I had lunch with a friend recently. I mentioned FBI was presenting a number of seminars on Sourcing at MAGIC, February 16 – 18, 2010. When she asked me what sourcing was, I had to think long and hard about how to describe sourcing in general. It seems easy enough to describe: the supply of resources as required by a business process. I’m sure that’s not what she wanted to hear, so I thought about it for a while. She is a screenwriter with no experience in any sort of manufacturing or service industry. I realized, however, that sourcing can be applied to almost any business process. In her case I related it to her wedding, I asked her to think of her wedding planning as sourcing. Think of the logistics, planning, purchasing, deliveries, setup, payments and tastings as sourcing.

Unless you’re doing everything yourself, including sewing your own dress, baking your own cake, growing your own flowers and playing all of the instruments in the band, you’re sourcing. Many brides hire a wedding planner – let’s call that the agent. The agent’s job is to facilitate the sourcing process. They smooth out the bumps, they help ensure shipments are on time, they deal with customs and suppliers and manufacturers to make sure everyone has what they need to get the merchandise manufactured and delivered on time. In the case of a bride, however, late shipments, extensions, customs holdups and shortages aren’t acceptable at all, so the wedding planner has his or her hands full just as much as an agent. Throughout the wedding planning or sourcing process there are a number of vendors supplying goods and services. A bride might have a caterer supplying food, a photographer, a DJ or band, florist, clergyperson, venue and more. A manufacturer might have fabric or trim suppliers, cutting and sewing services, shippers or freight forwarders and more. Retailers can be as demanding as a bride, so keep in mind your retailers requirements throughout the sourcing process.

That’s not the half of it, however. You don’t just start sourcing, just like you don’t just start planning a wedding. First, you need to think of your budget. How much do you have to spend to bring your products to market or to get yourself and your spouse-to-be to “I do?” Second, what should the end result look like? Third, what is the timeframe to get to the deliverable? How long do you have to plan this? In the wedding world, it may be months or years, in the retail world weeks are better than months and rarely can anyone get away with years. Fourth, how do you find a reliable, high quality agent or wedding planner that fits your requirements - budget, personality, location, contacts, etc.? Do you work off of recommendations, advertising, Angie’s List? How do you know that the person you entrust with your business will provide the services you need? Fifth, how do you begin to execute your plan? Where do you find your suppliers? How do you know the designs and fabric swatches you sent months ago will be delivered to your specifications and quantities? Can you get TOP samples? A bride can’t. But she can have her gown custom altered and chances are good, you can’t do that with your production run. Sixth, what about logistics? What are you doing to track your purchase orders, customs clearing, quota numbers and containers? Let’s hope you have a good system in place to provide visibility to all of that information. If the bride is savvy, she’s tracking her information in an organizer or spreadsheet. Last, but not least, how are you tracking your finances? Letters of credit? Payments to your agent or vendors? Due dates and payment terms? Hopefully the bride is tracking her deposits and payments by check or credit card.

By the time I finished explaining the sourcing process with my bridal analogy, my friend actually understood sourcing better than many of my clients. Then I hit her with “Hopefully, this is the only wedding you’ll ever have to plan. Apparel manufacturers source year round for millions of products to be delivered to thousands of retailers. It’s like planning hundreds of wedding a year, without the cake tasting or big parties at the end.” And, if you do it right, make your deliveries and even make your margins, you’ll keep on doing it year after year.

Jill Mazur is an independent apparel business and technology consultant working with Fashion Business, Incorporated. Email: jill@fashionbizinc.org

Speed to Market – Fast Turn – Rapid Response

What do these terms mean to the apparel industry in 2009? Good news and bad news!

New times = New methods of doing business = Rapid response to the demands of the retailer and consumer.

But, can the average apparel manufacturer respond rapidly? Well, for the small company who, due to their smaller orders are for the most part producing domestically it is good news. They can turn on a dime and produce faster than the larger companies who need a much longer lead time to produce their goods, usually in far off places. Smaller companies with small orders ship them to the retailer, then if the orders sell through they get reorders. This is the very best of new business news for new and smaller manufacturers. It is also good news for the retailer as they can plan for the demands of their customers, the weather, and the economy etc. This new type of selling and buying results in the manufacturer having a much better cash flow, as they will not be seeking funding for larger orders when selling through the traditional five seasons each year.

