School campaign with losses for the fourth consecutive year

This year’s school campaign would not bring the long-awaited reactivation for the textile mypes of Gamarra, the most important commercial emporium in Peru.

And it is that, according to the National Union of Textile Entrepreneurs (Unete), the paralysis of economic activities in some regions after the road blockade puts the school clothing market in check, where Gamarra covers 80% of the national chain.

“We see the demand as complicated. Since the use of uniforms is not mandatory, due to the heat the children wear shorts and a polo shirt. The demand for uniforms would only pick up in May and June, but our production will drop to 30%,” commented to La República the president of Join-GamarraJose Luis Munoz.

Far from bankrupt, but with the noose around his neck

Edward Raymundo, president of the Federation of Businessmen of Gamarra (Fedegama), acknowledges that, despite the ravages of the coronavirus, the sociopolitical crisis and inflation, it is irresponsible to ensure that “Gamarra is bankrupt”; however, it is urgent to improve market conditions, such as applying safeguards to imported garments and facilitating access to credit.

A school campaign in normal times allowed the conglomerate to obtain up to S/30 million, but now it recognizes that they expect to move only half.

“A standard polyester pants for a schoolboy, on average, cost S/40 and a short-sleeved white shirt did not exceed S/20. Now a pair of pants would go up to S/50 and a shirt up to S/20 due to the higher cost of raw materials”, Raymond adds.

In this sense, the Gamarra stores will finish off the garments of the summer season with up to a 60% discount to survive, “since the year-end and summer campaigns have been completely affected” by the sociopolitical crisis, according to Susana Saldaña, president of the Gamarra Peru Association.

With this clothing liquidation they seek to recover capital for the Mother’s Day and autumn-winter campaign.

What do textile mypes expect?

Raymundo warns that there are approximately 900,000 mypes from Gamarra that, despite the unfair competition against Asian clothing, are still standing. In this regard, the Multisectoral Commission of the Executive Power needs to determine if the tariffs on these garments that enter at tiny prices will be raised.