Focus Issue

Clothing and Textiles

Research Journal

Responding to the 2021, Vol. 39(2) 157-172

ª 2021 ITAA
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DOI: 10.1177/0887302X21994207
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of the Global Clothing

and Textile Value Chain

Li Zhao1 and Kihyung Kim2

Abstract
The COVID-19 pandemic has created lots of uncertainties that force clothing and textile (C&T)
companies to question their current practices and make urgent changes to navigate their future.
Given that this period represents an unprecedented market situation with almost no prior research
on how an industry can recover from such a crisis and reshape its value chain, this study aims to
present new possibilities with C&T value chain by evaluating specific industry responses. The global
value chain framework and resource-based theory of the firm were used as the theoretical
framework in this study. Based on case study analysis and extensive literature review, this study
develops a conceptual model illustrating the connections among various value chain segments in
C&T that have been affected due to the COVID-19 pandemic. The findings provide actionable
considerations for C&T practitioners when implementing appropriate strategies during times of
crisis, such as the COVID-19 outbreak.

Keywords
global value chain, COVID-19, clothing and textile industry

The COVID-19 pandemic has created lots of uncertainties that force clothing and textile (C&T)
companies to question their current practices and make urgent changes to navigate their future.
Survival and growth strategies are required to address (1) how to design and develop products that
provide value to customers during the pandemic crisis, (2) how to strategize sourcing and manu-
facturing practices, (3) how to distribute the products to customers efficiently, (4) how to adjust
operations to fit the post-pandemic “new normal,” (5) how to react to the shift in consumption
patterns and adapt to market changes, and (6) how to find external supports and achieve

1
Textile and Apparel Management, University of Missouri, Columbia, MO, USA
2
The Trulaske College of Business, University of Missouri, Columbia, MO, USA

Corresponding Author:
Li Zhao, Textile and Apparel Management, University of Missouri, 137 Stanley Hall, Columbia, MO 65211, USA.
Email: zhaol1@missouri.edu
158 Clothing and Textiles Research Journal 39(2)

sustainability goals. Based on the global value chain (GVC) framework and the resource-based view
(RBV), this research proposes a conceptual model for the C&T industry to survive amidst the
outbreak of a contagious respiratory disease and explore unique growth opportunities. To discuss
and develop implementable strategies, we employ an in-depth qualitative content analysis and case
studies by incorporating perspectives from diverse leading firms and organizations in the C&T and
health care sectors.
Severe Acute Respiratory Syndrome Corona Virus 2 (SARS-CoV-2) causes the infectious
COVID-19 disease. The virus is highly contagious and transmitted through respiratory droplets and
aerosol (Howard et al., 2021). COVID-19 first hit China in late December of 2019 and has since
spread around the world. Effective treatments for the disease are few, and vaccines are not widely
available as of the date of this research. To control the COVID-19 pandemic, governments advise
social distancing and the wearing of personal protective equipment (PPE), and in some cases impose
lockdowns of businesses and social activities (Centers for Disease Control and Prevention [CDC],
2020). The COVID-19 pandemic significantly disrupts the C&T industry supply chain. According to
a report from the International Textile Manufacturers Federation (ITMF), average orders and
expected turnover were down by 42% and 32%, respectively, between May 20 and June 8, 2020
(ITMF, 2020). Top executives predict that U.S. fashion sales could decline by more than 50% this
year due to the COVID-19 pandemic (Freeman, 2020).
Industry practitioners and researchers say that this pandemic will not only affect the industry in
the near future but may also have a long-term impact (Lu, 2020). This period represents an extraor-
dinary market situation with almost no prior research on how an industry can recover from such a
crisis and reshape its value chain. It is, therefore, important to systematically reevaluate current
strategies in the GVC and RBV to improve the C&T industry’s emergency strategy. The GVC
describes the people and activities involved in the global supply chain including manufacturing,
distribution, logistics, and post-sales activities across geographies (Ponte et al., 2019). By taking the
GVC perspective, we can achieve a comprehensive understanding of the crisis and avoid partial
solutions to deal with the emergency. The RBV states that acquiring unique, costly-to-copy, and rare
resources enables firms to achieve sustainable competitive advantages (Barney, 1991). The RBV
provides insights for identifying which resources to procure and produce during and after the
pandemic. Grounded in the two theories, GVC and RBV, the goal of this research was to create a
new conceptual model after exploring recently published academic papers, industrial magazine
articles, and consulting firm reports. Then we enhanced our model’s implementability by including
industry practitioners’ experiences and insights through case studies. This study provides both
theoretical and managerial contributions, which can open up a dialogue window for the academia
and the industry to continue discussing best practices and strategies to handle challenges and seek
opportunities in the global C&T value chain.

