In the cutthroat world of fashion, innovative design and strong branding are driving global markets, and Australian designers are leading the way.
The global fashion industry is tough—competitive and constantly evolving—but Aussie success stories such as Collette Dinnigan, Sass & Bide, Zimmerman and Akira, as well as many emerging Australian labels, are putting their stamp on runways around the world.
However, the statistics available on fashion’s contribution to exports are modest at best. The Council of Textiles and Fashion Industries of Australia (TFIA) estimates that the clothing manufacturing industry contributes $1.03 billion (2005–06) to the Australian economy, with around 6.8 percent (or $250 million) in total sales contributing to our exports.
New Zealand is by far the most significant country of destination for Australian clothing exports ($124 million in 2005–06). Figures in millions for other major destinations in the same period: Hong Kong ($30.1), UK ($18), US ($15).
But clothing represents just 1 percent of total manufacturing in Australia, and broader fashion sectors, such as accessories and footwear, aren’t even accounted for in the figures.
Many businesses in the fashion field are manufacturing offshore, with good commercial reasons for doing so. “A good international brand needs to be able to deliver large quantities of product, on time and at the right price, and you need a large manufacturing facility that’s extremely competitive in the global supply chain,” says Rob Sutton, national manager for consumer products at Austrade. But some specialist collections are still being produced in Australia, and in some cases by hand.
Mary Gualtieri, regional director of Fashion Group International’s Sydney chapter, says most niche or specialised products are manufactured locally as it’s easier to control the quality and manage smaller quantities and short production lead times, but she says most high-volume product is manufactured offshore to take advantage of better cost structures.
Brisbane-based design label Easton Pearson—established by Pamela Easton and Lydia Pearson in 1989—has been exporting its vintage ranges of womenswear for almost 10 years, using a combination of local and offshore manufacturing. Their garments are highly detailed, handcrafted and embroidered, primarily using natural fibres. The co-directors design all the decorative detail and patterns on the textiles, using artisans in India, Vietnam, and China to execute the work. The garments are then manufactured in the Easton Pearson studios in Brisbane.
On the other hand, seamless underwear label Nearly Nude, was developed in 2005 by Lucy Hosken, who intended to use an Australian manufacturer but found there was no one who had the machinery needed to produce her garments. She required the use of special Italian weaving machines that Chinese manufacturers also used, so was forced to manufacture offshore. “And of course China was going to be cheaper [than Italy] and it was easier for me to get there,” she says.
With more than 2,000 active fashion exporters delivering their goods overseas, export growth has been evident across the whole supply chain—from the cotton-grower and wool-maker through to designers and garment producers—but our innovative design sector has showed the most strength in recent years.
“There are a number of different specialty sectors and we’re now developing niches in different areas of expertise,” says Austrade’s Rob Sutton. “Australia is a design leader worldwide now, and that’s something Australians can be very proud of. If you look at the people who are producing outstanding modern design around the world, Australia is right up there, and people frequently ask us how we did that. I think it comes down to the great education that young designers are receiving in Australia. We’ve got a tremendous education platform, we’re very creative, we have a youthful lifestyle and outlook, and I think that’s the relevance to modern consumers around the world.”
Fashion Group International’s Gualtieri agrees. “Australian fashion is well regarded for its creativity with a constant flow of new emerging talent,” she says. “Australia has its own unique interpretation of fashion trends. International trends have some influence but, predominantly, our fashion is designed for the Australian market. Our colour palettes and fabrications are attuned to our climate and lifestyle.”
The Australian lifestyle is alluring, with our summer and spring collections proving most popular overseas. Swimwear and surfwear are strong exports—one only has to look at the enormous success of aussieBum and Billabong—as are other key sectors such as lingerie, ready-to-wear, evening wear, menswear, womenswear, and accessories.
The Aussie outback lifestyle has proved just as popular as our beach culture, with the likes of RM Williams and Driza-Bone becoming renowned overseas.
“Australian fashion is really making a difference, and the exciting thing is that fashion categories appear in newspapers and magazines on a daily basis around the world,” says Sutton. “People read about it as part of their everyday life, unlike some of the heavier industries. Fashion is a great leading story about Australia and our lifestyle, and it helps with our brand positioning.”
Nearly Nude’s Lucy Hosken agrees that Australian fashion is becoming more popular. “I think they like labels from Australia because they’re quite forward with the designs, they’re young and groovy, and people also like the fact that it comes from Australia, they think it’s a good place.”
