Thursday, February 16, 2012

A downward trend - manufacturing apparel in China

My first experience with manufacturing apparel in China came in 2004 when I was a technical designer for Ralph Lauren in NYC.  I was a fresh slate and had no opinion of China when I started other then I knew it was less expensive to manufacture there than it was in the USA.  Over the course of my employment as a technical designer, I developed a very strong anti-China opinion.  From horrible rashes on my arms I received from opening boxes full of our product that came from the factory floor (all production items are "cleaned" unlike the samples we received - I wonder what kind of chemicals that entails) to contracting pink eye multiple times from  working with our samples getting them ready for line opening to having over 500 new messages in my inbox from 10 different people working at the same factory asking me the same question 15 different ways, China's positives for me wore off very quickly.  It now seems that for many, their opinion of China is starting to change as well, although I'm sure that the reason is far from human rights and patriotism.

In 2010, China's estimated per capita income was $7,600 - not a lot by our standards, however this is a huge increase over previous years and is higher then other countries where there is talk of the apparel manufacturing industry migrating to in order for manufacturers to pay lower wages. Recently, Bangladesh (annual income of $1,700) was identified as the potential new apparel sourcing hotspot.  Some estimates are as high as export value around $36-42 billion by 2020 meaning the current market in Bangladesh with double by 2015 and nearly triple in 10 years.  To put it in perspecitve, China exported $111 billion worth of textiles and apparel to the world last year alone.  It's going to take a while for the shift to occur.

I came across the blog when looking into the state of China and the author had some very funny ideas about where to go from China next:

Positives:  Very motivated workers since Somalia’s estimated annual per capita income is around $600 a year.  Lots of port facilities.  Good cell phone and Internet services.
Negatives:  Complete lack of a central government.  Your manufacturing site managers will have to learn to get along with the Islamist Al-Shabaab group.  Lots of Pirates.
Democratic Republic of the Congo
Positives:  Very very motivated workers since the Democratic Republic of Congo’s estimated annual per capita income is around $300 a year.  Big labor pool as the Democratic Republic of Congo has a population of over 71 million people.  Ability to order your workers around in French if you want since lots of people there speak French.
Negatives:  Well established history of corruption.  Daily production meetings can take a long time since 242 languages are spoken in the country.  Lots of diseases and snakes.
Positives:  Very motivated workers since Afghanistan’s estimated annual per capita income is around $900 a year.  Everyone has heard of Afghanistan, especially us, the former Soviet Union and the English.  Given long history of exporting opium, exporting clothing should be a snap.
Negatives:  Managing Pashtuns can be tricky.  Very hot climate but no nice beaches.  Finding female workers will not be that easy within the next few years I would guess.
Positives:  Motivated workers since Comoros’ estimated annual per capita income is around $1000 a year.  Since the whole country is an island, you might be able to trick your managers into believing that they are actually working in Hawaii.  Good scuba diving for you and your family during your annual production visit.
Negatives:  More than 20 coups in the last 35 years.  Lots of volcanos.  The whole country is an island.

I really liked this tongue and cheek analysis of possible hopeful future production facilities and also agree with the final point of the article.  Instead of dealing with foreign countries, oceans, and corruption, why not just make your apparel in this country?  It might end up being more cost effective, produce less headaches, and even sell more clothing at the end of the day!  People are very aware of where that label states the item is made and the closing argument in many folks minds now a days is Made in the USA!

Happy Sourcing!

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