Literature Review
Major Impacts of COVID-19 on the Clothing and Textile Industry
Given the essential features of this global pandemic, several major impacts have been observed in
the C&T industry. First, disruptions within the global C&T supply chain have created many complex
problems. When the world’s largest textile and apparel producer, China, was first hit by COVID-19,
the strict lockdown caused delays in the manufacturing supply chain. These delays have been
especially challenging for C&T companies because most fashion products are seasonal items. Then,
when the virus was detected in most countries around the world by March, massive order cancella-
tions or postponements affected vendors in China, Bangladesh, and India (ITMF, 2020). Even C&T
companies that have restarted their operations in China or South Korea still face multiple problems
Zhao and Kim 159

in connection with the supply chain, such as a labor shortage, shortages of textile raw materials, and
a substantial cost increase in shipping and logistics (Lu, 2020).
Second, the lack of consumer demand or the fear that demand will drop significantly have
severely damaged regular business operations. Although many countries have reopened physical
retail stores that traditionally contribute 80% of the transactions in the fashion industry (McIntosh,
2020), consumers are still afraid of virus-spreading crowds and try to avoid in-person contact. As
everyone’s focus has been on purchasing essential items to survive during the lockdown, fashion has
become an afterthought (McIntosh, 2020). In addition, due to travel restrictions, fashion consumers
are not able to make big-ticket purchases in fashion capitals, where the luxury industry has suffered
the most (Business of Fashion, 2020a). Third, the lack of crisis management or flexible planning
makes it exceedingly difficult for many companies to secure liquidity during this crisis (ITMF,
2020). With order cancellations, delayed payment, store rental costs, and many other unpredictable
expenses, companies are having a hard time staying financially afloat and find themselves without
effective backup plans.

The Global Value Chain Framework

In this study, the GVC framework is the main theory to comprehend complex issues in the C&T
industry in the shadow of the global pandemic. The GVC framework is useful to interpret the major
practices of creating and distributing economic, social and environmental values from a holistic
view (Gereffi, 2020). Relying on the comprehensive and systematic work of Ponte et al. (2019), this
section focuses on the relevant part of GVC to our work. The GVC framework involves two main
parts: value chain mapping and analysis (Gereffi & Kaplinsky, 2001).
Value chain mapping focuses on geographical analysis in the supply chain. In the C&T industry,
the supply chain is fragmented. For example, 97% of clothes sold in the United States are sewn
abroad and imported. Fibers are produced in India and yarns spun in China; fabrics are woven or
knitted in Mexico before the final garment is sewn and shipped across continents (Ha-Brookshire,
2017). Hence, the health and economic impacts of COVID-19 influence the whole C&T industry
through the international GVC. It means that survival and growth strategies should consider the
interdependency of the C&T industry’s value creation.
Value chain analysis emphasizes dynamic factors such as governance, institutions and interfirm
relationships. Leading firms play critical roles in the GVC as they contribute 80% of all world trade
(Strange, 2020) and connect international and domestic markets (Gereffi & Memedovic, 2003).
Moreover, the leading firms are frontiers in research and development. According to the World
Investment Report (United Nations, 2020), the top 5,000 international lead firms in the C&T
industry expect revenue to drop by 40% on average due to COVID-19. It is important to understand
the leading firms’ strategies against the COVID-19 pandemic because of their significant influence
over the C&T GVC.
Scholars have analyzed the C&T value chain and proposed five main segments, including “raw
material supply, provision of components, production networks, export channels, and marketing
networks at the retail level” (Gereffi & Memedovic, 2003, p. 4). A schema was further proposed to
point out six value-adding stages in the textile and apparel value chain: “(1) research and develop-
ment, (2) design, (3) production, (4) logistics (purchasing and distribution), (5) marketing and
branding, and (6) services” (Fernandez-Stark et al., 2011, p. 16). This provides a great angle from
which to understand dynamic changes and recategorize GVC in the global C&T industry due to the
COVID-19 pandemic. By analyzing leading firms and major value-added activities across different
countries, the GVC framework can be an effective tool to assess opportunities for growth and
development at both country and firm levels that connect international businesses. In this study,
based on the characteristics of the C&T product/industry, we categorized the main stages of the C&T
160 Clothing and Textiles Research Journal 39(2)

GVC and identified leading players participating in the C&T GVC during this pandemic. Then, we
presented an analysis to show significant bottlenecks as well as business strategies.

Resource-Based View
Firms can generate and maintain superior long-term performance by possessing unique, valuable,
and hard-to-imitate resources (Barney, 1991). In the C&T industry, the RBV provides insights for
new venture success (Zhao & Ha-Brookshire, 2014), manufacturing flexibilities and supply chain
agility (Chan et al., 2017), e-commerce and e-supply chain resources and capabilities (Mola et al.,
2020), and sustainable development and dynamic capabilities (Da Giau et al., 2020). In the general
management context, Queiroz et al. (2020) provide a systematic review of valuable resources to
consider during the COVID-19 pandemic based on disaster management principles. The valuable
resources include abilities to innovate products, operational flexibilities, timely and accurate infor-
mation, and sustainability. Our study is based on the RBV because the framework points out
resources for survival and growth strategies that are valuable for the C&T industry.
Our model complements the GVC with RBV to systematically address the challenges and
opportunities for C&T businesses in the COVID-19 era. The RBV identifies what are the valuable
resources that a C&T company should acquire during the crisis. The RBV is also useful for the C&T
industry to find what to produce to create value for other stakeholders. To make the acquisition and
production possible, we need to understand the GVC in a crisis. We believe the integration of the
GVC and RBV forms an essential theoretical background for the C&T industry’s strategy to respond
to COVID-19.