This tradition of selling at the four or five markets each year usually requires groups within each line that demands cash outlay for the expenses for patternmaking and sampling. Now, the manufacturer is constantly designing, which they really always have and then showing new products, and shipping weekly or monthly new merchandise. So now the manufacturer can get paid more often. They do not need to invest heavily in the five big lines a year as they are now producing and shipping new items to replenish sell through products. The retailer will also have less of a cash flow problem with this type of merchandise planning. The customer will see new items when ever they shop. A win win in a new economy! Well, we hope so.

So, it has at last been officially noted by many international economist that the small business owners are really the backbone of our economy, not only in the US but globally. The big branded companies are not fairing well and many have had to cut back or worse, close their doors. Small businesses can adjust and respond as they don’t have large overheads. For the most part they contract out all their work, including sewing, cutting, bookkeeping etc. and cut back on other expenses to respond to demands, or lack of demands of the economy.

Some for the negative results of this new economy is that bigger retailers are demanding, from branded manufacturers that they discount or allow markdown money. Additionally, major discount store, e.g. Marshals, TJ Maxx, Ross are producing more private label. This has resulted in much cheaper prices for the average clothing labels that are now being sold. The price of clothing today is the lowest we have seen in years. Due to the recession sewing factories around the world have all been forced to lay off workers. The ports in China and other locations are full of containers with cancelled orders. These goods may get discounted and sold or they will have to be destroyed.

However, much merchandise is still being produced domestically, especially in southern California where they produce premium denim, active sportswear and contemporary clothing. But sadly both the off shore and the domestic sewing contractors reluctantly have been forced to take cuts in their pricing so that they can keep their workers working. This rational is in the hopes that the economy will turn around and then the demand for new clothing will pick up. The alternative is to lay workers off and then when the economy turns around they will then need to reinvest time and money in finding good workers and training them.

Another change in business methods are that some of the higher end retailers are asking the smaller manufactures to sell on consignment and this is not a good idea. It was bad enough that traditionally the manufacturer has taken all the risks with development and production costs then have to wait to get paid. Now they are expected to take ALL the risk and maybe then get paid!

Talk about getting screwed!  - Consignment selling will be one of my next blog topics.

But, now onto a very different topic. It is the season to be merry! And I need to take a deep breath and keep my mouth shut when I see all those ugly heavy knitted sweaters decorated with Christmas trees adorned with lights and holly. Or, equally as offensive fashion trend, those cheaply mass produced red jackets lovely dragged out annually of the closets. Where, in my very opinionated opinion they should really remain for posterity. J

HAPPY HOLIDAYS TO YOU AND YOUR LOVED ONES. I HAVE MUCH TO BE GRATEFUL FOR IN MY LIFE AND ALTHOUGH CLOTHING IS MY BUSINESS IT IS NOT MY LIFE.

If you were in the Los Angeles area this week, I hope you had the opportunity to come by the Globaltex trade show at the LA Convention center. There were a lot of great vendors, new products, new and familiar faces and interesting seminars. Since GlobalTex is a new trade show, they’re still fine-tuning it and responding to exhibitor and attendee feedback. I’m hoping the next show will fill the entire room and then some. If you’re looking for industry trends, companies such as MPDClick were there as well as a trend area showing some of the latest fabrics, colors and prints.

So here’s what I learned:

1: Trade shows are still the best way to see and feel new products, colors and designs. I’m a big fan of technology, don’t get me wrong, but nothing beats holding something in your hand to really understand the product.

2: Hemp jersey is my new favorite fabric. Seriously. I was thinking “Hemp Jersey?” How soft can that be? Well, it’s as lovely as Modal – soft and drapey, without the clinginess of Modal. One of my clients is already using it in some of their designs and I can’t wait to see it when it comes to market.

