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'We have one chance and this is it': UKFT chairman on Brexit

Nigel Lugg

UKFT chairman Nigel Lugg is determined to get the best Brexit deal for UK fashion. He is calling on the industry to speak as one to ensure the industry continues to grow.

Depending on who you speak to, Brexit could either threaten the recent renaissance of UK fashion manufacturing or be its biggest opportunity. For Nigel Lugg, chairman of the UK Fashion & Textile Association (UKFT), it is the latter – but only if the industry combines its forces.

“It’s a fabulous industry and growing: the opportunities are huge,” says Lugg. “[But] we have less than two years to negotiate a Brexit deal and, if we don’t get our act together, we’ll be in no man’s land.”

Two years through a three-year term at the helm of the UKFT, Lugg bears the weight of responsibility for protecting and nurturing the industry in the run-up to Brexit. UKFT represents 2,500 businesses throughout the fashion and textile supply chain, and many employ 10 or fewer people.

The association is urging the industry to come together to present a strong proposal to government that will ensure its long-term viability. It is in the process of forming a Brexit board made up of representatives from textile and garment manufacturers, brands, retailers and other stakeholders, with the aim of establishing a unified strategy to present to the government.

We have less than two years to negotiate a Brexit deal and, if we don’t get our act together, we’ll be in no man’s land

Lugg sees the Brexit negotiations as a unique situation that could position the UK manufacturing industry as significantly more attractive and competitive, based on speed to market, quality, flexibility and transparency. He believes it is also competitive on price when taking into account logistics and warehousing.

“I think we have one chance and this is it,” he explains, the passion evident in his voice.

Kate Hills, founder and chief executive of the Make it British British website, which promotes and provides information on UK manufacturing – and organises the Meet the Manufacturer trade show, which takes place in London this week – believes a united approach is critical in the textiles industry, which is full of small businesses: “If we don’t speak as one, we won’t get anything done – especially given how fragmented the industry is.”

One project the UKFT is exploring is the potential for a fashion manufacturing hub in London. Lugg is reluctant to reveal specific details, but describes it as a “one-stop shop to demonstrate what can be done”, which would act as a kind of shared workspace in a building that is fit for purpose, has its own pool of labour, and is backed by both public and private investment.

Screen shot 2017 05 25 at 10.25.31

Screen shot 2017 05 25 at 10.25.31

UKFT launched the High-End Manufacturers Database with the British Fashion Council in March

The scale of the scheme is still under debate, but Lugg sees it as a 2018 project and says it is a “dream that is becoming a reality”. If successful, it could be rolled out to other cities.

“There is a need for the manufacturing to come back,” he asserts. “If you’d asked me about four years ago if I believed in developing manufacturing in the UK [on a wider scale], I’d have asked if it was ever going to compete with Asia. But now, who knows? Besides, is mass manufacturing what anyone wants in the future?”

He shrugs and refers to the uncertainty around the currency market, as the weakness of sterling piles pressure on retailers’ margins, as well as the increased demand for smaller orders, quick response and fast repeats, driven by the growth of fast fashion.

As well as niche, high-value, quality production, there is also a growing UK trend towards individual styling and personalisation, led by businesses such as London-based knitting technology company Unmade, which won this year’s Drapers Digital Award for Best Use of Innovation.

“Do I think we’re going to take over a Nissan car plant and turn it into a garment business? No. But I do think the industry can grow significantly from here,” Lugg affirms.

Nigel Lugg 02

Nigel Lugg 02

Nigel Lugg at the Chester Barrie store at 19 Savile Row

Lugg’s take on the position of UKFT is an interesting one, given his day job as group chairman of Prominent Europe and Quantum, two suppliers to the UK high street that are owned by Japan-based Itochu Corporation. Prominent offers men’s shirts and suits, womenswear and casualwear to retailers such as House of Fraser, Marks & Spencer, John Lewis and Next, and has offices in Barcelona, Paris, Milan, London and Nottingham, importing goods mainly from Asia. It also owns the Chester Barrie brand and holds the menswear licence for Richard James. Quantum makes shirts, hosiery and intimates for retailers including M&S and has manufacturing plants in Sri Lanka, Cambodia and India.