Research Method
The COVID-19 pandemic is a rare event that we all are currently experiencing. As with other
industries, the pandemic is forcing changes to the C&T industry within its real-world context. To
explain these changes, an extensive literature review with qualitative content analysis was conducted
first to provide a foundation to map key topics in our conceptual model. Then a case study was
conducted to provide a timely and deeper understanding of the COVID-19 pandemic effects with
respect to the appropriate and contemporary context of the C&T industry.

Sampling Method and Data Collection

To address research questions, a qualitative content analysis was used to categorize and summarize
emerging trends and topics in the C&T industry under the shadow of COVID-19 (Mayring, 2004).
Data sources include recently published academic papers, industrial magazine articles (Just-style,
Business of Fashion, etc.), consulting firms’ reports (BCG, McKinsey & Company, etc.), and
government or organization documents (ITMF, United Nations, etc.). In total, approximately 100
articles and reports were included in our review for content analysis.
After setting the groundwork, a case study was conducted to provide diverse perspectives and
enhance our model. Diverse cases were chosen to offer a good range of variation (Seawright &
Gerring, 2008). After receiving approval from the University Institutional Review Board, four cases
and five participants were identified for this study through the authors’ personal network. All cases
were leading firms or key members in responding to this public health emergency and were able to
provide valuable insights related to the global C&T value chain. Due to the challenging nature of
identifying qualified participants, it is possible with a small number of cases to achieve sufficient
validity of results (Yin, 2017).
Zhao and Kim 161

Table 1. Descriptive Information of Cases and Sample Questions.

Case No. (Location) Business Types Sample Questions

Company A (China) Underwear
Participant 1 (P1)
General Manager
Company B (USA)
Participant 2 (P2)
President
Company C (China)
China Participant 3 (P3)
Marketing Manager
Organization D (USA)
Participant 4 and 5 (P4 and 5)
Director of Supply Chain
Director of Strategic Planning
Can you describe the impact of COVID-19 and how
Manufacture, your company responded?
Wholesale, Retail How did your company convert its production line to
make PPEs?
What are current challenges and opportunities for
C&T industry? What are your company’s plans in
the new normal?
Clothing Wholesale, How does COVID-19 affect the global C&T supply
Retail chain?
How have most C&T companies reacted to this
pandemic? Any action plans?
What key resources are which helpful for C&T
companies to fight COVID-19?
Non-woven Fabrics, What is the current demand and supply situation of
PPE Manufacture PPE products worldwide?
For C&T companies to participate in PPE business,
what are some barriers and the profit outlook?
Any recommendations for investing in different
levels of PPE?
Health Care Can you describe the current state of PPE supply?
How do you coordinate available resources of
PPEs during this pandemic?
For C&T companies who make and sell medical or
non-medical PPEs, what are challenges or
concerns? How can C&T companies contribute to
the fight against COVID-19 and help the
community?

Data were collected in July 2020 through semi-structured interviews by phone or online confer-
ence tools. Each interview lasted 40–60 min. All interviews were recorded, transcribed, and then
translated, if needed, to avoid loss of information. The data collected in the interviews were trian-
gulated with documentary information from internal company information such as product catalogs,
company brochures, or information available on the internet. Table 1 lists descriptive information
for each case and sample interview questions.

Case Introduction and Data Analysis

Company A is a knitted underwear company with experience of coping with challenges during the
pandemic and quickly revitalizing operations when the crisis was brought under control (the new
normal). While Company A has been actively seeking opportunities in making PPE, its main under-
wear business has changed in many aspects due to the impact of COVID-19. Company B is a
wholesaler and retailer based in New York City. It offers a portfolio of premium global brands of
apparel and accessories through multiple distribution channels. Company B was selected to exhibit
how a global fashion company has addressed the disruption of the supply chain and managed
omnichannel retailing in the global market.
Company C is a non-woven fabric producer that has participated in full-stream PPE manufac-
turing during the pandemic. It provides valuable insights for the PPE supply chain worldwide, which
helps C&T companies who want to tackle new business opportunities in the PPE business.
162 Clothing and Textiles Research Journal 39(2)

Organization D is an academic health system located in the Midwest region of the United States. It
has been working with C&T professionals to source or produce different levels of masks to help
ensure community health. The inputs offer valuable insights into not only the global sourcing of PPE
products but also how to engage the local community, given the capacity to make PPE during the
COVID-19 pandemic.
Following the guide of GVC and RBV and using the initial themes from qualitative content
analysis, we developed the initial codes and general ideas from the transcribed interview data of
the case studies. We employed three rounds of data iterative process by referring back to the
theoretical framework and research questions to synthetize and restructure codes to generate
theme development (Srivastava & Hopwood, 2009). A conceptual model was developed to illus-
trate practices and strategies in the global C&T value chain, as well as envisage the new normal in
the post-COVID-19 era.

Findings
Considering industry domains previously discussed by Ha-Brookshire and Hawley (2013) and the
most important value-adding stages in the C&T value chain introduced by Fernandez-Stark et al.
(2011), we reorganized the global C&T value chain into three major components by using GVC
mapping methodology: (1) Design and Product Development, (2) Sourcing and Manufacturing, and
(3) Wholesale/Retail Distribution and Consumers. We discussed current changes in the global C&T
value chain and strategies that companies are using in each stage. Then, two main topics, external
relations and sustainability, were highlighted throughout the C&T value chain. A discussion of the
new normal was then introduced to explore action plans and new directions. The conceptual model is
shown in Figure 1. See Table 2 for direct quotes from interview participants.

