Benetton will move half of its production to the Mediterranean as well as Portugal by the end of 2023, in order to diversify its sourcing and production hubs. Benetton has already relocated more than 10% of its production from Asia to Serbia, Turkey, Tunisia and Portugal. However, textile manufacturing in Turkey has been hit by the recent earthquakes, with around 500 apparel factories in the earthquake region that have been affected, according to a Reuters report.
The fashion industry, that recovered quickly from the lockdown and registered a global growth of more than 11%, slowed down due to inflation, war in Ukraine as well as China’s zero COVID policy according to Euromonitor.
Since supply chains have also been hit, companies are moving production away from China. Moreover, industry players now want to invest in their supplier relationships instead of choosing the cheapest supplier that produces large volumes quickly. The focus is now on risks and reputation.
Fashion companies are now turning to more circular business models to reduce supply chain risks. It means developing new business models that require the production of lower volumes, as well as using more materials from low carbon, circular sources as well as innovative textiles.
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