Appeared In
Special Issue
WWD Special Report issue 09/05/2012

ORWIGSBURG, Pa. — Nestled along the rolling hills of eastern Pennsylvania lies an oddity — at once a vestige of a bygone era and a beacon pioneering the potential of a new age in American manufacturing.

This story first appeared in the September 5, 2012 issue of WWD. Subscribe Today.

It’s a family-owned, fully integrated, state-of-the-art knitwear factory called Fessler USA. Owned and operated by the Meck family, the 155,000-square-foot facility serves as company headquarters, manufacturing plant, warehouse distribution site and hub for shipping goods to satellite sewing factories in the area.

The factory houses a computerized design and patternmaking department run by Gerber systems, cutting rooms for its array of knit tops and medical and health-care goods made and packaged on site, and a bar-coded inventory control system that integrates functions from shipping and receiving to sales and manufacturing. The system also accounts for every yard on every spool of yarn that goes onto the diversified selection of Vanguard/Monarch knitting machines.

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A trip up to the roof during a tour of Fessler’s sprawling facility on rural Route 61 reveals a year-old array of 160 solar panels that provides the full energy capacity for the plant, generating 0.5 megawatts annually, with the excess put back into the East Coast power grid.

“At times, the meter runs backward,” said Walter Meck, 61, the patriarch and chief executive officer of the firm, noting that the solar panels were paid for in part by a federal grant in the form of tax credits.

“We did the solar project to keep jobs in the area and as a commitment to sustainability,” Meck said.

“We also did it to remain competitive with foreign manufacturing by keeping costs down in the long term,” said his son, Brian, who is vice president of sales and marketing. “It’s going to allow us to be more profitable, and maintain and hopefully add jobs.”

Fessler employs 130 people directly, and another 150 to 300 indirectly at any given time, including sewing shops in nearby Allentown and Reading, and contracted dyeing and other service jobs in the area. Bonnie Meck, Walter’s daughter and the company’s chief operating officer and chief sustainability officer, has discussed job training programs with local government officials because she said if Fessler and other companies in the area are going to expand, more skilled workers are going to be needed.

Walking into the nearly pristine building, Fessler proudly displays signs depicting its key customers, including Dillard’s, Nordstrom, Pendleton and Michael Stars. The family and company are strong advocates of Made in USA textiles and apparel, for the obvious reason that it would help their business, but also with a broader agenda for which they passionately advocate — bringing back a business that sustained jobs in the region and country, and was a more efficient way for brands and retailers to operate.

Interest in U.S. manufacturing has been revived in the last few years because of frustrations over delivery, reliability and dependability of foreign manufacturing, brought to light by the recession and China’s shifting sourcing dynamic, contended Walter. Bonnie said the key to turning the interest into reality is the retail mind-set.

“For most retailers, the right price is what they paid in the past,” she said. “Our challenge is to educate the retailers to understand what the value is to be able to replenish within season, to not have those excess markdowns at the end, and that’s been the ongoing challenge for our company.”

Brian added that one of the most difficult conversations with potential customers is the cost-to-risk ratio of U.S. manufacturing versus foreign production.

“One of the things we go through is to explain…what’s the cost of them having to go out and buy yarn, fabric, contract a knitting factory, all the things that need to be done if you’re not buying from a vertical operation — you don’t have control,” he said. “We tell them, ‘If you buy from us, we have the team in place and the capability, we’re going to manage that all for you and take away that risk and lack of control. You might pay a little more for the finished product, but in the long run it’s not going to cost as much.’”

Walter feels there are more companies that want to either create a percentage of their manufacturing domestically or increase what they are already doing.

“The problem right now is that not enough companies have figured out how to do it, but several have and many are still trying,” he said. “There are a number of companies who think they are just going to take their sourcing structure from offshore and impose it on the USA, and you can’t just do that.”

Fessler has been successful by focusing on areas that are less price-conscious and where being quick to react to trends and where the use of better quality fabric is important — fashion, children’s wear, activewear and performance wear. Its full-package manufacturer’s price averages $7 to $9 a garment.

In general, textile manufacturing is easier to bring back than garments because, while it’s more capital intensive, there are less peripheral supply chain issues and less labor is involved, he said.

“There are no more Chinas,” he added. “About five companies have ‘reshored’ with us in a so-called China Plus One strategy, and the fact is we shouldn’t be the replacement.”

Walter noted that one of the positives of the industry’s near extinction and now slow rebirth is that “on the yarn and fabric side, anything that comes back is state-of-the-art, it’s brand new. We’re rebuilding a world class textile industry in the U.S.”