Design and Product Development

Product innovation is key to new market opportunities for C&T companies, especially in the PPE
business. During the pandemic, many brands have designed various masks, from embellished
couture masks to masks with customized prints (Rabimov, 2020). For example, the Chinese brand
Cosmo Lady capitalized on a niche product concept. The company developed an antibacterial
intimate wear line to meet consumer demand for health and safety (Business of Fashion, 2020a).
Some companies have also designed new fabrics and garments with protective features to address
consumers’ concerns about their health.
Company A has taken advantage of its design capability and unique fabric to differentiate its
masks in the market to meet both the aesthetic and functional needs of consumers. With the
experience of making masks for SARS in 2003, Company A quickly began PPE production in
February by using its idled sewing capability. As a knitted underwear company, Company A utilized
its patented fabric and created a special mask with four layers. The mask provides good protection
and was assigned for use by government agencies and schools. To expand its PPE business, Com-
pany A then acquired a license to make medical supplies and invested in 10 automatic production
lines in April to explore opportunities in both domestic and international markets. It recently
developed a new mask brand, introducing the concept of “Have a good week” with eight colors
of masks for consumers to use based on their mood. Masks become not just a health protector but a
fashion accessory. At the same time, their underwear products also stand out in the market and are
welcomed by consumers, with antibacterial fabrics made from seaweed fiber and other newly added
health features.
Assortment plans must be adopted in terms of timing, season, and location to consider both on-
hand inventory, confirmed arrivals, and future plans. Fashion is very dependent upon seasonal
Zhao and Kim 163

Table 2. Selected Quotes From Interview Participants of Case Study.

Themes Quotes From Participants

Design & Product “Face masks are viewed as a new fashion accessory now. Consumers want to
development showcase their individual style through this new fashion item. With our patented
fabric and innovative designs, our new masks really stand out in the market. Our
underwear products with antibacterial fabric are also very popular now.” (P1)
“Due to COVID, consumers want cozy pieces to wear at home. Our brands are
street style, so most products are casual and comfortable which consumers need.
We plan to include more of such products in the future. Brands have to adjust
their assortment plan if their current products can’t fit the new lifestyle.” (P2)
Sourcing & “We worked hard to look for suppliers from Vietnam and other countries when
Manufacturing China was hit hard by the pandemic. However, with the worldwide travel
restriction, it’s impossible to visit and inspect the factory. Our brands are
premium brands with high quality. It’s very difficult to switch to other suppliers in
such a short period of time. Moving forward, we will continue searching for new
supply chain partners.” (P2)
“When I had to search for PPE vendors myself, most of them cannot offer reliable
information or product quality is not good. It was very challenging and time
consuming. If C&T companies wish to produce medical level masks, having an
expert to handle the quality and providing the certificate would be very
important.” (P4)
“Although we have been making non-woven fabrics for a long time, but making masks
is something new. With our existing global network, we completed all certificate
process and entered PPE business very quickly.” (P3)
“Since we have a strong sourcing network worldwide and many C&T manufactures
started making masks, I received requests to source masks. But I wasn’t able to
secure any orders due to quality and trade concerns.” (P2)
““I went to Texas and found it’s a good place to build an apparel factory. If you add up
the labor cost, rent, tax benefits, etc. it’s very competitive. However, the main
problem is the supporting facilities. Due to COVID, almost all buyers in New York
City want to bring manufacturing back. It may take some time, but we have to do
it.” (P2)
Wholesale & Retail “We have our loyal consumers, and they buy our products online when physical
Distribution stores are shut down. In China, it’s mainly through the T-mall flagship store. In the
US, we don’t have such a platform. We need to bring traffic to our own brand
websites from social media, or work with partners to strengthen online
promotion.” (P2)
“Consumers are more aware of their health and willing to purchase masks even after
COVID. We plan to develop more products with our unique seaweed fiber-
enriched fabric. Antibacterial function is our selling point.” (P1)
Sustainability “There were thousands of knitted apparel manufacturers before the pandemic in my
city. At least hundreds of them closed due to COVID-19. Workers lost their jobs.
Companies need to think about social responsibility” (P1)
External Relations “I appreciate that fashion educators and professionals are willing to help us sew
masks. I never thought this local network can be so strong. We need to build a PPE
network including C&T companies for future emergencies” (P5)

trends. However, with people working from home and the disruption of the supply chain, some
seasonal designs are less in demand or simply unavailable. According to Berg et al. (2020), there has
been a shift in customer demand represented by increased interest in loungewear, skincare, and
sports products, especially yoga wear. Companies may wish to develop more seasonless designs and
increase the portion of loungewear and sportswear in their assortment plan. Company B believes its
164 Clothing and Textiles Research Journal 39(2)

Design & Product development

• Product Innovaon
• Assortment Planning
• Minimal Designs and Repurpose Designs

Sourcing & Manufacturing

• Diversified Sourcing Strategy

• Risk management in Internaonal Trades
External
• Reshoring Manufacturing and Flexible Sustainability
Relaons in the
Capacity Plan
(Government/ Global
Local C&T
Community/ Value
Other Wholesale/Retail Distribuon
Chain
Organizaons)
• Reacng to Consumer’s Behavior Shi
• Digizaon of wholesale/Retail
• Awareness of PPE Consumpon