3: Heavy rains made for a light turnout the first day of the show. It also made for nightmarish traffic, but that’s to be expected in Los Angeles.

4: Frances Harder of FBI, Victor Dahan of Shipson, Ken Wengrod of FTC and I had a great time on the “Speed to Market” panel. We approached the subject from our own view points. Frances moderated and injected her wisdom about bringing production back to the LA area and how California designs are sought after around the world.

5: Ken talked about financing and the current credit situation. Everyone wants to know what will happen if/when CIT files for bankruptcy. Ken explained the most likely scenarios and let everyone know that business would still continue. I swear I heard a collective sigh of relief.

6: Victor discussed how to improve the supply chain and how markets in China and Russia are opening up to American goods.

7: We all talked about how selling to the international markets should not be a barrier in business any more. Financial transactions, credit, customs, commercial invoices and more are easy to address and can expand a company’s revenue stream dramatically.

8: I talked about the role of technology in speed to market and how using tools can give you a 360 degree view into the design, sampling, production, inventory and financial aspects of your business and how no company should ever be without them. No matter what your budget is, there are tools to help your business.

9: Retailers are conducting business differently and manufacturers need to be able to react quickly to change. Keep inventory low. Don’t expect the re-order. Speed to market is an entire process from design to delivery, know how to react.

10: Don’t wear boots with three inch heels when walking a trade show.

Jill Mazur is an independent apparel business and technology consultant working with Fashion Business, Incorporated. Email: jill@fashionbizinc.org

Like so many businesses, the business of sourcing has been rapidly changing. Whether we are discussing apparel, custom machined parts, electronics, or virtually any other manufactured product, we have sourcing technology available today that simply did not exist even a few short years ago that can make the work of sourcing much more efficient is a host of ways.

However, it is not enough to simply use computerized systems to connect buyers with suppliers. Both the buyer and supplier should and can go much deeper. There are a few key points that both the Supplier and Buyer need to understand in order to truly be effective in serving both of their interests. Let’s focus on two such points:

1. What kind of computerized system to use to solve the main sourcing issues of Apparel Buyers and Suppliers.

2. Why Buyers and Supplier need to be able to actually transact business via computerized systems, a.k.a. “Going Deep”

Example of using computerized systems and why that in and of itself does not get the job done.

When you really think about it the main goal of a Supplier is to keep the machines running. This means servicing current clients and having a way to connect with the right new customers at anytime.  Buyers on the other hand are on the hunt for the right suppliers with the right capabilities at a particular moment in time.

For Buyers and Suppliers the right technology via the internet is the solution.

Typically a buyer goes through something like this in order to source any particular garment; Get designs ready, prepare a tech pack with specs, email designs to a handful of factories, and request quotes back from factories. The buyer then might receive a handful of quotes from different sources in different formats – spreadsheets, faxes, quotes at LDP, quotes at FOB, etc… Now the buyer has to compare disparate quotes from different sources and try to figure out what is the best deal in price, geographic location, landed, picked up etc…

Doing that once you might say is worthwhile and perhaps the only way. Doing it repeatedly however is a real headache for both the Buyer and the Supplier. The internet offers various “solutions” for local suppliers to connect with international buyers. Upon further inspection however most of the options serve only as “brochure-ware” or directories of suppliers that a buyer must navigate to find a source. Then the buyer has to most likely go through a series of phone calls or emails to attempt to qualify the suppliers that maybe could do the work at hand. This is not that much different than a buyer pulling out the yellow pages and thumbing through to find a supplier.

