Volume 2 :  November 02,  2006






In the summer of 2005, Werner International executed a worldwide study on the textile printing industry with emphasis on Italy, Turkey and China. Through visits and plant assessments, detailed data was collected and subsequently analyzed. The analysis focused on apparel printing.

Production run lengths (per color-way) in printing varies substantially depending on the country of manufacturing. While for bed-linen the run length per color-way is usually longer (more than double), in Italy the average run length per color-way in apparel printing is around 400 running meters, in Turkey 3,000 meters, in China about 5,000 meters.

The basis taken was rotary, rather than flat-bed, though in practice, the operating costs of each are fairly similar.
For ease of cross comparison between the countries, we chose a printing production order which uses an 8 screen design, and requires the printing of 4 color-ways or variants (for example the red flower colorway, the yellow flower colorway ..) .

In order to complete the picture of the printing cost of fabric, we also assumed a purchase price of a given cotton fabric in the various countries and for each company. The chosen fabric is a fairly fine Popeline, typical for ladies blouses.

The final result shows a finished fabric cost structure for the three countries assuming a 2000 MT order and 4 color-ways as follows : Italy has a production cost almost double to that of China and Turkey’s costs are about 35% higher.

The following cost elements have been considered :

1) Printing cost per hour
• Hours of operation each year and machine speed.
• Percentage utilization of the machine
• Operator costs
• Energy cost
• Depreciation provision
• Infrastructure costs
2) Paste and Dyes Cost
3) Engraving cost
4) Preparation and finishing costs

The cost breakdown between Italy and China is given in the graphs below.


Fabric printing in Italy has a very extensive history and tradition which has allowed Italian prints to be of the very highest quality and to be recognized and valued the world over. However, with globalization and strong price competition from Asia, the whole textile industry in Italy, and in particular the printing industry, has undergone massive down-sizing. In recent years, there has been the drift of production facilities away from Italy, first of all to Eastern Europe and Turkey, and most recently to China.

Italian designers and printers are able to survive because they are aiming at very high quality standards, fast development of new designs, service to the fashion industry and are leaders in the constant search for ever more complex and imaginative products. Italian printing companies continue to operate at high quality levels, with highly experienced and well trained machine operators and technicians, and with a long tradition of leading edge design development and innovation. Because of this, the end product quality is exceptional, and there is the guarantee of color re-producibility.

Today, much of the previous Italian fabric (at least for medium and low quality printing) is now produced in Asia. What is now left in Italy is the high quality fabric and also the infrastructure for fashion development. Each year, the overall production quantities in Italy are reducing by around 10%, due principally to the high labor cost in Italy, which represents around 50% of the production cost, compared with the very low labor cost in other countries, with China around one twentieth of the labor cost of Italy.

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More and more Textiles & Fashion managers and entrepreneurs, aware of the complex dynamics that are rapidly re-shaping the global textile and apparel industry, are considering the set-up, within their organizations, of a Strategic marketing function to support future strategies, marketing activities and decision processes.
In Werner’s experience it will be fundamental to properly design and develop within such Strategic Marketing functions, a business intelligence system in charge of efficiently identifying, collecting, consolidating and distributing all relevant business and market intelligence necessary to support all strategy activities while improving the whole organization’s capabilities, know-how and skills.

Business Intelligence therefore , is not only a tool for providing top management with the latest market inputs but also a comprehensively designed approach to knowledge management throughout the organization.

Werner International is currently working on an interesting number of such assignments internationally thanks to its unique competence in terms of both textile and fashion market intelligence and organizational and technological issues.

Textile and fashion markets are changing rapidly and this will continue to increase in the future.
Successful companies will be those capable of avoiding direct price competition by turning their own organizations into a competitive advantage and value generating “engine”.
Technical competences and know-how, product understanding and spirit of innovation, clear understanding of market trends and anticipation of selected clients requirements, global networking capabilities: all these key knowledge areas will concur as key ingredients for textile & fashion enterprises to succeed in a knowledge-based competitive environment.

