My son is an avid Little Leaguer. That has caused me to dig out an old baseball glove from youth — part of my parents’ continuing effort to get stuff that is not theirs out of their house. My baseball glove has two notable things written on it: a Catfish Hunter autograph and “Made in Korea.” While Korea now means flat panel TVs and surprisingly good cars, in the Ford administration it meant cheap sewing. The question now is how soon the “Made in China” on son’s baseball glove will seem similarly out of place.
This issue was addressed in a recent Wall Street Journal article (U.S. Apparel Retailers Turn Their Gaze Beyond China, Jun 15). As we have written before, costs have rising in China and also labor has become restive. That can punish retailers in competitive markets hard as they are unable to pass on higher costs in their home markets. But where else are they to go? Among the options discussed in the article are India and Vietnam.
As the graphic shows neither of these places is really a panacea. In India there can be logistical challenges. In Vietnam there can be issues of getting raw materials:
Vietnam has a big labor pool, but textiles aren’t as available there as in China, meaning retailers would have to ship in fabrics, said Andrew Jassin, managing director of fashion consulting firm Jassin Consulting Group.
So China then has a leg up because of its skilled workforce and infrastructure to support the industry. Another consideration mentioned in the article is that labor is only one component of the cost.
Moreover, labor typically accounts for between 15% and 22% of the total cost of a garment, while fabric and logistics can account for as much as 60%, according to Hana Ben-Shabat, a partner in the retail practice of consulting firm A.T. Kearney.
So “Made in China” may be on baseball gloves for a while.