E-marketplaces in the Textile and Leather Sector By Letizia Gallacci and Giovanni Luca Atena The International Scene Recent reports regarding the global performance of the leather and textiles industry sector indicate soft demand and stagnated consumption, resulting in zero growth. It is not surprising then that a decline in export activity for leather and textiles has occurred. A closer look at 2001/2002 export figures show a greater reduction in the export of leather products than for textiles and clothing. Markets hardest hit were the USA and Japan, reporting a decrease in export activity of 10%. On a more positive note, the first half of 2004 is expected to see better results.
eBusiness in the Textile Industry So, do e-marketplaces provide the most benefit to buyer and sellers in ‘tough economic times’ eliminating the need for ‘expensive’ intermediaries? Well, according to eMarket Services, 45 e-marketplaces are now active in the Leather and Textile sectors. This number is not especially high considering the volumes of leather and textiles traded globally, but e-marketplaces specific to Leather and Textiles are increasing, as is the volumes being traded within them.
Growth in the Number of Textile and Leather E-marketplaces 50
41
45
37
40
22
25 20 15
46
45
35 30
45
25
13
E-marketplaces in the Textile and Leather Industry*
10 5 0
jun-01 oct-01 feb-02 jun-02 oct-02 feb-03 jun-03 oct-03
Source: ICE - eMarket Services Italia Italy is the world’s second largest producer of textiles (6.5%) and the third largest producer of clothing (5.3%). At the premium ‘high-end’, 10 Italian companies control approximately 20% of the world market with an income of approximately 6 Million Euros. It follows then that Italy has the highest number e-marketplaces dedicated to Leather and Textiles products (in terms of headquarters and sales offices).
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Geographic Location of E-marketplaces in Textile and Leather Industry North America 24%
Africa 2%
Asia 26%
Latin America 3%
Australia & Oceania 5%
Europe 40%
Global Focus
The focus of the majority of Leather and Textiles emarketplaces is worldwide (68%) where transactions involve various countries. Of these, many (33%) focus more on a particular geographical area or region, usually coinciding with the country where the e-marketplace has its head office. In the leather and textiles sectors it is common for sellers from a particular country to offer locally produced products on a global scale. This is the case for e-marketplaces in Italy, Spain and certain Eastern European countries. In addition, there are a large number of e-marketplaces with sellers operating in Asian countries, such as China, Taiwan, Pakistan or India. These areas are becoming increasingly competitive in the sector due to low labour costs. 18% of Leather and Textiles e-marketplaces have a geographical focus on a single country, 10% focus on the USA, and 6% on Europe with this focus centred primarily in Italy and Spain.
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E-marketplaces in Europe (headquarters and sales offices) Italy 13 Spain
9
Uk
4
Germany
4
Romania
2
France
2
Portugal
2
Poland
2
Belgium
1
Bulgary
1
Hungary
1
Netherlands
1
www.emarketservices.com
Geographic focus
focus on USA 10%
focus on Europe 6%
Global focus 35%
focus on a country 18%
Global focus +preferential country 33%
Trading Function, Buyers & Sellers and Products with the highest rates of transaction Leather and Textile products are more suited to online sales than others. This is confirmed by widespread research on B2C (business to consumer) electronic commerce, where the clothing/accessories/handbags/footwear sector is identified as one of the most attractive for online purchases by end users.
Trading functions As with most web sites that sell directly to end-consumers, products that are bought and sold in B2B emarketplaces are frequently presented in a virtual window, as if in a shop. They are usually associated with an online catalogue, and a shopping cart tool through which orders can be placed directly is offered. Trading tools are selected to cope with the peculiarity of the Leather and Textile sector and its traded products. The Product catalogue is a key trading tool because it affords a high level of flexibility to meet the buyers’ requirements. Individual companies are able to present their unique product offerings (style, fabric, price and so on). Another online trading tool commonly used is the proposal and request system (RFX –Request for Proposal, Bid, and Quotation). This is a flexible and useful tool. A company can make an offer or a request according to its particular need (such as unsold warehouse stock) and wait for a reply. The auction and reverse auction tools are used less.
