Globalization At It’s Best
Forget sex… let’s talk about business baby, just you and me. Globalization has forever changed the fashion industry. It has changed where things are made, sold and how different companies compete with each other.
Imports and exports are very important aspects that every nation needs to take into consideration. Generally speaking, every nation would like to have equal parts of imports coming in and exports going out.
For those of you who have no clue what I’m talking about… Exports are products or services that one country sells and ships to another. Imports are merchandise brought in from another country for resale or other purposes.
All Industry Segments Are Affected by Globalization
Textile Producers: They usually buy their products from other countries for a lower, more affordable price. Many textile producers import yarns needed to produce the fabric.
Apparel Firms: They have their product made in different countries where there is more labor available for a lower price. Different companies like Liz Claiborne and Nike have their garments make in dozens of countries.
Retailers: They are also very active global players. Retailers have been part of the global economy for a very long time. They have traveled to other countries to buy lines for their stores. But more recently, they have gone a step farther. They have started to include private-label lines, taking on many roles that are usually taken care of by the manufacturer.
Consumers: A huge link in the global fashion economy. 60 to 70 percent of apparel sold in America is made in different countries, the need for imports are growing at a rapid pace. In the past, the global brands were usually only connected with luxury labels, like Chanel and Rolex. But as time and technology increases, consumers all over the world tend to want the same things, forcing the fact that export and imports will increase in the global economy. There are three major reasons it’s become easier to share and receive products from different countries: 1) The ability to use credit cards to pay for any product anywhere; 2) Internet allows apparel firms and retailers to sell to anyone in any location; 3) Worldwide delivery systems like Federal Express.
Who Imports and Why
There are three major categories of fashion merchandising imported into the United States: 1) Fabric and yarn; 2) ready-to-wear merchandise that is totally designed and produced by foreign manufacturers and is generally purchased by retail buyers for resale; 3) merchandise that is contracted out to oversea factories for all or part of the production process and then is returned to the United States.
The reasons for the high growth rate of imports can be very different. Some of them include: Lower prices– U.S. labor costs are so much more expensive than the third world countries that are willing to work for any wage. Availability of hand labor– Many other countries have more hand labor capabilities than America has. Hand labor increases in price in more developed countries. Product voids in the United States– Category of merchandise that the United States doesn’t have a good resource of or doesn’t make well, like cashmere from Scotland and leather from Spain. Other reasons include Exclusive rights, fashion cachet of Europe, etc.
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