The real value in connecting local suppliers to international buyers lies in a transactional online sourcing platform. In order for local suppliers to truly get connected to international buyers, the supplier has to have far more control of the situation and not simply be listed in a giant directory. Imagine a Chinese apparel factory joins a large sourcing site and gets listed in the directory with a profile. The buyer on the other side of the planet does an online search for “jeans factory in China” and receives a site with a directory of thousands of Chinese Denim factories. Now what? The buyer starts his processes of trying to find the right supplier. If you are the supplier and are listed on page 2 of the directory, you might never even get seen. Imagine being on page 257 of the directory!
It is far more interesting and effective for both the supplier and buyer to collaborate on a true online sourcing platform whereby a buyer can provide the designs to a marketplace and a supplier in the marketplace can hand pick the production it wishes to secure.
From a supplier’s perspective it is far more effective to be able to peruse a continuously updating marketplace of buyers with actual production needs exactly when the buyer is looking and has the capacity.
From a Buyer’s point of view it is far more effective (and clearer) to be able to tell the marketplace what it is looking for and receive several competitive quotes back from suppliers in an apples to apples format. From there it is easy to compare quotes and make decisions.

At that point the buyer and supplier can connect by other means – email, telephone etc.. knowing there is a good chance that the fit makes sense as they start to do business together.
Local suppliers are truly connected to international suppliers on an online sourcing platform that allows the parties to transact business together.

When I say “Job Creation” I’m referring to new jobs or positions created in our industry, not the act of filling an existing position. For example, several years ago, it became a necessity for many companies to have an on-line presence. Whether it was a web site devoted to the company or brand or an actual on-line marketplace would be determined later. What most companies lacked was an existing employee with the knowledge and skills to create and maintain a website. There were a rash of jobs created specifically to support websites and ecommerce positions. Now these jobs exist or are outsourced at most apparel manufacturers. So I’m wondering what the next set of necessary jobs skills will be.

Many companies have moved away from internal or domestic production in favor of outsourced or full-package production. With the economy the way it’s been, retailers demanding lower stock levels and quick turnaround, are we headed back to a domestic cut and sew production model? If so, we’ll need to be able to ramp up domestic production. Sewing and cutting contractors, dye houses, trim and fabric suppliers may start filling long empty spaces in and around downtown. Production managers and assistants would be required to manage cut and sew operations. Marking, grading and patternmaking skills would be in demand. Wouldn’t that be nice? Instead of losing more jobs to off-shore manufacturing, we’d start creating new jobs to be able to support the retailers’ need for speed-to-market.

FBI is working hard to help create new jobs in the apparel, footwear and fashion industries in general. Specifically, we work with new and existing companies to help them grow by providing the resources and training they need to survive and thrive. Where else in Los Angeles or San Francisco can a designer with a great idea for a new product go to get help finding a qualified contractor, a respected accountant or business advice to create a profitable company? Where else can a business go to find seminars, classes, even certification programs on industry specific software and skills? I can’t think of any other place than the FBI. And yet, most fashion companies aren’t aware of the benefits of an FBI membership. At a starting price of just $200 per year it’s the best investment a company can make.

Jill Mazur is an independent apparel business and technology consultant working with Fashion Business, Incorporated.  Email:  jill@fashionbizinc.org

Fashion Business, Inc. is asking for your input to help us conduct a study of the apparel, footwear, textile and accessory industries. Specifically, how the recession has affected job opportunities within these industries over the past 12 months.

We’d like to know a few things about your business. This study is anonymous – any information you include about your business will be kept confidential and only used for data gathering purposes. We will be happy to provide you with the results of the study, should you so desire. Please indicate this on your response, along with your email address.

1: What is your sales volume today (in dollars)?

2: Over the past 12 months what percentage of your sales volume has increased or decreased?

3: In the past 12 months, have you had any layoffs or reductions in staff? If so, how many people or percentage of your work force.

4: In the past 12 months, have you hired staff for any existing positions?

5: In the past 12 months, have you hired staff for any newly created positions?

Thank you very much for your time today. Your help is greatly appreciated.

Jill Mazur

Independent Apparel and Business Consultant

Email: jill@fashionbizinc.org

We received a inquiry from a reader frustrated with her search for the right textiles and notions.

Yes its no secret finding materials in our industry can be a slightly underground process.  We know, its hard to know even where to begin…

Well reader…no fear.  Here are a few ways you can find the textile and notion resources you need:

1.  Attend Sourcing Events: Going to a trade show is a great way to meet and see the products of a variety of manufacturers at one time.  The next round of big sourcing shows start at the end of August with,  Sourcing at MAGIC or be sure to check out the LA Textile Show which starts at the end of September.

