cctc oct13 newsletter

38
NEWSLETTER OCT 2013

description

The Cape Clothing and Textile Cluster newsletter for October 2013

Transcript of cctc oct13 newsletter

Page 1: cctc oct13  newsletter

newsletter oct 2013

Page 2: cctc oct13  newsletter

Cluster facilitation services are provided by Benchmarking & Manufacturing Analysts SA (Pty) Ltd (B&M Anaylsts, an organisation that provides high value specialised support services to drive sustainable industrial development.

Over the past 15 years B&M Analysts have developed methodologies and skill sets that allow them to play a unique role in relation to supporting the competitiveness of value chains and the growth of industrial sectors. These services are tailored to support the industrial development goals of government organisations, private sector organisations, and public-private partnerships (PPP).

B&M Analysts is a verified Level 2 B-BBEE contributor under the Codes of Good Practice for Broad-Based Black Economic Empowerment (B-BBEE).

For more infomation on B&M Analysts please visit www.bmanalysts.com

compiled & distributed by

Page 3: cctc oct13  newsletter

IntroductIon to the cctc

The Cape Clothing and Textile Cluster (hereafter the CCTC) was launched in 2005 in response to the considerable pressure the industry was facing as a result of trade liberalization and increased global competition. The aim of the cluster is to assist clothing and textile firms to bolster their competitiveness.

The Cluster operates as a Not-for-profit Company (NPC), governed by an execu-tive committee and numerous Technical Steering Committees (TSCs). The service provider of the cluster is Benchmarking and Manufacturing Analysts (BMA), who are responsible for the management and facilitation of the cluster. BMA is also the service provider to the CCTC’s sister cluster, the KwaZulu-Natal Clothing and Textile Cluster (KZN CTC).

The activities of these clusters are synergised and therefore enable a national de-velopment strategy to be executed for enhanced competitiveness of the cloth-ing and textile industry in South Africa. With support from five of South Africa’s largest retailers, the Cluster has been able to establish and entrench programmes designed to assist local firms’ development by accumulating economies of scale through group activities and shared resources.

Page 4: cctc oct13  newsletter

The benefits of clustering include:

• The generation of a critical mass of resources• Shared learning• The rapid diffusion of ideas• Collective action and risk sharing• Reduced costs• Enhanced ability to compete on a global platform

Page 5: cctc oct13  newsletter

contentS

1. Announcements

2. Upcoming Events

- Peer Reviews

- Final 2013 CCTC Executive Meeting

- Final 2013 QR Workshop

3. Recent Events

- CIP Awards

- RCT Imbizo

4. Focus Article – Value Stream Mapping

5. Industry News

- Textile industry averts strike action

- US and African companies call for immediate renewal of AGOA

- Cape Union Mart plans to expand in Botswana, Namibia, SA

6. B & M Analysts - About the Service providers to the CCTC

Page 6: cctc oct13  newsletter

AnnouncementS

ProductIon IncentIVe APPLIcAtIonS

Please be reminded that all Production Incentive applications need to be with the CTCP Desk before 31 January 2014. Take note that any late or incomplete applications will not be considered.

As noted in the previous newsletter, the IDC have distributed new PI guidelines. If you have not received copies of these, please contact the Cluster to ensure you are up to date with the amendments. An important change from the prior years’ applications is that applicants are now only allowed to use a maximum of 50% of their Benefit Ceiling towards Interest Subsidy and that this will be phased out in the following year 2014/15 onwards.

If you require any assistance with your PI application, please do not hesitate to contact the CCTC at:

Email: [email protected]: (021) 552 0240

Page 7: cctc oct13  newsletter

trAce 2014

B&M Analysts’ newly accredited TRACE programme for Supervisors and Team Leaders has been well received by a number of our CCTC members this year: K-Way Manufacturers completed their first class earlier this year with both Falke Eurosocks and Freudenberg non-wovens currently busy with their third class which began in October.