The capability to adapt and compete in a global market will largely depend - particularly for higher labor cost producers - on their ability to reposition in the global growth area of higher value market segments, where fashion dictates unpredictability, and luxury demands for exclusivity.
Speed in time to market and a flexible organization to process small lots are consequently becoming key success factors.
Such market niches and segments must be identified and anticipated; competitors monitored, alliances forged.
To successfully compete in such a complex environment will require companies to be proactive, flexible, innovative, offering niche products to highly selected clients, actively working to consolidate and govern the “supply chain”.
All this can be achieved only if business and market information and knowledge are considered a key strategic tool of the company.

Such information is obtainable occasionally through external ad hoc research or less focused multi-client studies. These market information sources however, provide only a temporary relief for the knowledge company’s long-term need for a continuous flow of market and business understanding.

It is surprising how much informally managed market information is held within a company, unused.
Sales representatives and agents, designers, buyers, customer accounts: they all act as antennae, collecting a multitude of inputs, but in most cases they lack the necessary tools to properly and efficiently decode, process and elaborate them into strategic information to be properly distributed across the entire organization.

The Werner approach is quite unique. Werner does not provide a specific information management software application solution and is therefore totally independent when providing its professional support in software selection activities.
Werner’s strength lies in adopting a flexible conceptual though pragmatic approach, tried, tested, applied and verified over the years, in order to assist its international clientele in the design and implementation of a custom-designed marketing intelligence management system (MIMS). Custom-designed because only in differentiation can value be created.

A sequential three step approach is generally adopted.
The first step, developed in close conjunction with a dedicated client marketing & IT team, is aimed at designing a comprehensive MIMS Structure Plan, basically answering the following key questions:
What type of information is needed?
From where can it be collected?
How often should it be collected?
How should it be elaborated and presented?
To whom should it be distributed?
How and with what tools should all this be achieved?

The second step foresees the contribution of the Werner Market intelligence Department, providing custom market and business reports and positioning analysis as a starting point, to be then regularly updated by the company’s own Information Management System (IMS).
The third and final step sees the Werner team provide support in the implementation and fine-tuning of the system.

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Elimination of global textile and apparel trade quotas on January 1, 2005, has brought about a dramatic shift in the world market for textiles and apparel products. China, with its vast supply of labor, significant upstream capacity in textiles manufacturing, efficient garment factories, and well-developed logistics infrastructure, has achieved breathtaking gains in exports in just the first few months of quota-free trade. Many other global suppliers have clearly suffered in comparison with continued downward pressure on world prices.

The value of Cambodia’s garment exports grew from $26 million in 1995 to $1.6 billion in 2004. The sector now produces 80 percent of the country’s exports, accounts for one-eighth of GDP, and employs 250,000 people directly. Another 2.5 million are employed in supporting industries or receive remittances from direct and indirect employees. Cambodia’s garment industry on the whole has managed to hold its own in the first half of 2005. Cambodian producers may be benefiting from uncertainty among U.S. and EU buyers, many of which are retaining multiple sources of supply while waiting to see how safeguard actions (new quotas) against China undertaken by the United States and European Union will play out. But safeguards will not last forever. The question for Cambodian producers is whether they can be cost-competitive when safeguards are lifted.

And in Cambodia, with concentrated success comes vulnerability. To continue prospering despite heightened competition, Cambodia’s garment makers must continue to attract global buyers who sell in the U.S. and European consumer markets. Manufacturers already have a good reputation among U.S. buyers not only for quality but also for working conditions in factories. The greatest promise for boosting competitiveness—and providing Cambodians with a foundation for sorely needed industrial diversification—lies in boosting productivity at the factory level.

Over the next three years, Werner International in cooperation with Nathan Associates will be establishing a Garment Industry Productivity Training Center in Phnom Penh. Productivity can be boosted by as much as 20 percent—by training factory directors, managers, supervisors, and team leaders and by introducing management information systems and production controls. The center will offer a curriculum for improving management and a program for furthering sound economic governance that complements manufacturers’ reputation for good working conditions.

Click here to read full report - pdf

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Information Management (IM) or more commonly known as Information and Communication Technology (ICT) is today considered today the nerve center of a company’s organization, a fundamental instrument in the execution and monitoring of a company’s Competitive Strategy leveraging knowledge and leadership to out perform the competition.

Generally speaking, a competitive strategy is substantially a long term endeavor and requires a healthy slice of the company’s available financial resources. To make things worse, the related decisions are by no means easily reversible. It is clear that any one strategy decision must be based upon sound information, whether sourced internally or externally, in order to reduce the ever ominous risk factor.

