Selecting Locations for Global Sourcing
Characteristics of Countries that Impact Sourcing Decisions
What is Level of Development and Geographic Location
Three types of Apparel Importers
Private Brand Retailer, Brand Manager, and Apparel Sourcing Intermediary
What is the primary focus of the North America Free Trade Agreement (NAFTA)?
The North America Free Trade Agreement (NAFTA) focused primarily on trade and investment unity. Based on the country of origin (COO)qualifications, the following ratification went into effect: Textiles and apparel had a 15-year transition period to eliminate tariffs
90% of goods traded among Mexico, Canada, and the United States
Workplace health and safety, the minimum wage, and child labor laws were to be upheld
The role of China in textile and apparel industry
China is the world’s leader in textile and apparel exports.
China is the world’s largest producer of man-made fibers.
China is the world’s leader in cotton production.
The role of AGOA in Sub-Saharan African nations is____
AGOA was developed to promote the self-reliance of Sub-Saharan African nations
Factors Related to Levels of Development of a country that impact sourcing decisions.
What is
Overall Stability and Security
Bureaucratic Efficiency
Infrastructure
Education
Human Rights
Labor cost
What is the difference between brand manager apparel manufacturers and an apparel sourcing intermediary?
Brand Manager Apparel manufacturers design, produce, and distribute products under their own brands.
An apparel sourcing intermediary is a company that has expertise in design, product development, and acquisition of materials, logistics, and importing. It has a network of factories it contracts with.
Trends in Textile and Apparel Trade in the Americas
Textile production is automated and computer controlled
Many US apparel manufacturers are now considered brand managers
Apparel manufacturing has moved to low-wage countries, such as Mexico, Argentina, Vietnam, etc.
The main focus of the Japanese textile industry is _______
What is
Production of high-tech synthetic fibers and fabrics
What is the role of the World Bank?
What is
a UN agency that provides interest-free loans to low-income nations to improve living standards
Factors Related to Geographic Location of the country that impact sourcing decisions.
What is
Shipment Time and Cost
Import Tariffs
Cultural Values and Norms
Natural Disaster Risks
What services do CMT(cut-make-trim) factories provide?
Cutting fabrics, making(sewing) garments, and providing trims (labels, hangtags, price ticketing and packaging)
Clearing and packaging finished products
The vendor is responsible for garment production and packaging only
The Role of the United States in the Textile and Apparel Trade (US Retailers)
US apparel retailers are involved in design and product development
Large retailers provide online shopping for ultimate consumers
Eight of the top 15 largest retailers in the world are based in the US
Internet-enabling technologies provide opportunities for small apparel businesses
Retailers source at major trade fairs in the US.
Large US-based retailers have stores in other parts of the world
The major textile-related export by Australia and New Zealand is________
What is Wool?
Factors that hinder trade and development in the African region include _______.
What is
Inefficient transportation and communication infrastructure
Political instability
What is the difference between lean manufacturing and agile manufacturing?
Lean manufacturing emphasizes efficiency, economy of scale, and reducing costs throughout the entire process, while also improving quality. Good strategy for the production of basic products
Agile manufacturing focuses on production flexibility and speed, small runs, and quick changeover from one product to another. Better suited to fashion products
What services do Full-package (full-service) factories provide?
A full range of preproduction and post-services:
Design
Product development
Sourcing , purchasing and inspecting all necessary materials including fabrics,
Logistics and delivery of finished goods
What are the benefits of the US-Colombia trade agreement?
US-Colombia trade agreement eliminates tariffs and other trade barriers and promotes economic growth for both countries.
US cotton, yarn, and fabric exports are used in many apparel items that Colombia exports back to the United States
India is ____ in the world’s cotton production
India is number 2 in the world’s cotton production
India is the most invested in textile and apparel industry in this region
The role of Egypt textile and apparel industry ___
–Produces finest long-staple cotton in the world.
–Qualified Industrial Zone (QIZs) provide duty-free access to the US market if products include some Israel contents
–Apparel companies some of which are vertically integrated, and capable of providing full-package services and deliveries
What are trends in global sourcing for textiles and apparel industry?
Regionalization – growth in regional trade and sourcing, in which smaller, more frequent shipments could be available
Reshoring (returning apparel production to the US) – some apparel companies are looking for opportunities to manufacture products domestically. “Made in USA” goods
Sourcing documents used to ensure manufacturing control and vendor compliance (quality assurance, country of origin, and care labeling).
Sourcing documents include product specifications, cost sheets, and vendor bids, payment for goods, insurance, shipping issues and clearing customs
What is the European Union (EU)?
The EU is an organization of countries formed in 1993 to expand cooperation regarding trade, social issues, foreign policy, defense, and social issues.
All EU countries are connected economically but are politically independent.
Each country also has a distinct cultural heritage and language that it wants to maintain
ASEAN includes members from ________
What is South Asia? India, Sri Lanka, Bangladesh and Pakistan
–The textile and apparel sector is the largest source of manufacturing jobs in South Asia.
–Labor costs for textile and apparel production are the lowest in Asia
Developing and Newly Developing Countries in the Middle East
What is
Turkey (GCI=45) Highly effective global textile and apparel business. Close trade relationship with Western Europe
Jordan (GCI=64)Jordan has a free trade agreement with the US, the EU, the Greater Arab Free Trade Area, Morocco, Turkey, Singapore, and Canada