Will it Be Made in America?

FINAL image_Anastasia‘Made in America’ is quite the hot topic right now, grabbing up headlines left and right; from the backlash about Ralph Lauren’s 2012 Olympic uniforms (the company quickly learned its lesson—the 2014 ones were made in the US) to retail beast Walmart’s declaration to increase its purchase of American-made goods by $50 billion during the next 10 years. It’s a hopeful story—fostering patriotism while supporting the return of jobs to US soil.

There are those who say that domestic manufacturing is simply not feasible at certain price points, while others have found a significant shortage of skilled workers as a blocking point. Despite these obstacles, will apparel manufacturing sprout again in the US?

Our take is yes.

Companies are manufacturing clothing in the US today and have been for a long time. Take Martin Greenfield Clothiers, for example. The menswear company offers fine, hand-crafted tailored clothing including made-to-measure suits and tuxedos, made 100 percent by hand in its Brooklyn, New York factory. The company’s customers aren’t too shabby either—Presidents, Ambassadors, major motion pictures, the list goes on.

You may be saying, well of course a company that produces such high-end garments can charge a premium and not worry about paying extra for production. And we agree. But many companies are finding success producing in the US at all different price points. In fact, according to a recent study by Boston Consulting Group on the shift in global manufacturing, China’s manufacturing cost advantage over the US has shrunk to less than five percent, while Mexico currently has lower manufacturing costs than China. This shift highlights how American companies can now consider their home turf as a viable manufacturing option, keeping production closer to the end consumer.

Brand names like Ralph Lauren, Club Monaco, Frye and Brooks Brothers are now producing a percentage of their pieces on home turf as well. Designers like Nanette Lepore are outspoken on the topic; she organizes Save the Garment Center rallies and is vocal with lawmakers in Washington to support the American fashion industry.

America’s Research Group found that approximately 75 percent of consumers would pay more for American-made goods, up from 50 percent in 2010. Thus, people are seeing this as a business opportunity, evident by the rise of startups dedicated to US manufacturing. Look at American Giant, a direct-to-consumer apparel company that makes high-quality, affordable basics, including hoodies, t-shirts and sweatpants. After a December 2012 Slate article declared the company’s best-selling sweatshirt as the “greatest hoodie ever made,” there was a months-long waiting list. American Giant pledges to never outsource jobs overseas.

An important element to consider is the fact that this ‘repatriation’ movement isn’t unique to the US. There is also a push for ‘Made in Britain.’ British companies were dealing with the same challenges—wage increases in China, higher transportation costs, hard to control supply chains; there was also a wave of patriotism following the Olympics and the Jubilee. Many companies have been able to spark an onshoring resurgence, with Mulberry, Marks & Spencer, Topshop, Christopher Nieper and John Smedley being just a few examples.

The moral of the story is: if other higher wage countries are successfully moving toward domestic production, there’s no reason the US can’t follow suit.

We may end up eating crow because of our stance on this topic as only time will tell.

Fabric Substitution Needles Home Textile Shoppers

Preference for Cotton Remains Paramount

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Housing starts and existing home sales are not only good economic indicators, but they are also strong predicators of future growth in other areas like home textiles. As the turnaround in the housing market gains steam, the home textiles market benefits – but consumers are increasingly paying higher prices for lower quality and less cotton-rich items, and they are not satisfied.

Textile World recently reported that housing starts could increase by as much as 15 to 20% over the course of 2014, despite the harsh winter, leading to potentially brisk business for the home textiles sector. While January building permits were 5.4% below the December rate, they were still 2.4% above the January 2013 estimate, according to the Department of Commerce, hinting at an upswing in the industry that could carry over to home textiles.

Cotton remains the favored fiber for home textiles like bedding and sheets; more than eight in 10 (81%) consumers prefer their sheeting to be made from cotton and cotton blends, and 75% of consumers prefer their bedding to be made from cotton and cotton blends, according to the Cotton Incorporated Lifestyle Monitor™ Survey. But that’s not always evident at retail. [Read more...]

Seeking Transparency

Cotton Charts 05-2014-01

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How Sustainability Can Enhance Your Supply Chain

Has sustainability truly become part of our lexicon, or is it still just a buzzword? Today, most consumers expect products and their manufacturing processes to be sustainable; indeed, it’s part of the legacy of the original Earth Day, held more than 40 years ago. And while Millennials demand it, they’re not always willing to pay more for it. So how can the retail industry adapt?