In fact, a competitive strategy is successful only when the organization is able to emphasize the firm’s strengths while minimizing it’s weaknesses (internal analysis), yet is able to exploit market opportunities while skillfully parrying threats (external analysis).

Day-to-day decisions must be aligned with the competitive strategy goals, enabling all those involved to "surf" the value chain and act when necessary, preferably preventing undesired events and not curing their consequences. Awareness of the connections between the different “leading” key performance indicators (KPIs) in the different areas, the measuring of “gaps” in relation to pre defined target indicators or to previous situations and the forecasting of trends, are all keys to incisive competitive improvement making.

In response, we at Werner have been assisting our customers in the art of continual improvement and knowledge management through the application of our consolidated IM methodology providing effective and efficient Balanced Scorecard information management and management intelligence permitting goal sharing at all company levels creating a more constructive, competitive and team spirited environment.

Employing the Werner IM methodology has led to competitive gains in numerous companies. Indeed, a recent customer audit revealed supply chain inefficiencies resulting in intolerable complaints due to incomplete or non fit consignments. After Werner BPM (Business Process Mapping) and HR change management the customer witnessed a 30% improvement in overall supply chain performance. On the other hand, a lack of decisional support information in one customer led to the implementation of a management intelligence system shared by management and all knowledge workers, with the objective of fulfilling the company’s business strategy through the constant monitoring of market changes, competitor intelligence and comparative company performance.

IM is critical to constant performance improvement and only through pondered and carefully aimed investments will textile companies leverage their knowledge into workable competitive strategies.

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Structure of fixed assets investment in textile and apparel sector in China - 2004



Foreign investments in textile & apparel industry - China textile Council


Discussing and writing about China and its future hegemonic role in the now globalized textile industry appears to be quite a common activity these days. Nevertheless, most of international textile and fashion entrepreneurs and managers often reveal limited confidence in their capability to really understand this new amazing reality for its vastness and complexity, but also for the difficulties faced in deeply understanding their counterparts’ real views and goals.
Often welcomed in joint ventures with Chinese companies just to reveal in a matter of a few months their lack of strategic match and romance, foreigners are today preferring direct investments. This is not the case for investors from Hong Kong or Taiwan, who because of their cultural proximity, appear to be at a greater advantage.
Foreign investments in the Chinese textile and apparel sectors are however booming. The last published statistics clearly confirm this trend.

At Werner we have therefore thought it interesting to develop quite a comprehensive opinion search amongst entrepreneurs and managers in China to better understand their views and feelings on the future. In their view, can we all benefit from a fast growing global industry and trade environment, is there room for strategic compatibility? And probably most importantly, how are “values” evaluated and calculated in Chinese companies?

This search is to take place in the months of November and December, all across China, and will provide a fair portrait of Chinese textile decision makers’ thinking, both in private and public textile and confection companies, by interviewing more than 400 key decision takers in the industry, and will most likely reveal some interesting concepts.
We have prepared a comprehensive and pervasive questionnaire, but if you have any specific queries which you believe should be included in our survey, please do not hesitate to write to us!
The results will partially be published in the next edition of this New Twist newsletter in early 2006.

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During the months of June and July 2005, the Turquality Strategic Steering Committee, orchestrated by Werner International and composed of members of the Working Group and a panel of external international branding experts, held a two sessions workshop in Istanbul in order to forge the Strategic Plan to drive the future activities of this ambitious project.

The final conclusions reached in such workshops and consolidated in a Marketing Guidelines Plan, were presented to His Excellency the Minister of Trade Mr. Kürçad Tüzmen, on July 30, 2005.

This document will provide a very clear direction for the future implementation of the project.
The focus of the program will be oriented to assist, through a wide array of support services and coaching activities, qualified Turkish companies in developing their comprehensive capabilities to compete internationally with a branded approach.

As a “brand accelerator and incubator”, Turquality will therefore aim at facilitating the eventual success of a number of Turkish brands on the international arena.

The success of these brands will eventually create a very relevant “return effect” on the whole Turkish industry. By acting as real credentials and international ambassadors for Turkish products and brands all over the world, such brands, will in fact contribute to ignite a very positive virtuous cycle, fundamental in successfully positioning Turkish product image internationally.