In the modern manufacturing environment, the role of Team Leaders has in-creased in importance. As such, it is important for the World Class Manufactur-ing concepts to be successfully introduced and implemented at his level. The TRACE skills programme presents both the theory and practical application of fundamental WCM principles and is complemented by leadership and project management training to support a holistic and comprehensive skills upgrading programme.

The TRACE has two principle goals in this regard:

Goal 1: Skill learners to understand the concepts and basic implementation of WCM principles in the workplace.

Goal 2: Ensure that these skills translate directly into the organisation’s operational competitiveness and efficiency.

Page 8: cctc oct13  newsletter

With the positive responses that have been received from the participants that have completed the programme thus far, we strongly urge our members to consider putting forward teams for training in the New Year.

If you require any assistance with your TRACE programme registration, please do not hesitate to contact Roslynn Manuel at:

Email: [email protected] Phone: (021) 552 0240

Page 9: cctc oct13  newsletter

Peer reVIeW

The topic of discussion at the next Peer Review will be ‘Employee Involvement and Communication’ and will be held at Waltex on the 12th of November. Peer Reviews provide an invaluable opportunity for learning from one another and give participants a supportive environment in which to test ideas and interrogate their own beliefs.

November 12 Peer Reviews

December 5 Final 2013 Executive Committee Meeting

11 Final 2013 QR Workshop

uPcomIng eVentS

Page 10: cctc oct13  newsletter

FInAL 2013 eXecutIVe commIttee meetIng

The CCTC executive committee will sit for their final meeting of the year on 5th December 2013 to critically reflect on the on the passing year as well as finalise the 2014 CCTC Business Plan. The committee will reflect on the various require-ments listed by industry during this years’ Imbizo and formulate a clear set of responsibilities for the Cluster in 2014.

FInAL 2013 Qr WorkShoP

The VCA TSC agreed to conclude the year with a final 1-Day QR workshop for CCTC members in December. The workshop will be titled, 2013 South African Quick Response Supply Chain Lessons and will reflect over another year of inten-sive CCTC activity, take note of major progress that has been made in respect of introducing Quick Response retailing and associated supply chain practices into South Africa.

All CCTC members are cordially invited to attend the CCTC’s final workshop of the year to engage the key lessons derived from the CCTC’s extensive 2013 QR activities. Please refer to the conference details below:

Date: 11th of December 2013Time: 11:00 to 16:00Venue: Belmont Conference Centre

Page 11: cctc oct13  newsletter

recent eVentS

cIP AWArdS ceremonY

The CCTC hosted the annual CIP Awards function on 10 July this year. The annual awards ceremony provided an opportunity to reflect on the progress made over the last two years and to acknowledge key successes that have been achieved. Importantly, the awards ceremony provided an important opportunity for the hard working Lean Teams at the participating firms to receive the acknowledge-ment that they deserve, with both government officials and dignitaries in attend-ance this year. The 2012 winners, Radeen Fashions, handed over the Best Practice floating trophy to the 2013 winner, K-Way Manufacturers.

Page 12: cctc oct13  newsletter

rct ImBIZo

The Fifth Retail-Clothing-Textiles Imbizo was held at Devonvale Golf and Wine Estate from the 16th to the 17th of August 2013.

The intention behind the Imbizo was two-fold. Firstly, to provide an opportunity for key stakeholders and interested parties to review the progress made by the Cape and KZN Clothing and Textile Clusters against the mandate given to the respective Clusters at the 2009 Imbizo.

Secondly, to provide an opportunity to determine the strategic direction of the Clusters going forward while ensuring that the Clusters remain the key drivers of constructive dialogue and action supporting the de-velopment of the apparel value chain in South Africa.

The Imbizo was well attended by the Cluster manufacturing firms as well as rep-resentatives from the apparel retailers. Participation was purposefully limited to manufacturers and retailers with a history of involvement in clustering activities in order to ensure that discussions were focused, forward looking and non-partisan.

Page 13: cctc oct13  newsletter

Key public sector parties were also invited in order to facilitate dialogue between the public and private spheres, while enabling the public sector to better under-stand the strategic direction and support needs of the private sector.