Australian Fashion Week is also one of the first shows of the season, which means Aussie designers can be early in setting trends, particularly in spring/summer. This was where Easton Pearson got their kick-start globally, with two major buyers from the UK and China buying the collection after their first show in 1998. “It was all about timing. It came at a time when buyers were looking for something unique. Our designs are all hand-embroidered and decorated, and they’re very individual,” says Pearson. “If people are looking for something individual, they will look to Australian designers because we’re seen to do that really well.”
Easton says it’s inevitable for Australian designers to innovate, rather than follow fashion trends. “Australian designers know that if they’re going to succeed internationally and catch the attention of overseas buyers they can’t just copy something that’s already out there. They’ve got to bring something new and innovative to the market. Australia is renowned for being very creative.”
Broadly speaking, modern Australian design is a service industry. “If you look at Australia as a creative nation, it involves a lot of work in creating new products, fundamental research in new fabrics and design and consumer trends, and possibly a lot of the prototyping in garments can be done in Australia as well,” says Sutton. “So we don’t necessarily have to focus on the big production run because maybe we’re making that closer to the retail market or in very large production plants anywhere in the world. But where we’re seeing great strength is in the innovative, high value-add components of the garment—the brand, the design, and the fundamental research on how to make that garment.”
Design as a service, however, is hard to measure, and so exact figures on fashion’s contribution to our export base aren’t available. What we do know, though, is that Australian fashion is making its mark. It is traditionally strong in the US and Europe, with a major achievement being the launch of eight Australian brands into Ireland’s B
rown Thomas department stores last year.
We’ve also had strong showings in Japan and the Middle East over the last year, but Sutton admits exporters often work most successfully closer to home, so our fashion industry does well in neighbouring markets such as New Zealand, Indonesia, and Singapore. An unforeseen success story came out of Rosemount Fashion Week in Sydney last year, when six Indonesian buyers signed 53 deals with Australian brands—the largest in terms of value and volume, according to Austrade.
The type of product will obviously determine the right markets. For example, red-carpet fashion will do well in wealthy, affluent markets, whereas swimwear will undoubtedly do well in big resort areas.
In order to stay competitive in the global fashion field, brand management and positioning is crucial. Gualtieri believes it’s vital for designers to have a presence at major international fashion events with an eye to being picked up by overseas retailers and boutiques. “There is a greater recognition of Australian fashion due to a greater participation by Australians in international trade showings such as New York and London Fashion Week,” she says.
Although fashion shows launched Easton Pearson internationally, the pair choose not to officially ‘show’ at fashion events these days, but have a more subtle presence. “We don’t exhibit at the trade shows because our brand is unique and we try to keep it exclusive, but we do go to Paris during Fashion Week and show by appointment,” explains Pearson.
Hosken’s Nearly Nude, however, has been lucky enough to grow organically through word-of-mouth. She first made contact with a Canadian distributor through a friend just a year into the business, and six months later her product was in 50 stores across Canada and the US. Nevertheless, as she tackles new markets with a growing product range, Hosken says she’ll need to spend more time at international fashion events to grow the brand.
Such events will raise a brand’s profile but just as important are the business elements which follow, such as delivering to, and supporting, the buyers around the world. “If there’s one take-home message that’s really important for Australian exporters, and for admiring young designers, it is listen to your consumer and listen to your retailer,” advises Sutton. “The retailers have some very specific requirements—it will turn up on time, it will be priced correctly, and it will make your consumer feel special.
“Then, the process of brand management is a partnership between the brand owner and the retailer. If you can’t support your retailers in far-flung and wide markets, then you’re probably not assisting your retailer to sell the product, and they will ask the question, ‘considering the number of choices I have around the world, why should I buy from you?’”
Hosken says maintaining relationships with her agents and distributors overseas is crucial. “That’s where I spend about 80 percent of my time. I speak to my agents and distributors every second day and we have really good relationships with them, which I think is key.”
In order to maintain brand presence, Australian designers are starting to show collections that are trans-seasonal, which is helping to increase cross-seasonal sales and acquire customers in the northern hemisphere. It’s a big job for any design team to run different seasons in parallel, but necessary for brands to stay competitive.
“This is a bit difficult to juggle in terms of business flow,” admits Easton, “but we get around it by manufacturing twice—once for the northern hemisphere and once for the southern hemisphere, so that we are delivering to each market in the correct season.
“A lot of our stuff is also now trans-seasonal, and this is a general global trend across all fashion industries and markets.”
Nearly Nude is non-seasonal, and Hosken attributes half the success of the business to this. “Our stuff is a range of basics that’s non-seasonal and when I’m selling here to Australia in summer, I’m selling overseas in winter, so I’ve got both ends hedged really.”
