Thursday, February 4, 2010

Is there a shortage of supply of local manufacture companies?

Nowadays, manufacturing clothing in developing countries such as China, Thailand, Indonesia, and Vietnam are popular since the lower cost of labor and manufacture materials. However, while the majority of clothing company produces in these developing countries, is there a supply shortage in local manufacture clothing companies? Today, I will use the company Lululemon as a reference to analysis this issue.

Lululemon Athletica Inc. Is founded in 1998 is a yoga-inspired athletic apparel company who has its factory based in Vancouver, Canada. The concept of the company is that it produces locally in Vancouver. However in 2004, the company starts to expand its factory outside of Canada such as China and Taiwan. Later in the early January 2010, Lululemon is planning to have the majority of its production shifting it to China. Immediately, there has been a large debate local Vancouver consumer. They strongly object this idea by Lululemon. They think Lululemon has broken their philosophical practice when it is first set up. People in Vancouver actually really like the idea of local manufacture clothing companies.

This reaction by local citizens in Vancouver shows that there is a shortage of supply of local manufacture clothing companies. Also, it shows that there are markets and that producing local clothing can make profits. Consumers are more than willing to pay more bucks for local brands. Thus, I think while the majority of clothing companies shift towards foreign countries, one can try to produce their own brands locally in North America. There is an opportunity out there it is worth trying. Even though the cost many be higher and products could be priced higher, there are consumers out there that are local friendly to support local production companies.

Thanks

MC

1 comment:

  1. I agree with the fact that there will be local friendly supporters who will support local production companies, however, this group of people may be the minority. Going back to the basics of a business, it is in the company's own interest to increase profits and cut costs. On the contrary, having local manufacturers in the city will definitely be regarded as positive in view of creating jobs and boosting the economy.

    My .02

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