Balance of Power
August 15, 2005-- Home Textiles Today,
Technically, we're eight months in as far as free trade is concerned.
Realistically, depending upon the category, the post-quota axe fell a few years ago. Still, it's not easy to determine the arc of post-quota balance of power.
Consider the soft window category. Quota came off in 2002. Seeing as three years have elapsed since then, the offshore powerhouses ought to have become well established by now, no? Not necessarily.
First, the advantage swayed to Turkey. Good quality. Strong tradition of design. And if the colorations or patterns weren't necessarily attuned to American tastes, they were tweakable.
Then — and rather quickly — mills in China began improving quality (on a relative basis) and at lower cost. These were not mega-mills. They were not even by U.S. standards “large mills.” But in a rapidly developing world market and a country that still makes room for family-produced piece-work, it was a gain.
About a year after quota was lifted, I corresponded for a time with a local rainmaker in China who explained how it all worked: Well-Known American Supplier or Big-Time American Retailer would place an order with Regionally Significant window fabric mill. Said mill would place a blackboard outside its factory outlining the specs. Families all over the region — “Every farmer has a loom in his house,” said my correspondent — would get to cranking.
Here were are today. There's still a lot of piecework being done, and there's nothing wrong with that. Such is the nature of developing nations; such is the nature of opportunity. Let he who is without a foreign sourcing office or import rep cast the first stone.
But three years in, it's not so easy to identify the overseas powerhouses in window manufacturing. Sheets and towels? Easy-breezy. But perhaps only for the moment.
Consider Alok, which until spring 2004 was a maker of shirting fabric. It's now one of the top offshore producers of sheeting for the United States.
Ah, but next year, Welpsun's sheeting capacity will have a full-year running. And Welspun's sheeting capacity could exceed all others in India.
But then again, there are now approximately 15 spinning manufacturers in India that have taken on capital and expect to become full-on sheeting manufacturers within the coming 18 months.
And we haven't even touched the subject of China's sheeting build-out yet.
Which brings the conversation back to the elimination of window quota three years ago. In the early going, it was easy to tell which offshore manufacturers were grabbling share. But at this juncture, the landscape is murkier and populated with scores of small, emerging players.
The good news, I suppose, is that it's still anybody's game. The sobering news is that it's one in which the players — and the playing ground — is constantly shifting.
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