The 2009 Imbizo identified four focus areas as being critical to the future develop-ment of fast product retailing and associated quick response manufacturing in the South African clothing and textiles value chain:

(1) Fast product testing, (2) Fabric stability for quick product supply, (3) The development of retail supply chain strategies, and (4) Supplier development.

Following the opening of proceedings by Professor Mike Morris of UCT, Dr. Justin Barnes outlined the progress made by the Clusters to date against each of the key focus areas highlighted above. He noted that the DTI’s CTCP has clearly sup-ported cluster and manufacturing upgrading, as well as the extensive testing and piloting of quick response supply chains. In addition, the DTI commissioned Textile Mapping Study was completed in 2012, while extensive manufacturing develop-ment support has been delivered by the clusters.

Rob Stewart, the Chief facilitator of the KZN and Cape Clothing and Textile Clus-ters then provided a brief look into possible future scenarios based on projected growth of the top 7 retailers in the country, with projected apparel retail sales of

Page 14: cctc oct13  newsletter

between R104bn and R165bn by 2022. Assuming current ratios remain constant, this translates into between R58bn and R92bn being spent on sourcing apparel products. Based on these figures, it was further postulated that if quick response purchases were 40% of the buy and 20% of “normal” lead time buy was also sourced locally, this represented a total of R55bn potential local manufacturing sales. Converted into employment figures, this represents a potential 150 000 local clothing and textile jobs (inflation and efficiency adjusted). The presentation highlighted the potential upside of ensuring a healthy and viable local manufac-turing industry that is able to provide a full suite of solutions to the retailers.

A brief Plenary session was then hosted by past and current Chairs of the KZN and Cape Clusters (Mike Wood, Bobby Fairlamb and Graham Choice), which offered an opportunity for questions related to the presentations as well as general dis-cussion points.

The balance of the day was spent in a brainstorming session whereby the value chain was divided into groups representing the clothing, textiles and retail por-tions of the value chain, with each group focused on highlighting what it requires from the other links in the value chain in order to start fulfilling the long-term vision of growth and job creation. The day ended at 4pm before participants re-con-vened for an evening celebratory dinner.

The evening dinner was opened by Mr Gwector General at the DTI, who out-lined current initiatives within national government to support the economy and

Page 15: cctc oct13  newsletter

correct market failures. Rob Stewart accompanied Mr Strachan in awarding the best lean teams from the KZN and Cape Clothing and Textile Clusters with their trophies for 2013.

The following morning the feedback sessions from the brainstorming sessions were held, followed by further discussion and debate. The groups then re-convened to consider and rank which of the needs placed on them by the other links in the value chain were most important. These ranked outcomes were presented back to the plenary for further discussion and debate. The Imbizo was closed at 12:30 followed by a final, informal lunch at the estate.

The notes from each of the three groups are presented below:retAIL reQuIrement ASSeSSment

Both the clothing and textile groups were tasked to list their respective require-ments in relation to the retail segment of the value chain in order for industry to fulfill its long term objective of job creation and growth. These requirements and required interventions are outlined on the next spread.

Page 16: cctc oct13  newsletter
Page 17: cctc oct13  newsletter

cLothIng reQuIrement ASSeSSment

Similar to above, both the retail and textile groups were tasked to list their respec-tive requirements in relation to the clothing segment of the value chain in order for industry to fulfill its long term objective of job creation and growth. The require-ments and required interventions are outlined below:

Page 18: cctc oct13  newsletter

textile requirement Assessmentt

Again, both the retail and clothing groups were tasked to list their respective re-quirements in relation to the textile segment of the value chain in order for indus-

Page 19: cctc oct13  newsletter

try to fulfill its long term objective of job creation and growth. The requirements and required interventions are outlined below:

Page 20: cctc oct13  newsletter

The exact roles and responsibilities of the Cluster in facilitating the required inter-ventions for each of the retailer, textile and clothing requirements will be formally detailed at a strategic session to be facilitated by the CCTC early in the New Year.