Taking the Resource-Based View

The New Normal
• Cross-funconal Collaboraon and Coordinaon
• Acceleraon of the Use of Digital
• Industry Consolidaon and SMEs

Figure 1. The conceptual model of practices and strategies implemented by the C&T industry in response to
the Covid19.

streetwear brands meet consumers’ need for cozy and casual pieces. However, for a premium down
jacket brand they own, P2 sees sales dropping as consumers spend less time on outdoor activities.
Company B plans to continue adjusting its assortment plan based on the locations of stores and
distribution channels around the world. By taking a demand-focused approach, retailers may con-
sider reducing the complexity of product categories and inventory levels, and being flexible with
their assortment strategy (Business of Fashion, 2020b).
Minimal Designs and Repurposed Designs might be the upcoming trend. The economic outlook
in a post-COVID world is unclear, but the great recession that has shown what fashion looks like
during hard times provides a reminder about minimal designs (Velasquez, 2020). With the high
global unemployment rate spikes, consumers may be less likely to spend on fashion and instead will
look for classic designs with longevity. Consumers may use their own inherent creativity to redesign
their current clothing pieces to not only save money but also have more variety. C&T companies
may wish to consider paying attention to minimal designs and engage consumers with redesign ideas
on social media or through some other online communities.
Zhao and Kim 165

Sourcing and Manufacturing

Sourcing Diversification has been viewed as an accelerating trend. Companies that rely on longer
lead times and have a limited sourcing base are uniquely vulnerable to the category’s discretionary
nature (Business of Fashion, 2020a). Company B was struggling with the disruption in its supply
chain. It had to explore other sourcing destinations when China was hit hard, but decisions were
difficult to make due to cost and quality concerns. Fashion companies in the United States typically
choose to source from multiple countries to reduce the risk and balance the needs for sourcing cost,
quality, speed, reliability and flexibility (Lu, 2020). It was found that most respondents in Lu’s
survey continue to diversify their sourcing destinations, with 42.1% currently sourcing from more
than 10 different countries or regions. At the same time, companies also try to consolidate their
sourcing bases and maintain core supply-chain partnerships. P3 also mentioned Company C’s
strategic plan from the suppliers’ perspective. With four manufacturing locations outside of China
(India, Malaysia, Germany, and the United States), Company C wishes to provide more onsite and
efficient services for their customers to reduce lead time and risks.
Uncertainties Related to International Trade may need more attention from C&T companies who
are interested in the PPE business. Hospitals and other organizations such as nursing homes that
faced a shortage of PPE when this crisis appeared had to search on their own for vendors. Many C&T
companies are eager to chase this opportunity. More than 100 textile and apparel companies used
their idled production facilities to mitigate the mass PPE shortage (Just-style, 2020). However, P4
expressed her concerns about the reliability of product information and quality when sourcing PPE.
When C&T companies enter the PPE market, it is critical to have the expertise necessary to ensure
high standards and quality, and to do the research on requirements from importing countries and
secure the appropriate licenses and certificates for different levels of PPE.
As Company B has a strong sourcing network in Asia among C&T manufacturers that started to
make PPE, P2 received many requests to source PPE for both medical and non-medical uses.
However, with quality concerns and certification issues related to importation, Company B was not
able to secure any PPE orders. Similarly, Company A experienced many challenges when it
expanded its production and started exporting PPE. It took the company more than 4 months to
acquire the required certification from the U.S. Food and Drug Administration. P1 highlighted the
fact that medical-level masks are the most profitable, but Company A lost out in the international
market due to the difficulty and delay in acquiring the necessary certificate. By contrast, Company C
had been a supplier for upstream production of PPE, but is new to the downstream mask business.
However, since Company C is familiar with international trade regulations and has many large
partners to help with the certification process, it was able to obtain all the required certificates
quickly and started exporting large numbers of masks. C&T companies must be wise in terms of
selecting the right time to enter the PPE market, making decisions about what type of mask they are
capable of producing and selling, and get familiar with trade policies and the certification process.
Reshoring Manufacturing and Flexible Capacity Plans are emerging topics in the fashion indus-
try. From this global trade disruption, C&T companies are realizing that the value chain must be
reinvented. Exploring near shoring opportunities to bring flexibility and autonomy to production is
extremely important. P2 once owned four overseas garment factories. She shared her experiences
about bringing manufacturing back to the United States. She believes that investing in apparel
manufacturing in the United States can be very attractive, but the lack of supporting facilities is
the biggest issue. In Lu’s report (2020), U.S. fashion companies now are more actively exploring
“Made in the USA” sourcing opportunities to improve agility and flexibility and reduce sourcing
risks. Approximately 25% of the respondents in the 2020 Fashion Industry Benchmarking Study
expect to somewhat increase sourcing locally in the United States in the next 2 years, which would
be the highest level since 2016.
166 Clothing and Textiles Research Journal 39(2)

