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APSyFI: The national textile industry is headed for a trade deficit, 2018 exports grow 1% and imports grow 14% (yoy).--IKATSI: The growth of the national textile industry is still hampered by floods of imports, Indonesia needs a clothing security law.

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Home arrow From The Editor arrow National Textile Industry Need Paradigm Become a Trend Setter

National Textile Industry Need Paradigm Become a Trend Setter PDF Print E-mail
Written by editor   
Tuesday, 03 December 2013

The ability of the textile industry and textile products (TPT) in generating export and absorbing foreign workforce in large numbers to contribute positively to the national economy makes this sector as a strategic sector in national economic development.


indonesia textiles

With a total number of medium-large enterprises around 3000, this sector absorbs about 1.5 million direct labor. In terms of foreign exchange earnings, the 5-year average export value reached USD 12 billion, or about 12% of the total exports of the nation's manufacturing industry. The value of these exports contributed net income of the average trade balance of U.S. $ 5 billion per year.


Similarly, meeting the needs of the domestic market in its role as import substitution. With a large population and growing middle class is quite high, pushing per capita consumption continues to rise so that the increase in consumption is driven not only by population growth alone. Consumption per capita in the last 5 years increased by about 50% so that in 2012 the total consumption of apparel and textile finished goods reach 1.56 million tons valued at $ 12.5 billion, of which 85% is supplied by local products.



Still in Class of Follower


World know Indonesia as one of the production base of textile and textile products other than China and India, but until now there is no "masterpiece" is generated in addition to its ability to produce goods orders (base on the sample) from the buyer. In other words, we are still in the textile industry maker class (follower) instead of the creator (trend setter).


Class of follower make our textile products as commodities are very susceptible to price competition, where competitiveness is determined more by the comparative competitiveness as wage labor, energy costs, interest expenses, transportation costs and other production costs.


While the trend setter class competitiveness is not much competition to compete on price because competitiveness is more determined by the innovation and creativity through the development of products that contained the type and unique products so that value added is higher and sometimes not measurable. This is done as textile industries in Italy, Japan, South Korea and Taiwan.


Displacement class of followers to trend setter made by developed countries to anticipate the magnitude of the increase in production costs so that they can continue to maintain this sector to continue to contribute to the economy, because the class will continue to move follower seek areas with cheap mass production costs. This phenomenon is known as the Foot Lose or Flying Goose, wherein when one industry to relocate it to other similar industries tended to move the main goal is to get the amount of low production costs.


Indonesia with a per capita income of about U.S. $ 3,600, began to migrate from developing countries to developed countries which will be followed by a massive increase in production costs continuously. And with the large number of young population and future workforce as well as additional income from non-oil sector, the sector is still very necessary. With this phenomenon it must begin no effort from all stakeholders in this sector to raise the grade of the follower to a trend setter so that the sector can continue to contribute to economic development.


The existence of some of the city known as creative as Bandung and Yogyakarta is known as a city with a fairly high degree of creativity, the provision Indonesian textile industry to lift the class can be a trend setter considered sufficient. It's just necessary synergy between industry players, actor’s creative textile industry and researchers to undertake development activities and product innovation.


National Textile Industry Structure


The structure of the textile industry in Indonesia is quite complete and integrated from upstream to downstream, ranging from industrial polymerization which make artificial fibers, which makes industrial spinning spun and filament yarns, knitting weaving industry which makes woven and knit fabrics, industrial dyeing / finishing printing makes finished fabrics to apparel industry and other textile finished goods. Overall the whole sub-sector linkages and integrated, where most of the raw material requirements supplied by the domestic industry in the upstream.


Completeness of such industrial structures owned only by China and India with greater capacity and Thailand with a smaller capacity than the capacity of Indonesia in the respective sub-sectors. Indonesian Only drawback lies in its supporting industries such as machinery and spare parts, dyestuff and auxiliaries, accessories as well as research institutions that product development is still owned.