The intention of this session will be to determine the Cluster’s role in addressing the challenges highlighted at the Imbizo, whilst simultaneously informing the content for the new CCTC Three Year Strategic Business Plan framework.

Page 21: cctc oct13  newsletter

FocuS ArtIcLe – uSIng VALue StreAm mAPPIng to IdentIFY And reduce WASte

Using Value Stream Mapping to Identify and Reduce Waste

Effective implementation of Quick Response amongst retailers and manufac-turers depends on a lean value stream from concept to consumer. This largely entails the reduction of waste at various levels of the value chain. In lean manu-facturing, waste is anything that adds to the time and cost of making a product but does not add value to the product from the customer’s point of view.

Whereas value-added activities transform the product into something the cus-tomer wants. Learning to effectively identify these wastes in your value chain, specifically through value stream mapping, is the key to starting out on your journey of transforming your organization into a lean enterprise.

Page 22: cctc oct13  newsletter

the eIght WASteS

Typically waste can be classified into the 8 categories listed below:

1. OverproductionOverproduction can be understood as producing more than the customer needs right now and is often the cause of the other wastes. The costs associated can be serious, including costs of working capital tied up in inventory and the associated interest charges, extra storage, handling, paperwork, and people to monitor and control it. Causes of this could include inadequate forecasting, long set-ups, and producing “just in case” for breakdowns.

2. Inventory More materials, parts, or product on hand than the customer needs right now is unnecessary inventory. Causes of this could be supplier lead-times, lack of flow, long set-up times, long lead-times, paperwork in process, and a poor ordering procedure.

Page 23: cctc oct13  newsletter

3. TransportationTransportation waste can be understood as movement of product that does not add value. Causes of this could be large bundles sizes, push production, storage, and inefficient layout. ‘Runners’ in a Cut Make and Trim (CMT) firm are often solely responsible for this task. The eventual goal would be to eliminate the need for them to transport product between production stages and to train them to be value adding employees such as machine operators.

4. MotionMotion refers to movement of people that does not add value (i.e. every operator’s motion not creating value). Causes could include workplace disorganiza-tion, poor work sequence, poor process layout, missing items or tools, and an unsafe work area. The principle of “5S” (sort, straighten, shine, standardise, sustain) in lean manufacturing attacks this waste by improving the work space in which employees work to reduce motion waste.

Page 24: cctc oct13  newsletter

5. WaitingIdle time created when material, information, people, or equipment is not ready results in waiting, and is effec-tively unproductive time. Causes of this could include push production, work imbalance, centralized inspec-tion, order entry delays, poor prioritising, and poor com-munication. Balancing a manufacturing line by ensuring the time taken for operations are evenly spread across employees to prevent them from waiting for material to work on is another way to avoid the waste of waiting.

6. Over-ProcessingOver-processing can be defined as effort that adds no value from the customer’s viewpoint. Causes of this could include delay between processing, a push system, or a misunderstood customer voice. Employees checking garments at the end of a production line as opposed to operators checking their work as they com-plete operations is an example of over-processing as it is not a value adding activity. ‘Checkers’ in a CMT are often solely responsible for this task, and the eventual goal would be to eliminate the need for them to check garments at the end of the production line and to train them to be value adding employees such as machine operators.

Page 25: cctc oct13  newsletter

7. Defects or reworkWork that contains errors, rework, mistakes, or lacks something necessary, results in repeated operations and additional time needing to be taken to repair the de-fect. Causes of this could be a process failure, misused machinery, large bundle sizes, quality of incoming raw materials, or incapable machines. Large bundle sizes are often a reason for many mistakes being made before the need for a repair can be identified, and are therefore also avoided as much as possible.

8. Unused Employee Creativity Traditionally, production employees in a factory are necessary for what they can do, and not for what they could contribute beyond that. An alternative and more productive approach is to view all employees for what they can do as well as what they can contribute beyond that, including valuable suggestions and intellectual capacity. Losing time, ideas, skills, improvements, and learning oppor-tunities by not engaging or listening to employees is a major waste which should be avoided. Empowering staff to make decisions regarding their work as well as genuinely using things like suggestion boxes are ways to facilitate a workspace where employee’s creativity is not lost.