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Buyers and sellers Participants in Leather and Textiles e-marketplace transactions tend to be final resellers, representatives, producers of raw materials, final product manufacturers, and wholesalers who are interested in importing from a specific geographical area (as in the case of products ‘Made in Italy’). A minority of users are producers of machinery specific to the textile industry and/or leather processing.
Products traded on E-marketplaces in the Textile and Leather Industry textile
23
textile & leather
9
leather
9
machinery a w ide range of products
4 2
Products Not all Leather and Textiles e-marketplace trade in both Leather and Textiles. 23 e-marketplaces focus on textiles only (49%), 9 on leather only (19%) and 9 cater for both (19%). 4 e-marketplaces trade in machinery specific to the Leather and Textiles sector (9%). It is also possible to exchange Leather and Textiles products on 2 horizontal (not exclusive) e-marketplaces (4%). Textiles On 44% of e-marketplaces it is possible to trade in all the products within the Textiles sector including textiles, yarn, thread clothing, knitwear and linen for the house. Other e-marketplaces are more specific and only buy/sell clothing and fashion wares (39%), while some e-marketplaces focus only on textiles that can be chosen according to several criteria by customers (finishing, colour, quality).
Textile products traded only textiles 17% all textile products 44% only apparel & fashion 39% Leather E-marketplaces dedicated to the Leather sector are less varied and fall into one of two camps. They are either focussed only on footwear and its parts (soles, uppers, heels) or on multi-products, where the goods traded come from the entire leather industry including leather apparel, handbags, footwear, luggage, and wallets.
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Leather products traded all leather products 44%
only footwear 56%
At present B2B trading in shoes is particularly successful in Italy and Spain though e-marketplaces dedicated to shoes are increasing in Asian countries mainly due to low labour costs. As a general rule Asia is most competitive in low quality products while Italy dominates the high-end quality products both in leather and in textiles.
Engaging a Leather and Textiles e-marketplace Most e-marketplaces have clearly defined procedures to be followed by both buyers and sellers. Registration Of those Leather and Textiles e-marketplaces we analysed most require registration to enter the trading area. Only very few allow free access.
E-marketplaces which require registration no registration required 11%
not available data 4%
registration required 85%
Services The services additional to the core trading platform provided by e-marketplaces such as consulting, logistics management, web solutions, and financing, will vary from marketplace to marketplace. Access Regarding pre-qualification or screening, some e-marketplaces will select buyer and seller companies to ensure the reliability of those companies trading on their platform. Other e-marketplaces avoid any prequalification, as they suppose it can discourage companies from joining the e-marketplace. For 71% of Leather and Textiles e-marketplaces, companies must pay a fee to use the trading platform and the related services. This payment can be as a membership fee or a transaction fee, or both.
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E-marketplaces which require fee or transaction percentage not available data 11% no fee 18% fee 71%
* Please find attached an information sheet containing information relating to e-marketplaces in Leather and Textiles sector including head-office and sales offices locations and (membership and/or transaction fee).
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Name
URL
Location
Head Quarter
Sales Offices
Fee or Trans % Reg
1
Apparelbids
www.apperelbids.com
North America
USA
___
Yes
Yes
2
AsianProducts
www.asianproducts.co m
Asia
Taiwan
___
n.d.
Yes
3
Calzadonet.com
www.calzadonet.com
Europe
Spain
___
_
Yes
4
CanalTextil
www.canaltextil.com
Europe
Spain
___
_
Yes
5
ClothingBids.com
www.clothingbids.com
North America
Usa
___
_
Yes
6
CNTEX - China Textile Network
www.cntextile.com
Asia
China
___
Yes
n.d.
7
Fabria
www.fabria.com
North America
Usa
___
n.d.
Yes
8
FashionUnited.com
www.fashionunited.com Europe
Netherlands _ _ _
Yes
Yes
9
FashionXchange
www.fashion-xchange.com
Europe
Germany
___
Yes
Yes
10 FiberBuys.com
www.fiiberbuys.com
North America
Usa
___
Yes
n.d.
