![]() |
![]() ![]() |
Home | Site Map | Buyer's Guide Search |
![]() |
Event Calendar | ![]() |
Article Archive | ![]() |
Message Boards | ![]() |
Classifieds | ![]() |
Product Showcases | ![]() |
News | ![]() |
Advertise | ![]() |
Search | ![]() |
Join Now | ![]() |
![]() |
![]()
![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
![]() |
![]() Onshoring, The Next American Apparel Revolution?
By Christopher Bernat, Chief Revenue Officer, Vapor Apparel
Many buyers looking for a way to bring things back to the US need the same capabilities that they had offshore.
![]()
Onshoring. Noun or verb? Ask experts on the topic and you will hear both answers. Regardless, onshoring is bringing manufacturing of goods back from low cost-of-labor countries to the United States. A steadily growing trend, onshoring is spurred by a combination of factors. To understand and benefit from it, you need to have a grasp on all the different contributing causes and to stay up-to-date on these causes as they change and evolve. A large-scale apparel operation is not a simple business, but a challenging environment that can be maximized for profit.
Where? This onshoring trend started about 20 years ago in some industries. Consider the car industry. In 1994, BMW launched a manufacturing facility in Spartanburg, South Carolina for their X3 and X5 SUVs. The brand knew that the SUV was going to have a higher level of sales in the United States over Europe. The size of the market and the national affinity for larger cars made it obvious. Manufacturing the vehicles in the United States bore many cost benefits versus making them in Germany. According to a recent study conducted by the Boston Consulting Group (BCG), more than a third of US-based manufacturing executives at companies with more than $1 billion in sales are planning to bring production back to the US from China. In addition, it found that, by 2015, the US would have a cost advantage of five to 25 percent over manufacturing goods exported when compared to countries such as Germany, Japan and the United Kingdom. Labor costs in China have skyrocketed, shooting up 500 percent since 2000, and are expected to continue to climb an average of 18 percent each year. Added to that is the price of natural gas, which has fallen so far in the US, that gas in Asia now costs four times as much. Other compelling reasons behind onshoring include higher US worker productivity, more flexible unions, the lack of intellectual property (IP) protection in China, less supply chain disruptions, and the desire of companies to be closer to their customers. According to the BCG study, the companies involved cited top factors driving future decisions on production locations that include: Labor costs (57 percent), product quality (41 percent), ease of doing business (29 percent), and proximity to customers (28 percent).
How can you grow your business as a result of this trend? But there are American apparel manufacturers and decorators who are already bringing business back, and even more who will be able to gain ground with this trend. Your business model and how you position yourself as the trend continues to build momentum will have a huge impact on your opportunity to gain customers. One of the largest factors in the success of onshoring is the demand for “short-run” production, which is driven in part by the need for fill-in stock and the demand for limited edition designs. The other factor driving much of the opportunity is customization. As customization continues to grow, so does the market opening to bring more things back to the US for production.
Product Mix & Expertise
![]()
Customer Base
Supply Chain
Currency As the global recession took hold, the US quickly made a move to devalue the dollar as part of a strategy to reinvigorate the economy. Now, the US Dollar is slowly increasing in value against other currencies. If the US continues to grow and improve its economic performance versus other countries, the value of the dollar will continue to increase. When compared against the US dollar, currency values in Brazil, Mexico and Colombia are declining, making them more competitive versus Asian goods that also carry a duty.
Technology & Automation
Words to Action If you can position your business to maximize a shorter supply chain, mass customized output and digital print technologies — you are poised to take full advantage of this moment in the marketplace. Automation is a huge part of how this type of business becomes profitable. With digital files come the need for an information system that is easy to access and eliminates opportunities for error. Christopher Bernat is chief revenue officer at Vapor Apparel, and an SGIA Board Member. He focuses on sublimation and domestic cut and sew programs. This article appeared in the SGIA Journal, Fall 2013 Issue and is reprinted with permission. Copyright 2013 Specialty Graphic Imaging Association (www.sgia.org). All Rights Reserved.
|
![]() |
|
![]() |
|
![]() |
|
![]() | ||||||||||||
| ||||||||||||||||||
© Copyright 1999-2019, All Rights Reserved. |