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Suitmaker exporting made-in-USA to China
2008-07-15
China Daily/Agencies
Clothing from China that fills US store shelves is nothing new, but now a designer whose suits are still made on American soil is going against that trend - by selling in China.
Joseph Abboud, a privately owned tailored apparel brand with a factory in New Bedford, Massachusetts, plans to open stores in China and sell its tailored looks to professional Chinese men attracted by the cachet of "Made in the USA".
"The concept of products being made in America and then exported to China is really odd," admitted Marty Staff, chief executive of brand owner JA Apparel Corp, owned by Staff and Boston-based private equity firm JW Childs Associates. "We're taking this in the wrong direction, but it worked."
The company, which supplies upscale US stores like Nordstrom, Saks and Neiman Marcus and has stores elsewhere in Asia, will open 15 stores in Beijing and Shanghai this year and 15 more Chinese stores by next summer.
"The idea of bringing an American designer to China but have it not be bright T-shirts but have it be fine tailored clothing was revolutionary to all the people we spoke with in China," Staff said.
Joseph Abboud, a brand Staff calls a "well-kept secret" by American men, makes about $300 million in sales a year and employs 600 people at its US factory making dress pants, sport coats and suits. A suit costs about $900 in US stores.
"We only make what we have orders for and we do our business at full price at the very best stores," Staff said, acknowledging that the limited capacity at his US factory means the company leaves some business on the table.
The company has managed to resist the temptation of manufacturing overseas in light of high US labor costs by being more nimble with order turnarounds due to less transport time, and taking advantage of federal subsidies on fabric, he said.
"Tailored clothing historically in mens' is a low-margin, high-risk business," Staff said. "We've been able to utilize our factory as a weapon."
The company signs license deals for everything from decorative fabric to boys' clothing and has increased that business to now make up 55 percent of total sales.
JA Apparel will partner with Chinese-owned Judger Group, described by Staff as the largest supplier of tailored clothing to China. It will handle day-to-day retail operations, but JA will supply the clothes, design stores and supervise displays.
Staff said Joseph Abboud considers its rivals to be higher-cost brands like Giorgio Armani or Versace.
Clothing fits will be tweaked for the Chinese market and each suit will include a card in the breast pocket explaining that the garment came from a unionized factory in the United States.
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