“Research reveals price and style still top consumers’ lists of purchase drivers when shopping for apparel, though environmental-friendliness remains a draw,” says Kim Kitchings, Vice President, Corporate Strategy and Program Metrics, Cotton Incorporated. “When she buys something that looks great on her and is the right price for her budget, the item’s environmental-friendliness becomes a kind of added bonus.”

Indeed, data from the 2014 Cotton Incorporated Environment Survey support this; 98% of women say fit is the most important factor when making a clothing purchase, followed by comfort (97%), quality (95%), and price (95%). Nearly half (46%) of female consumers cited environmental-friendliness. [Read more...]

How Chicago Grew Its Own Fragrance

Tru Fragrance_flowersThe Second City has racked up something novel. For the first time, the city has come together to fulfill a mission of sustainability, urban beautification, and economic development through creating flower gardens specifically for use in a fine fragrance.

Tru Blooms is a fragrance initiative designed to transform Chicagoland’s green spaces into growing spaces, and cultivating flowers that are harvested and bottled into a limited edition perfume.

Capitalizing on the trends of urban farming, locally-grown produce, and the overall “farm-to-table” vibe, Tru Fragrance, based in Willowbrook (just west of Chicago), and with offices in New York and Denver, saw an opportunity to do something completely different in the perfume space.

The brand DNA was not only based on the flowers grown locally in the Windy City, but it was also infused with an artisanal touch, and defined by community and purpose. Over 60 people have been trained and employed to plant and maintain more than three acres of flowers located across the city, ranging from the high profile and highly trafficked Grant Park, to many of the small neighborhoods that Chicago is known for.

Tru Blooms is a brand based on community gardening with a perfume evoking an olfactive image of a fountain cascading with overgrown with roses. Our goal is to produce a scent that is as authentic as the spirit of the community of gardeners. [Read more...]

Moneyball for Retail

YG_moneyball_FINAL imageThere’s a new way to grow profits and hit it out of the park with consumers, employees and shareholders. It’s “Moneyball for Retail” – finding market inefficiencies to gain a competitive advantage.

In Major League Baseball, team owners want to win games. In retail, executives want to grow sales and profits. Both want to achieve these goals without breaking the bank, and the best-managed franchises in each have one fundamental principle in common: identify, develop, and reward the right players.

Whether baseball teams are winning or not, their ongoing costs continue to escalate. To keep the franchise operating at a high level, management needs to be aware that the most expensive players aren’t always the best fit for the team. The same holds for retail stores: operational costs are escalating regardless of store success, and executives need to schedule the right people in the right places to generate profits with the fewest additional costs.

And just as iconic baseball dynasties have come and gone, so have seemingly invincible retail giants. The survivors are the ones that continue to win. [Read more...]

The Power of One

shutterstock_93965347Consumer Insights from MasterCard Advisors

The digital age has brought a shift in power from retailers to consumers unlike anything known before. Each consumer is now a market segment of one. Within the next five years every retailer will learn to win consumer business and sustain loyalty by understanding behavior as it’s reflected in what consumers buy, the experiences they covet, the networks they leverage and their attitudes regarding data usage, price and convenience.

The year is 2020. Isabel, a 35-year-old professional, opens her tablet. First stop is her home screen, from which she controls her universe. She has her favorite brands, her product wish list with the prices she’s prepared to pay (information she has shared with those same favorite brands) and an easy-to-manage dashboard defining what the outside world sees about her. Certain brands she trusts enough to share quite a lot about herself. These favorites, of course, know the most about Isabel, so that she can get exactly what she wants from them. [Read more...]

Innovation and Prosperity: A Primer on Private Brand Fragrance Development

shutterstock_115177768Why aren’t more retailers getting into the private brand fragrance game?

In the fashion retail marketplace, developing your own private fragrance brand, especially for specialty apparel chains, is a powerful way to take share from larger multi-brand stores. The single brand strategy resonates so well with consumers today, from Millennials to Baby Boomers, at all levels of the marketplace — from mainstream to luxury. Multi-brand retailers can use private or exclusive brand fragrance to enhance their businesses. These proprietary brands reinforce uniqueness; can be used as promotional tools, gifts-with-purchase, or other innovative marketing techniques.

