Pringle sale cramps style of cashmere
Hilary Clarke reports on the fears of Scottish producers of the luxury fibre
Sunday 19 September 1999
Edinburgh-based Dawson International hopes to cash in on the acquisitive appetites of international luxury goods companies like Gucci and LVMH by putting its ailing Pringle brand up for sale.
Dawson hopes the brand, which industry insiders say could now be worth as little as pounds 5m, will raise the necessary capital for it to invest in its other cashmere businesses. In fact, Dawson has been quietly winding down Pringle's cashmere products and the bulk of its sweaters are now in lamb's wool - although the fortunes of the famous diamond-patterned v-necks have also suffered.
Even so, manufacturers of cashmere knitwear around the Scottish border town of Hawick are concerned that the publicity surrounding Pringle's sale will cast a further cloud over smaller manufacturers of the luxury fibre.
This is despite a dramatic fall in the price of cashmere wool and the adoption of lines in the luxury wool by mid-market US international clothing retailers like The Gap and Banana Republic.
Scottish manufacturers have, along with cashmere goat farmers in the Third World, been hit by the recent trade spat between the European Union and the US. The US threatened to impose punitive trade sanctions on a series of European luxury goods items, including Scottish cashmere, because of a dispute over the EU's regime in the international trade of bananas. The industry has also suffered from the crisis in the Asian economies, which took a heavy toll on the luxury goods sector, and the rise in sterling, which has made British cashmere goods expensive in Europe.
"It is easy to tar Hawick with one brush, but in Hawick there are a number of companies which specialise in producing cashmere sweaters. Despite difficult market conditions and a strong pound, we, for one, are in good health," said David Sanderson, deputy managing director of the Hawick Cashmere Company, which makes sweaters for international designers such as Calvin Klein and Celine.
He said small specialist cashmere companies had gained an edge because they have adopted the latest knitting technology. The Hawick Cashmere Company has recently expanded its factory and has just opened a shop in Geneva.
Dawson wants to use the money raised from the Pringle sale to invest in its core cashmere businesses such as Ballantyne Cashmere and Barrie Knitwear. In the statement announcing the sale, Dawson said that while "market conditions throughout the cashmere chain of businesses remain challenging", cashmere prices should increase in the second half of the year.
This is because despairing cashmere goat farmers in China and Mongolia have been slaughtering their animals for meat, which in turn has led to a squeeze on supply.
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