Converting regular C&T production capacity to PPE production is an innovative idea. A flexible
capacity plan is mutually beneficial because the C&T industry can utilize the idled capacity,
allowing society to mitigate the PPE shortage. According to the U.S. National Council of Textile
Organizations (NCTO), C&T companies are “retooling production virtually overnight to produce
PPE products ranging from hospital gowns, face masks and shoe covers to scrubs” (Meyers, 2020).
P4 expressed the urgent need for reshoring the manufacturing of PPE and having flexible capacity
plans as well. However, when C&T companies participate in PPE production, currently it is difficult
to produce medical-grade masks if they do not have the melt-blown nonwoven fabric. This specialty
fabric is “made by a limited number of companies worldwide due to the high capital investment
required for heavy machinery” (Gereffi, 2020). In regard to the flexible capacity plan for PPE
reshoring, it is much more complex and requires the reinvention of the entire GVC. Efforts are
needed to coordinate with local hospitals, health-care organizations, the entire C&T production
chain, and federal agencies.

Wholesale/Retail Distribution and Consumers

The Shift in Consumption Patterns has forced fashion companies to adjust their strategies. As more
countries lift the lockdown orders and retail stores are gradually reopened, consumers have slowly
come to accept the reality of having to live with COVID-19. New consumption patterns are observed
in both the wholesale and retail sectors (Berg et al., 2020). As previously mentioned, design and
product development must reflect consumers’ new health concerns, changing needs due to working
from home, and reduced purchase intention for fashion items. Consumers have also changed their
shopping behavior for convenience and value. Many consumers have tried a new brand or first-time
shopped online during the crisis (Business of Fashion, 2020a). In terms of retail experience, con-
sumers are less interested in shopping in the physical environment and are more price conscious.
They prefer one-stop shopping and expect retailers to take necessary measures to ensure their safety
while shopping in stores. C&T companies have to increase their speed and responsiveness to adopt a
more fluid and dynamic approach to getting products into the hands of consumers.
Accelerating Digital Strategy and Transformation throughout the GVC may help to support
consumer shopping journeys. Both Company A and Company B have utilized online platforms to
promote their sales during COVID-19. Before COVID-19, Company A relied heavily on its offline
distributors, and 90% of sales came from physical stores. However, Company A now has been
forced to partner with its largest distributor to build its online portfolio to meet consumers’ new
demands. P2 also mentioned that the way of operating online businesses may vary in different
countries. Company B is actively seeking partners to bring traffic to its brand’s website. With more
stores having reopened in many countries, providing a seamless omnichannel experience is impor-
tant and requires manufacturers and retailers to shift from a crisis mode to a more fundamental
realignment of their portfolio and route-to-market strategy to reflect this. The digitization of whole-
sale has also been slowly implemented. Buyers are invited to attend virtual showrooms and use high-
resolution imagery and interactive user interfaces to review collections. Purchase orders can also be
completed online at the buyers’ convenience (Streets, 2020).
Increased Consumer Awareness of Healthy Lifestyles will impact companies’ decisions regarding
new investment in PPE (or related products). When Company A decided to make a large investment
in the mask production line, P1 viewed this as a long-term strategy. With the new mask brand, P1
believes this will not only bring profit to the company but also establish a unique brand image in this
niche market. Its main underwear products also emphasize product features that may benefit con-
sumers’ health. To respond to consumers’ changing lifestyles, both Company A and Company B
propose incorporating technology and “smart clothing” concepts into their new product and brand-
ing strategies. Linked back to other key stages in the C&T value chain, this trend may persuade more
Zhao and Kim 167

companies to make PPE investments or reshape their mindset about developing new products and
providing retail experiences.

Sustainability in the Global C&T Value Chain

The pandemic will reshape values around sustainability and wake up fashion consumers and com-
panies to focus on sustainability-related issues such as waste management, materialism, and irre-
sponsible business practices. Many developing countries that are popular sourcing destinations, such
as India and Indonesia, are facing great challenges as millions of workers have lost their jobs and
each country is having a hard time securing its position in the GVC (Business of Fashion, 2020a). In
Company A’s city, famous for knitted clothing manufacturing, hundreds of companies are closed
and many workers lost their jobs. According to a survey in April (Granskog et al., 2020), consumers
want fashion companies to act responsibly and incorporate social and environmental considerations
into their business practices. During this pandemic, the C&T industry has shown increased interest in
social responsibility by contributing to the global rapid response to the rising needs for PPE world-
wide (Meyers, 2020).
Throughout the global C&T value chain, companies may wish to position technology at the core
of sustainability initiatives and develop robust governance for sustainability. For design and product
development, incorporating 3D printing, eco-friendly design, and slow fashion may enhance sus-
tainability. In terms of sourcing and supply-chain management, the disruptions caused by COVID-
19 force fashion companies to develop a flexible production plan to mitigate epidemic and demand
risks (McMaster et al., 2020). Majumdar et al. (2020) showed the lack of equal negotiation power
from suppliers and unauthorized subcontracting of apparel manufacturing are responsible for viola-
tions in the “code of conduct” of social compliance during the COVID-19 pandemic. The authors
suggested that incorporating disruption risk sharing contracts will help to build a sustainable sour-
cing model in the post-COVID-19 period.
For retailers and consumers, increasing communication regarding supply chain transparency will
help consumers understand companies’ efforts towards sustainability. As more consumers are inter-
ested in durable and classic fashion products or keep the items they already have for longer, fast
fashion retailers must adopt changes to respond to consumers’ needs (Granskog et al., 2020). The
COVID-19 crisis could remind C&T companies of their commitments to sustainability and accel-
erate industry-wide changes.

