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MIAMI — The mood at last week’s Material World was one of apprehension. Global issues — war in Iraq, competition from China and looming trade legislation were foremost concerns. But attendees kept focus on current realities, seeking product, sourcing and technology solutions to keep business competitive in the Western Hemisphere.
The first spring edition of the show ran March 17-19 at the Miami Beach Convention Center. It included three-main areas: sourcing and trade, which featured many groups of Latin American apparel contractors; fabrics, trimming and supplies, and technology. Those last exhibitors were grouped together in a “Technology Solutions” area, a new element of the show.
While war was top of mind, attendees were less concerned about its potential to disrupt production and shipping than the effect on consumer spending and the economy.
“There’s concern about the impact on production in Turkey, Pakistan, Jordan and Egypt,” said Kevin Burke, president and chief executive officer of the American Apparel and Footwear Association.
But Burke said the major worry is war’s effect on the economy.
“Hesitant U.S. businesses and private investors have a lot of money sitting on the sidelines,” he said. “Nobody benefits from prolonged war. A positive outcome will cause the stock market to spike, but we need steady growth, not a spike.”
Peter Gabbe, executive vice president and chief operating officer at Carole Hochman Designs, a New York manufacturer of sleepwear, expressed serious concern about disruption of shipping lanes by the war.
“We’ve looked at alternatives, such as air routes, in recent weeks,” he said. Gabbe added that the full implementation of the Customs and Trade Partnership Against Terrorism program, which requires meticulous certification of goods, has slowed shipments over the past 45 days, causing further strain
Burke noted that imports of apparel from the Caribbean and Central America have declined recently. He said future growth is contingent on the pending Central America Free Trade Agreement legislation.
“It’s crucial, and needs to pass soon, before the election year,” said Burke.
Tom Travis, Miami-based partner at the law firm Sandler, Travis & Rosenberg, predicted “vibrant” CAFTA negotiations, with a key point of debate being rules of origin for fabrics and yarns.
He noted that CAFTA is one of almost a dozen trade deals currently being negotiated and pointed out that the U.S. could opt to reward Mideast countries with trade perks in exchange for help in the war with Iraq.
Regardless of trade perks, attendees sought to capitalize on the advantages of proximity inherent in Western Hemisphere production. They urged Latin American manufacturers to develop the capacity to offer full-package garment production services.
“The Far East has full-package production. Many Latin American companies say they have it, but very few local companies really do,” said Alfonso Hernandez, ceo of The Argus Group, a manufacturer and contractor based in San Salvador, El Salvador. “You can’t just push a button and have full package. Many sewing factories don’t have money to update, so they go under.”
The 12-year-old Argus Group recently bought and consolidated nine factories, six in El Salvador and three in Nicaragua.
“Our biggest challenge is minimizing production cycle time,” said Hernandez. “We’re working on 31 days from order to delivery and 19 of those days are out of our control — in shipping, Customs, etc.”
He said that Argus’ sales have picked up over the past year, but voiced concern over what effect the war might have on sales.
“War could stifle demand, and won’t benefit business overall,” said Hernandez. “Our biggest concern is another terrorist act, as a result of war.”
Material World offered networking and buying opportunities, especially to South American buyers, whose needs differ from domestic companies.
“The climate [in South America] is opposite, so it’s a great opportunity to sell our end-of-season goods,” said Pearl Ann Marco a partner in De Marco California Fabrics Inc. of New York. Marco said buyers were cautiously shopping for close-to-season goods.
In business since 1963, the $40 million company imports base fabrics, and prints them exclusively in U.S. facilities. Despite a bad economy and a shrinking customer base, business has been steady, said Marco.
“We have to work harder, reduce overhead and cut costs, and work with lower margins,” she said.
First-time Material World exhibitor Danny Pour Rahmani, president of Textile Secrets International Inc., a Los Angeles fabric producer, said he took orders mostly from smaller manufacturers. Buyers responded to novelties, embellishment and detail, he said, although they bought close to season.
The show also provided a showcase for fashion trends. Trend pavilions included computer kiosks that allowed attendees to experiment with changing fabrics, silhouettes and garments on virtual models.
Technical innovation, novelty and variety were key elements. Performance fabrics have developed more moisture management and climate control. In fashion, novelty fabrics offered an abundance of prints, including abstracts, graffiti, photo prints and Asian-inspired looks. Textures continue to drive business, with crinkled jacquard suede and stretch looks in various combinations, with an emphasis on details and embellishment, such as lace and embroidery.
While investment dollars are tight, technology is an area that can’t be ignored, said attendees.
Newer technologies, such as radio-frequency identification, a handheld remote control that identifies and tracks physical inventory within a store, or body-scanning technology with pattern-making capabilities intrigued buyers. But attendees were most interested in augmenting, rather than revolutionizing, existing systems.
“People are looking for small initiatives with big paybacks,” said Marshall Gordon, industry segment manager for apparel and footwear at SAP America, a Philadelphia-based technology firm. “They want efficiency in forecasting, predicting and analyzing.”
Tech companies offered new software to integrate areas, along with modules and portals that expanded Internet applications.
“Visibility is now the buzzword,” said Andrew White, research director for enterprise and supply-chain management at Gartner Inc. “Companies share data from retail point-of-sale to offshore suppliers’ shipping information, in one database. Retailers and manufacturers are often in a power struggle over this, but the big guys, such as Wal-Mart, all want it.”
Koret, a division of Kellwood, recently implemented Internet-based software that linked 20 of its global vendors, with the goal of increasing visibility.
Mark Goldberg, vice president of Western Hemisphere operations and sourcing at Koret, said the new technology had resulted in 50 percent time savings in some areas of the production pipeline.
Material World drew around 3,500 attendees — slightly lower traffic than the October edition — with 250 exhibitors.