[an error occurred while processing this directive]
January 2008
Industry Highlights
Apparel Sourcing — The Newest Frontier?

by Bob Zane

Up until a few years ago, if a sourcing executive were asked to name the most important skill necessary to perform his or her job, the answer probably would have been quota management.

After all, virtually all Asian countries were subject to quota (which meant that each of these countries could export a finite quantity of specific products to the United States, with anything over and above those limitations subject to embargo), quota costs were often high and always unpredictable, and production programs had to be consigned to many factories in many countries in order to ensure that adequate and cost-effective quota was available. No wonder that entire staffs devoted no less than 40% of their time and effort to managing this very elusive and often incomprehensible attribute.

And then, at the end of 2005, quota ceased to exist. While we all expected profound changes to occur within the supply chain — factory and country consolidation, lower costs, and more meaningful relationships with fewer suppliers — the changes have been far greater than most executives anticipated.

Perhaps because of quota elimination, perhaps in conjunction with it, or perhaps due to pure happenstance, the landscape has changed immeasurably in the last two years, especially for the established brands and wholesalers:

These are the new realities now confronting sourcing executives. While they may no longer have to contend with all the ramifications of quota, there remains much for them to do: source better product at better factories providing more services at greater speed and for lower costs. This challenge promises to make the management of quota a cakewalk.