External Relations With Government and the Local Community

Different rates of return on consumer confidence heavily rely on control of the pandemic, in which
the role of government support is key. However, there are more impacts that may directly connect to
the C&T industry. In many countries, governments have developed financial programs using loans,
grants, short-term work schemes, delayed tax payments, delayed social security payments, etc. to
support businesses. With its local government’s support, Company A was able to restart its mask
production in early February. The government helped coordinate the local demand and connect
Company A to those organizations that needed masks. The government also secured the supply of
key materials and provided health measures for workers to return to the factory. Similarly, in the
state of New York, the government offered $6.9 million for manufacturers to help alleviate product
shortages due to supply chain issues (Wightman-Stone, 2020). American fashion designer Christian
Siriano received $352,590 from this funding to make masks. For reshoring manufacturing, Company
B also emphasized the government support it received to provide a water treatment system essential
for its plan to invest in a new clothing factory in Texas.
168 Clothing and Textiles Research Journal 39(2)

Local community support has been ignored by companies during COVID-19 but can be a strong
tool for building local networks and reputations. P5 coordinated a sewing project to utilize some
local facilities (such as sewing machines and laser cutters) and volunteers to make thousands of cloth
masks for Organization D. With the media coverage and social media spread, this mask-sewing
project has been widely praised. However, although Organization D has been working with the C&T
field for other projects such as adaptive clothing and other medical supplies, P5 did not see the extent
to which the C&T industry can make positive contributions to health-care needs because of COVID-
19, and there is no organization that coordinates all the information or available resources. Fashion
companies may wish to proactively engage the local community’s services or events to build a
positive image and fulfill their commitments to social responsibilities.

The New Normal

The global C&T industry has to imagine and shape the new normal and proactively plan for new
challenges and opportunities. A GVC is dynamic in relation to its environments. Changes in the
value chain adjust the value of resources. Therefore, it is critical to be flexible in strategies (Priem &
Butler, 2001). At the time of this writing, the C&T industry is still struggling to acquire and maintain
valuable resources in the GVC to cope with the impact of COVID-19, as we have shown in the
previous section. However, it will be necessary to re-evaluate resources in the coming new normal
situations because the GVC will be different from what it was before or during the crisis.
For Company A, innovation and a patented fabric, a good relationship with the local government,
an agile supply chain, quick responsiveness, and decisive investments in digital channels were
valuable resources that helped the company overcome difficulties and identify new opportunities.
For Company B, robust branding and unique product positioning helped the company keep loyal
customers. Flexible retail networks both online and offline across geographics ensured profitability
even during this crisis. Strong sourcing capability in Asian countries guaranteed the flexibility of
orders to meet company demand. For Company C, having a strong global network with buyers from
130 countries and regions and being the top advanced polymer materials supplier in the world
allowed it to quickly align with downstream mask businesses, receive certificates from foreign
countries, and become one of the few mask makers capable of supply chain and quality control at
full capacity.
While C&T companies learn from cases and reconsider the resources they own, it is critical to
understand the changing environment and emerging trends. With in-depth analysis that has been
presented for each stage in our conceptual model, we emphasize the following three key tasks for the
C&T industry to adapt to the new normal situation.
First, key stages in the conceptual model will require cross-functional coordination and colla-
boration. Leadership and new operating models will be critical for fashion companies to succeed in
new circumstances. From accelerating the fashion cycle to integrating sustainable ingredients into
product design, and from manufacturing to merchandising, a variety of everyday activities requires
cross-functional coordination to achieve efficiency, effectiveness, and consistency across large,
complex supply chains. As the case of Company A shows, establishing a clear and quick certificate
approval system for PPE production helps C&T companies quickly join the medical supply chain
with their current manufacturing capacity. In general, this effort would require collaboration and
coordination among external networks, such as government and health-care professionals, third-
party inspection agencies, and factories. The capability of coordinating key functions in the entire
value chain would thus be an important resource for C&T companies.
Second, the crisis accelerated the adoption of digital technology throughout the value chain,
which has encouraged innovation and efficiency in every sector of the C&T industry. Industry
leaders believe that the significant changes and paradigm shifts that have emerged so far will
Zhao and Kim 169

