H1 Bankruptcies of Japanese Textile & Apparel Firms Increase in Number, But Liabilities Decrease

According to the Credit Exchange Agency Co., Ltd., the bankruptcies of textile- and apparel-related firms throughout Japan during January-June 2017 (liabilities of 10 million yen or over and including liquidation and internal reorganization) numbered 237 cases, up 15 cases or 6.8% compared to the first half of last year.

Liabilities amounted to 42,180 million yen (down 5,286 million yen or 11.1% from the year before). The liabilities continued to be on the 40-billion-yen level since the previous year, and during the last decade also were the lowest after 2013 and 2014.

Large-scale bankruptcies with liabilities of 1 billion yen or over numbered five cases, or four cases less than the year before.

By type of business, retailers accounted for 85 cases, or 35.9% of the total, and was followed by manufacturer-wholesalers of men’s, women’s and children’s wear (67 cases); manufacturer-wholesalers of knitted and miscellaneous goods (30 cases); other businesses (17 cases); fabric wholesalers (10 cases); dyeing, finishing and special processing companies (9 cases); manufacturer-wholesalers of bedding and interior goods (8 cases); manufacturer-wholesalers of Japanese traditional garments (6 cases); fabric manufacturers (3 cases); and wholesalers of textile fibers and yarns (2 cases).

In regard to bankruptcy factors, sagging business accounted for 206 cases or 86.9% of the total. There were 24 cases of bankruptcies caused by a sudden change in business situation, 3 cases by weak funds, 2 cases by bad debt losses, and 1 each for poor credit worthiness and excessive investments.

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