NEW YORK — In the wake of the monstrous earthquake-tsunami catastrophe in South and Southeast Asia, industry executives continued to be frustrated late last week as they reached out for threads of information regarding manufacturing operations, as well as the status of product and shipments.
As people struggle to survive the disaster of historic proportions, in which killer waves are forecast to claim more than 150,000 lives and displace up to five million people, the question of logistics and how to get workers to facilities where roads and transportation have been destroyed and all power knocked out — not to mention the dilemma of guaranteeing on-time deliveries — is becoming a critical issue for apparel executives.
Although a majority of manufacturing firms and major retailers source fabrics and manufacture branded and private label innerwear, as well as other apparel, in China, Taiwan, Turkey and Eastern Europe, a substantial number of companies conduct business near the tsunami disaster zones, including Sri Lanka, Indonesia and India. Executives who have a vested interest in those regions are anxiously awaiting updates from contractors, factory managers and international shipping carriers.
Government officials in the affected countries, as well as apparel and textile executives, said last week that so far they had more questions than answers. Despite reports that major production plants remained undamaged, the question of long-term effects on the manufacturing and sourcing sectors is causing a good deal of angst.
Bill Ghitis, president of global apparel for Invista Inc., observed, “We were extraordinarily lucky because our plants in Singapore, Taiwan and China were not affected. There was an earthquake in Singapore on the eastern side of the island, but our two plants are on the western side.”
Ghitis said the impact of the catastrophe could be a major problem in 2005.
“The issue for us, which we have not yet ascertained, is how have our customers and users been affected? We don’t quite yet understand if there’s an impact downstream. It’s very difficult to gauge right now,” said Ghitis.
Seth Morris, president of Carole Hochman Designs Inc., said, “Our main concern, of course, is the people and if they are all right. We work with three factories in Sri Lanka, but they were not damaged because they are inland. The main problem, though, is how to get people to work.“There are no deaths to report, but the big issue is transportation and electricity. It’s really keeping people from coming to work. They [contractors] expect to be closed down for seven to 10 days. We’re not in panic mode right now, but we could see a delivery slide of 10 days.”
Richard Leeds, chairman of Richard Leeds International, who returned Wednesday from Indonesia where the firm contracts work, could not be reached. However, his wife, Marcia, who serves as chief executive officer, said: “Sumatra, which is at sea level and where the earthquake hit, is not a manufacturing area. It’s mostly fishing and agriculture. We manufacture on the island of Jakarta, and the facilities there were not affected. Richard said it all looked normal.”
Officials at Victoria’s Secret could not be reached late last week. But a spokeswoman for the lingerie specialist, which produces goods in Sri Lanka, said early last week there had been no manufacturing disruption.
As for the status of international shipping, Fred Dela Pena, vice president of operations for New Rochelle, N.Y.-based American Import Shippers Association, said, “Basically, all operations are back up. But logistics could be a problem, in Colombo [Sri Lanka] in particular, where most of the businesses are located inland. It’s the coastal roads that have been destroyed.”
John D. Bowe, regional president of the Americas unit of international carrier American President Lines, sent a mass e-mail to customers Wednesday, which gave an update on operations in the region where the seismic waves struck. It said: “There has been no damage to APL vessels or operations; there has been no overall impact to our schedules; it is business as usual in APL offices, including those in Indonesia, Thailand, Malaysia, India, Bangladesh, Sri Lanka and Myanmar, and ports in the affected areas have resumed normal operations.”
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