Industry Employment Sags


T
 extile job numbers remain dismal. Over the past 12 months, for example, the number of
workers in basic textiles has plunged 19 percent. And the decline in more highly fabricated
products is put at 14 percent. Compare the current figures to those existing a decade ago, and the
slippage has been far more precipitous – 68 percent for basic textiles and 40 percent for more
highly fabricated products. And the picture is pretty much the same in the downstream apparel
sector, with comparable year- and decade-ago declines at 14 percent and 69 percent, respectively.
Nor is there any indication that this workforce erosion will bottom out anytime soon. New Bureau of
Labor Statistics projections call for about a 35-percent drop in textile and apparel employment
over the 10-year period ending in 2016.

Putting a positive spin on all this, however, is the fact that not all of this worker
drop-off can be attributed to declining industry activity. A good part, for example, can be traced
to increasing productivity, which has enabled the industry to meet any given demand with fewer and
fewer employees. And these productivity increases are expected to continue at near a 2.5-percent
annual rate through the foreseeable future. More importantly, these impressive efficiency gains are
probably one of the key reasons that the industry continues to survive and even show some profit in
today’s hotly competitive global marketplace.

MayJune09textilechart


An Improving Business Picture


US textile and apparel sectors should also be helped by the somewhat less dismal economic
outlook anticipated for the next few quarters. To be sure, the nation is still deep in the biggest
recession in more than 70 years. But there now seems to be some light at the end of the tunnel as
consumers and businesses make substantial progress in trimming the imbalances that precipitated the
downturn.

On the consumer front, sky-high family indebtedness is beginning to contract. Mortgage
commitments, which account for three-fourths of all household borrowing, have been declining for
three quarters in a row. Add in the fact that all the new Washington stimulus moves are starting to
boost consumer confidence, and retail sales should show at least a modicum of improvement in the
months immediately ahead.

On a business front, corporate cost-cutting and inventory retrenchment are pretty much
nearing completion, thus paving the way for some increased activity.

Finally, there’s Wall Street. True, the market is still quite volatile, but stock prices do
seem finally to have bottomed out. Given all the above, economists are predicting decelerating
gross domestic product losses, with the  6.3-percent tumble of late last year giving way to
only a 2- to 3-percent drop over the current quarter. And there could even be some fractional gains
toward year end. All this should slow down recent textile and apparel losses – though any outright
gains in these industries would still seem to be a long way off.


Trade Uncertainties


Big import question marks are also keeping the industry on edge. To be sure, incoming
shipments of textiles and apparel in early 2009 were down 14 percent. But this isn’t nearly as
encouraging as it might seem. The decline in US manufacturers’ shipments of textiles and apparel
over the same period were off 24 percent and 12 percent, respectively. Implication: The huge
foreign share of our overall textile and apparel market isn’t declining and may well be continuing
to grow. And that is particularly pertinent for our biggest textile supplier – China. The Chinese
situation will bear especially close watching because Washington seems to be easing its pressure on
Beijing for a further upward revaluation of its currency, the yuan. The Treasury Department is now
saying China is not manipulating the yuan to increase its exports. That’s not to say US officials
are happy about Beijing’s current currency and subsidy policies that clearly continue to make
Chinese products unrealistically cheap to US buyers. The problem is that our options are limited.
It’s far more important to keep China on our side, not only for crucial geopolitical reasons, but
also because that nation’s big economic stimulus program, along with our own, is clearly needed to
put the world back on the road to prosperity.

May/June 2009

VF Corp Acquires Mo Industries Holdings

Greensboro, N.C.-based VF Corp. – an apparel company with a diverse, international portfolio of
brands – now owns Mo Industries and its Splendid® and Ella Moss® brands after acquiring the
remaining two-thirds of the capital stock of Los Angeles-based Mo Industries Holdings Inc. for $161
million plus the repayment of $47 million in existing net debt. VF Corp. will fund the acquisition
through strong cash flow from operations.

