Fabric faces big challenges
By Susan M. Andrews -- Furniture Today, December 26, 2004
High Point — The coming year will be one of disruption and change as the textile industry learns its way around the newly enlarged and complicated global marketplace.
But the disruption should be minor and short-lived. Weak players may falter and fail, but strong players will stay in the game and get stronger.
Some of the drawbacks to imported fabric — long delivery time and too much similar product — may start to tarnish the gleam of those nearly impossible low prices. Domestic producers will likely ramp up their creativity in design, marketing and technical innovation to create value in their product.
Last-minute political wrangling could delay some effects of the upcoming elimination of worldwide textile quotas.
But regardless, Jan. 1, 2005, will be the first day of a new global future for textiles and everything that went before will become history.
It won't be as ghastly as the livid worst-case scenarios the lobbyists have been painting with their rhetoric for the past year, and it won't be as dreamy sweet as the big retailers have painted it either, with Americans happily mesmerized by their new, even-less-expensive home and apparel goods from Liz Claiborne and JCPenney.
Many American fabric sources include imported fabrics in their lines and have done so for years. Just like upholstery fabrics imported from Italy, Germany, France, Belgium and Spain, upholstery fabrics from China, India, Pakistan and Turkey are being used by most American upholstery manufacturers.
For the past few years, a lot of imported upholstery fabric has come into the United States as "cut-and-sew" kits, which are considered furniture components and not included in quotas.
According to the U.S. Department of Commerce's International Trade Administration, cut-and-sew cover imports from China rose 148.7% in the first six months of 2004, compared to the same period in 2003. The percent change was even greater in cut-and-sew covers imported from Germany at 225.7%. Such imports were down from Taiwan and Italy, 29.1% and 16.1%, respectively.
In addition to cut-and-sew covers, there is tremendous growth in the amount of upholstery — sofas, chairs and recliners — that American manufacturers are importing completely finished from China.
During the first half of 2004, imports of completely finished upholstery to the United States from China rose 60.1% compared to the same period in 2003, according to the ITA.
As American upholstery production moves to China, there is a corresponding increase in the number of American fabric sources finding effective ways to produce their goods in China as well — where they can be easily shipped to the manufacturing plants in China.
An example is Culp Inc., which is successfully blending its product manufactured at home with its product manufactured in China, much of which is sold to American furniture manufacturers producing their upholstery in China.
Without question, there will be additional major American players finding ways to stay competitive by having at least a toe or two in China.
There are those who want to avoid doing business of any sort with China because of the issues related to their currency, which has been artificially supported and not allowed to find its real value in the market, and they will continue to have a range of domestic producers to deal with, although some are likely to find the competition too stiff to overcome.
The strong, as always, will survive.
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Where will the industry be in 10 years?
Feb 26, 2006 -
U.S. mills find ways to grow
Apr 27, 2008 -
Closing 'loophole' could raise cut-and-sew costs
Sep 10, 2006 -
Asia now center of fabric sourcing activity
May 6, 2007 -
Showtime goes global
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