MILLS FACING HURDLES TO CBI TRADE
Byline: Joshua Greene
NEW YORK — U.S. mills have an image problem.
Last year’s extension of trade benefits to apparel made in the Caribbean Basin of U.S. fabric offers the domestic industry an economic advantage in competing with Far Eastern suppliers. But that message doesn’t seem to be getting through to retailers and apparel sourcers, textile executives contend, partly because companies who now rely heavily on Asian production have bad memories of the domestic textile industry.
“Retailers don’t understand the benefits and they have a dated perception of U.S. mills. They don’t know us,” said Stewart Little, senior vice president of yarn supplier Unifi Inc., which is currently running a series of seminars on Caribbean Basin Initiative parity in the U.S. and abroad.
Little said Greensboro, N.C.-based Unifi is making a number of efforts, including the seminars, to better inform the industry about the trade benefits.
“We’re trying to get at the highest level of the manufacturers and make a pitch,” he said at a presentation in Manhattan on Thursday.
Also at the seminar, consultant Mary O’Rourke, of the New York-based Jassin-O’Rourke Group, said that the dropping of duties on Caribbean-made garments of U.S. fabric has made many of those garments price-competitive with Asia, even though U.S. fabrics are typically more expensive.
“Your fabrics may be more expensive, but there are ways to show manufacturers other opportunities to have it be less,” O’Rourke told mill executives. “Garment costs, especially synthetics, are competitive and sometimes cheaper with CBI benefits, despite higher fabric costs.”
But convincing retailers and apparel brands to buy costlier fabrics and relocate their manufacturing is difficult, since many domestic mills have lost ties with retailers. O’Rourke said some retailers still see the U.S. textile industry as stuck in the mid-Eighties, in terms of price, quality and efficiency.
“If buyers are not able to see fabrics available in the West, then they won’t manufacture in the West,” she said. “You need to convince your buyer that CBI is good.”
O’Rourke cited shorter lead times as a key incentive in courting retailers, especially fashion retailers who need to react quickly to new trends. Lead times for garments shipped from the CBI region can be 30 to 60 days shorter than from Asia, she said.
Mill executives who attended the seminar said they’d try to step up their focus on the CBI region.
“Change is difficult for all of us, so I’m not looking at it being easy, but in these competitive times, everybody has to change and retailers are no exception,” said Alex Fisher, president of Murray Hill, N.J.-based Fablok Mills. “I’m going to suggest to more of our potential customers that they have to look closer at the duty savings, because it’s our responsibility to convince them that they can get a better cash flow and lead time.”
Following the Sept. 11 attacks, some industry executives have become reluctant to maintain the intensive travel schedules required to monitor contractors far overseas. Mill officials have held out hope that those fears will encourage apparel brands to look more closely at CBI production.
“I think the world situation will have a huge impact on retailers wanting to see how they can work this way,” said Martin Sohn, vice president at Meadows Knitting Corp., which is owned by Newark-based Safer Textiles. “You don’t have to worry about being tied up in customs or going to a dangerous [country] and it’s faster.
“The fact that we have the opportunity for the next few years of increasing our business, it’s the first thing our government has done for [the textile industry] in recent times,” he said. “This will certainly help us compete in a world economy.”
Bob Calabrese, president of sales and marketing at Native Textiles, worried that Asian competitors, particularly China, will find a way to drop their prices lower than those allowed by the duty breaks.
“Whether or not we will ever compete with the Asian price is my question,” he said. “We’re finding, in many cases, no matter how low our prices, it can still be bought in Asia for cheaper.”
Calabrese added that textile companies, yarn suppliers and domestic manufacturers must work together to coordinate full garment packages for Caribbean sewers. Ultimately, he said, it takes time to have faith in the U.S. textile industry.
“All the communication is wonderful,” he said. “We’re in the early stages of this and everyone doesn’t understand how to take advantage of it, yet. We need more time and need to continue working together.”
More of the seminars are being held in the Caribbean this week. Today, Little and O’Rourke are speaking in the Dominican Republic, and over the next three days will be moving on to Honduras, El Salvador and Guatemala.