continue even after the crisis (Berg et al., 2020). Although the digital revolution has been discussed
in the segment on retail and wholesale in our conceptual model, it is important to highlight that
digital escalation should be achieved throughout the value chain. A crisis demands boldness and
learning. Most fashion companies have been aware of digital trends even before COVID-19. From
personalized design, direct digital manufacturing, virtual trade shows, a smart supply chain, and e-
commerce to omnichannel, fashion companies know how to pilot new digital initiatives during
regular operating times. They have time, then, to test the market and wait for consumers to adjust
to new ways of shopping. However, the COVID-19 crisis has forced customers, employees, supply
chains, and all other stakeholders into digital channels and new ways of thinking. The best example
is how Company A quickly invested in an online business that it had hesitated to pursue for a long
time. According to Alibaba’s 2020 report regarding the development of consumer brands in China,
there are nearly 500 new brands that have sold more than 100 million RMB in the first quarter of
2020 since they opened stores on T-Mall (SinaFashion, 2020). WeChat also observed a 159% boost
in transaction volume for fashion brand mini-programs (Business of Fashion, 2020a). The current
crisis might be the precise moment to boldly adopt a new digital agenda, and fashion companies
have to make quick but careful decisions in the right directions.
Third, new questions are posited about industry consolidation and survival strategies for both
large and small C&T companies. Because the entry barriers are relatively low, there are many small
clothing factories and brand companies in the C&T industry. Small C&T companies are less likely to
survive due to the limited resources they possess. The C&T supply chain is very fragmented, with
many small businesses finding it increasingly difficult to compete. However, these companies
provide employment opportunities and contribute to the economy and innovation. The whole
industry’s efforts and policy measures are needed to provide assistance to these small businesses,
as well as to create long-term measures to ensure a rapid recovery. On the other hand, even among
large companies, merger and acquisition (M&A) activities have been more intensive. Many fashion
retailers in the United States filed for bankruptcy during the pandemic. Brooks Brothers is one that
was recently bought by the apparel-licensing firm Authentic Brands Group (Maheshwari, 2020).
Based on a recent report published by the Boston Consulting Group, there are plenty of opportunities
for acquiring healthy brands to enrich the current brand portfolio or to provide cash flow (Bianchi
et al., 2020). As companies now have urgent needs to diversify their sourcing partners or gain
competencies to enhance their digital agenda, M&A might be worth pursuing during this crisis.

Conclusions
Through a qualitative content analysis and case studies, this study provides the C&T industry with a
viable strategy to deal with the impacts of infectious diseases such as the COVID-19 outbreak. This
study provides valuable theoretical contributions. It systematically organized strategies into a con-
ceptual model based on the GVC framework. Our model identified important operations in the three
main stages of the C&T industry value chain. In addition, holding the RBV, we discussed how the
efficient integration of individual strategies in the C&T value chain requires external support,
especially from government and the local community. Sustainability is easy to overlook, but it is
an important value. We also emphasized the resilience of strategies for the coming new normal by
positing key resources in the GVC.
Our model provides managerial insights into how to overcome crises and adapt to the new normal
after the crises subside. Drawing from the most updated academic articles and industry reports, and
diverse cases, some actionable considerations can inspire C&T companies to explore their own
survival and growth strategies. Across different industry segments, distribution channels, and geo-
graphies, C&T companies have to seek unique opportunities, explore new operating models, and
provide more personalized experiences to each customer. In particular, this study pinpoints the
170 Clothing and Textiles Research Journal 39(2)

unique business opportunities in PPE and C&T products with health-related features. From manu-
facturing, sourcing, and exporting, to retailing, the benefits and risks in such investments were
demonstrated in this study. In addition, whether for making a profit or demonstrating corporate
social responsibility, the C&T industry is playing a critical role in global manufacturing strategy and
offers solutions to help contribute to the fight against the pandemic.

Limitations and Future Studies

We hope that our work will spur further discussion of the C&T industry’s risk and crisis manage-
ment strategy. The proposed conceptual model focuses on the three major segments and two core
areas of the global C&T value chain. However, limitations still exist in the dimensions not covered.
We recommend the following topics for further discussion. First, for academic research, it will be a
valuable task to develop a well-organized literature review that demonstrates an up-to-date under-
standing of the impacts of and responses to global disasters in different sectors in the C&T value
chain. From fabric science, manufacturing engineering, and supply-chain management, to retail
studies and fashion education, each area presents unique research questions that are waiting to be
answered. Second, extended qualitative studies will be valuable to enhance our understanding of
effective strategies for managing disaster situations. To learn from successes and mistakes, gathering
the inputs from different stakeholders, including investors, employees, influencers, and consumers,
is necessary. Third, quantitative empirical studies will verify the effectiveness of survival strategies
in a scientific manner. With the qualitative findings presented by this study, further empirical studies
may develop hypotheses to provide more tangible conclusions for C&T companies. As COVID-19 is
still an ongoing crisis, it is critical for C&T fields to keep an open mind in reshaping and reevaluat-
ing their current situation and proactively seeking new solutions.

Declaration of Conflicting Interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship, and/or pub-
lication of this article.

Funding
The author(s) received no financial support for the research, authorship, and/or publication of this article.

ORCID iDs
Li Zhao https://orcid.org/0000-0002-0552-1118
Kihyung Kim https://orcid.org/0000-0001-7928-8200

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Author Biographies
Li Zhao is an assistant professor in the Department of Textile and Apparel Management at the University of
Missouri. Her research interest is to improve interfunctional coordination in the global textile and apparel
supply chain through digital innovations. Her research is categorized as interdisciplinary in nature with aspects
of textile and apparel management, informatics and data science, and business studies.
Kihyung Kim is an assistant teaching professor in the Management Department at the Trulaske College of
Business, University of Missouri. His research interest lies in supply chain management where many companies
collaborate with and compete. By modeling supply chains from the game theoretic point of view, he delivers
managerial insights for corporations’ social responsibility, capital investment, and joint production.