kookai fijiby steps up as short run specialist James Boston
Fiji has spent the past decade restructuring its manufacturing operations to fill the niche requirements of Australian and New Zealand clothing companies and now has its eye on production for the Australian fashion industry, writes James Boston. Fiji s fashion push At its peak the island nation employed almost 20,000 workers in its clothing industry, but following the removal of quotas and the reduction of tariffs post 2000, the industry has shrunk to around a quarter of that size after large amounts of production headed to Asia. A number of companies were unable to cope with the change and closed operations, but those with foresight shifted their business models to take on short-run production for the Australian and New Zealand markets, predominantly for the workwear, corporatewear and schoolwear sectors. The change was in part facilitated by a three year structural adjustment program funded by Ausaid,titled Make It In Fiji, which focused not only on production efficiency and engineering, quality assurance and standards, but also on occupational health and safety and social responsibility. The program has been extremely successful, with companies that participated now reporting growth rather than decline and a number even reporting difficulties in recruiting sufficiently skilled staff to meet the demands of their growth. Corporate social responsibly (CSR) is a clear focus at all of the factories visited on a recent trip by ATF Magazine. Factories are well lit and well ventilated, workstations are well designed, workers are generally unionised (and as a result paid above award courtesy of collective bargaining) and all receive additional entitlements such as maternity leave. Some employers even offer free childcare to retain their workforce. The companies that underwent the transition program are regularly audited by third party auditors such as John Hardin, of Hardin and Associates in Sydney, and all the factories visited by ATF Magazine had received either an A or a AA rating for CSR. The industry now feels it offers the most attractive option to Australian and New Zealand companies for short run and flexible manufacturing. Recognising it now has a competitive advantage over Asian manufacturing centres, it is also looking to expand its options with a bent towards fashion production. As a result a number of factories have recently set up fashion production clusters and production lines. One such company is Mark One Apparel. Mark Halabe from Mark One says that over the next decade, he believes Fiji can become a realistic option for Australian labels. There are currently smaller second and third tier fashion designers who are now coming to Fiji and testing the water and I suspect in the next decade, if we get our act right in Fiji, we will become the centre of fashion manufacturing, Halabe says. Between now and then, what we need to do is develop the skill base of those who can conceptualise a design and put it into production. So all these elements of skill and professionalism need to be developed and incorporated into Fiji s industry. Halabe says that the industry has established the Fashion Council of Fiji to oversee the development of the skills required to make the transition into a fashion manufacturing hub. We have people wanting to see the development of designers, and by designers I mean people who are able to go from a from concept, to sketch, to a finished product; from pattern making, grading, design itself, fabric selections, the knowledge of fabrics, the dyeing and finishing and garment construction. It takes a long time to develop those skills, and Fiji lacks a lot of that now, so nothing will happen in six months, probably six to ten years is what we re aiming for. We re convincing tertiary educators, like the Fiji National University and the USP University here to look at programs, and secondary schools to run basic fashion courses in home economics as well, and we ve had some success. Halabe says while Fiji will never match the production levels of China, Mark One Apparel works with companies who often have major programs in Asia to cover the smaller production runs. Many of my customers have a major program in South East Asia, be it in Vietnam, Bangladesh, China or Indonesia, but when it gets to the small runs they know their manufacturing supplier in those countries doesn t like doing the small runs so they tend to ignore that order or delay that order.
