Made in America Does Have Its Advantages
SANTA MONICA, Calif.—Apparel manufacturers that still make clothing in the Western Hemisphere have one thing in common.
They still believe that spending a few extra dollars on clothing with a fashion edge and a touch of quality will keep them in the black without going to Asia. It’s just a matter of having that hot item that flies off the shelves.
“Cost of goods is not the bad thing. It’s the quality of the brand,” said Dov Charney, chief executive of American Apparel, the 10-year-old company that employs about 5,000 people to make T-shirts, pants, dresses and underwear in a factory in the heart of downtown Los Angeles. “Take the iPod. Kids will pay another $20 for an iPod. Build quality into a product and make the design good and it will sell.”
Charney, a hyperactive apparel maker known for his contrarian views and off-the-wall statements, was speaking at the annual meeting of the American Apparel Producers’ Network, a group of garment makers and suppliers mostly based in North America and Central America. The topic at the March 11–13 meeting was: “How It’s Made in America(s).”
Charney said everyone is trying to figure out how to take advantage of free trade. But one thing is for sure. “Made-in- U.S.A. products are welcome almost everywhere,” he said.
He should know. He runs the largest garment factory in the United States as well as more than 140 retail stores around the world, from Mexico City to Tel Aviv. He does it while paying living wages and providing health-care plans. His workers make about $100 a day. The real cost of production, he noted, comes from developing a new product, which is usually done in the United States.
A few months ago, Charney started making blue jeans at his factory at a labor cost of about $5 a pant, which isn’t that much cheaper than a pant made in China, the executive observed, noting that there are indirect costs that some people don’t take into account when thinking about producing in Asia.
“Gap may make a pant for $3 overseas, but they have all these indirect costs of flying people back and forth to China who make $200,000 a year to check on things,” he said.
He said technology, such as cheaper telephone systems, faxes, computers and e-mails, have enabled companies to produce their goods in foreign countries where labor costs are cheaper. But it also makes it easier to sell our goods overseas, too.
There are a number of air freight companies that can whisk a product to Europe or Asia in a couple of days. In the United States, we have one of the best transportation infrastructures in the world. Here you can hop on the freeway in Los Angeles and drive non-stop to Jackson, Miss. You can’t crisscross the country via freeways in China.
“I can have a T-shirt done at my factory on Saturday and have it in a store in Amsterdam by Tuesday,” Charney observed. The cost of air freight may add a little to the retail price tag, but it doesn’t make the cost prohibitively expensive.
There are many manufacturers who concur with Charney’s outlook. Jeff Marine, president and chief executive of Jem Sportswear, a 36-year-old T-shirt maker based in San Fernando, Calif., believes California has all the necessary ingredients to help companies make a good product. “I am amazed at how much opportunity is here because there are so many different pieces of the supply chain that help us develop new products, anywhere from the raw materials all the way to embellishments,” said Marine, whose company is going beyond its formula of making licensed and private-label tops to launch its own line of high-end T-shirts. The new concept will employ the skills of the company’s 500 workers in its factory in Ensenada, Mexico, and its 200 employees at its San Fernando headquarters.
Technological glitch
One of the principal challenges faced by most apparel manufacturers anywhere is figuring out what kind of software programs they need and how to integrate them into their dayto- day practices.
Walter Wilhelm, an apparel-industry consultant from Walter Wilhem Associates LLC, said he sees companies grappling with a certain amount of information overload.
That was stressed by Barbara Zeins, president of Gerson & Gerson Inc., a New York–based maker of children’s sportswear and Bonnie Jean dresses for girls. She has been in charge of leading the company’s technological advances shortly after she joined the company in 1993.
She said she knows scores of people who have bought boxes of software that are still sitting by their desk. She has also talked to apparel manufacturers who tried to integrate Product Lifecycle Management (or PLM software) into their operations only to find the programs clogged up their systems instead of speeding them up.
She said she thinks sometimes we try to do too much with technology, which can impede creative thinking and handson designing. “Technology is a tool, not a solution,” she explained.
She is in favor of software programs that are easy to learn and manage and allow apparel makers to keep a hands-on approach. Her company uses TukaTech software for internal operations. Designers merely use Photoshop and Illustrator to create their garments. Oftentimes these two basic software programs are taught in design school.
“The more the tool does, the less we need to know. Are tools making us dumber?” she asked.
She cited the lack of designers who know how to drape fabric and work with their hands when creating a garment. These days, it is difficult to get really well-trained employees who have worked on a factory floor because most factories have left the United States.
She is also not a fan of continuous e-mails. She maintains a constant barrage of e-mails contributes to employees’ inability to get a job done. “E-mail is probably the greatest time suck of all time,” she said. Studies have shown that most employees spend an average of 2 1/2 hours a day answering e-mails. “I’m not a Luddite. I love technology,” Zeins said. But she did suggest that employees check their e-mail in the morning, turn it off for most of the day, and then take care of e-mail business again at the end of the day.
“I am suggesting it is time to tame our technology and value employees,” she said. “You can solve technological problems while nurturing creativity.”
Better world
One trend that has taken hold of the garment industry is something called “corporate sustainability.” It means companies integrating long-term environmental, economic and social responsibility issues into their business practices while maintaining their brands.
More and more companies have been embracing recycling and environmentally friendly resources to run their businesses. Randy Harward, director of Patagonia, the sportswear company in Ventura, Calif., said trying to be environmentally aware has been part of the company’s mantra since it was founded in 1976. Patagonia is incorporating recycled polyester into many of its products and is conscious of trying not to use plastic in its packaging.
Rick Horwitch, vice president of solutions business development at Bureau Veritas, which helps companies manage social accountability and health and environmental issues, noted that even Wal-Mart Stores Inc. is trying to go green in its building designs. “What we found in the industry,” he said, “is that if Wal-Mart decides to get behind something, ultimately it becomes almost a de facto standard.”
