Here is the speech by Gregorio De Felice, chief economist of Intesa Sanpaolo, on the Italian fashion system.
Italian fashion
The economic framework. In the first part of 2013, fashion companies (textiles, clothing and the leather supply chain) recorded a new decrease in turnover (-3,4% in the January-August period, based on Intesa Sanpaolo estimates), after the one already experienced in 2012 (-4,4%). Once again, it was domestic demand that penalized the results of companies in the sector the most. Retail sales show, in fact, a new fall in purchases of clothing and footwear (-3% at current prices in the first eight months of the year), albeit gradually decreasing in the summer months. The foreign front is better, where Italian companies achieved a growth of 3,4% at current prices in the January-August period, thanks above all to the increase in exports of leather and leather products (+7,2%) and clothing (+2,4%), while the textiles is in negative territory (-1,6%). Excellent results on non-EU markets (+6,3%), especially in ASEAN (+25,9%), OPEC (+15,2%) and China (+14,6%). Sales also continue to grow in the United States (+5,4%) and in Japan (+4,4%); in European countries, after a very negative first quarter, there are interesting signs of a trend reversal which lead to +0,7% the overall variation in exports between January and August 2013.
The comparison with Spain highlights a more lively trend in Iberian exports of products from the Fashion System (+11,1% in the period January-July 2013) accompanied however, unlike Italy, by a growth in imports, especially from low price. The Spanish balance of the fashion system consequently remains in negative territory, just as France appears heavily in deficit. On the contrary, Italy recorded, also in the first part of 2013, a positive and high balance, confirming the strength of the integrated supply chain of Made in Italy in this sector. The importance of supply chains. The leading companies of the main districts of the Fashion System (63 companies interviewed by Intesa Sanpaolo in the spring of 20131) appear to be aware of this wealth of skills: almost 60% turn permanently to local subcontractors, appreciated above all for the quality of the workforce, the product and service and for the high level of reliability. Also in perspective, the companies do not intend to reduce recourse to these suppliers and, indeed, over 14% indicate that they want to bring back to Italy work previously entrusted abroad. The criticality of the supply chain also clearly emerges among the concerns of the lead contractors: almost 70% believe that there is a problem of reduced creation of new businesses and lack of generational turnover among their subcontractors (a percentage more than twenty points higher than what is found , for example, among the leading mechanical companies). The prospects of the Italian fashion system therefore also depend on the ability to preserve and renew this heritage.
The prospects. In the coming months, the less negative tone of retail sales on the domestic market and the revival of exports to EU countries will be reflected in an improvement which, however, will not be sufficient to guarantee growth in turnover, expected to fall by 1,7, 2013% at current prices for the whole of 4,4 (after -2012% in 2014). We will have to wait for 1,4 to register a recovery (+3,3%), followed by an acceleration to +2015% in 2012. Crucial will also be the support of the foreign channel in the coming years which will allow a parallel improvement in the indexes of profitability, which fell again in 6,1: the analysis of a representative sample of companies in the Fashion System shows, in fact, a further reduction in profitability, with the average ROI down to 6,7% from 2011% in 2015. The recovery of profitability will also be gradual, given the high competitive pressures on international markets: only in 2008 will it be possible to return to the levels of XNUMX, prior to the great crisis.
