pro:Americas Annual Conference
AAPN talks hemispheric strategies, technology coming out of pandemic
Posted June 3, 2021
Editor’s note: Portions of this article first appeared as a blog on the CGS, Inc. website.
By Devin Steele
The Americas Apparel Producers’ Network (AAPN) had to forego its pro:Americas Annual Conference again this year, at least in person, but the group recently was able to attract a full house in a dynamic, virtual format that featured subject matter experts covering several pertinent topics.
Putting together the pieces of a hemispheric strategy – the primary goal of the AAPN being to connect the players of the Americas – was the order of the day. To that end, several speakers offered insights relevant to that mission before a group of nearly 200 attendees.
An underlying theme was technology and tools that will drive the industry as we emerge from the COVID-19 pandemic. During the crisis, everything seemed to change … or at least accelerate, in many respects. Change was fast-tracked to address the needs of the new environment in which many businesses and individuals found themselves. At the same time, lingering issues that had not been properly addressed moved to the forefront, and companies began to take a closer look at ways to turn many of them into opportunities.
This is especially true of the textile and apparel industry and their brand and retail partners, as noted by presenters. Sustainability, fast fashion, personalization, customization, digitization, onshoring, nearshoring, made in the Americas, consumer shopping behaviors and supply chains are always top of mind to this sector, and how the industry is working to implement the technological tools necessary to capitalize on these opportunities and trends was an underlying theme of the event.
In many instances, the industry came together to collaborate and figure out ways to alleviate the critical shortage of Personal Protective Equipment (PPE) during the early weeks and months of the pandemic. And lessons learned from that disruptive experience may serve as a model for cooperation in order to nearshore production and help avoid such problems going forward.
Among speakers was Dr. Juan Jose Daboub, president of the ThinkHUGE (Honduras, USA, Guatemala, El Salvador) Business and Investment Council and a former managing director of the World Bank Group. He explained his group’s goal of achieving a win-win for all by creating job opportunities that would effectively reduce the USA’s dependence on mostly Asia-made goods and reduce the crisis on the U.S. southern border.
“With ThinkHUGE, our objective is to take advantage of the opportunity that allows coordinating and strategically aligning a regional effort for the development and empowerment of the people of the United States, Guatemala, Honduras and El Salvador,” said Daboub, a graduate of N.C. State University. “This can be done through clusters that promote investment opportunities and job creation with a high focus on social benefits that are sustainable in the medium and in the long term.”
He laid out a roadmap that potentially could create 2 million jobs in the four countries. The council is looking to create various clusters that could underpin and improve such areas as transportation infrastructure, telecommunications, energy, logistics and innovation. One of those, a “textile cluster,” has tremendous potential, which has tremendous potential to benefit all of these countries, he said.
He explained his group’s goal of achieving a win-win for all by creating job opportunities that would effectively reduce the USA’s dependence on mostly Asia-made goods and reduce the crisis on the U.S. southern border. He laid out a roadmap that potentially could create 2 million jobs in the four countries.
“Nearshoring and new technologies such as automation are enablers that can help us reduce C02 emissions and achieve a circular value chain, all the way from a zero-waste design process to production of renewable and sustainable fibers,” he said. “Nearshored fabric industries could invest in resource-efficient, sustainable technologies with automated finishing, significantly reducing the use of energy, water and chemicals.”
He added that automated production of high-quality, customized garments would increase the value of fast-fashion items for consumers and prolong garment life. Also, on-demand production and distribution and an improved recycling business has great potential to minimize waste by reducing unsold items and inventory, further reducing shipping costs and emissions, he pointed out.
“While there are very important challenges, there are also opportunities that we want to make sure we capitalize on for the benefit of the people,” Daboub said. “So while illegal immigration and the commercial dependency on Asia is complicated, it seems for everybody for the region, there is also the fantastic opportunity of the rapidly increasing opportunity that can be achieved, high levels of investment for countries that are very near to the United States.”
Walmart’s made-in-America initiative
Meanwhile, Laura Phillips, senior vice president of Global Sourcing & U.S. Manufacturing at Walmart, covered the global retailer’s commitment to products that are grown, assembled and produced in the U.S. She pointed out that Walmart has strengthened its commitment to American-made goods with an additional $350 billion investment through 2030 and an initiative called “American Lighthouses,” a collaborative program aimed at uniting key stakeholders in specific regions of the country to identify and overcome top-down barriers to U.S. production.
“Specifically, we’re going to start in textiles and apparel,” said Phillips, who opened her comments by thanking the industry for scrambling and turning on a dime to produce critical PPE during the pandemic. “The industry has a strong history in this country and remains robust. We know it’s still there – we just need to wake it up a little more.”
Phillips added that a resilient supply chain in the Western Hemisphere is important the company’s made-in-America initiative. Producing closer to home helps increase transparency in the area of sustainability, which continues to rise in importance to consumers and remains a priority for the company as it relates to its suppliers and customer demands, she said.
“We know we can reduce emissions, but our sustainability commitment doesn’t just stop there,” she said. “There are other areas we can have an impact on, especially through making textiles and apparel here in the U.S. and in this hemisphere. We can also impact waste and improve circularity. We’re excited to see some of the broader impacts we can have as we think about recycled fibers, yarns and fabrics.”
