Reshoring Hits the Apparel Industry and the Pages of McPaper

I’ve never spent much time reading USA Today as a general business news source, but it’s a useful bellwether of what mainstream publications consider to be moderately important news (even if a few minutes spent scanning Economist headlines is infinitely more valuable for our purposes in procurement and supply chain). Yet when certain types of stories make the pages of USA Today, such as this recent coverage of reshoring in the apparel industry, it’s a useful indicator of the trending popularity and importance of a subject.

The above-linked story highlights the role that reshoring is playing in the retail and apparel business, noting that “in the past few years, major designers and retailers such as Brooks Bros. and Saks, as well as dozens of smaller companies, have moved some production from foreign countries to the U.S., creating perhaps 1,000 jobs.” The rationale USA Today articulates goes beyond the facts that “Asian factory wages … are rising rapidly and U.S. consumers have shown a willingness to pay more for Made-in-America products” to also include the speed of production.

For example, according to the head of domestic manufacturing for Brooks Brothers, “if a style is popular … new orders can be filled from a U.S. factory in two weeks, vs. up to seven weeks from an overseas plant.” There’s also the perception, according to the same source, that US makes a luxury good more desirable. Perhaps not so ironically, one of the same challenges facing reshoring in industrial manufacturing is also a challenge in apparel factory production: skilled labor. According to the story, many of the smaller shops – defined as fewer than 100 workers – handling the resurgence of apparel market onshore production “can't handle the added workload in part because sewing machine mechanics, seamstresses and managers are often in short supply.”

Ultimately, while the total cost model equation of apparel sourcing may be simpler than for complex manufactured parts, components, and finished products, the shortage of skilled labor that wants to make a good living in a blue-collar profession in the States is the same in both cases. Rather than focus on incentives for retailers to bring back production and source domestically or build local facilities, perhaps the most advantageous role for the federal sector and local governments to sustain this early-stage trend will be to invest in training and development programs to prepare a new generation of factory workers. If there’s labor to support production at the right cost, they will come.

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