The program envisions two main levels of support activities, the first more general and “education” oriented, the second more customized and coaching oriented.

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The Mexican Apparel and Textile Industry is no doubt aggressively challenged by the impressive growth of Chinese exports into the US market as recent statistics well show.


New regional agreements are in the process of being forged, in order to enhance North American textile supply chains and their proximity value, while the US market is expected to act to somehow “protect” its neighboring suppliers.
Mexican textile companies are however aware of the need to rapidly reposition their activities away from direct price confrontation with Asian cheap imports of standard items.
Such repositioning will have to focus on better and higher value added products, but also on an improved capability to manufacture quality, in small lots, in short times whilst maintaining profitability.

In this context of required understanding of improvement opportunities available, the active collaboration between Werner International and the Mexican Textile Industry Chamber Canaintex, has resulted in a very intensive series of technical benchmarking audits aimed at providing about 20 large Mexican textile operations with a clear picture of their manufacturing strengths and weaknesses in a highly professional benchmarking exercise carried out by Werner International specialists.
This specially developed two-week audit & benchmarking exercise will provide top managers and owners in participating companies with a unique tool and detailed analysis to properly and strategically position their manufacturing operations compared with leading international firms and their adopted best practices.

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The phase-out of textile and apparel quotas worldwide is changing the global environment in which the Dominican Republic exports textile and apparel products. The Dominican Republic apparel companies can pursue a number of strategies to improve their prospects in the post-quota world. They would do well to improve their ability to produce more cost-effectively, meet buyer demands for full-package service, and streamline production chains to boost their competitive position in the US market. Dominican Republic apparel firms will be required to adapt to open competition with Asian apparel producers that offer more services at cheaper prices. The largest firms in the Dominican Republic are already adapting to this new environment by:

  • Acquiring smaller Dominican firms to complement and broaden services for retailers and buyers;

  • Developing full-package capabilities including trade financing, fabric sourcing, and pattern development rarely offered by traditional sewing operations;

  • Integrating knit fabric production dyeing and finishing on or near premises.

These responses are helping larger firms to cut costs, improve services, and respond more quickly to market demand. In contrast, small and medium-sized firms have changed little, mostly focusing on reducing costs in their current operational environment. Many of these firms still depend on a few brokers and/or contractors, which leaves them highly exposed to market fluctuations. Producers managing only the cut-and-sew aspects of apparel production can do little to reduce costs; more than half the value of a garment is determined by fabrics, usually sourced by brokers. The full-package producer, managing the whole value chain, including fabric and trim sourcing, has far more opportunity to squeeze costs from the value chain and control lead times.
Few small and medium sized producers are in a position to:

  • source fabric;

  • develop patterns, markers, or designs;

  • cut fabric;

  • provide, flexible, quick, cost effective response based on short product runs.

These and other value-added services will determine the ability of these firms to survive in a quota-free world.
Expecting these firms to take these steps independently may not be reasonable.

Recognizing this, Werner International in cooperation with Nathan Associates are assisting small and medium apparel firms in adjusting to the new trade environment by providing technical assistance for the establishment of a pre-production training center.

For many years (since its origin), the making-up of garments in the Dominican Republic, for the most part, has been restricted to sewing and finishing of the already cut pieces of fabric arriving from the USA. Now these companies need to develop all the pre-production activities, so that they can offer a complete service to the clients and counterbalance the technical power of the Asian countries. Initially, the training center will be equipped to be able to train technical people for the major products made in the Free Zone, such as:

  • Trousers, jeans, shorts

  • Knitwear (t-shirts, polo-shirts, training suits, pajamas, etc…)

  • Jackets

In a subsequent stage, the training center may expand its ability to also produce other important apparel products such as woven shirts, women’s underwear and outerwear and many other product that could be of interest.
While this proposal and the initial stage of this project are focused on the medium term goal of augmenting pre-production skills, it must be recognized that pre-production skills alone are not likely to guarantee the long term success of firms. While pre-production skills are the initial and essential step into full-package production and quick response, the training center will eventually need to offer more extensive and complimentary skills. Further training in the following areas will have to be carried out :

  • Supervisor and management capabilities to maximize line productivity, flexibility and efficiency at the firm level, to ensure cost effective quick response capabilities on the production line;

  • Fabric, trim and material sourcing;

  • Production financing, customer management and marketing.

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