Asean A Viable Alternative To China For Sourcing Textiles, Apparels

A New York-based private consultancy firm that specializes in offshore services believes Southeast Asia offers the "best alternative" to China for US-based textile and apparel companies wanting to source these products.

TigerTrade Services Inc registered in New York is an end-to-end platform for global trade, connecting manufacturers in the Asean region with the United States and international buyers.
TigerTrade works in sectors such as apparel, textiles, footwear, furnishings and home accessories.
TigerTrade has a network of offices and contacts in the Asean region from where American buyers are increasingly sourcing their apparels and textile needs as manufacturing and labour costs in China, a traditional supplier of these products, have soared in recent years.
Tanjila Islam, the Chief Executive Officer of TigerTrade, highlighted the advantages of sourcing such products from the Asean region.
"TigerTrade's website is designed to help you find trusted businesses with which you can establish business relationships. To complete a transaction, you will need to finalize the arrangements with the other party in Southeast Asia," she said at the just-concluded TexWorld Show in New York, North America's largest apparel fabrics show, organised by the Atlanta-based Messe Frankfurt USA Inc.
Islam told Bernama that some of the high-end manufacturers within the Asean region such as Singapore and Malaysia had moved their operations to low-cost producing sites such as Vietnam, Cambodia, Laos and even Indonesia.
"It is easy to maintain quality control over these low-cost manufacturing sites. Thailand, which has been a leading producer of textiles and apparel in the Asean region, maintains quality controls on such operations in the low-cost sites. It enjoys the twin benefits of good quality and low-cost production," she added.
With China's rising apparel and textile production and labour costs making its products increasingly incompetitive, Islam said, ASEAN offered many "hot spots" for sourcing.
Indeed, she said, Asean had acquired a "powerhouse status" because of Vietnam, Cambodia, Indonesia and Laos. Malaysia, Thailand and Singapore, though more expensive, could complement the low-end Asean suppliers by offering value-added product lines.
What was "exceptionally interesting" that all these players belonged to the ASEAN community which allowed duty-free inter-trade.
Islam also pointed out that once the Trans-Pacific Partnership was finalized and launched - Malaysia is interested in becoming a member of the TPP which is the second largest trade agreement after the World Trade Organisation (WTO) - manufacturers based in the ASEAN region would have access not only to the TPP community but also be within the geographic proximity of China.
According to Islam, China not only faced rising labour costs but also labour shortage in the eastern coastal cities; another disadvantage was the steady appreciation of the Chinese Renmimbi, making Chinese exports more expensive to international buyers who were discouraged by the loss of competitiveness of products manufactured in China.
Western manufacturers are also closely eyeing the opening up of Myanmar, the "new kid on the block", which would offer its low-cost manufacturing services not only to the Western principals but also to the better-developed ASEAN countries such as Malaysia, Singapore and Thailand.
The Philippines, a traditional apparel and textile supplier in the past, had lost its competitive edge in the past few years, although that country still has some good brand-names that still have manufacturing operations there.
But Islam also emphasized that ASEAN was not there to "completely replace" China but provided opportunities to those who wanted to take advantage of the competitive edge which the ASEAN community offered.
John Gallagher, the CEO/President of the organizing company Messe Frankfurt USA Inc., said that he was "very pleased" with TexWorld's three-day performance.
The event, he said, was "well attended" and the exhibitors had been "quite happy" with the response they received at the event.
"We expanded in terms of space renting by 45% over the year 2012," he said in an interview with Bernama at the Javits exhibition center, the venue of the show.
Gallagher said that he had received feedback from the exhibitors that they found the U.S. economy was showing greater resilience and rebound than Europe.
"The exhibitors told us that the U.S. economy was less unstable than in Europe," he said.
He said that some of the exhibitors - the large majority of exhibitors were from Asia - had held business negotiations with representatives from big stores such as Macy's, Wallmart, J.C. Penney, etc.
Besides Southeast Asian, Chinese and Indian exhibitors, the large presence of Turkish exhibitors was conspicuous to all the visitors. A special section called "Apparel Sourcing" was also popular amongst American buyers.
"Malaysian exhibitors should also showcase their products at this fair because there are many American buyers who are willing to pay a slightly higher price if the suppliers can provide quality products and are reliable about their delivery terms," Gallagher added.
(Source: BERNAMA)