Page 26: cctc oct13  newsletter

VALue StreAm mAPPIng

Value stream maps are a useful tool to analyse waste in a value chain and plan ways to reduce it. They provide a useful blueprint for a more comprehensive implementation of lean manufacturing by showing the linkages between infor-mation and material flow, as well as assisting in identifying the sources of waste in this flow and planning ways to reduce these wastes. A fictitious value chain map is displayed below to illustrate the usefulness of this tool in identifying and elimi-nating waste.

Page 27: cctc oct13  newsletter

The simple value stream map above illustrates the benefits of value chain map-ping. It follows the path of a garment from concept to customer, mapping the various interactions between a clothing manufacturer (Sell-A-Lot) and their CMT factory (KB Clothing).

As can be seen, initial interactions over order placement, design and sampling are laborious and can take over one month. Thereafter, fabric development, production and delivery can take anywhere from two month upwards. In many instances, the whole process from initial concept discussion to delivery of fabrics to the CMT factory (often referred to as the pre-production process) can take up to four months or more. It is in these early stages of garment production that most waste often occurs, but this is not to discount the high levels of waste preva-lent in the production process, which we go onto describe now.

In our fictitious example, once fabrics have been delivered to the factory, they wait in raw material holdings for 15 days before progressing to the cutting de-partment (where marking, cutting, sorting and stamping occur). Thereafter, cut fabrics stands for a few days as work in progress before a production slot opens up. As can be seen, there is an additional waiting period before despatch and then finished garments are stagnant before final despatch.

As summarised in the text boxes in the bottom left of the value stream map, the total value adding time spent on the garment is four hours and 32 minutes com-pared to the total production lead time of 20 days. Interestingly, many factory

Page 28: cctc oct13  newsletter

managers still believe that most efficiency gains are achieved at the operator’s ‘needle point’, whereas this example shows that most waste, is as a result of fab-ric or garments waiting as inventory at different stages of the pipeline.

Some common techniques used to reduce inventory waiting times include: more reliable delivery of raw materials just in time for production and better planning to ensure that cut fabrics slot directly into their scheduled production time. Further-more, reducing bundle sizes as well as instituting a pull system, whereby WIP is moved along the production line only once there is a need for it (and not pro-ducing for the sake of producing), could also assist here.

The push production system, whereby whole orders are pushed down the line, of-ten leads to high levels of work in progress specifically at production bottlenecks. Bottlenecks often have the knock-on effect of creating waste in terms of waiting and handling, as well as the need to move these materials from each stage of production to the next.

From the above example it is evident that the value stream map is indeed a useful tool for identifying waste. We have provided a few techniques to reduce production waste, but drafting a ‘future state value stream map’ is a more useful technique for devising a comprehensive plan to eliminate waste. The future state value stream map is essentially a blueprint for implementing lean manufacturing in your factory.

Page 29: cctc oct13  newsletter

If one looks at the entire garment pipeline, the decoupling of fabric sourcing from the overall production pipeline, quick decision making, the development of stra-tegic production partnerships and efficient logistics are all techniques that can help to eliminate waste in the end-to-end pipeline. You might recognise these techniques as the bedrock of the quick response apparel value chain as quick response is ultimately about removing waste to ensure the quickest time from design concept to consumer.

InduStrY neWS

teXtILe InduStrY AVertS StrIke ActIon

MORE than 50,000 clothing and textile workers will not go on strike as five out of six employer organisations and the Southern African Clothing and Textile Workers Union (Sactwu) have reached a last-minute deal.

Sactwu general secretary Andre Kriel said on Monday that this agreement would bring stability to the sector for the foreseeable future. The employer organisations had acceded to all of the union’s demands, he added.During the past month Sactwu has been balloting its members on whether to strike should the negotiations fail. More than 86% of 40,000 workers balloted voted in favour of the strike.

