Other sectors could learn from survival of Canada’s textile industry
DUBLIN, IRELAND: Diversifying to more specialized materials has helped Canada’s textile manufacturing sector become more competitive, according to a new report by Textiles Intelligence, a U.K.-based company that monitors the industry.
The report, “The Textile Industry in Canada” says Canadian textile companies combated declining sales by expanding into specialized areas such as technical usage textiles (TUTs) and other value added textiles (OVATS).
TUTS and OVATS are textiles with innovative manufacturing processes, with materials integrated into other materials in order to add characteristics to a product, such as flame resistance or water repellency.
Between 2005 and 2009, things looked bleak. Total factory sales by Canadian textile mills and textile product mills had fallen by 44 per cent. Clothing manufacturing sales had dropped by 50 per cent.
Textile companies, like many other Canadian manufacturers, faced competition from developing countries, diminished workforce strength and a strong Canadian dollar that clobbered profit margins.
The CTT Group, a Quebec-based textile industry organization, proposed a new strategy for business.
It recommended firms invest in scientific and technical resources, research and development, and business networking.
While the sector still faces challenges —product development, production costs versus lot size, and a fluctuating Canadian dollar— the initiative has already achieved some success, the report says.
Between March 2007 and June 2009, the number of companies involved in technical and other value-added textiles rose from 241 to about 400. In mid-2010, it was estimated that this figure had been more or less maintained.
The report says several Canadian companies such as Consoltex, Matador Converters, and PGI Difco Performace Fabrics have become global leaders in end-use textile sectors ranging from uniforms to footwear and in special niche markets such as coatings and filtration.
Jean Michel Laurin, vice-president of global business policy with Canadian Manufacturers and Exporters, says there’s a lesson in the sector’s uphill climb.
He notes textiles was one of the first sectors in Canada to be hit by growing international competition and “their death notice was published several times.”
But the companies that have come through these challenges are the ones that remodeled their plans, he says.
Laurin recommends companies that have yet to form a strategy start by looking at their strengths and weaknesses, talking with their business peers to see what others are doing, and investing in skills for their workers.
Mobilizing the entire workforce around a common business plan and demonstrating leadership are also crucial tactics, he adds.
“If you have the right business strategy, if you’re providing a solution to your customers and your product is innovative, there’s no reason a furniture company can’t succeed in Canada just in the same way that a company in aerospace won’t be around in five years if they continue business as usual,” he says.