Burberry is famous for its luxury English-made trench coats , also sells products including T-shirts which are imported from other countries. Within the Ready-Made Garments (RMG) industry the T-shirt is classed as a standardised-clothing item, with a manufacturing process that can be broken down into six stages (Figure 1). For the high-value stages of the value chain (R&D, Design, Marketing and Services), Burberry’s product design and development are centred in London and its services are also provided in the UK . This is because Burberry must maintain its luxurious brand, and the higher value-added that flows from having headquarters and prime divisions in a developed country is crucial to this. Conversely, an ideal location for the low-value stages of the RMG chain (Purchasing, Production, Distribution) would be Bangladesh.
From a real options perspective, Burberry could either start a franchise in Bangladesh, outsource apparel manufacturing or establish its own manufacturing plant (Figure 2). Regarding the first option, given the rapid growth of the luxury market in emerging countries , Burberry could set up a branch in the country. However, this option should probably be deferred to a later date because the current GNI per capita in terms of Purchasing Power Parity is low in Bangladesh , and therefore, at present, the total addressable market for the finest clothing is still in developed countries . Consequently, the remaining options are to outsource production to local companies or to invest directly in its own factories. Outsourcing would be possible, but for Burberry, the design of the T-shirt is as vital as its quality. Owing to the shortage of skilled labour it is likely that the workforce will be unable to manage the required standards of quality control (for “Higher Education and Training”, Bangladesh is ranked 117 out of 137 countries ). For this reason, outsourcing would involve an unacceptable level of risk. Consequently, Burberry ought to set up its own manufacturing plant.
There are currently three types of manufacturing operation in Bangladesh, depending whether raw cotton is used, imported yarn, or a premade fabric. For the reasons given above, outsourcing would not be a reliable
Esquel, one of the leading cotton-shirt-manufacturers in the world came from China and it supplies lots of clothing brand such as Banana Republic, Tommy Hilfiger, Hugo Boss, Brooks Brothers, Abercrombie and Fitch, Nike, Nordstrom and Lands’ End, in addition to private companies (Plunkett Research, Ltd.). However, due to the high demand of the US apparel stores for Chinese products, the low cost, which was the main reason why raw materials are being purchased from China, have increased. China’s competition is huge, with Vietnam, the Philippines, Malaysia and Sri Lanka also producing material at cheap prices (Plunkett Research, Ltd.). The US apparel stores can instead purchase from these other Asian countries. It is hard to determine the exact number of suppliers in this industry; but, in general, majority of them are in Asian countries that can provide low-cost raw materials to US-based apparel stores. Therefore, the US apparel stores may acquire higher net profi
The introductory of the documentary examines the fabric mills of Bangladesh. It is very competitive in the international market place to find low cost labor; when merchandise manufactured in another country is imported these country put on a duty rate. Apparel companies contemplating low cost labor,
Journal of Fashion Marketing and Management Vol. 10 No. 3, 2006 pp. 282-300 q Emerald Group Publishing Limited 1361-2026 DOI 10.1108/13612020610679277
Competition to the Tory Burch product line is most likely to come from designers of existing brands. Not only are they more likely to understand the consumers’ tastes, styles and aesthetic preferences, but they also have the required infrastructure and suppliers to produce high quality garments and accessories. However, given the current unfavorable economic conditions in the United States, it is not likely that the larger, more established brands will expand their product lines in these times. The risk of financial loss outweighs the possibility of a
Just when the memory of the infamous fashion scarf is about to escape the fashion corner of our minds, there goes the news that we, commoners can also have a chance to get hold of the much coveted personalized Burberry scarf that was once only available for the who’s who of the fashion industry.
The Kate Spade & Company online presence is engaging. The many products and services are displayed in a specific fashion giving shoppers a personal feel for the look and quality of the offerings without the requirement of being present in the store. Also, a website that is easy to maneuver and is updated on a regular basis to meet the demands of the consumer. In addition, this company offers press releases and top news information promoting their product.
In the last few months, I have been studying the market of clothing manufacturing heavily. From quality to fabric cost, the whole idea of clothing manufacturing is very appealing to a young man that would like to pursue a career in graphic and architectural design. I will be sharing my personal experience with clothing manufacturing, as well as the differences between trade-offs and opportunity costs.