Page 30: cctc oct13  newsletter

Sactwu is one of the few labour organisations affiliated to the Congress of South African Trade Unions (Cosatu) that conducts a ballot to gauge members’ views on strike action.

Mr Kriel said should the negotiations not have succeeded on Monday, then the union would have given the employer organisations a 48-hour strike notice.“Settlement of this negation is primarily to bring stability to the sector so that we can focus on other issues concerning the industry,” he said.

In terms of the settlement, clothing workers in urban areas will receive a 7% total wage increase and those in rural areas a 10.1% increase.

All increases will be backdated to September 1. Employers that unilaterally im-plemented wage increases and third-party employer associations that have not signed the agreement will need to implement a further wage increase.Mr Kriel said the further wage increase was to discourage unilateralism, which in the union’s view was detrimental to orderly collective bargaining.

Date: 2 October 2013Source: Business DayWritten By: Paul Vecchiatto

Page 31: cctc oct13  newsletter

StAte BAttLeS to BuY LocAL ProductS

NEARLY two years after new government procurement regulations were passed, challenges remain to ensure local manufacturers of clothing, and textiles in par-ticular, benefit from state spending.

The regulations were designed to complement the Department of Trade and Industry’s industrial policy action plan to support local sectors like transport equip-ment, vehicles, pharmaceuticals, office and school furniture and renewable energy.

The procurement rules require national, provincial and local government and a number of other government entities, including major groups such as SAA, Eskom, SABC, Denel and Transnet, to ensure purchases comply with certain local content requirements, ranging from 30% for set-top boxes for digital migration to 100% for school furniture.

In the clothing, textiles, footwear and leather sector, where tens of thousands of jobs have been lost over the past decade due to cheaper imports, the rules state that 100% of state spending must be allocated to local content.

But local clothing manufacturers and other role players in the industry say many

Page 32: cctc oct13  newsletter

tenders are still awarded to companies that manufacture in neighbouring coun-tries or to local middlemen who simply import the products from overseas.Simon Eppel, trade union Sactwu researcher, said: “At this stage, there does appear to be non-compliance, particularly among municipalities and within the public healthcare sector.”

The South African Bureau of Standards has been appointed by the department to audit tender winners to ensure local content rules are complied with.

• This article was first published in Sunday Times: Business Times

Date: 8 September 2013Source: Business Day Written By: Jana Marais

Page 33: cctc oct13  newsletter

uS And AFrIcAn comPAnIeS cALL For ImmedIAte reneWAL oF AgoA

The African Growth and Opportunity Act (AGOA) plays a vital role in the de-velopment and support of a competitive U.S.-African textile and apparel trade partnership, a critical step to developing a broader reciprocal commercial rela-tionship with AGOA countries.

AGOA has created more than 300,000 direct jobs in Africa, and AGOA imports are important for the millions of American workers in apparel retailing, manufac-turing and importing companies.

Originally enacted in 2000, AGOA has enjoyed widespread bipartisan support and has been modified and extended several times. It is currently authorized through September 2015.

Representing the apparel manufacturing, brand, and retail industries in Africa and the United States, the National Retail Federation and other like minded asso-ciations have urged the following:

Immediate renewal: AGOA must be renewed as soon as possible, ideally dur-ing 2013, but in no event later than 2014. Because sourcing decisions are made many months in advance, renewal needs to occur soon for it to be truly seamless. Any delay into 2015, especially in light of last year’s last-minute renewal of the

Page 34: cctc oct13  newsletter

third country fabric provision, will discourage continued sourcing and new invest-ment, resulting in the loss of trade and jobs in both Africa and the United States.Long term renewal: AGOA should be renewed for a long enough period -- at least 15 years -- to ensure the predictability necessary to support trade and in-vestment decisions.

Shorter term renewals will not provide enough certainty to enable the industry to make capital intensive investment decisions necessary to attract textile invest-ments or affect long term sourcing partnership decisions.Long term third country fabric renewal: The third country fabric provision should be renewed for the full duration of the AGOA renewal. This provision has become central to AGOA.