Man-made fibers, especially polyester, rayon and nylon textile industry base which is supposed to be the mainstay of the national textile industry in product development to downstream. In addition to the "artificial"-that allows the modification of its character, nature and specification wider than natural fibers such as cotton, wool, silk, and so forth, Indonesia is one of the world's major manufacturers of man-made fibers to polyester which is the manufacturer of the 5th the world and is a manufacturer of rayon to 2-world in terms of capacity.


And if it is pulled upstream, Indonesia is a producer of oil and gas which Terepthalat Purified Acid (PTA) and Mono Ethylene Glycol (MEG) as the main raw material of polyester is derived. While the extent of Indonesia's forests could still be a guarantee of growth eucalyptus as raw material for rayon fiber.


Map of world fiber consumption also showed greater growth in man-made fiber. Data of Fiber Year 2011 shows that in the last 10 years the average consumption of polyester and rayon grew respectively by 4% and 3.6%, while cotton is only grown by 2, 6%, even wool consumption fell by 2.2%. Large consumption was very significant change where artificial fiber consumption in 1990 was only 17 million tones of natural fibers while 30 million tons, but in 2011 made fiber consumption reached 48 million tones and natural fibers only 33 million tons. This condition is driven by consumption growth, especially sportswear apparel and other textile functional as well as non-consumption of clothing for industrial needs such as automotive, construction, marine, aerospace and others.


world fiber consumption


For the industrial manufacture of yarn well spun yarn (spun yarn) and filament yarn, Indonesia is still energized. Even the competitiveness of Indonesian products were deemed to be spun yarn can outperform competitiveness of China and India are also well-known as the world's textile giants. Only products Yarn Indonesia is still very standards by which excellence competitiveness over China, India and some textile manufacturers still his world due to the low cost of energy and the use of cotton policies implemented by the government of China and India. In contrast to Japan, South Korea and Taiwan are already producing functional yarns and industrial yarns and yarn types are applied to specific products.


Among the sub-sectors of the textile, cloth-making industry is the most competitive. In addition to the magnitude of the burden of cost pressures, limited human resources capable, innovative and creative a problem that is quite prominent. On the other hand, competing countries in the sub-sectors of the textile industry such as Italy, Germany, Japan, South Korea and Taiwan continue to develop better products for functional fabrics needed for apparel as well as for industrial purposes. Research & Development (RnD) has become a part of their business is taken care of its own so that they can continue to perform the creative process in the context of innovation.


After the successful government to run "Milano Project" in 1999 to 2003, South Korea's textile industry could be a trend setter. Establishment RnD center is one of the many things that run, that the institution was tasked to translate market trends lifestyle European Union (EU) and United States (U.S.) becomes a fashion trend to the type and characteristics of the fabric that will be used in the next few years in every type of markets such as sports, casual, formal, party and so on and each began to market segmentation infants, children, adolescents and adults. So do not be surprised if many buyers world-class buyers purchase fabrics from South Korea for his collection at retail, even Indonesia, Vietnam and Bangladesh as the country's garment manufacturers have to import fabric from South Korea since the appointment of the buyer.


Much earlier, Italy did the same thing only with a very specific market segment that is upscale market, especially the celebrities. Japan, Germany and Taiwan also do the same thing in different kinds of very specific market segmentation.


Because only accept job order, the garment industry in Indonesia is only known as an industrial seamstress. Start of brands, design, type of fabric, accessories to the type of stitching, labeling to packaging, everything is set following buyers with sewing costs. Not much room for our garment industry to improvise when trying to accept the order unless the order can be completed as quickly as possible so as to increase productivity in order be spared of loss or gain little profit.


Not many companies have the garment of our own brands and design their own products. As for still playing at the level that it can not compete domestic as well as export market brands EU, U.S., Japan and South Korea.