VF Corp. initially bought one-third of the company from founder Moise Emquies and Summit
Partners, a private equity and venture capital firm, in June 2008. The Splendid and Ella Moss lines
– which have tripled revenues since 2004 and realized sales of $95 million in 2008 – will become
part of VF Corp.’s Contemporary Brands coalition. VF Corp. expects the new brands to contribute $70
million to company revenues in 2009, and hopes that despite the current slow economy, their
long-term revenues could grow by 10 to 15 percent.

In a related move, the company’s John Varvatos® mens sportswear brand will become part of the
Contemporary Brands coalition, shifting from its Sportswear coalition.

“We’re very pleased to be adding two strong and growing brands to our portfolio,” said Mike
Egeck, president, Contemporary Brands, VF Corp. “These brands not only complement each other well,
but they also complement our 7 For All Mankind® and lucy® brands. The addition of the Splendid and
Ella Moss brands and the move of the John Varvatos® business to our coalition provide us with the
ability to service the contemporary consumer and lifestyle in many different ways.”

At VF Corp., Emquies will hold the title of founder/CEO of Mo Industries and will report to
Egeck. Former Mo Industries CFO and COO Jonathan Saven is now president. Splendid and Ella Moss
Creative Director Pamella Protzel Scott will retain her position under the new organization.

“We’re excited to become part of the VF family of brands,” said Emquies. “This is a great
opportunity for both our business and our associates, and we look forward to partnering with VF to
leverage their size, scale and resources to continue to grow our business both domestically and
internationally.”

May/June 2009

Tuscarora, CloverTex Merge

Mount Pleasant, N.C.-based Tuscarora Yarns Inc. – a specialty yarn spinner with manufacturing
plants in Mount Pleasant, China Grove and Oakboro, as well as an international office in Gastonia,
N.C. – has merged with Clover, S.C.-based specialty yarn manufacturer CloverTex LLC. The merged
company will operate under the Tuscarora name and plans to maintain all existing facilities.
CloverTex CEO David M. Roberts has joined the executive group at Tuscarora’s corporate offices. The
companies aim to create an efficient, unified business for the production of innovative specialty
colored yarns for the United States, Central and South America, and other worldwide markets.

Tuscarora plans to install new spinning equipment to enhance and broaden its product lines
for specialty yarns.

In particular, seeing a gap in the marketplace with the recent closure of two spinning mills
in North Carolina, the company expects to expand its line of natural specialty yarns produced in a
recently opened facility.

May/June 2009

LA Textile Show To Co-locate With Material World

The  L.A. International Textile Show, hosted by the California Market Center (CMC), Los
Angeles, and  Material World & Technology Solutions, produced by Atlanta-based Urban
Expositions LLC, will co-locate as of fall 2009. Co-locating the shows – to be held Sept. 30-Oct.
2, 2009, at the CMC – will create the largest, most comprehensive marketplace for apparel and home
furnishing textiles, sourcing, global fashion production and supply chain resources on the West
Coast. Beginning in 2010, the events will be held semi-annually.

“When the opportunity arose to co-locate with such a well-established, successful event as
the L.A. International Textile Show, the list of benefits to the industry could not be ignored,”
said Tim von Gal, president, Material World & Technology Solutions. “By teaming up, we
eliminate market confusion and bring together an unprecedented international product and service
resource that promises to become the must-attend event for the sewn products industry.”

“By co-locating, we’ll maintain the fashion-focused show experience we’re known for, while
growing the offerings in our current categories and dramatically expanding new ones like home
furnishings fabrics, Information Technology, equipment and machinery,” said Joanne Lee, senior vice
president, CMC.

May/June 2009

Tarboro Textiles Acquires Glenoit Fabrics From Haixin

Red Bank, N.J.-based Concept III Textiles International – a developer and sourcer of fabric-based
finished products for outdoor and activewear markets – has announced that its supplier Glenoit
Fabrics (TT) Corp. Inc., Tarboro, N.C., has been sold by China-based Haixin Group Co. Ltd. to
Tarboro Textiles LLC.