11 FloorUniverse
www.flooruniverse.com North America
Usa
___
Yes
Yes
12 Fobconnect
www.fobconnect.com
Usa
Yes
13 HungaroTex
www.hungarotex.com
Europe
Italy
South Africa,China, _ India, Indonesia,Japan,Korea, Australia,Belgium,Czec hRepublic, France,Germany,Italy,S pain,Poland,Portugal,Tu Yes rkey,USA Hungary Yes
14 InfoMat
www.infomat.com
North America
Usa
___
Yes
Yes
15 ItalianModa.com
www.italianmoda.com
Europe
Italy
Bulgaria, Romania, Usa Yes
Yes
16 Leather Commerce Australia
www.leathercomau.com Australia & Oceania
Australia
___
_
Yes
17 Leatherfashionandm www.leatherfashionand Europe ore more.com
Italy
___
Yes
Yes
18 Leathernet
www.leathernet.com
Uk
Usa
_
_
19 LeatherXchange.co m
www.leatherxchange.co Europe m
Spain
Yes
20 LinkApparel
www.india-apparel.com Asia
India
China,India,Singapore,I Yes taly,Russia,Argentina,B razil,Mexico,USA ___ Yes
21 Modainfantil.net
www.modainfantil.net
Europe
Spain
___
_
22 Moddo.com
www.moddo.com
Europe
Spain
Portugal,Brazil,Colombi Yes a, Peru Mexico,
Yes
23 Pagine tessili
www.paginetessili.it
Europe
Italy
___
Yes
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North America
Europe
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Yes
Yes
www.emarketservices.com
Yes Yes
Yes
24 PakistanTex
www.pakistantex.com
Europe
Italy
Pakistan
Yes
_
25 Paktextile
www.paktextile.net
Asia
Pakistan
___
_
_
26 RomTextiles
www.romtextiles.com
Europe
Romania
Italy
Yes
Yes
27 Sell2italy
www.sell2italy.com
Europe
Italy
___
Yes
Yes
28 Shoenet
www.shoenet.org.tw
Asia
Taiwan
___
n.d.
Yes
29 Taiwan Textile Federation
ttf.textiles.org.tw
Asia
Taiwan
___
n.d.
Yes
30 Tanneryandmore
www.tanneryandmore.c Europe om
Italy
___
Yes
Yes
31 Textile Network
www.texnett.com
Asia
India
___
n.d.
_
32 Textile Web
www.textileweb.com
North America
Usa
Japan, UK, USA
Yes
Yes
33 Textileitaly
www.textileitaly.com
Europe
Italy
___
Yes
Yes
34 TexWorld
www.texworld.com
North America
Usa
India
Yes
Yes
35 TexYard
www.texyard.com
Europe
Uk
Yes
Yes
36 Tractes.com
www.tractes.com
Europe
Spain
China,India,Thailand, UK Germany,Turkey, ___
Yes
Yes
37 Tractescalzado.com www.tractescalzado.co Europe m
Spain
___
Yes
Yes
38 Tractesjuguete.com www.tractesjuguete.co Europe m
Spain
___
Yes
Yes
39 United Raw Materials Solutions Inc. 40 US Style
www.urms.com
Asia
Taiwan
Japan,Korea,Singapore, Yes Usa, Taiwan,Germany
Yes
www.usstyle.net
Europe
Italy
___
Yes
Yes
41 Vigevano Shoes
www.vigevanoshoes.co Europe m
Italy
___
Yes
Yes
42 Woolnet
www.woolnet.co.nz
New Zealand
___
Yes
Yes
43 World Fashion Exchange
www.worldfashionexcha North America nge.com
Usa
India
Yes
Yes
44 Wotol
www.wotol.com
Europe
France
Yes
45 Yeboss
www.yeboss.com
Asia
China
Indonesia,Japan,Malays _ ia, Pakistan,Singapore,Tai wan,Thailand,Poland,US A ___ Yes
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Australia & Oceania
8/8
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Yes
