NEW YORK — All the elements are there — a revival for U.S. manufacturing, lower cotton prices, rising consumer demand and a real commitment to innovation — to believe a new era has dawned for the global textile industry.
This story first appeared in the July 26, 2011 issue of WWD. Subscribe Today.
With serious attention being paid to sustainable fabrics and production methods, and renewed enthusiasm for organic, natural and recycled textiles, the exhibitors, attendees and show organizers at the recent round of textile and sourcing trade fairs here agreed there is a new reality in their industry. The consensus at Première Vision Preview, Spin Expo, Texworld USA, the International Apparel Sourcing Show and the Kingpins Show was that the days may be over of rushing to the lowest-priced factory or country, paying only lip service to environmental concerns or shunning product development in favor of cranking out basic, commercially safe goods.
But that doesn’t mean all is rosy. There are plenty of obstacles in the way to make for uncertain but still upbeat times. Among them:
• Where will cotton prices go?
• Will enough investment emerge to take Made in America out of mothballs?
• Will consumer demand wane?
• What impact will the next natural disaster or political circumstance have on the apparel world?
One of the more talked-about developments is a potential revival of U.S. manufacturing, as recent statistics have indicated. Across the board, executives agreed the interest is there, but questions remain whether there will be enough firms prepared to invest in manufacturing and enough retailers and brands ready to make the commitment to pay extra for domestically produced goods.
Showing at Texworld USA, Walter Meck, chief executive officer of Fessler USA, a manufacturer of fabric and yarn using primarily Lenzing cellulosic fibers, said his firm, based in Orwigsburg, Pa., has survived the economic crises and is ready to grow.
Meck noted how Fessler has just completed installing 1,600 solar panels that cover about half the roof of the company’s Deer Lake manufacturing facility. The photovoltaic system will generate about half of the facility’s energy needs.
“It’s a different market now,” Meck said. “It has caused us to change and change for the better. We have always served the fashion market, but we’ve had to develop new products for the fashion market using new capabilities. We’ve also changed by moving into different markets, such as performance wear, outdoor wear and activewear. These are markets that are uniquely suited for U.S. production — smaller runs, faster turns, higher quality and higher value fabric. We can compete very well in the premium fabric end of the market. We can produce fabrics as competitively as anyone in the world.”
Just like the use of blended fibers, such as Lenzing’s Tencel mixed with cotton, gives a garment the best qualities of both materials, Meck said, so does a blended sourcing strategy.
“Bringing back U.S. manufacturing is more than talk; we’re seeing it,” he said. “It’s not going to happen the way people think it’s going to happen. We’re going to end up with a blended sourcing strategy. We’re getting back to the true theory of comparative advantage — where’s the best place to make certain things. For us it’s about sell-through for retailers, selling more goods at full price. If you have to pay a little bit of a premium, but you don’t have to mark down goods, then the retailers fall in love with Made in the USA again.”
David Sasso, vice president of international sales with Buhler Quality Yarns Corp., a fine-count yarn spinner of Supima cotton, Tencel, Modal and other Lenzing cellulosic fibers based in Jefferson, Ga., and also presenting at Texworld, said, “When people talk about coming back to the Western Hemisphere, there’s only so much that can come back. The number-one reason is we don’t have full confidence that the retailer will stay. Second, the U.S. government trade policy is our number-one enemy. You have the retail lobby pushing for free trade, pushing for cheaper products.”
However, Buhler, which Sasso said spins yarn for the “Kohl’s and upward” retail market, has benefitted from exporting — 60 percent of sales — to countries involved in the North American Free Trade Agreement and Central American Free Trade Agreement.
“If you negotiate and work along the textile supply chain, you can achieve very good pricing, delivery and innovation,” Sasso said. “I think it’s fantastic that [stores and brands] are looking [at more U.S. production], but they get shocked by the price. I’d like to see it come back more to this side of the world. There are a lot of great apparel and fabric manufacturers here, but what comes back has to be more specialized and more niched.”
Across the aisle, Eleanor Haycock, a sales representative for Laguna Fabrics, which makes novelty yarns and fabrics for the contemporary market, said the firm has seen “tons of interest” in its goods made in Los Angeles.
“We have six-to-eight-week turns and we see a lot more manufacturing coming back to the U.S.,” Haycock said. “We’re seeing more new buyers and larger orders from our existing accounts.”
Sometimes fresh investment in domestic manufacturing can come from unexpected sources. German textile machinery manufacturer Stoll GmbH & Co. opened the Stoll Fashion & Technology Knitting Center at 250 West 39th Street, in the heart of the Garment District, in April 2009. Beth Hofer, senior manager, customer relations and educational resources for Stoll Fashion & Technology, explained that the multipurpose center is meant to be a prototype for modern manufacturing and sourcing.
“It is a fast-track sampling center consisting of a full-service knitting workshop for product development and sample making, covering from 3- to 16-gauge machines,” Hofer said at Spin Expo.
The facility includes a real and virtual knitwear archive, pattern library and database, and hand-knitting courses. The sampling service includes seven high-performance knitting machines, as well as finishing equipment on-site.
Hofer said one reason Stoll opened the facility is to help spur more U.S. production, beside the obvious tool for marketing its machinery.
“You certainly are hearing more about Made in America,” she added. “We know there is an interest and we feel our center can help facilitate it. We also help put designers and companies together with factories. We know companies want to make at least some of their goods closer to home if they can find the right place to do it at the right price.”
Ronald Sheridan, president of STC Textile Inc., U.S. agents for Confetti Tekstil, a Turkish dyer and printer of better fabrics, showing at Première Vision Preview, said: “In catering to the better market, we’re finding that with the production and price issues out of China, companies are being forced to move away from an Asian manufacturing base and, increasingly, they’re looking to the U.S., especially California. It might not be a major move back to the U.S., but they’re exploring opportunities. There is a resurgence of interest in manufacturing close to home, especially in the better market where price isn’t as much of an issue.”