Glenoit was founded in the 1950s to produce sliver knit pile fabrics. Following bankruptcy
reorganization in 2002, Haixin purchased Glenoit, and in subsequent years, Glenoit lost market
share and reduced its output. In late 2005, Haixin announced plans to close the Tarboro plant,
intending to move that production to China and Canada. To avert the closure, plant manager Jerry
Howard and his staff formed Tarboro Textiles, taking over production and manufacturing Glenoit
fabrics for Haixin on a contract basis, with a focus on customer-specific fabrics. By 2007, the
operation had returned to profitability.

In a shift of its strategic focus, Haixin decided to terminate manufacturing in North America
and entered into negotiations with Tarboro to transfer ownership of Glenoit. Tarboro has received
financial backing from a local businessman and now controls Glenoit’s operations, including
production, customer interface and the company’s relationship with Concept III, as well as all
profits and losses.

Concept III has a longstanding relationship with Glenoit. In the mid-1990s, the two companies
partnered to debut GlenPile performance piles and Berbers for outdoor and outerwear applications.
Concept III has long been the source of a large portion of Glenoit’s orders.

May/June 2009

Sustainable And Stimulative


A
 mid the doom and gloom, some bright spots still occur in the textile industry. Prior to
the economic tsunami that seemingly has changed everyone’s game, the industry had real momentum in
areas like technical textiles, performance apparel and  green sustainability. It is great to
see some of that momentum returning.

Take the case of a recent press release from the office of the Governor of North Carolina. It
states:  “Gov. Bev Perdue today announced that Sustainable Textile Group LLC, a national
manufacturer of fabric made from pre-consumer waste, will establish a new facility in Rowan County.
The company plans to invest $11 million and create 223 jobs in China Grove during the next two
years. The announcement was made possible in part by a $300,000 grant from the One North Carolina
Fund.”

“North Carolina continues to support growth in our evolving textile industry and offers
companies the opportunity to adapt and tap into new markets,” Gov. Perdue said.

The release goes on to clarify: “Sustainable Textile Group LLC is part of the Sustainable
Solutions Network of companies, which includes Sustainable Solutions Inc., Strateline Industries
LLC and Circle LLC. The companies offer a wide range of sustainable products and services. Those
include non-woven fabrics made from regenerated cotton fibers. The fabric is used in items such as
personal wipes and other non-woven materials for the home furnishing, medical and automotive
industries.”

This is great news – Sustainable Textile Group will reopen the vacant Hanes plant in China
Grove, create 223 jobs with average annual salaries of more than $29,000 and spin yarn from
regenerated fibers.

Circle LLC Founder and CEO Joy Nunn explained:  “It is our goal to produce items that
are first of all better products, cost the same or less and are sustainable. Utilizing ‘waste’ as a
raw material, we create high-quality products that are then sold globally.”

It is refreshing to see a state government interested in the textile industry while
acknowledging it is evolving.

A government interested in well-paid manufacturing jobs and willing to offer coordinated
support that includes the NC Department of Commerce, the NC Department of Revenue, Rowan County,
the Town of China Grove and Duke Energy is also good news. Another key aspect is that the grant
money doesn’t get paid until the company performs, so this is not a handout to manufacturing. The
One NC Fund has created more than 35,000 jobs and made $6.5 billion in investments since 2001.

And, what about the investment? Well, words and phrases like “sustainable,”  “better
products [that] cost the same or less” and “high-quality products that are then sold globally” lead
one to believe this is part of the latest evolution in the US textile industry. Non-commodity,
global, sustainable products are key.

Recessions don’t end on a given Wednesday. Recovery varies in duration and, although it would
be convenient to have clear signals as to where the United States is in the economic cycle, few
know anything until after the fact. With that headwind, it is impressive to see companies stepping
forward and investing in the future.