Renewing it for a shorter duration than the full program would be tantamount to renewing the entire program for that shorter duration. Moreover, further vertical integration into upstream textile production requires maintenance of a healthy downstream apparel sector, which in turn is dependent upon the third country fabric provision.

Third country fabric extended to all AGOA beneficiaries: All AGOA beneficiary countries should be able to use third country fabric provisions. Unequal applica-tion of this provision lessens the positive impact of AGOA and retards regional integration efforts.

Page 35: cctc oct13  newsletter

Date: 18 OctoberSource: Fibre2FashionWritten By: National Retail Federation

cAPe unIon mArt PLAnS to eXPAnd In BotSWAnA, nAmIBIA, SA

PRIVATELY owned and family-operated business Cape Union Mart Group will expand its footprint in South Africa, Namibia and Botswana, CEO Andre Labus-chaigne said on Friday.

The company’s brands include Old Khaki, K-Way, Sparks and Ellis, a uniform com-pany, and Poetry — a lifestyle concept store for women.

“We are aiming for 200 stores by 2016. We believe in South Africa, Namibia and Botswana. We are not going further north of the border in the foreseeable future,” he said.

Cape Union Mart, which this year celebrates its 80th anniversary, was founded in 1933 by the late Philip Krawitz, the grandfather and namesake of the current chairman.

The company started out as an army-and navy-type store and today employs more than 2,000 people. In addition to the nearly 80 Cape Union Mart stores in

Page 36: cctc oct13  newsletter

South Africa, the group owns and operates 20 Poetry outlets and more than 40 Old Khaki stores.

Last year, the group invested R2m in equipment and machinery for its K-Way brand in order to gain an edge over the influx of cheap imports from East Asia. These imports continue to put strain on domestic clothing, textile and footwear makers.

K-Way, which produces a range of outdoor clothing and gear, also increased the size of its factory’s production floor by 700m² at a cost of more than R3m, to enhance design and production capabilities. The factory, located in Tokai, Cape Town, makes 450,000 garments a year.

South African manufacturers are competing with the Asian producers’ cut-throat prices, which are mainly a result of low labour costs, large production runs and subsidies offered by states.

“There is one thing that all manufactures are crying for in South Africa and that is for the government to stop levying import duty on fabric.

“Because we don’t have a textile industry in South Africa, we can’t buy locally and if we could import that fabric duty free, we could be much more competi-tive and it would create more jobs,” Mr Labuschaigne, who joined the group in 2011, said.

Page 37: cctc oct13  newsletter

The company, which he said continued to see strong double-digit year-on-year growth in turnover and profitability, has also expanded its distribution centre in Montague Gardens, Western Cape.

Most retailers have been bemoaning the trading environment as consumers in the middle-to-low living standard measures battle rising utility costs, debt and a dearth of jobs in South Africa.

Philip Krawitz, chairman of Cape Union Mart, said the group’s understanding of its customers and its focus on value-for-money had been key in driving its success.“Even during an economic downturn customers return because they are willing to spend money on durable, practical products that are well-priced,” he said.

Date: 21 October 2013Source: Business DayWritten By: Zeenat Moorad

Page 38: cctc oct13  newsletter

Cluster facilitation services are provided by Benchmarking & Manufacturing Ana-lysts SA (Pty) Ltd (B&M Analysts), an organisation that provides high value special-

ised support services to drive sustainable industrial development.

Over the past 15 years B&M Analysts has developed methodologies and skill sets that allow it to play a unique role in relation to supporting the competitiveness of

value chains and the growth of industrial sectors. These services are tailored to support the industrial development goals of government organisations, private

sector organisations, and public-private partnerships (PPP).B&M Analysts is a verified Level 2 B-BBEE contributor under the Codes of Good

Practice for Broad-Based Black Economic Empowerment (B-BBEE).

For more information on B&M Analysts please visit www.bmanalysts.com