R
egardless of your opinion of the Central American Free Trade Agreement (CAFTA) as
currently proposed, the linchpin issues focus on trade preference levels and cumulation that
threaten US manufacturers’ claim on supply to the region. Many North Americans want
tariff-incentivized imports from the region to start with their products. But, a question kept
surfacing at the recent American Apparel Producers’ Network (AAPN) meeting in Cancun, Mexico —
Where are the North American fiber producers, spinners, weavers, dyers and finishers?
The meeting — which brought together Western Hemisphere sourcing managers, apparel
manufacturers and others — went well but suffered from a lack of participation from the back-end of
the supply chain — North American manufacturers. Members from the region reported the problem runs
deeper than meeting attendance, which did include some dedicated North American suppliers. The
situation needs to improve quickly if effective supply chains are to be established to compete with
the China threat.
So, is this lack of interest in Central and South America real? And if North American
producers are not serving the region properly, isn’t recent investment in the region from European,
South American and Asian producers a signal that something is wrong?
The North American industry often is criticized as a lazy industry that has benefited from
protectionist policies that have created a less-than-world-class business culture — maybe not in
investment in manufacturing processes, but certainly in developing and servicing new businesses. In
the good old days, you may remember turning down business that didn’t fit the mill, or was lower
than your run size or put-up. In many cases, that is yesterday’s news, as many companies now step
up to the plate to serve the customer with the flexibility demanded by today’s market.
So then, what is the problem?
Textile World
editors often hear, “I know all of my customers,” a phrase that speaks of both arrogance and
stagnant selling. If you think you know all of your customers, and the industry continues to
contract, it is just a matter of time until you will be out of business. New business is hard to
come by and expensive to generate. New customers bring risks, financial and otherwise. But, if the
Central and South Americans are right, one must ask if North American mill culture has failed to
change. What does it take for the industry to participate and become partners in product
development?
TW
was contacted and asked, “Can you help? These guys are your readers. Where are they?” Why
aren’t opportunities like the AAPN meeting embraced? What opportunities do North American mills
need to get them to participate? Certainly price differentials are significant on products imported
to the region, but if the region starts to compete as a supply chain, isn’t there a benefit to
trying? If all is lost, why fight CAFTA?
November 2004