May/June 2009

Business Groups Fight Labor Organization Legislation

A high-powered business coalition, including textile and apparel manufacturers, is stepping up
efforts to defeat legislation that would overhaul the way union elections are held. The Employee
Free Choice Act (EFCA) currently has 40 Senate and 225 House co-sponsors, and President Barack
Obama has endorsed it.

On May 5, the 580-member Coalition for a Democratic Workplace wrote to every member of the
Senate, saying the legislation “severely undermines long standing principles of balance and
fairness in federal labor law.” The National Council of Textile Organizations and the American
Apparel and Footwear Association were among the signers of the letters.

The EFCA would direct the National Labor Relations Board to certify a union as a bargaining
agent on the basis of a majority of signed cards and would take away an employer’s right to decide
whether to use the card check or require a secret ballot. It also would provide mandatory
injunctions for unfair practices during an organizing campaign.

The business coalition says the EFCA represents “egregious attempts to limit the rights of
employees and employers and will severely diminish the ability of US business to succeed in our
globally competitive market.” They contend that union access provisions in the legislation would
give non-employee, professional union organizers the right to enter a workplace during work hours
to solicit support during a union organizing campaign. They say, “Union access provisions will
significantly disrupt the working environment of a business, severely hampering day-to-day
operations as employees could be approached by professional union organizers while they are
performing their job.”

The coalition says current federal law permits both union organizers and employers the right
to make their cases to employees.

The American Federation of Labor/Congress of Industrial Organizations (AFL-CIO) contends the
legislation would enable workers to bargain for improved benefits, wages and working conditions in
an atmosphere where they could not be unduly influenced by employers.

While there have been some suggestions of compromise on the legislation, including a shorter
time frame for deciding elections, the coalition says flat out, “There can be no acceptable
compromise.”

May 12, 2009

The Rupp Report: Cotton With A New Approach

In the International Year of Natural Fibres, declared by the Food and Agriculture Organization of
the United Nations, cotton is even more the focus of attention than in the past. For decades,
cotton was considered to be a kind of “bad” fiber, using too much water for irrigation, and,
moreover, too much pesticide. Those times are gone.

What Is Clean Cotton?

As Textile World has reported before, there is a totally new approach to cotton these days.
Sustainability is one of the key words. Customers around the world are putting more attention on
“clean cotton.” But what exactly is clean or sustainable cotton? As quoted in the last cotton
report from Bremen Cotton Exchange, sustainability as well as sustainable cotton production are
much-discussed terms.

However, there are still misunderstandings between sustainability and terms like “organic” or
“bio.” Back in 1987, the United Nations presented its definition of sustainability: “Sustainable
development is development that meets the needs of the present without compromising the ability of
future generations to meet their own needs.” Therefore, a sustainable agricultural production
should have an ecological, economical and social balance that also considers the options of future
developments.”

Research Programs

Under the theme “Sustainable Cotton Production,” the International Cotton Advisory Committee
(ICAC) organized a Research Associates Program, which took place April 6-16. Cotton researchers
from Ivory Coast, Germany, Greece, Sudan, Turkey and Zambia participated. The focus of the program
was to learn the definition of sustainability in combination with practical input of the cotton
production sector.

Besides modules at the ICAC office in Washington, other important locations for the US cotton
industry – including visits to the United States Department of Agriculture and Cotton Council
International in Washington, and Cotton Incorporated in Cary, N.C. – completed the program.



Improved Seeds

The US agricultural sector also tries to improve its methods through intensive research, the
report says. The use of chemical inputs is being reduced further owing to the use of genetically
engineered seeds. Furthermore, the agricultural research has reached a stage of high-tech crop
management that can reduce pesticide use to a minimum. An exact diagnosis of the soil condition,
irrigation steered by satellite and, of course, specific seed breeding are factors already used in
the fields.