Sheridan said just last year his firm made 99 percent of its goods in Asia and 1 percent in the U.S. This year, that changed to 95 percent in Asia and 5 percent in the U.S., “and we’re looking to bring that to 10 percent.”
Jacques Brunel, general manager of Première Vision, said the market right now is somewhat dichotomous — “those that are looking for different, creative fabrics, and those that are very price conscious.
“We haven’t seen this kind of response in the American market for three years,” Brunel said. “We hope it’s a strong sign that the market is back.”
He said feedback from exhibitors was that there is a movement away from offshore production and toward more local manufacturing.
“They are saying that their offshore operations are very difficult, especially in China, where they are focusing on their own market and fighting with increases in labor and raw material prices,” Brunel said.
Karine Van Tassel, founder and organizer of Spin Expo, noted how China’s move toward more production for its domestic market is “giving a chance to European and U.S. companies to gain back market share.”
“People want to start manufacturing in their home market again,” she said. “Creativity will come back to where it belongs and production will come back to where it belongs and in a more balanced way.”
London’s Liberty Art Fabrics, which was bustling with buyers at its Première Vision Preview booth, just opened a corporate office to better serve the U.S. market. East Coast sales agent Iona Banu will be overseeing the new corporate office in New York at 110 West 40th Street, adding that “it’s better to have corporate offices in key countries to truly represent the brand.”
Fay Jaraha, vice president of marketing for Huntington Yarn Mill, based in Philadelphia, said, “One of the reasons people like to deal with us is that we do everything under one roof. From small to large companies, when they want to develop something new, we can mix different fibers together and bring it to life.”
Jaraha said Huntington sells mostly to U.S. knitters in places like New York and Atlanta, as well as exports some to overseas garment makers. With wool bouclé its chief component, she said the rise in raw material prices has been “terrible.”
“But our customers know that we wouldn’t raise the prices if we didn’t have to,” Jaraha said at Spin Expo. “It was a shock for everybody, but now they’ve adjusted. We’re trying to be more creative with our yarns to make them more cost-effective. One thing the recession and the raw material price increases have done is make people more mentally prepared that things can change overnight.”
But many exhibitors expressed concerns over the volatility of raw materials prices, particularly cotton and wool.
Vince Mancini, U.S. representative for Zhejiang Xinao Textiles Inc., based in Zhejiang, China, said business right now is “challenging but optimistic…raw material prices are the most challenging.”
The company manufactures worsted merino wool yarns in China, selling mainly to large U.S. vertical retailers, and was seeing strong action at Spin Expo. John Liu, manager of the International Department of Xinao, said when next month’s wool auction takes place it will give companies a better idea where prices will be for the fall 2011 season.
Cotton was the topic at a seminar at the Kingpins Show, where discussions ranged from the drought on the High Plains of Texas and the uncertain pricing environment to the benefits of Fibermax cotton seed and the difficulty of growing organic cotton.
O.A. Cleveland, professor emeritus at Mississippi State University and an industry consultant, noted how cotton prices skyrocketed past $2 a pound, peaking in March at about $2.40, then dropping to about $1.25 a pound today.
“I can’t tell you this price volatility will go away,” Cleveland said. “I can also advise those of you that buy cotton to be aggressive in your planning. Now is the time to buy. The Chinese have a tremendous need to rebuild their stocks and I look for them to come in soon. We’re bottom fishing right now and I think the price could go back to as much as $1.44 a pound.”
Whether it was cotton farmers Steve Newsom or Cliff Bingham, or experts such as Cotton Inc.’s vice president of agricultural research Kater Hake, the complicated nature of cotton farming was made clear. Bingham, an organic cotton grower, said his crop has been severely depleted this season by the drought, while Newsom, a conventional cotton grower, said things are tough, but he was holding his own through irrigation and improved methods of soil management and chemical applications.
Cleveland said the good news is that most of the world’s cotton crop projections are up from last year, although he said the U.S. crop was subpar, and noted how around the world cotton acreage was fighting other agricultural products used for food and energy.
Many agreed that consumers today demand creativity, and that the right balance of all the factors facing the industry leads to success.
Solstiss Lace was receiving lots of attention at Première Vision Preview thanks to the publicity it received for the lace fabric used for Kate Middleton’s wedding gown, and the importance of lace as a trend, said Sandrine Bernard, executive vice president of Solstiss USA.
“We’ve also been in the American market for 30 years and have good relationships with our clients, and made lots of appointments for the show,” said Bernard. “After the crisis of the last couple of years, the consumer wants to wear something different. Lace has a certain worth to it, an added value, that makes her feel good.”
Sonny Puryear, account manager for the Americas at Australian Wool Innovation showing at Spin Expo, said, “We’re getting people to look at merino wool again as a luxury fiber,” noting this is especially important given the steep price hikes the commodity has seen in the past year. “We want to make sure people understand that wool can be a year-round weight fabric. It’s also being using in the athletic-outdoor market by brands such as The North Face and Icebreaker.”
Bringing it all together was Sabine Le Chatelier, associate fashion director for Première Vision, who said there is a connection right now between creativity and practicality.
“There is a feeling that collections have to more risky and more engaged,” Le Chatelier said. “We see globalization is here to stay, we know it’s a fact and that it’s brought more uniformity, which is why it’s important for brands and collections to try to have personality and identity. On the one hand, price is limiting to the type of material, but at the same time it puts more of a focus on the creativity of the material. On the other hand, there is a recognition of the importance of sustainability and the environment in designing and manufacturing a collection.”