childcare at markone apparel Fiji is part of the supply chain management process and we take on the small stuff. An intimate growth story A company which already has a long history of servicing fashion clients is Intimate Apparel, Fiji s only lingerie manufacturer. Some fijian employers offer free childcare to retain their workforce. For example when I arrived at one of my customers recently there was a 40 foot container being offloaded from China with one just style, and it just so happened my 20 foot container arrived at the same time and 50 styles were being offloaded in that 20 foot container. And that s what Fiji is. Halabe says running this type of dual sourcing program maximises cost effectiveness Fiji is not cheaper than China for large runs, our cost factors involved are not as cheap as China, purely because of volumes. The reason why China can offer a low price on a garment is their minimums are so high that their factory can perform at 100 per cent efficiency. When you do 100 garments per style and there are 500 garments on the factory floor, the factory efficiency is woeful for good reason. The operator cannot repetitively do that operation to lift up her efficiency. It s four or five fabrics, two or three different styles in a day so you re lucky to get 60 per cent efficiency. And this is where Mark One and Fiji can come in as we are geared for this type of production. Located in the Suva suburb of Vatuwaqa, Intimate Apparel was established by V Wanarajan who first worked in a lingerie company in Sri Lanka. Lingerie is a complex product to manufacture, but Wanarajan is assisted by his background in textiles and is a Chartered member of the Textile Institute. The company produced lingerie and underwear for the likes of Bonds and Berlei before the drop in tariffs saw them move production to China. As a result the company diversified its offerings to include schoolwear and sportswear and has invested heavily in sublimation. However, Wanarajan says the company s competitive advantage is its ability to produce its namesake, intimate apparel. We are currently looking to increase our business in the intimates sector again, Wanarajan says. It is quite a specialised manufacturing process and we can offer Australian companies the flexibility of very short runs they cannot secure elsewhere. We are aware of the price pressures on companies in Australia and New Zealand, and can offer very competitive pricing for those wishing to try our services. intimate apparel Fiji is part of the supply chain management process and we take on the small stuff. MANUFACTURING AT FIJI S LARGEST & MOST REPUTABLE FACTORY united apparel We specialise in manufacturing mens and ladies tailored suits, jackets, trousers, skirts, shorts, shirts and blouses for corporatewear, schoolwear and fashion. We are flexible with low minimums, quick turnaround, efficient communication, high service levels, and sample making facilities. Lot 1 Nadawa Road, Nasinu, Fiji. P (679) 339 4855 F (679) 339 4620 E kaushik@unitedapparel.com.fj W www.unitedapparel.com
united apparel We are aware of the price pressures in Australia and can offer very competitive However, we find that once we are able to exhibit our quality and quick turnaround capabilities our clients are more than happy to pay a little more for this quality and service. The company also has the ability to manufacture swimwear and sportswear and works with Australian stretch fabric manufacturers including Eclipse, Standardknit and Stretchtex. Wanarajan, who runs Intimate Apparel with his MCom-educated wife Inbamalar, has seen his company grow from just 21 workers to 200 and believes the future is bright for Fiji and the company. The TCF Council has overseen a 20-20 per cent increase in wages for workers over the past two to three years, so that is a positive, Wanarajan says. And the industry is definitely growing. We have just added an additional four graduates to our management team, which will assist us in our growth period. Big enough to matter, small enough to care United Apparel s Bipin Patel says that the exodus of work from Fiji to Asia is complete and that a number of clients are returning to the company after experiencing difficulties sourcing elsewhere. Once boasting 1400 staff, United Apparel still holds the bragging rights as the industry s largest employer, with 750 employees currently on the books. Patel said the company s restructure over the past few years has been responsible for this resilience as other companies have disappeared. He adds that there is no such thing as a big run or a small run with United anymore. Initially when we used to have some major customers like King Gee and Yakka we used to have big lots of two and three thousand units an order or five thousand units an order. Even now on average we would have a production order in a style going through the factory, maybe 50 units, 100 units, so we re geared up ourselves either being a small order or a big order. There is flexibility to handle small runs with a slight surcharge. Patel says the shift of production to Asia has spurred the remaining Fijian garment makers to do better. It doesn t really make a difference making small runs; it still goes through the same production line, but efficiency suffers with small orders, hence the surcharge. We have garments, madeto-measures, that go through the main production line, one unit, two units of any type of products. Patel says the shift of production to Asia has spurred the remaining Fijian garment makers to do better. Many of the clients who had taken some big business away to China or Indonesia or elsewhere, they are putting some production back into Fiji Some of them have had difficulties getting their work out from Asia and they are coming back. Most of them still use China for some of their bigger runs and bigger programs but Fiji, through the Make It in Fiji initiative, has promoted that we can turn around orders quickly, [in] three or four weeks, and in some instances two weeks; and most of them use us for