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28 Oct

IAHTM Conference: Global sourcing challenges update

Alan Schwartz, President, Fashion Seal Healthcare

Earlier this week the International Association for Healthcare Textile Management (IAHTM) hosted their Annual Member Meeting and Education Conference in our own backyard of Clearwater, Florida. I was lucky enough to sneak away from the office for a bit to attend the panel discussion “Where is Our Industry Going? (Textiles, Equipment and Chemicals)” featuring Norbert Gittard, Vice President of Sales and Marketing for Jensen USA, Jason Lang, Director of RD&E for Ecolab and our very own President, Alan Schwartz.

Alan is an expert in uniforms and image apparel, and the economic factors impacting the textile and apparel industry. He gave an update on global sourcing challenges, a topic he presented on at various conferences in recent years and  has authored multiple white papers on as well. Here are the key takeaways I captured from Alan’s portion of the panel discussion:

Raw Materials
Polyester is a derivative of petroleum, so when the cost of petroleum goes up OR down, the cost of polyester fabric follows suit. The increased oil supply in the U.S., combined with weakening expectations for the global economy and world oil consumption, will likely continue to push oil prices lower in the foreseeable future. As the cost of oil falls, so will the price of petroleum products like gasoline or polyester.

Compliance
The issue of ethical sourcing and compliance is a core challenge within the textile and apparel industry. Compliance standards of your vendor partners should be top of mind no matter if you’re a manufacturer, laundry, distributor or the actual purchaser.

Never hesitate to ask your vendor partners to view their compliance strategies as their failure to act could affect your business. In fact, public companies listed on stock exchanges around the world are seeing major compliance questions coming up at their shareholder meetings.

Energy
Apparel production is very energy intensive. Even so, some of the most popular countries for apparel manufacturing struggle to provide energy to their factories due to the high expense and short supply. For example, Pakistan has experienced an unrelenting energy crisis in recent years. A June 2015 Wall Street Journal article referenced in the panel discussion states that “power shortfalls in Pakistan have approached 50% of the national demand.”   

Pakistan and other like apparel manufacturing countries having the same struggles will need to make the necessary investments in power infrastructure to support their growth and development.

Transportation
Shipping lines are controlling capacity. If a ship isn’t at full capacity, it won’t leave the port, which inevitably makes exports delayed.

An ongoing issue affecting transportation costs, particularly coming in from Asia, is the imbalance of trade. When container ships are coming over to the United States from any of the ports in Asia, they are generally coming over completely full, filled with all kinds of merchandise. However, at some point these containers have to be routed back to Asia and many of them go back empty.

New Product Development
The Future = Smart Fabrics. Meaning fabrics in which aesthetics and performance are enhanced. Organizations and end-users are looking for new products that offer:
•    New fabrics
•    Better barrier protection
•    Technology advancements
•    Extensive color options

In order for new products to be successful in the marketplace, apparel manufacturers must work with laundry equipment manufacturers and chemical companies to ensure that their new creations can withstand being processed constantly in industrial laundries. Otherwise, the product is a bust!
 

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