Fashion can also be very market and culture-specific, so exporters should be aware that what is considered fashionable and stylish will differ considerably between markets. “[Fashion exporters] need to consider the lifestyle of the audience [they are targeting] and adapt colour, garment practicality and fabric choices to suit the targeted climates, lifestyle, and market group,” advises Gualtieri.
Certain social laws will dictate to what extent certain parts of the body should be covered, and even the models displaying products should reflect the target market, advises Sutton.
Easton Pearson, for example, have had to adapt their sizing and hemlines for markets such as Japan and the Middle East, and while Hosken believes Nearly Nude will do well in the Middle East, she’s aware that she’ll need to tread carefully with the social restrictions on women’s dress code when she tackles the market this year. Our box-out below highlights some fashion faux pas in certain overseas markets.
Looking ahead, Sutton believes Australian fashion will continue to consolidate its position around the world. With the tactical advantage of having Australian merino and BMP Cotton, Australian designers will continue to work with these natural fibres, particularly as they respond to global concern for the environment. “With the partnership of the Australian brands working with the Australian natural fibre industry, there is really a great opportunity to expand and grow around the world, and I expect to see some specific sector development occurring as a team.”
Gualtieri predicts the Australian fashion industry will continue to grow with companies going offshore as their product quantities increase or become more cost-driven. “Smaller, creative niche market specialists will continue to produce locally in order to control the quality and smaller quantities. As the older and more established labels become larger and move some of their manufacturing offshore, there will always be new, emerging talent coming through, ready to start the cycle of growth and development.”
A Helping Hand
Through AusIndustry, the Australian Government provides the following grants and concessions for businesses in the textiles, clothing and footwear industry.
Textile, Clothing and Footwear (TCF) Expanded Overseas Assembly Provisions (EOAP) Scheme
The TCF EOAP provides duty concessions to firms who assemble garments and footwear overseas from predominantly Australian fabric and/or leather and then import them back into Australia for local consumption.
Textile, Clothing and Footwear Post-2005 Strategic Investment Program (TCF Post-2005 SIP) Scheme
The TCF Post-2005 (SIP) Scheme aims to foster the development of a sustainable and internationally competitive TCF manufacturing industry and TCF design industry in Australia by providing incentives which will promote investment and innovation. It is an entitlement program which provides incentives in the form of reimbursement grants, paid annually and in arrears. The program will run until 2014/15.
Textile, Clothing and Footwear Product Diversification Scheme (PDS)
This scheme is designed to assist clothing and finished textile manufacturers located in Australia to internationalise their sourcing arrangements and complement their product range. It will do this by providing duty credit that can be used to offset duty payable on qualifying finished
clothing or relevant finished textile articles.
Textile, Clothing and Footwear Small Business Program
This program provides grants to improve the business enterprise culture of TCF small businesses. The program is specifically aimed at TCF small businesses unable to receive assistance under the TCF Post-2005 (SIP) Scheme. It is competitive and merit-based with a maximum grant of $50,000 provided to each successful project. Funding of $2.5 million is available per year over a 10-year period (from 2006/07).
The Tradex Scheme provides relief to people or organisations via an up-front exemption from Customs duty and GST on imported goods intended for export or to be used as input for exports. The scheme removes the need to 'drawback' these charges after export.
Fashion Faux Pas
• Shorts, skimpy t-shirts or other ‘immodest’ clothes are considered inappropriate for many Middle-Eastern women.
• In Ecuador, it is a faux pas for men and women to wear short pants in townships.
• In Mexico the colour purple is associated with funerals.
• It is a faux pas to give a married Chinese man green-colored headwear as a gift. The Chinese saying ‘wearing a green hat’ means that someone's wife is unfaithful. For Cantonese speakers, this connotation extends to hats in general.
• In Europe, white socks, including the style associated with athleticism in the US, are widely regarded as inappropriate for adult men.
• Wearing real fur clothing is a taboo in the UK, especially among the young. Fake fur however, has no taboo there.
• One-piece swimwear doesn’t sell well in Italy.
“There’s a lot more to learn than you first imagine. There are also a lot of different import requirements into the various markets and lots of paperwork, which we underestimated in the beginning, so beware of that.”
—Lydia Pearson, co-director and designer, Easton Pearson
“Do your homework and research on distributors and agents. Look at the brands in Australia that you like and admire and who are having success overseas—look at who they’re using as agents or distributors, and have discussions with them. Get people’s feedback.
“Don’t wait too long. I thought I’d just be doing business in Australia for five years and really ground this down before I took the step to export, but I started it after a year and I’ve had way more success overseas than I’ve had here.”
—Lucy Hosken, founder, Nearly Nude