In the weaving industry, yarns pass through the weaving process to form cloths, which can be classified into knitted cloth, woven cloth and technical cloth. The main competitive advantage of Taiwan’s weaving industry includes developing products in small quantities, diversity and differentiation. In 2017, facing uncertainties in the global consumer market, and affected by the continuous transfer of production bases by Taiwanese companies to Southeast Asia, Taiwan’s cloth exports grew slightly by 1.13% from 2016, amounting to US$6.815 billion. In 2017, Taiwan’s cloth exports are divided into woven cloth, knitted cloth and technical cloths (such as dipping-coating cloth, towel terry, non-woven cloth and others): (1) Knitted cloths constituted 35% of total exports, with an export value of US$2.413 billion. (2) Woven cloths accounted for 30% of total exports, with an export value of US$2.04 billion. (3) Technical cloths formed 35% of total exports, with an export value of US$2.362 billion.
In 2017, Taiwan’s weaving industry faced the following challenges: (1) The significant appreciation of the New Taiwan dollar affected profitability after foreign exchange; (2) Brand customers’ procurement demand for products with short delivery time, products in small quantities, and diversified products continue to increase; (3) Labor shortage at grass-roots level continue to exist; (4) Upstream and downstream supply chains are gradually disintegrating, indicating that the industry is rapidly losing its advantage; (5) Production capacities and technical talents of Taiwanese cloth manufacturers are moving to Vietnam.
Taiwan’s functional cloth have always gained an advantage over its competitors with its ability to develop high-quality, diversified and differentiated products. In the future, the weaving industry will encounter many of the challenges above. The possible strategies to overcome these challenges include:
(1) moving toward the development of “Smart Manufacturing” and “Digital Plant”; (2) expanding the application range of functional cloths and gradually progressing toward the development of industrial functional apparel; (3) developing smart cloth materials.
In addition, Taiwan’s weaving industry undertake orders from customers who adopt procurement strategies involving the purchase of products in small quantities and with short delivery time, in order to reduce inventory risk. The regional supply chain for textiles and apparel formed by various Asian countries is getting more and more complete. Coupled with the New Southbound Policy and the purchasing trends of international buyers, Taiwan’s cloth manufacturers are gradually expanding into Southeast Asian countries, with Vietnam as the main venue for the textile cluster, and the major overseas location which Taiwanese cloth manufacturers are expanding into.