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| Martin Trust urges Sri Lanka
to continue with government reforms to improve
the country’s competitiveness. |
| Photo by James Overly |
Apparel industry giant Martin Trust, a principal
force behind the growth of the Sri Lankan apparel
manufacturing industry, says Sri Lanka must prepare
to meet serious challenges now arising from new
competitors and from changes within the U.S. retail
garment industry.
In a recent address to members of the American Chamber
of Commerce in Colombo, Trust, chairman of Brandot
International and founder of Mast Industries, noted
that Sri Lankan garment exports now account for
nearly half of total Sri Lankan exports, with garment
exports to the U.S. now composing 30 percent of
Sri Lanka’s total exports.
Trust says Sri Lankan garments have maintained a
unit value higher than garments shipped from Bangladesh
or Pakistan, and continue nearly to match the total
value of Indian garment exports to the U.S. But,
he warns, China is now in first place in both textile
and apparel exports to the United States, and is
“ready, willing and able to take market share
from Sri Lanka.” Trust also advises that Vietnam
is rising quickly among apparel exporters to the
U.S.
Changes in the U.S. retail clothing industry also
bring serious implications to Sri Lankan clothing
manufacturers. Consolidation has reduced what used
to be 32 independent department stores to three
(and two of those three are talking of merger).
The same phenomenon has occurred at the wholesale
level, he adds.
At the same time, specialty retailers have grown
to take significant market share, and private label
retailers continue to show growth. These entities
in turn are meeting new pressures from the “800
pound gorillas” of retailing – such giants
as Wal-Mart, Costco, J.C. Penny and Kohl’s,
who, Trust says, “are getting smarter everyday
in their buying.”
The retail garment industry also faces growing pressure
from associations and groups advocating various
causes, from eliminating child labor to environmentalists
urging greater use of recycled materials. Most of
these groups are reasonable and can be dealt with,
Trust says. Whether moderate or extreme, however,
their advocacy can cost the industry dearly in both
time and money, so they cannot be ignored. To sum
up, Trust says, retailers will be looking for manufacturers
who offer a “hassle-free” business environment,
provide good labor practices with no child labor,
and, of course, can deliver goods rapidly and on
time.
Trust says he is confident that the “good,
smart people” in the Sri Lankan apparel industry
will be able to take these forces into account in
their planning and operations. Trust urges Sri Lanka
to continue government reforms and other changes
to improve the country’s competitiveness. Trust
also urges the apparel manufacturers to work closely
with the retailers to learn precisely what changing
expectations the retailers will have of their suppliers
and manufacturers.
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