2.  Do an Online Search: You can search online for resources as well.  Infomat.com is an excellent online resource to help you find more production resources than you’ll know what to do with.

3.  Get a Guide: The Textile Association of Los Angeles publishes a quarterly guide of textile resources that sells for about $75 dollars.

And remember you can always visit textile showrooms year-round as a buyer.  Check out the floor directory for the California Market Center in downtown, LA for exact locations.

Happy Hunting…

We received an inquiry from a newbie designer wondering how to start producing her designs. So how do you get from the idea to the garment.

Here’s the skinny….

1.  The Idea–Before you get a pattern created of course you’ll need to solidify your idea.  This can be in the form of a product sketch or even other pictures or samples of garments that you want to pull together into your own creation.  (ex. a sleeve from this…a collar from that…the length of that).

2.  The Pattern–Once you have your sketch or idea on the table you’ll need to work with a patternmaker to create the pattern.  When you first meet with your patternmaker its best to have all the same materials you’d like to use for production including things like elastics, and fusing. The accuracy of the pattern and the ultimate fit of the garment will depend upon what materials you use….so you don’t want to waste the patternmaker’s time or your money working with materials you don’t plan on using.

3.  The Sample–The patternmaker or a separate samplemaker will make samples from your pattern.  It’s rarely right on the first try so get ready for a series of fittings…likely 2-3, before you’re able to really see your vision come to life.

4.  Grading–Your first sample should be in the medium size of your product.  From there the pattern will be graded proportionally up or down.  Sometimes the patternmaker will do this other times you can source it out again to a computerized grading serivce.  Although the more you can combine services under one roof the better.

5.  Production–Once you have all your patterns and a final sample..and yes of course….Orders– you’re finally ready to go into production.  Some samplemakers will do small production lots (under 200 units), which can be ideal for a start up company.  And since samplemakers are used to small lots they can be a lot more flexible in helping you get your hands on re-orders so you don’t have to invest in too much inventory.

Overall the production process is a lot more complicated than it seems at first blush.  Everything from your fabrics, trims, pattern, cut and sew techniques all work together to make your garment what it will ultimately become.  Set up a good system for tracking your production process so you’re able to meet your delivery dates and accountability is always clear.

In the past many fashion companies seemed to inadvertently associate profitability and growth with off-shore manufacturing. China…Vietnam…The Philippines, anywhere but here. Unfortunately other than being good patriots, too many brands have found it financially difficult to rationalize being “Made in the USA.”

Interestingly enough in these challenging economic times, there appears to be an emerging sea change in the “off-shore is better,” mentality. Some design companies are starting to pay closer attention to the quality, cost and time benefits that can come with domestic manufacturing.

Here are some things to consider when you decide on your on or off shore production strategy:

1.  Speed to Market–Working closely with a local manufacturer can add up to significant cost savings when it comes to translating you developed product into final production. If you’re serious about speeding up your product life-cycle make sure you’ve established a good relationship with a local manufacturer that can help get your product out of your head and on the shelves as soon as humanly possible.

2. The Hidden Costs of Importing: The new 10+2 importing compliance rule is the latest example of the hidden cost and logistical hassles that can result from importing product from overseas.  Make sure that you are keeping track of the costs and time involved as well as how they affect your bottom line.

3.  Quality Control–Although the U.S. is known for the quality of the goods it is able to produce, especially in the higher end and conemporary market, domestic manufacturing can also afford designers the ability to overse their production preimpting any issues before they become real problems.

Importing into the U.S. has just gotten a little more complicated. In this week’s California Apparel News, the paper highlights strict new importer requirements which go into effect January 26, 2008.

The new “10+2 Rule” contains a laundry list of data required from the importer as well as the ocean carrier that must be supplied before imported product can be received at a US port.

Also, since one ship could be carrying product from multiple companies if one company is not compliant the entire shipment will be delayed until the proper paperwork is completed.