Rules of apparel business alter with change in supplier strategies

01 Aug '09

1 min read

The ongoing global crisis has brought a drastic change in the business sector. Recognizing the change and adopting flexibility in operations is the right way to ride the tide.

Greater China (China, Hong Kong and Macau) was the number one supplier, but its market share was only half of what it is today.

CAFTA and Mexico-both quota-free countries-were each only slightly below, with Bangladesh and Indonesia-both easy quota countries-well behind. The 2005 quota phase-out changed the game.

Garment suppliers expanded their location from somewhere to everywhere. Transnational suppliers with multiple branches across the globe started emerging.

Customers wanted to take advantage of countries that have a duty free access to the US. Suppliers are now changing their shipping terms from FOB to DDP, and their payment terms from L/C to open account plus 30 days credit.

They are selling their goods FOB New York (or London or Tokyo). They are opening design and sales office in every market where they ship. This trend will shift the entire sourcing process.

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Fibre2fashion News Desk - India

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