Trade fairs are an excellent barometer for the state of the global economy. Exhibitors provide an indication of what the situation will be in one or two years' time based on the volume of orders being placed and sales prospects in the pipeline. While buyers at the fair will reveal more immediate trends that are reflections of consumers' recent spending habits.

The slowdown in Western economies two to three years ago definitely had an impact on the Chinese manufacturing sector, and was also felt by other companies from Southeast Asia. But for most Chinese companies, this was mainly offset by a switch in focus from exports to the growing domestic market, as well as stronger growth in other developing countries.

The Chinese economy is still providing solid opportunities within the textiles industry, and there is a huge demand for products at competitive prices, and with new, value-adding features. In the technical textiles industry, domestic consumption is expected to grow by nearly 10% between 2010 and 2015, with exports and imports growing at 10.2% and 7%, respectively, during the same period.

Textiles for the filtration & separation, geo-synthetic, medical & healthcare, security & protection, structural enhancement, and transportation sectors are particularly in demand, with growth in these areas of between 10 and 13% expected until 2015.

The home textiles market is also going from strength to strength, with increasing household income, a rapid urbanization rate, and strong growth in consumer retail sales. In the first three quarters of 2012, total investment in real estate development grew by 15.4%, while retail sales increased by 14.1%. These figures are strong indicators of home textile purchases, and this was reflected in a 4.5% rise in imports of home textiles during this period.

It is common knowledge that Chinese consumers have a strong desire for Western products, and this is also the case in the home textiles market. An increasingly popular trend is that of the 'whole-home' design concept. This is where a home is decorated with one consistent theme throughout, often Western such as Italian or Classic English.

These figures and trends show there are still numerous opportunities for overseas textile companies that are willing to spend time on the ground in China building relationships with local partners.

Shift away from Europe to Asia


While the situation in China remains rosy, there are valid concerns with markets further afield. Many exhibitors have been moving or have moved their focus away from Europe as the traditional export markets continue to underperform. But they are still optimistic about Asia and the US market. This is reflected in economic figures for the first two months of 2013, with overall exports of home textiles to developed countries increasing 15.1% or USD 1.9 billion, while exports of home textiles to the US alone increased 25.8%.


Overall, a decrease in either exhibitor or visitor numbers that would reveal the economic situation in the West hasn't been seen, a domestic economy beginning to slow down or rising production costs in China are having a negative impact on the trade show industry in Asia. In fact, we have experienced new records this year, with a more than 35% increase in SalonEurope exhibitors at Intertextile Beijing Apparel Fabrics, one of the largest apparel fabrics shows. At Yarn Expo Spring, which was held in March 2013, there was a 43.5% rise in the number of visitors attending, with a significant portion of this increase coming from domestic visitors looking for yarns and fibres.


Chinese buyers display newfound confidence


As for major trends in the textile industry in 2013, a shift in the buying patterns of domestic visitors has been noticed, which is a reflection of the changing spending habits of Chinese consumers. Increasingly, domestic visitors are looking for high-quality products, and are less cost-conscious than before. They are also attending fairs to place orders for products rather than just looking at the latest items as they might have in the past. Western textile brands are also increasing in popularity, with those with a long history from Europe and the UK doing particularly well in China.


With a slowdown in their home markets, European suppliers, textile industry associations and even trade fair organizers are unsurprisingly looking to China to revive their fortunes. The Chinese market remains a challenging prospect though, and these companies' best bet is to partner with an experienced local player.


Trade fair organizers from Italy are also getting in on the act by organizing pavilions at the Intertextile Shanghai Home Textiles and Intertextile Shanghai Apparel Fabrics fairs during 2013. These pavilions are immensely popular with domestic buyers as they look to better understand the popular styles and trends from Europe.

 

We have also noticed Asian suppliers increasingly looking to tap into the Chinese market. The Cotton Textiles Export Promotion Council of India (Texprocil) organized an Indian Pavilion at the Intertextile Pavilion Shenzhen fair in July this year, and was pleased with the response the Indian suppliers received from Chinese buyers, saying they would bring a bigger delegation to the 2014 fair. They saw the future potential in the region, saying Southern China has a big demand for yarn. A lot of Chinese buyers were not aware of the high-quality yarn that is produced in India, but are confident that trade fairs such as this were the best way to change this perception.


At the end of the day, the future success of the textiles industry in China is inextricably linked with the health of the domestic economy. The recent gradual slowing of GDP growth hasn't had a serious flow-on effect on the industry just yet, and may never do so as Chinese suppliers are adept at changing their business models quickly.


Despite global economic uncertainty, textile sectors in Asia remain upbeat, writes Wendy Wen, Senior General Manager of trade fair organizer Messe Frankfurt (HK) Ltd.