Cashmere yarn firm weathers epidemic challenge

Now that the novel coronavirus has caught global luxury apparel brands off guard, could their raw material suppliers cope with the stern challenge?

Consinee Group, which supplies cashmere yarn to leading labels, is poised to leverage the vast domestic market to weather the storm.

Overcoming the impact of COVID-19, the Chinese company from Ningbo, Zhejiang province, saw revenue inch up 6 percent year-onyear in the first half, fueled by robust growth of international brands in China and surging domestic demand for quality knitwear and apparel, said company chairman Xue Jingli.

"Despite overall lackluster performance, China has been bucking the trend to become a growth engine for a number of the luxury brands we are serving, which has offset the downward trend," said Xue.

In the case of Burberry, for example, the Chinese mainland grew in the mid-teens in the first quarter but surged ahead of the January pre-COVID-19 level of 30 percent in June, company figures showed.

Given that exports previously contributed almost 90 percent of Consinee's revenue, another critical growth pillar is to bank on a wealth of upscaling Chinese merchants and local fashion designers who are looking to upgrade their offerings to an increasingly demanding audience.

"As China embarks on the 'dual circulation' strategy, we believe it's important to sharpen our focus on the interplay between the domestic and international markets, and extend our experience and expertise serving global clients to empower local players," Xue said.

The central plank of that strategy is the inauguration of the Consinee Shanghai Center, located near the Hongqiao Railway Station, arguably Asia's largest transportation hub.

Xue called the facility a bridge bonding top designers and manufacturers through technology and know-how sharing, hosting industrial seminars, fashion shows and news conferences. He hoped the tie-up can help local producers take a page from the global playbook.

"As the only Asian participant and exhibitor of Italy's Pitti Filati (a world-renowned yarn and knitting trade fair), and member of the global luxury club, we hope to share our first-hand information on international luxury yarn trends with designers and industry professionals here and help them grow," he said.

To cater to the domestic market, it has set in motion a series of initiatives that include a cashmere yarn inventory service, a minimum order amount of one kilogram, three-week product delivery promise, and dedication to sustainable development by creating antibacterial cashmere yarn.

Automation is also at play. The company has just wrapped up building a fully digital intelligent unmanned factory developed in collaboration with Siemens.

"While we endeavor to create infinite possibilities from a thread of yarn, we are also showing the world our Eastern philosophy of diligence and civilization, where a major manufacturing nation is destined to become a manufacturing superpower."

Inspired by long-term optimism in China, the company even raised wages by an average 15 percent in July. It remained confident about the power of Chinese brands, not only the Consinee brand but its local clients aiming to move up the value chain.

"We've (Chinese companies) long positioned ourselves as a manufacturing hub," he said."The pandemic should have shown the world how the country is responding fast and efficiently to first realize business restoration. I'm confident the Chinese marques should have their glory post-crisis."