Reliability Is Tops in Apparel Sourcing for Retailers and Brands, Survey Says
The key to success in the apparel industry boils down to this: on-time delivery of quality goods.
If clothing factories can get that one down, they have a good chance of being a top sourcing spot for apparel companies and retailers.
That was the conclusion reached by Walter Wilhelm, head of apparel and footwear consulting company Walter Wilhelm Associates.
Wilhelm recently surveyed a group of U.S. retailers and brands about what factors they considered when working with a clothing factory, whether it was in Bangladesh or the United States.
On top of the list was on-time delivery. “If you can’t do that, you’re dead,” he said.
Wilhelm was speaking at a Feb. 9 seminar organized by Setlog Corp. at the Fashion Institute of Design & Merchandising in downtown Los Angeles. Setlog is a German-based company that sells software for supply-chain management, much of it geared to apparel companies trying to manage their merchandise being made in far-away factories.
Easy access to raw materials was another important ingredient in the sourcing formula. Think fabric and trim supplies that are made in the same country where the apparel factory is located. China is at the top of the list for this one.
“What China did brilliantly was to cluster their suppliers together. They have the thread, button and zipper people near where the factory is doing the assembly [of clothing]. That saves a lot of time,” Wilhelm said.
China is still the go-to place for most U.S. apparel companies that have their creations made by overseas factories. But labor and raw-material costs have gone up considerably in the last few years. In addition, the Chinese government is spending less time and money supporting apparel factories and is focusing instead on higher-end electronic and appliance factories that make a more expensive product, said Kathy Fang, founder, president and chief executive of Lamode Textile in Shanghai.
Fang, whose 4-year-old company works with 30 to 40 Chinese garment factories to fill orders for European clients, said the apparel industry is losing workers to automobile and electronic factories where employees receive higher wages and use machines to help assemble goods.
“No one wants to learn how to sew and then be told their seam is crooked,” she said at the seminar. “Young people are fed up. They go with easy production.”
Fang reinforced the fact that with wages rising, many garment factories are moving away from the more expensive coastal regions and into the center of the country. But that brings its own set of problems. The mindset of the rural factory owners is different from those in the urban coastal regions. “They don’t understand why you ask for seven sizes. It takes time to train people,” she said.
Walter Wilhelm noted that more apparel production is coming back to Central America, where he is partners with Kurt Cavano and Carlos Arias in a Guatemala-based sourcing consulting company called RegionaLink.
That has been aided by a free-trade agreement with Central America and the Dominican Republic, meaning garments made of regional yarns can be brought in to the United States duty free.
That helps El Salvador, where a cluster of textile and apparel factories is helping to stoke a rise in performance activewear production. Tariffs on high-performance fabrics are high.
Central America also has an ample supply of knit fabric, which is good for T-shirts and other knitwear. But the region doesn’t manufacture very much woven fabric.
“Each country is good at a different product,” Wilhelm said. “Honduras is good at basic commodities like undergarments and socks. Guatemala does T-shirts and jeans.”—Deborah Belgum
