in Italy:
What was Italy’s response to Covid-19?
AM: Italian people responded well to the strict lockdown regulations by staying at home for three months. The situation is constantly improving, and we are slowly getting back to normal, though still having to wear a facial mask and – even more importantly – respecting social distancing.
What was the impact on the industry and FKgroup, specifically?
AM: The impact on business, in general, has been very bad, and exports have suffered a great deal for all Italian producers.
FKgroup has been busy by supplying the PPE manufacturers worldwide and helping several of them switch from normal apparel to face masks and other PPE for doctors and nurses. Needless to say, all businesses have slowed down.
What do you anticipate the next 12 months look like?
AM: While all businesses are gradually reopening, we are anxiously waiting for the fall, hoping that the pandemic will not return. We at FKgroup believe that there will be a need for extra efforts and as soon as possible we will need to resume our business traveling.
All things considered, the Italian industry will suffer a drop in exports across a wide spectrum of clothing and related products.
Thank you to Chuck, David, and Aldo for taking time to share insights into their markets and the efforts being made to combat challenges presented as a result of the Covid-19 pandemic. Their answers revealed a lot of similarities to the U.S. and reinforced the importance of being able to shift production to meet market demand.
SPESA will be doing a deeper dive into the industry response to Covid-19 in a webinar with Germany’s VDMA this upcoming July 29 at 10:00 a.m. ET. Specifically, the webinar will feature speakers from the U.S. and Europe to discuss trends, tactics, and challenges of navigating operations in the middle of a global pandemic. Mark your calendars. More information will be available soon on the SPESA website.
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