For retailers who have the will and the vision, the development of private brand fragrance products represent an opportunity for significant financial gains combined with the strategic leverage of merchandising exclusive, compelling products. This is a wonderful opportunity to showcase the creativity, imagination and innovation of your company – - just what is necessary today to differentiate yourself and be successful in the retail space. While nothing is ever guaranteed (and especially not in retail), the development of private brand fragrances can potentially lead to tens of millions of retail profits. [Read more...]

We’re Talking Tech

Lectra-3DWe think Nick Graham, co-founder of Joe Boxer, is a rock star. “The brand is the amusement park, the product is the souvenir,” he says. Well, we are in line to buy both tickets and souvenirs!

You can’t forget about the product! But how do you create a better product? It takes a good team and a good process, and technology has to be the backbone.

Technology is taking the fashion and retail world by storm, transforming the way we work in the design room, during production and at the point of sale.

Technology for design and pattern development is a good place to start but technology can’t compensate for a bad process. In fact, it only makes it worse! But a good process, one that marries retail, design and production from the beginning, for example, can take you from just an “okay” product to a fantastic one that both your customers and you love. One that fits and looks great, but also meets cost and time objectives. [Read more...]

Sales Force Transparency: You May Have an Olympian and Not Even Know It!

salesforceBy the time you’re reading this article, the 2014 Sochi Winter Olympics committee will have awarded its last trio of medals. The athletes will have boarded planes back to their respective home countries, and only the elite few will have cemented their places in Olympic history.

On a worldwide competitive stage like this one, the difference between immortality and obscurity is often a matter of microseconds. Events are won or lost by hundredths of a percentage point. And the single factor that separates the winners from the losers is precise and consistent measurement. Without it, the whole system falls apart at the seams.

So what does this have to do with retail? [Read more...]

Reaching the Chinese Consumer

China continues to top the AT Kearney Retail Apparel Index, which shows the top 10 emerging countries viable for the retail sector. Strong growths in population and in income make it an increasingly attractive market for western brands looking to expand. Yet reaching the Chinese consumer poses unique challenges.

According to Euromonitor International, Chinese clothing expenditures are projected to nearly double within the next 10 years, from 1.2 trillion in 2012 to 2.2 trillion in 2020. Even in 2011, a year of slower than predicted growth, Chinese real GDP still amounted to 51.1 trillion RMB.

And while the Chinese population is expected to grow 2% by 2020, income growth will continue to outpace population growth — which means more consumers with more buying power. Per capita disposable income is expected to grow 75% between 2012 and 2020, according to projections made by Euromonitor International.

As the population continues to grow, though, it is also shifting towards more urban areas. This stands to benefit western retailers first expanding into larger cities, since urban consumers tend to spend more on discretionary purchases like apparel and textiles. [Read more...]

Tru Fragrance

Tru_CMYKTru Fragrance creates custom fragrances and scented brand extensions in the bath, body and skincare categories for niche and specialty retailers worldwide. Leveraging a distinctive business model, Tru Fragrance manufactures, launches and markets private label fragrances by working with retail and brand partners from conception through launch. Together they bring to market unique products that strengthen brand loyalty among consumers while helping retailers boost their transaction size and bottom line. The Tru Fragrance model offers retailers guidance in research, creative development, inventory management and marketing. The process maps out a unique path for each partner to help them enter and capitalize on exclusive products within the fragrance space.

People Improvement is a New Frontier of Growth

In my last article, I addressed the importance of “individualizing” store growth plans based on each store’s metrics and specific DNA. Now, let’s discuss the next step in the process — looking further inside the “black box” to the individual associate’s performance to help each person reach his or her full potential as reliable, strong contributors to store growth.

Developing associates to be more productive has never been more important than right now! Retailers face increasing pressures on labor costs. The Affordable Care Act (ACA) forces companies to make hard decisions on full-time vs. part-time staff. Although many retailers remain committed to maintaining a core staff of full-timers, these higher costs must be offset somehow. Our answer is to systematically increase individual productivity. When associates learn and apply new skills to help more customers buy, and buy more, they dramatically offset increases in wages or benefits.career path

As we all know, retail boils down to customers and associates. Associates are the ultimate touch point — where their interactions with customers strongly influence the likelihood of hearing, “Yes, I’ll take it.” So what’s the best way to systematize individual performance improvement and develop more top sellers? [Read more...]