According to Textile Exchange Online, performance apparel is one of the fastest growing sectors of the global textile industry, with some of the largest gains realized in North America. Lifestyle changes and healthier outlooks are contributing to the burgeoning industry. Major apparel brands have taken note and are rushing to offer the very latest in style, flexibility and functionality. These companies are turning to the global garment industry as partners in their quest to capture and maintain ever-increasing shares of the consumer market.
A recent article in Sourcing Journal Online by industry expert David Birnbaum casts some fascinating light on this topic. He states that macro costs and direct costs played major roles in deciding where to outsource manufacturing up until the year 2005. That was the year when quota premiums for strategic products were phased out, leading to what Birnbaum referred to as a revolutionary change when customers started turning their attention toward indirect costs.
Birnbaum says that factories are now being looked at more as service suppliers than simply product makers. New criteria are emerging such as speed to market, the ability to handle small orders, and the flexibility to produce an increasing number of styles. He concludes that this move to reduced indirect costs is only the first step in a revolution that will change the entire garment industry.
Companies which are solely looking at their total landed cost or just labor cost, without considering the benefits of working with a nearshore supplier, may be losing the competitive edge. Many performance apparel companies are already reducing their indirect costs by increasing their reliance on Mexican manufacturing capabilities. Not only are they receiving high quality and fast turnaround, the decreased transportation costs and timeframes are having a dramatic impact on their bottom lines. The benefits of having a Mexican manufacturing partner right next door are tremendous for brand names trying to appease a highly-demanding American market. Whether turnkey contract manufacturing or CMT, MFI has the expertise and capabilities to help performance apparel companies compete more effectively.