African fabric offering new opportunities for textiles buyers

Though China has long been the go-to location for sourcing of fabrics and textiles, East African countries are gradually becoming strong players in the market. Kenya and Ethiopia specifically are now two of the best destinations for textile and apparel sourcing in East Africa, and have the potential to be serious players in the global market. Here are five reasons why Kenya and Ethiopia may soon change sourcing practices for the textile and apparel industry worldwide, driving the market for African fabric:

 

  1. Lower costs: For companies interested in African fabric production, both Kenya and Ethiopia offer cost reduction opportunities. Wages for textile workers in Ethiopia are some of the lowest in the world at a maximum of roughly USD 60 per month. Labour costs for workers in Kenya are higher but still fairly low at roughly USD 120-150 per month, due to the level of development of Kenya’s economy. Ethiopia’s electricity prices are competitive compared to Kenya’s, but Kenya’s electricity supply is more reliable and stable, which reduces overall production times and obstacles.

 

  1. Supportive government initiatives: The Kenyan government is working to lower electricity costs to foster investment in and lower costs for textile mills. Additionally, the textile and apparel industry is on the government’s list of focus industries that it expects will drive industrialization in Kenya as part of the Kenya Vision 2030 program. The Kenyan government is also lobbying for changes to the African Growth and Opportunity Act (AGOA) to extend the period that preferential trade windows remain open. Ethiopia has not benefited from the implementation of the AGOA; instead, its government formed industry and development partnerships with Turkey and Germany. The government has launched numerous additional initiatives to attract investors and support the textile and apparel industry, and the industry is considered a priority sector under Ethiopia’s current five-year Growth and Transformation Plan.

 

  1. Geographic benefits: The climates and landscapes of these East African countries makes them especially good options for cultivating materials used in African fabric and apparel production. Ethiopia, for example, has approximately 3.5 million hectares of land suitable for cotton cultivation. The majority of this land (approximately 90%) is at present unused, and most of the cotton used in Ethiopia’s textile industry is imported from other countries, which presents a significant, low-competition opportunity to companies that are able to properly utilize this land for cultivation efforts.

 

  1. High availability of workforce: The availability of workers in Kenya and Ethiopia is very high. Ethiopia has the second-highest population in Africa, and its large workforce has allowed the country to establish itself as a reliable producer of basic, large-volume orders of fabrics and textiles. According to McKinsey & Company, t-shirts account for 46% and trousers account for 31% of all clothing sourced from Ethiopia. The scenario is similar in Kenya, where trousers alone account for 58% of all clothing sourced from the country.

 

  1. High production levels: The typical minimum order size in Kenya is 10,000 pieces, with larger players in the country accustomed to order sizes of 25,000 to 50,000 pieces. This high production of fabrics and textiles is in part due to its large workforce, but has also been influenced by past business interactions with many European buyers, who manufacturers—especially those in Kenya—perceive as more demanding in terms of order size and adherence to lead times. African textile suppliers have become accustomed to large order sizes and are able to produce them quickly and efficiently.

 

There may never be a ‘next China’ in terms of fabric sourcing, but African fabric producers can definitely absorb the majority of the market that’s leaving China. Countries like Kenya and Ethiopia offer significant benefits in terms of cost reduction, cultivation opportunities, and future development. Investing in and working with East African textile suppliers and textile mills in these countries now, in the early stages, will benefit companies in the long run as development continues.

 

If you’re looking for business partners, whether in the fabrics and textiles industry or elsewhere, BizVibe has you covered. BizVibe is home to over 140,000 textiles companies and over 7 million companies across all industries. Register today and connect with thousands of suppliers, manufacturers, potential customers, and more from around the world.

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