Sourcing Strategy of Leading U.S. Apparel Companies

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Author: Sheng Lu

Professor @ University of Delaware

16 thoughts on “Sourcing Strategy of Leading U.S. Apparel Companies”

  1. I think it is interesting that the common factor for all of these companies is that they have manufacturers in numerous countries. It is a prime example of globalization and shows that it is necessary to adopt globalization in your business practices to have the most efficient and cost effective production process.

    1. I definitely agree that this is an example of why more and more companies need to jump on board with globalization. There are many factors that attribute as to why globalization is becoming more popular. It is more efficient for businesses to source over seas and as we discussed in class it is beneficial for different countries including our own when we outsource. It is important that these countries get the recognition they deserve though. The days of “made in” tags is definitely outdated and I believe that we will see changes with that in the coming years.

  2. This interestingly ties into the “Made in China” discussion about tags and attributing it to only one country. It begs the question if it is even possible to fully make a garment solely in one country. I was surprised that even Ralph Lauren, a company deeply rooted on America and American culture, had less than 3% of their products made in the US. In the link provided below on the RL website, they advertise how they created the uniforms for USA for the 2014 Winter Olympics, with the header reading “Made in America”. This is pretty misleading especially when most of their other products were made elsewhere.

    http://www.ralphlauren.com/shop/index.jsp?categoryId=28870006

  3. After looking at this chart and seeing that some companies such as Levi Strauss & Co source from different vendors in over 30 countries, it is understandable why retailers have difficulty identifying each contributor to its supply chain. It is obvious that many of the well-known brands listed above are as successful as they are due to their diversified supply chains. This chart also implies that retailers rely heavily on globalization and that although some manufacturing may return to the United States, the bulk will remain overseas as long as the benefits (low labor/production costs) continue to outweigh the disadvantages (unstable governments, high energy costs).

  4. It is interesting to see how the majority of the brands we know manufacture overseas but it is not surprising based off of the material that we learn in class pertaining to globalization. Although these companies are looking overseas they will not settle if prices increase for example how the gap looked elsewhere after they noticed the prices in China were increasing. As companies look for cheaper places to manufacture as history has shown us, it can cause major issues for example the Rana plaza tragedy in Bangladesh. Although globalization is a good thing how can these companies continue to get the best prices while maintaining a safe environment for manufacturing?

  5. The main trend I noticed while reading through this chart is that all of these companies have manufacturers and sourcing strategies from a wide variety of vendors both internationally and domestically. In short, in order to compete in the global market place, retailers must be able to stay in line or ahead of their competitors. In order to stay ahead, many of these companies MUST move their manufacturing and sourcing bases overseas in order to be cost effective and stay afloat in the highly saturated T&A industry. It is a solid proof that globalization is affecting our industry on a daily basis.

  6. This article was so interesting to read. It was interesting to see brands that I love and buy source all over the world and to see who exactly they source from. It is also sad that some companies source less than 3% of products from the U.S. It is crazy to see how much globalization is a part of the textile and apparel industry, and how little people actually know about this. I wonder if these brands would be even half as close to as successful as they are now if they sourced more from the U.S and not from overseas.

    1. But on the other hand, “global sourcing” helps consumers save money–the retail price for clothing in 2015 is almost the same as in 1995. In comparison, think about the rise of college tuition…

  7. This chart really demonstrates just how many brands produce goods globally and how Globalization is truly affecting the industry. The chart also shows the way retailers are doing so many different things to cut down costs and earn as much profit as they can. However, this graph does make me question the “Made in ___” that are on the tags of all of my clothes, a majority of which belong to brands that are listed in the graph above. In addition, it is also interesting to see brands like Hanes, where some of their manufacturing is made in the Caribbean Basin Region. I feel as if this region is often overlooked by consumers as an area which produces garments.

    1. great thinking! Next time when you visit a clothing store, you may check the product label for cotton T-shirt. I believe most of them should be made in central America or mexico–largely because of NAFTA and CAFTA-DR as we discussed in the class this week.

  8. It is disheartening to me to see all of these well known “American” brands doing the majority of their manufacturing oversees in order to cut costs. You would think that a brand that claims to be “All American” would put more effort into domestic manufacturing. It just goes to show that apparel companies prefer to look to cutting costs rather than looking at the larger picture of social responsibility and how outsourcing negatively impacts less developed countries.

    1. If sourcing is all about “cut cost”, why didn’t company just choose to source from one single country with the lowest cost? Also, we all know China remains the largest apparel supplier to the US market, but China’s labor cost is NOT the lowest: https://shenglufashion.wordpress.com/2015/01/25/2014-world-textile-industry-labor-cost-comparison/ how to explain this phenomenon? Additionally, apparently social responsibility is not just a problem overseas: http://www.takepart.com/article/2015/09/10/sweatshop welcome for any follow-up comments.

      1. As noted in the textbook, China remains the largest apparel supplier to the US market despite it’s labor cost not being the lowest because it already has an established garment manufacturing system. The percentage of retailers that wanted to source from Bangladesh decreased from 2014, and retailers still choose China even though Bangladesh has cheaper manufacturing. There are many liabilities with sourcing from other places, as seen in the Rana Plaza incident, that could bring bad press to companies. Even though sourcing form the lowest costing country would save money, the bad publicity that a company incurs from such a tragedy is unforgivable and would cost them more than that. Because China already has an established garment manufacturing system, networks and transportation and other logistics are already worked out. Relationships with certain factories are already established as well.

        That is not to say that China doesn’t have issues with social responsibility as well (they most likely block some tragedies with their retail manufacturers because of their blocked internet access by government which is why we might not hear about it as much). Cheap labor from an economical standpoint is ideal for all companies, and Los Angeles sweatshops’ isn’t an exception.

  9. This chart shows that many retailers we buy from have relationships with many different countries in respects to its sourcing strategy. Majority of these countries include developing nations within the Trans Pacific Region. It is easy to now see why an agreement with these regions would be desirable as from this chart we can see that many American retailers look to these regions to outsource

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