CHICAGO — Global market changes continue to make textile sourcing and selection a challenge for today’s textile services manager.
During a seminar for TRSA’s most recent Annual Conference, Dr. Elizabeth Easter spoke on the Impact of the Global Marketplace on Textile Quality. The University of Kentucky professor, and founder of the Textile Testing Laboratory on the UK campus, started with a short history of the textile and garment industries, which shows similar parallels to today’s global marketplace, she says.
“We basically see that both industries contributed to industrialization and also now contribute to the global marketplace,” she says. “Textile was an industry that could be used to help rebuild Japan (after World War II).”
The United States has taken similar steps to help develop Korea, Taiwan and Hong Kong, all countries that are now competitive with the United States in the textile and garment industries.
It wasn’t until the 1970s that the U.S. industry recognized the entry into the global market and the competition of some of the other developing countries. Easter says the industry now acknowledges that Nike and Reebok were the first brands to take their business offshore or overseas. Neither company owns factories; they simply contract with factories mainly in Asia to produce their brand products.
THE MULTI FIBRE ARRANGEMENT
Easter points out the effects of the Multi Fibre Arrangement (MFA) established in 1974 as a way to impose quotas on exports from developing countries. It was a way for developed countries to compete with the lower labor and other costs that developing countries were able to work under. There were limits to the MFA, however, and by 2004, it had been phased out.
Without its constraints, the global marketplace for textiles and apparel exploded. Today, says Easter, the industry has evolved into a wide open marketplace. She says, in 2011, the United States exported $22.3 billion in apparel while importing $102 billion in textile and apparel products.
INDUSTRY CHANGES
The largest change in the industry, according to Easter, is that it is now a buyer’s market, rather than a supplier’s market.
In years past, the supplier would be the one to dictate product, price, delivery times and lead times. While the industry is still labor-intensive, a buyer now carries more weight as to what is produced. Walmart, Easter says, has played a huge role in the new industry. The corporation can mandate a price, a quality that is close to traditional brands, and can control lead time and raw materials. As a result, we have seen a move to lower prices, better quality, faster delivery times and smaller minimum quantities.
The consumer has also changed, Easter says. From 12-14% down to 8%, the U.S. consumer now spends less on apparel items but demands more quality. The average consumer has more garments and home furnishings than in the past, all made of textiles, and they also shop more frequently and buy more items.
SUSTAINABILITY
One major change in the textile and garment industries is sustainability, and consumers are looking to be more sustainable while using less and saving more, Easter says.
In addition to sustainability, concern is growing that the industry has moved back to the original issues that it once faced: poor working conditions, lower hourly wages, and long work hours. Product marketing frequently promotes that the companies inspect and guarantee the social conditions in which the product was produced in the global market.
Concerns about the environmental degradation of the global marketplace are also on the rise, Easter says. While U.S. industry is highly regulated, that is not the case in the rest of the world. The industry needs to be aware that precautions taken in the United States need to be applied to the global market, Easter says.
Something else that the industry needs to realize, she says, is that it is a completely different industry than it once was. With changes in the economic landscape, many companies no longer exist, with takeovers and consolidations changing the industry all the time. She pointed to DuPont, which was once a major player in the development of synthetic fibers. The company is no longer working in that part of the industry, relinquishing its role to more foreign-based companies.
Technology has also changed the industry. With the innovations of bar codes, point-of-sale scanners and other computer technology, the industry now has the ability to gain immediate feedback on items that need to be restocked as well as a change in communication ability.
MOVEMENT TO ‘RESHORE’
Some of these changes, Easter says, has allowed companies to begin to reshore, or bring back manufacturing and other parts of their businesses to the United States or to closer locations. With the new communication systems in place, firms no longer have to go through a supplier, they can directly contact the manufacturer to place an order.
The “Made in America” movement continues to be strong, Easter says. She pointed to an ABC News report that demonstrated that most people going through Grand Central Station rarely wore anything that was made in the United States—every piece of clothing was created in another country.
“There is a tremendous amount of work to reshore, if we choose to do so,” Easter says, “and we have to do so one small step at a time.”
INDUSTRY EVOLUTION
Easter says textile services managers can now be seen more as production managers in the textile industry, which needs to move more toward technical packages to help with communication between groups of people who may not speak the same language or have the same customs and culture.
This has replaced the concept of design or production that we have had in the past, she says, thus we need to move more toward specification buying and consumption.
These packages would contain specs on fiber content, buttons and size, where a label is placed and what it is made of, whether the product will be displayed on a hanger or if it will be folded and packaged; the specification package will contain everything a plant needs to produce a particular item.
But this does not relieve the buyer of its responsibility in the process. Easter says buyers must be more diligent in testing the finished products, looking for illegal substances, heavy metals and other banned or unsafe materials.
“We can no longer receive a product and assume it meets our specifications,” she says. “We may have a global market, but it is our responsibility to confirm we have the quality of product we want.”
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