From clothing production to PPE manufacturing: factories pivot during the pandemic
Geneva – The first wave of the COVID-19 pandemic caught the world by surprise, causing disruptions across the spectrum of productive activities, jolting economies and supply chains, including the global apparel industry.
Suppliers in garment-producing countries faced order cancellations, reduced order volumes and extended payment terms in 2020. Unable to bear the financial burden, many suppliers were forced to reduce or stop operations altogether, suspending millions of factory workers.
At the same time, Personal Protective Equipment (PPE) manufacturing breathed new life into the sector as the demand for such items skyrocketed during this time of crisis.
In Vietnam, most manufacturing sectors suffered, with textile and garment among the worst hit. The industry saw its export value falling for the first time in 25 years, according to the Ministry of Industry and Trade.
Ly Cam Sieu is the director of Better Work-affiliated Smart Elegant International Vietnam LTD, a clothing plant with over 450 employees, 80 percent of whom are women.
“COVID-19 hit us hard, seriously affecting our production between May and November,” Ly told Better Work. “All our previous orders had been cancelled, so we were forced to look for alternatives, like the production of fabric masks and other PPE material. We did our best to get as many orders as possible to guarantee employment and stability to all our staff. Although the orders couldn’t fully cover all our costs, they helped us overcome and survive through the crisis.”
The company started producing PPE in June, using the same machines and similar sewing methods the workers usually adopt when producing clothes.
“Workers adapted very fast to the new production and reached targeted production goals almost immediately. There is little difference between normal clothing and PPE production. Still, we faced a few challenges: preparation phases take longer than with clothing and products require larger storage, since some materials are very bulky.”
Ly said they had recently stopped PPE production as orders started to pick up again.
“Although the number of orders is still lower than in previous years, it shows improvement and more chances of stability for the industry in the near future. Let’s hope that the vaccine will help the industry get back to normal production levels.”
Meanwhile, Bangladesh’s garment sector faced order cancellations and delays worth about $3.18 billion between March-April, according to the Bangladesh Garment Manufacturers and Exporters Association (BGMEA).
Production had to halt due to the country’s lockdown, with the exception of those factories with a sufficient amount of work orders from international buyers or manufacturing PPE.
Shawn Islam, managing director of Better Work-affiliated factory Sparrow Apparel Bangladesh, told the UN programme that following the implementation of the country’s lockdown, operations in his three facilities in the capital Dhaka had come to a halt.
But the forced closure didn’t last long. As demands for PPE kept coming in, Islam said around 20 line supervisors had started producing surgical masks and protective clothing for local police and security personnel employed in one of his factories with the government’s approval.
“We have been making surgical masks and waterproof PPEs for Level 1 protection. We also distributed them for free among people working in the factories.”
The IFC’s Sumit Manchanda is currently in charge of a project that aims to help companies in emerging markets skill up PPE operations through technical support and advisory services.
Manchanda said that his team had been holding talks in 2020 with interested companies in Vietnam, Sri Lanka, Bangladesh, Jordan, Pakistan and several African countries. Many of these groups were already IFC clients and, in a few cases, also Better Work partners.
“What’s happened is that many companies, as a matter of survival and to keep their employees on the payroll, switched to PPE production in 2020,” Manchanda said.
There are three categories in which RMG companies can be fit in the context of PPE, Manchanda said. Some have completely reverted back to their old business of apparel, but, if need be, these companies already know the business and could swiftly switch back to PPE production.
A second category of factories continues to work on non-medical grade PPE and tries to innovate, hoping to reach the quality of medical-grade masks through testing and collaboration with international partners like universities, hospitals and private companies. The goal is to have the quality of their civil masks reach a high level of efficiency and filtration to address the challenge of waste that is emerging in the medical grade-masks, which are not recyclable and leave a huge environmental footprint.
The third category belongs to those companies that have decided to go from their textile line of business into the medical one, thus investing in product diversification and going into completely new value chains.
PPE production could offer a palatable opportunity for Haiti’s garment sector as well.
The apparel industry is one of the largest employers in the country, creating jobs for approximately 60,000 people across 41 Better Work-affiliated factories.
The local garment industry accounts for almost 90 percent of the country’s exports, with women making up the majority of workers and currently facing layoffs with no unemployment insurance and limited assistance for furloughed workers.
A study conducted by the IFC and L’Association des Industries d’Haïti (ADIH) between May and June 2020 measured the impacts of the COVID 19 pandemic on the country’s export-oriented garment sector. It showed clothing manufacturers in Haiti expecting at least a 30 percent loss in revenues as a result of the pandemic.
The same study also shows that firms producing apparel could easily shift to washable PPE if provided with multilevel support, spanning investment and support in accessing foreigner markets. This production shift could help meet the increasing global demand for masks, coveralls, surgical gowns, aprons, surgical caps, blouses and scrubs.
Factory owners said orders for masks and other PPE could help save companies and retain jobs amid such a crucial time of crisis for the local apparel industry.