Creativity typical of some of the city can be seen in the region of his fashion business, eg London, where many distributions mushroomed with typical design and local brands. Even today distributions phenomenon has mushroomed to other cities with London as his trade mark. It's just a business relationship between the creative sector and sme garment distributions represented by the fabric manufacturers sector is practically very ordinary. Distribution brands only use fabrics available on the market are manufactured by a local fabric manufacturer with no links more closely to develop products of various types of fabrics that can direct the next fashion trend.


On the other hand, we should be proud because some companies manufacture the fabric is capable of producing the fabrics, especially non-woven fabrics for automotive supply companies worldwide, some are producing yarn supplied to the tire manufacturer. Some companies are still willing to do product development and issued several collections of fabric designs especially for drill cloth in addition there is also a pull out some collection of georgette fabric.


Activity on only a fraction of our potential. Because of the total turnover value of national production from upstream to downstream of USD 34 billion, turnover of non-woven production values ​​only in the range of USD 500 million only, or only about 2.5% of its course and for the production of garments that are assessed based creative industries can be a new trend setter estimated reach of around USD 1 billion are driven by fashion and clothing Muslim clothing label distributions.


The move from class to class follower of the national textile industry trend setter is possible. It required synergy between sub-sectors from upstream to downstream to retailers including the Center for Textile with complete supporting facilities can function well as a research institute. Because some developed countries, research institutions-lah (whether public or private), which acts as a driving force in raising the class leader even become a trend setter industry.



Need to Increase the Level


Pattern-based marketing industry creative innovation in developing products is very much different from the industry who only accept orders only. Business pattern based on a sample job order, which the manufacturer to get a sample of the buyer then calculated out the cost of production so that the selling price. In this position the buyer make the same kind of company so that the company can convince buyers and low-cost one that will be chosen by the buyer to place orders.


While the pattern-based product marketing creative innovation opposite, manufacturers who provided samples RnD results that they have or they cooperate with research institutes to buyer, and the buyer choose which products they want to produce in accordance with their needs. In this case the buyer does not have much choice because although quite a lot of producers in the region, but each manufacturer has a different segmentation. In other words, when a buyer selects a product to be produced then the buyer can not produce it in other manufacturers as related copyrights and know-how that is not possible other manufacturers to produce it.


As a result of the many fabric manufacturers in Indonesia, which is only capable of producing fabric base on order, the trade deficit large enough to experience that is about 300 thousand tons per year valued at $ 1.5 billion. This is because the export-oriented garment companies, approximately 80% of the fabric must be imported either because of the requirements of the buyer, the quality specifications that can not be met by local cloth-making industry until the price comparison.


These conditions continue to weaken the competitiveness of the manufacturing sector of the fabric so that the government represented by the Ministry of Industry and the association of both the Indonesian Textile Association (API) and the Indonesian Synthetic Fiber Producers Association (APSyFI) began to make efforts to re-excite the business. Because if this situation continues it will disrupt the upstream sector of the business is the manufacture of thread, which would result in over-supply conditions that could threaten the survival of some companies.


Raise the grade of cloth-making industry follower to a trend setter is an effective way to tie competitiveness. Only way is not as easy as textile machinery restructuring program as it has done since 2007. Cloth-making industry makes us become a trend setter needed strong RnD institution and the quality of human resources (HR) qualified researchers who are able to read trends and business products.


If the cloth-making industry we can take a $ 1.5 billion class then we can switch into a trade surplus, garment industry will be energized for a faster delivery time, industrial manufacture of yarn and man-made fibers will grow because the product can be fully absorbed by the industry in the downstream .


As for the local businesses in the fashion industry, must begin the major project collaborations upstream-downstream from the retailer to the manufacturer or even fabric to yarn manufacturers and fiber producers in order to create a local fashion brands are able to master and play a role at least in the region of Southeast Asia.


For industrial textile products is still required strength RnD institutions because of this type of product is very difficult to obtain quickly even if we could afford the technology through machinery.


indonesia export target


For it is necessary that we rise to the class of the industry trend setter that does not rely on price competition so that the future of the textile industry can continue to compete on the world market and continue to contribute to the national economy. (Writen by Redma Gita Wirawasta)




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