It's not all doom and gloom. The past 12 months have seen one bad news after another, and it has often felt like we are taking two steps forwards and three steps back. This has been reflected in much of what I have written; it has been difficult to find a chink of light amid the ongoing negative news cycle at times.
Yet a few things I have read about lately have given me cause for optimism. Could we be seeing the "green shoots" of recovery? I think so, although my optimism is naturally cloaked with an element of caution.
First of all there have been a raft of news stories which suggest that many of our customers in the fashion and retail world are on the road to recovery. The online segment, which we as manufacturers must now be giving serious thought to, is growing rapidly.
One of the world's fastest growing online fashion brands is German online giant Zalando. In its annual report, the business recently said it is targeting at least 30bn Euro in e-commerce sales by 2025. The company made the statement in its annual report after a strong financial year 2020 when it achieved 10.7bn Euro in sales, despite the global pandemic. The company also says it has had an "extraordinarily strong start" to 2021 with expected growth of around 50 percent in the first quarter.
50 percent! That's a remarkable rate of growth and illustrates the extent to which parts of the market are bouncing back into life in dramatic style.
Likewise, the world's largest apparel retailer Inditex recently told investors its online sales had increased by 77 percent in local currencies to 6.6bn Euro over a 12-month period.
Many industries around the world have slowed right down or come to a complete standstill—aviation and live events and exhibitions spring to mind. Fashion, somehow, has evolved and adapted, shifting to indoor and leisurewear and—somehow—keeping a lid on losses. The resilience and ingenuity showed by many leading players in adapting to the new circumstances of the past 12-months has shown the ability of our industry to weather pretty much any storm. In short, if our customers can survive this, they can survive anything.
The two businesses above have plans for growth and there are many more like them. This year will be far easier for business than 2020. Remember also that many orders began being cancelled as far back as January/February 2020 as retailers looked down the road and didn't like what they saw coming; fashion and textiles has had more than a year of this, which shows the strength it has displayed in the face of adversity.
Meanwhile, there is good news at the government level. In many of our biggest markets, governments appear cautiously optimistic that economies can bounce back from the economic shock of the past year. Germany, a key market and the largest economy in Europe, is forecasted to grow by 3.7 percent in 2021. In Britain, the Bank of England believes economic growth will accelerate next year at the fastest rate since official records began as the economy rebounds by 7.3 percent.
In the US, the Federal Reserve has raised its growth forecast for the economy in the past two weeks and now expects its GDP to grow by 6.5 percent this year, up from 4.2 percent forecasted back in December.
In all these cases, we are seeing a "rebound" in growth on the back of 2020—that is, a sharp uptake in economic growth to partly offset the contraction of the previous year. Likewise, all are saying that growth will stabilise beyond 2021 and revert to its previous trajectory.
All of this is positive news for Bangladesh and provides an incentive for our ready-made garment manufacturers to keep fighting and "stay in the game" as there is clearly light at the end of what has been a long, dark tunnel. The news that our partners are bouncing back should also send a message to policymakers: let's support ailing businesses with the financial packages they need to tide them over until the good times return. There is no point in letting good businesses hit the wall for the sake of a lack of orders and cashflow—not when a return to growth is just around the corner. When orders do pick up, we need to ensure our garment makers are best placed to fulfil them.
What is stimulating this positive news? It is, of course, vaccines. I keep a close eye on our target markets and the signs are extremely positive. The United Kingdom is one of our largest export markets—it is third behind the US (1st) and Germany (2nd). In the UK, more than 25 million people—around a third of the country's population—have now been vaccinated for the coronavirus. The UK will soon be reopening for business and, with so many people having been vaccinated, the hope is that this time it will be for good.
All in all, I see reason to look to the coming months with far more optimism than at any time since February 2020.
One note I would add to this is the talk I keep hearing of a "new normal". If by a new normal we mean a more sustainable post-Covid future, then clearly that is something we can and should all get behind.
But in some circles there is talk of this new normal meaning less travel, people wearing masks all the time and a generally more fearful and cautious world. Is this really what we want? I am not so sure. If the past 12 months have taught us anything, it is that we should be grateful for what we have and never take things for granted.
This period has also taught us, as a country, that without business, we have big problems. It's our lifeblood—it puts roofs over our heads and food on our tables.
The "new normal"? I will stick with the old normal, thank you.
Mostafiz Uddin is the Managing Director of Denim Expert Limited. He is also the Founder and CEO of Bangladesh Apparel Exchange (BAE).