She added that not only does being sustainable provide opportunities for cost reduction and growth, but being a green-focused, low-impact company with suppliers with good stewardship is also “the right thing to do.”
Optimistic about nearshoring
Another speaker, Steve Lamar, president & CEO, the American Apparel & Footwear Association (AAFA), answered, “We're really optimistic about this,” when asked by AAPN President Ed Gribbin if he sees a lot of AAFA members working to move more sourcing supply chains closer to the Western Hemisphere.
“I’ve had probably more substantive, serious conversations with policy folks and other stakeholders in the policy arena in Washington in the last five weeks about this issue than probably than in the last five years,” Lamar said. “There’s a lot of energy and momentum around this, and a lot of alignment. People are looking for more nearshoring. Policymakers also have been talking about encouraging that.”
He noted that while brick and mortar took a big hit during the pandemic, ecommerce “exploded” over the last 14 months.
“And it will continue to grow, but it will do so in a much more integrated way with retail,” he said. “We’ve heard the word ‘omnichannel’ for years, and that will come into play in an even bigger way. We are still social creatures. We like to see each other, so we will begin to get out more, but virtual technologies aren’t going anywhere.”
Lamar added that the immigration crisis on the U.S. Southern border has also fueled this talk.
“I recently heard a fellow from the State Department say that it is the national security imperative of the U.S. to drive job creation in Central America, the Northern Triangle specifically,” he said. “We would look at Nicaragua, the Dominican Republic and Haiti, too. Looking at it through the immigration crisis filter, we can certainly see that materializing. The key is to make sure we can get the policies organized and aligned around this. As the job creators start moving into the region, it’s important that we have a catcher's mitt, a policy framework to absorb, incorporate and direct that investment so that it can become very productive.”
Lamar also spoke on other trade matters during his presentation, including China 301 tariffs, the Xinjiang forced-labor issue, the Biden Administration’s trade policy, consumer purchasing habits and more.
‘Stars are aligning’
In rounding out nearly a full day of presentations covering these issues and how technology is driving much of the change as we emerge from the pandemic, Jesus Canahuati, president of Honduras-based textile company Elcatex, which supplies product to numerous brands and retailers, said the days of generally sourcing from China at the lowest price are nearly over.
“The trend of nearshoring, the exponential growth of e-commerce, the internal demand within Asia, especially China, the geopolitical issues that we’re experiencing … all of those factors are really changing how this industry is going to develop in this hemisphere,” he said. “You need to produce closer to home, and we in CAFTA countries are the closest option to the United States. We’re committed to expand and invest in technologies in order to meet the growing demand that this region is going to have.”
Canahuati noted that “all the stars are aligning to making our region stronger and to really be one of the largest textile hubs in the world to service the growing demand in the United States.”
He added that, though 2020 was a difficult year for all, he said the way the industry pulled together during a time of crisis was awe-inspiring.
“I was amazed at the honest and true collaboration in the industry,” he said. “You saw whenever the PPE demand issue came up, everybody got together. Nobody was thinking of whether they were competitors or not. They came together to produce the gowns, the masks, the sewing and more.”
Canahuati added: “I personally was involved in one project for the sewing of medical gowns, 60 million gowns awarded by FEMA to Parkdale. And we have people in Honduras, Guatemala, El Salvador, Haiti, Nicaragua and the D.R. – all of us working towards completing that, and we shared recipes and information. It was an incredible time because we got to know each other better.”
He said that experience has bolstered his believe that such teamwork should be the philosophy of the Western Hemisphere.
“We all need to collaborate with each other” he said. “We’re not competitors. Our competition is in Asia. We are a group of manufacturers who need each other in order to be an umbrella for the growing demand in the United States.”
Future Forum Teams
Dr. Lynne Sprugel, CEO of abuzz global LLC and vice president of the AAPN, presented a preview of the network’s members-only Future Forum Team’s presentations, scheduled for this month.
After extensive exchanges during virtual meetings and a comprehensive follow-up survey, AAPN members created four Future Forum Innovation Teams to identify and explore opportunities as this supply chain network emerges from the COVID-19 pandemic.
“We are coming from an age of recent lockdowns, living behind closed doors,” Dr. Sprugel said. “We each have a unique experience – good and bad, and maybe a hybrid of both – and a story to tell. If we can mine those thoughts and new ideas around the forced realities under which we’ve had to operate, we can begin to create a future. As we turn the doorknob, we are anxiously awaiting a new age. We emerge seeing many new horizons, each different, each offering endless possibilities.”
Four teams emerged from the discussions: Team Biz Global, led by Renee Bavineau, CEO and founder of Raise The Bar RTB LLC and Rick Horwitch of Bureau Veritas; Team Remodeling Trust, led by Kirsten Harris of EarthFirst Consultants and Mandi Strickland of ImagineKnit Global; Team Material Sciences, led by David Sasso of Buhler Quality Yarns and Eric Joo of UTEXA; and Team TechSys, led by Pam Peale of DeSL and Jorge DeLeon of Gerber Technology.
“The future doesn’t just happen,” Dr. Sprugel added. “With partners like you, the future is what we make it – together.”