NATIONAL: Australian fashion companies have scored close to $11 million in export development grants for the 2008/09 year, with the highest average grant total across all industry sectors.
Data released by the Australian Trade Commission showed that grants for all industry sectors grew to $180,690,982 in the 2008/09 application cycle, with $10,606,797 of that going to fashion businesses.
While the average grant for all sectors was $44,892 the fashion industry average was substantially higher at $52,250.
The Export Market Development Grant (EMDG) is targeted at small to medium Australian companies looking to launch or expand their brand internationally.
The federal government scheme reimburses up to 50 per cent of eligible export expenses above a threshold of $10,000. This includes costs associated with showing at international trade fairs, marketing activities, meetings and private buyer viewings.
According to information business firm IBISWorld, fashion clothing exports grew by a solid 15 per cent during the year as international retailers capitalised on the weaker dollar. However, industry analyst Raghu Rajakumar said declines were expected for 2009/10 due to the booming Australian dollar.
“The combination of increasingly expensive Australian products, and the likelihood of further increases in the dollar – there is the chance of the dollar reaching parity or equality with the US dollar – mean that international customers are incredibly reluctant to enter into medium- to long-term contracts with any Australian providers, and probably won’t until interest rates in the US start rising,” he said.
This hasn’t deterred urbanwear label Zanerobe, which has just released an exclusive suiting range for department store David Jones, from continuing its assault on the US and European market. Director Leith Testoni has been successful in securing several grants for trade fair initiatives at Bread & Butter (Europe) and Project (USA).
Testoni will again exhibit at both fairs in 2010, having attracted major clients Nordstrom, Saks, House of Fraser and Selfridges as a result of previous showings.
“My aim is for Zanerobe to be in all doors of Saks and [Nordstrom] within the next six months,” he said, adding the next major product drop for the US market was scheduled for February, 2010. “There’s so many brands competing in the international market, particularly in the US, that you really have to be there at these trade shows to market your brand at every possible angle.”
Testoni said regular showcases would be close to “impossible” without government funding, with brands spending upwards of $60,000 to $100,000 for a solid trade show presence.
“It takes quite an investment to not only take part in the shows but ensure you present the brand in the most professional way possible,” he said. “We’re committed to being there, building our own stand and shop fit and getting as many marketing elements happening as possible.”
Of the 222 fashion businesses that lodged export development grant applications for 2008/09, only 19 were unsuccessful. The government allocated an extra $50 million to the scheme in its 2009 budget, bringing the total allocation to $200 million.
Assia Benmedjdoub