those small fill-in orders and we re quite happy with it. pricing for those wishing to try our services. United established its name on the back of its ability to work with worsted fabric. At its peak the company manufactured close to 700 suits a day. Over the years a lot of that went over to China and Indonesia and we moved into corporate wear and school wear, and diversified into other product categories like shirts, blouses, skirts and ladies trousers. Traditionally United was a men s trouser and a suit factory. We make semi-constructed shirts. It originally wasn t our business, but it made sense as with our move into school wear and corporate wear as we had to offer the complete package. There has also been a move from CMT to FOB supplies. The current break up will be 50 per cent CMT and 50 per cent FOB. United Apparel s strength has also come from its reputation for quality, service and reliability, Patel says. If we do take in an order we ensure that it s done on time and more importantly we stand by our product quality and in the event something goes wrong, we will ensure the problem is rectified without delays. We re quite strong in whatever we do and even our customer base between Australia and New Zealand know we are quite reputable in terms of our commitments. Intimate Apparel Fiji s intimate specialist Sublimation Sportswear Schoolwear Lingerie Bras Maternity Fashion Intimate Apparel Limited produces women s underwear, camisoles, knitted tops, swimwear and sportswear. Intimate Apparels is Fiji s only lingerie manufacturer and specialises in export of short runs to Australia and New Zealand. Intimate Apparel is an expert in working with specialized fibres such as Lycra and manufacturing is completed using the latest high-tech machines. Contact: V Wanarajan. wana@connect.com.fj. (679) 3386388. www.intimatefiji.com
overseas Fair Work Amendments spark surgeby James Boston Overseas clothing manufacturers are reporting a surge in Australian enquires after amendments to the Fair Work Act take their toll on local manufacturing. Mark Halabe from Mark One Apparel, a Fijian-based clothing manufacturer, says that he has noticed a spike in enquiries over the past few months which he attributes directly to new legislation relating to homeworkers. I m receiving two or three new enquiries a week about possible production assistance from Australia, Halabe told ATF Magazine. Most of these are coming from companies who were sourcing product in Australia but have told us that the new legislation has made it too hard to produce in Australia anymore. Those who ve been manufacturing in Australia, and indeed offshore as well, are finding it harder and harder to find capacity. The news comes as reports circulate the local industry of dozens of local Cut Make and Trim (CMT) operators have closed or a planning to close on the back of the legislation changes. Under the The Fair Work Amendment (Textile, Clothing and Footwear Industry) Bill 2012, Outworkers can no longer operate as independent contractors, must be treated as employees and guaranteed 20 hours of work a week on an ongoing basis. Despite industry outcries and warnings that the inflexible nature of the amendments would send work offshore, the legislation was passed. Bipin Patel from United Apparel, Fiji s largest clothing manufacturer, also confirmed that they had noticed an increase in enquiries in the lead up to and since passing of the legislation. We have seen a definite increase from companies that had been manufacturing in Australia previously, Patel says. Patel says companies concerned about social compliance could be assured with United Apparel regularly independently audited. We have been audited and were awarded both AA in social compliance and quality assurance systems. We met all the regulations regarding staff welfare, OHS, regular meetings, labour laws, no child labour, prison labour and all those international criteria. We were not only Double A in the first year, but in our recent audit we retained our Double A status. Only last week we concluded over 100,000 units of CMT garments with considerably more likely to be finalised over the next few months, McDonald says. When you already consider the work lost to overseas suppliers, the situation of losing skilled labour here is becoming critical. McDonald says that the amendment could see Ramsay McDonald become an import house, but this does not sit well with him ethically or morally. I have grandchildren and I fear for their future opportunities in this country where manufacturing has been decimated. One of Michelle O Neil s (TCFUA President) mantels is to crack down on overseas so called sweat shops. Well I think a delegation needs to be sent to Vietnam where working conditions are exceptionally well controlled. Vietnamese manufacturers have also recorded a spike in enquiries since the Fair Work Act amendments took effect. Peter McDonald from Ramsay McDonald says he has been inundated with Australian companies looking to source CMT offshore. Of course the wage structures are low but in line with the cost of living standards in each specific South East Asian country. McDonald said that like all countries there are good and bad operators, but in Vietnam the majority are very good and workers want to gain employment in Textile factories. united apparel Ironically during my last visit to Ho Chi Minh City I came across a CMT operator who was receiving work from an existing Vietnamese CMT company in Australia. The owners know of our recent Fair Work laws and simply laughed at such a strange law that restricts a person from earning a fair and equitable living. intimate apparel Mark One Apparel Garment Manufacturer for the South Pacific - Specialist in Men s Shirts and Women s Blouses. We make apparel! Be it small or large scale, design or casual, fast or slow production, we keep it simple and functional. Our priority is that you enjoy an effective service that is worth every dollar. Mark Halabe. mark@markone.com.fj. +679 339 40 11. www.markone.com.fj