The majority of clothing manufacturing resides within Asia, Central America and South America. In these regions there are risks associated with
Many people in The United States do not specifically know how their clothing is being made and what the living conditions are like for the people who make them. Blood, sweat, sacrifice, and tears have gone into the production of garments in Bangladesh and Hannan Majid and Richard York show it through the film they produced The Machinists. The three factory workers featured in the documentary are Mohammed and his wife, Nargis who lives with her parents and two sisters who also work in the factory, and Ratna a single woman involved in a union to help workers understand their rights. Also being analyzed are The Rana Plaza Garment Factory deaths caused by the collapse of the poorly constructed building in Dhaka shown in the documentary Fashion Victims produced by ABC Australia. It is very easy to look at the garment industry from an outside perspective and attempt to conjure up an effective solution. However, are U.S. consumers willing to give up designer clothing for a virtuous conscience? Can U.S. consumers strip the elephant in the room of its designer clothing and address the underlying problems of Exploitation of Garment Factory Workers in Bangladesh by Multi-National Corporations? We will be analyzing the garment workers starring in this documentary and what are the social reasons why U.S. consumers
Bulgari is a family-run company. Before the merger with Louis Vuitton Moet Hennessy Group, was 51% owned by the Bulgari family, the rest parts were floating. Bulgari was marked by an industrialization development, particularly in jewelry but also on leather goods in the last decade. In 2011, the largest luxury goods company Louis Vuitton Moet Hennessy purchased the Bulgari family’s 50.4% stake for 1.87 billion euros in stock. After the merger, Bulgari Chief Executive Officer Francesco Trapani joined Louis Vuitton Moet Hennessy’s executive committee as head of watches and jewelry, and then Bulgari family became the second largest family shareholder of the Louis Vuitton Moet Hennessy Group. Following the merger, Louis
In order to have higher profit margin, one of the most effective ways is to cut down production costs. In view of the low labor cost in developing countries, global sourcing seems to be a good choice to reduce costs. With the development of global production networks and the increasing competition, fast all fashion clothing firms have shifted their manufacturing operations to low lost locations over the past decades.
The pressure to produce goods inexpensively has driven companies to seek low-cost areas for producing those goods. In the quest to compete with low-cost discounters such as Wal-Mart, companies have been increasingly driven to overseas markets to produce their goods. Within the textile arena, especially, this phenomenon is occurring with regularity. One look at the label of the clothing in one's closet reveals clothing that was produced in Bangalore, Honduras, China, Bombay, and other far-flung regions throughout the world. As the world becomes smaller and the global marketplace increases, companies have been establishing plants in nations in which the labor costs are cheap. While many deride
Design plays a crucial role in product creation as it is the first process where new ideas form before they develop into a physical object. "... God as having made nature but also having made man in his own likeness, giving him the capacity... to imagine and make things beyond nature" (R Williams, 1997:82). By having the imagination and power to create, humans have produced an abundance of material objects to meet the constant demands of consumers. In todays society, value retailers are now encouraging fast fashion by constantly releasing new designs at low prices, High street brands such as Primark, Zara and H&M are just a few examples that are contributing to the mass production of clothes. The size of the fashion industry has
The L.A. Silks case study is a frustrating example of having the right idea and going about it the wrong way. L.A. Silks imports fine silk fabrics, prints designs on them, and sells the screened silk fabrics to fashion designers around the world, including Hong Kong, Tokyo, and Italy, although the major market is still in the U.S. They are looking to expand the production aspect of their business into china as it low operating costs, sits in a free trade zone and has more relaxed rules on chemicals used and imported in the region.
How often do you purchase new clothes for yourself? How much do you willing to pay for it? In recent year, the business model of Fashion & garment industry was changed to “Fast Fashion”, consumers are looking for high quality design clothing at lower prices. Therefore, more and more fashion brands understood customer needs then produce chic and aesthetic product with inexperience pricing. Most of the brands also concerns that the product lifecycle in fashion area is short, especially seasonal cloths with maximum three months only. Nowadays, “fast fashion” brand business growing is yearly increasing as well as the brand awareness.