Retailers are working hard to keep the lid on prices, primarily at the expense of their suppliers. However, it is not going to be possible to hold every price at a time when everything that goes into making product is rising too. Rising input costs are not unique to China; the cost of raw materials grew everywhere. Intercontinental freight, energy costs, the cost of capital and labor were all affected in ways that varied from country to country. The challenge is being met by those who are becoming more efficient with new technology and management practices.

 

The wage increases being forced upon Chinese manufacturers is a direct result of China's changing currency policy. Sourcing teams are seeking to move beyond China; however, that is easier said than done. Any analysis of the options in India, Bangladesh, Pakistan, Indonesia, Cambodia, Vietnam, Malaysia, Thailand, and CAFTA nations show major shortcomings, particularly for the sourcing of thread, buttons, zippers, etc., and well as limited distribution and infrastructure.

 

Meanwhile, new import regulations and government oversight rulings continue to be implemented. Supply chain security measures are being strictly enforced by US Customs & Border Protection (CBP). The C-TPAT members must now complete an annual securityprofile review, and the "10+ 2" Requirement has altered the dependence on LDP importing.

Exporting has also been under the watchful eye of the Customs & Border Protection (CBP). Fashion exports require pre-departure electronic filings of export information. Penalties, which have been on the increase, could include the forwarder, the carrier, and the foreign consignee...in addition to the manufacturer. The "REACH" program for exports to the EU includes significant labeling and testing requirements that could affect successful dealings with the EU retailers.

______________________________________________________________________________________             All in all, the current retail scene has shown us a new fashion retail landscape; the "old" model of retailing has changed forever. We are now in the wave of interactive customer profiling, social network shopping, online buying with mobile apps, and customers searching for products blogged by celebrities. The number of internet users and their devices is rising. Those fashion retailers and design-based manufacturers who hope to survive just by coasting through the current economic slump are misguided; the future has just begun.

The Fiber Price Sheet  

Below are the last month's current, month-ago and year-ago fiber prices. (Source: Women's Wear Daily)

 

   

 

---------------------------------------------------------
* Brought to you by:
the California Fashion Association

For more information, contact the TALA office:
p. 213.627.6173
e. info@talausa.org