No big apparel buyers pulling
out of Sri Lanka
By Iromi Perera
As the Multi Fibre Agreement (MFA) comes to an end
in less than a week, apparel industrialists can only hope that the
measures taken by Sri Lankan garment companies and associations
are enough to combat the rocky year ahead.
Sukumaran, new Chairman of the Sri Lanka Apparel Exporters Association,
in an exclusive interview with The Sunday Times FT said that the
industry is more positive than they were a few years ago about what
may lie in the quota free years.
different programmes and steps taken by the associations and factors
that are not in the hands of the industry such as China's internal
problems make the industry more positive about the future. Top buyers
such as GAP and Liz Clairborne Ltd have short-listed Sri Lanka in
their list of supply bases. Many buyers are shifting their supplier
base, not shifting by company but by country.
for Sri Lanka, a majority of the large buyers have already chosen
this country as one of their supply bases and so far there hasn't
been any big industry buyers who have indicated to anyone about
pulling out of Sri Lanka. The latter half of 2005 will indicate
to some extent as to which direction the industry will be heading.
to Sukumaran, the present situation is that larger companies are
expanding and some small companies are finding it difficult to run
and are looking for partners to take them over. More orders are
coming in for established companies. Thus these companies are on
the lookout to take over or to give work to smaller companies.
are some factories, which are going for the very low end of the
market, very low cost production. There are some doing the moderate
and upper moderate production.
feeling is that the low end of the market is what one should concentrate
on, mainly because we cannot compete in price alone," believes
Sukumaran. He said that Sri Lanka would never succeed by going head
on with countries like China, Bangladesh and Vietnam with prices
and that those types of businesses would be moving out of the country.
But those who are in the moderate business and upper end and those
who are giving complete package services will remain in the market.
nightwear and lingerie, Sri Lanka has gained a very good reputation.
Sportswear and other up market products are what Sri Lanka should
be concentrating on. Sri Lanka's garment industry has grown at a
rapid pace within the last few years. This growth came not from
new companies but through existing companies expanding. A lot of
European buyers have faith in Sri Lanka and Sukumaran believes that
this confidence did not come overnight and that it has been earned.
firmly believes that mere reputation alone will not bring business
in 2005 and beyond. The industry would have to work harder, different
and smarter. "If we are to survive beyond 2005 we must increase
our competitiveness, compared to China, India and other countries,"
order to increase competitiveness, individual factories have been
conducting their own programmes. Furthermore industry associations
have been working on key areas such as giving better prices, giving
value added services to the customer and reducing the supply chain
lobbying with the government, almost Rs 200 million was granted
for a productivity increase programme. The Joint Apparel Association
Forum (JAAF) has been getting these funds and have hired a foreign
consultant and a team of people and launched the programme where
any SMEs or any factory that wants to increase their productivity
will go through a training process for about two years and the goal
is to increase productivity by 30 points from an existing points-based