‘Made in Britain’ is still very important in some sectors

Lugg has spent his career carefully navigating the relationship between suppliers and retailers. He started as a buyer at Liberty in 1974 and took a role at House of Fraser in 1979. He moved on to the supply side of the industry in 1990, when he became European chief executive of US fashion and textile corporation Warnaco Group.

In his current role he says he could start taking UK brands to Japan and other Asian countries because the appetite is there: “If I could get a pound for every time someone said ‘can you get me a UK-made product’, I’d be a very rich man. ‘Made in Britain’ is still very important in some sectors.”

UKFT is also picking up the baton from the Alliance Project and the Textiles Growth Programme, which last month announced the results of the four-year initiative. They demonstrated that a relatively small investment from government could be more than matched by private funding to create jobs and stimulate growth.

In 2012 the programme received £27m from the government’s Regional Growth Fund, and it attracted a further £123m from the  private sector through the support of 340 British manufacturers. The project created or safeguarded 4,450 manufacturing jobs and created 380 apprenticeships over its four-year lifetime, while the value of UK clothing and textile production increased by 2.5% to £9.1bn between 2014 and 2016.

“My message is that this is fantastic, but we need to do more of it,” says Lugg. “We need to create more jobs in the UK and we need to make the industry a better place. I feel passionately about growing skills and training because we are not doing enough. We need practical help, but we also need investment and money behind the industry.”

Skills shortage

Skills are a worry post-Brexit, as the UKFT estimates that a high proportion of the 105,000 people employed in UK manufacturing are from overseas. In London, where there are around 13,650 workers, it has been estimated that around 70% of the workforce is from the European Union, and a typical machinist’s salary will fall well below the £35,000 threshold needed to secure permanent residency.

As well as pushing for a new visa programme, the UKFT is focused on stimulating the development of home-grown skilled manufacturing talent by working on new training programmes with universities and businesses.

Nigel Lugg 03

Nigel Lugg 03

Nigel Lugg

With 12 employees, the UKFT is lean but “punches well above its weight”, says Lugg. Where relevant, he wants to collaborate more with other organisations, such as the British Fashion Council – they teamed up to launch the British High-End Manufacturers Database in March. He is proud to have moved the association back into the black in the last fiscal year, while increasing its membership: “We’ve made it fit for purpose, so now we can add a lot of value to UK companies, with a huge wealth of intelligence on exports and the industry.”

The UKFT is the biggest user of TAP (Tradeshow Access Programme) funding from the Department for International Trade, and controls a £650,000 pot that helped 650 firms attend trade shows such as Pitti Uomo, Première Vision and Paris Fashion Week last year. But Lugg says the association needs more support and funds to encourage export growth. He underlines that, in 2015, the Italian government spent $20m (£15.4m) promoting the Italian fashion industry in the US alone.

Nurturing talent

A project close to his heart is UKFT Rise, which was launched in 2012 to support the next generation to meet regularly and gain knowledge from key experts across the sector, and now boasts more than 1,000 members: “I get so much out of that because you can put something back into the industry and see the impact in front of your eyes,” he says.

Lugg also wants to take things further by improving the image of the garment manufacturing industry, which has been plagued by reports of bad practices and low pay: “We need a voice in government saying we need to sort out manufacturers that aren’t operating correctly. In terms of social responsibility, we need to get it right.”

£9.1bn of fashion and textiles are made in the UK and 74% of that is exported to the EU

He points out that the industry is not very good at promoting itself, despite its size: “When you look at the numbers, they are big: £9.1bn of fashion and textiles are made in the UK and 74% of that is exported to the EU, which is scary.”

Lorna Fitzsimons, founder and director of the Textiles Growth Programme, believes Lugg will be a brilliant negotiator with government, thanks to his international experience and his extensive knowledge of the trade: “I think he will give the industry as much weight as we’ve had in years. He’s somebody the industry needs to coalesce around because government has made it clear that they want one voice.”

Industry figures think that Lugg could be the right person to speak for and promote UK fashion.

Nick Bannerman, managing director for knitwear at Johnstons of Elgin, adds: “We certainly want our industry voice heard on any Brexit negotiations, and Nigel seems a very decent guy to be leading the UKFT view. We have significant exports to Europe and simple, easy free trade is vital to us.”

“I’m not trying to save the world,” insists Lugg. “I’m just saying that right now, I have the custodianship of the UKFT and it is my responsibility to shout and say, ‘Look, we have to put our strategy forward.’”

 

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