To Face Financial Problems

Obviously, the financial crisis hit the textile sector. This was mentioned at a panel
discussion of the ICAC Standing Committee in which the research associates could participate as
well. The meeting took place at the Fashion Institute of Technology in New York City. The main
focus of the gathering was the panel discussion on “Demand for Cotton Products in the Economic
Crisis”. On the panel were representatives of textile-based sectors like fabric research or fabric
development as well as denim development and jeans manufacturing, but also the cotton research
sector. The main idea was that – at least in the US market – quality is of core importance. The end
consumer considers cotton a high-priced quality fiber despite the fact that man-made fiber can be
more expensive.

For more information on the important subject of sustainable cotton, please visit
www.textileworld.com.

May 12, 2009

RadiciSpandex Announces 2009 Stretch To The Future Design Competition Winners

Gastonia, N.C.-based spandex fiber manufacturer RadiciSpandex Corp., the North American business of
Italy-based RadiciGroup, has announced five winners of the 2009 “Stretch To The Future” Design
Scholarship Competition. The Radici competition – held with junior class design students at The
Fashion School of Kent State University, Kent, Ohio – was established 10 years ago to promote
apparel design using fabrics containing spandex. Judging was held at Kent’s Manhattan design
studio.

This year’s honorary judges were Lisa Mayock and Sophie Buhai, designers and founders of
Brooklyn, N.Y.-based Vena Cava, a contemporary womenswear label. Mayock and Buhai received Stretch
to the Future honoree awards from RadiciSpandex Marketing Manager Kim Hall. The Underfashion Club
sponsored the contest’s lingerie award for the second year.

This year’s winners were chosen from a field of 30 students. Fabrics used contained
RadiciSpandex’s RadElast® spandex. Alexandria Kakoules, who designed a one-piece swimsuit
constructed in fabrics from Darlington Fabrics, took the Grand Prize. Christine Barbas received the
Activewear Award for her three-piece design comprising a zip-up vest, long-sleeve top and leggings
using fabrics provided by Darlington, Gehring Textiles, Paul Gottlieb and Sextet Fabrics. Chelsea
Paskvan won the Swimwear Award for a swimsuit and cover-up designed using fabrics by Sextet.
Brittney Sampsel received the Lingerie Award for a bustier and panty constructed using Sextet and
Cyberknit fabrics. Jenna Weickert won the Eveningwear Award for her gown designed in black stretch
fabric provided from Darlington.

May 12, 2009

Klopman Vantage Fabric With Cordura® Wins Fabric And Fibre Innovation Award

Klopman Vantage workwear fabric featuring Invista’s Cordura® technology has received the Company
Clothing Industry Award’s 2009 Fabric and Fibre Innovation Award.

Wichita, Kansas-based Invista – a manufacturer of global integrated fibers and polymers – and
England-based Klopman International – a manufacturer of polyester/cotton blended fabric – partnered
to develop a comfortable, durable, abrasion-resistant twill fabric that could be used for a
complete garment.
(See ”
Invista,
Klopman Unveil Klopman Vantage Fabric With Cordura Technology,” October 2008.) Klopman
Vantage with Cordura contains an intimate blend of 50-percent Invista™ T420 Nylon 6,6 fiber and
50-percent combed cotton. The fabric is used to make trousers, coveralls and jackets, and is
available in five colors. Klopman currently is working to expand the range of fabric weaves in the
Vantage line.

“We chose to recognize Klopman Vantage Fabric featuring Cordura brand technology because the
performance of the fabric represents a step-change in terms of durability and abrasion resistance
without compromising on comfort or aesthetic appeal,” said Jose Sanchez de Muniain, chairman of the
judging panel, former editor of Company Clothing and current editor of Fire & Rescue magazine
and Industrial Fire Journal. “These factors heavily influence the success of workwear garments. The
fabric offers something new to the industry – and that is what we look for in a winning fabric.”

May 12, 2009

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