The 19th Istanbul Apparel Conference, organised by the Turkish Clothing Manufacturers’ Association (TGSD) under the theme “Redefining Value: Made in Türkiye”, took place in Istanbul on 13 October 2026. According to Turkish daily Ekonomim on 14 October, TGSD co-chair Toygar Narbay and TÜSİAD chief economist Gizem Öztok Altınsaç reviewed the cost, profitability and financing outlook for textiles and ready-made garments.
Narbay said the sector had been under heavy pressure for three years, describing it as a prolonged storm. Over the period he assessed, wages rose 11.3-fold, inflation 9-fold, financing costs 3.7-fold and the exchange rate 6.5-fold, while dollar-denominated costs increased by about 30%.
Margins eroded by financing costs
Financing expenses have eroded operating profit by 130% in textiles and 86% in apparel, Narbay said. He argued that a firm needs an EBITDA margin of 13.5% simply to preserve capital, versus about 3.6% for international peers — leaving Turkish producers roughly 10 percentage points behind each morning.
Between 2022 and 2025, selling prices rose 13% while production volumes fell 21%. Profitability stood at minus 0.6% in textiles and 2.3% in apparel, close to zero when the two are combined. Raising unit value by shrinking volume alone, he warned, breaks scale economies; both volume and value need to be protected.
Nearshoring, speed and cash discipline
Altınsaç said Türkiye’s proximity advantage in Europe is starting to erode and that a prospective free-trade deal with India could add further pressure. She does not expect a radical shift in the central bank’s FX policy, but sees gradual rate cuts easing financing costs by 2027. She flagged a tougher final quarter of 2026 and advised companies to stay liquid for the next six to seven months.
McKinsey apparel global leader Gemma D’Auria told the conference that brands now look beyond price to speed, flexibility and resilient supply chains. Small-batch production and fast delivery cut inventory risk; 3D design can shorten sampling by four to six weeks.
What brands and manufacturers should take away
- Build FX-linked cost inflation and longer financing cycles into order planning
- Shorten sample-to-bulk cycles to meet speed and flexibility demands
- Pair volume defence with design and embellishment choices that lift unit value
TGSD co-chair Dr Ümit Özüren stressed Türkiye’s full-chain production capability and proximity to Europe, arguing that the speed of turning knowledge into production will decide competitive strength.
This article was summarised and commented on by the LTS Frekans editorial team, drawing on the source article.
