Sold in the US: Cracking the American market
So you think you can sell your stuff in the US? For many local designers, seeing their clothes on the racks of Barneys or Neiman Marcus would be the ultimate dream. And as dreams go, it’s not entirely unreachable. But designers – and manufacturers – need to have a greater understanding of how the US market works, and to use that knowledge to create successful and long-lasting relationships with their business partners, according to industry experts who came to Cape Town last month for the second annual Source Africa trade event. The event combines a trade exhibition by various textile, apparel and footwear manufacturers from throughout Africa with business seminars and panel discussions.
Think of it as Sourcing 101, the equivalent of being doused with cold water in order to confront the realities of doing business in America. The preferential trade programme, the African Growth and Opportunity Act, enacted in 2001, and up for renewal in September 2015, has paved the way for African manufacturers to get their textile, apparel and footwear exports into the US on a tariff-free basis, while simultaneously offering US retailers a sourcing alternative to China.
The question is, how viable a sourcing alternative is Africa?
While it’s tempting to want to try to be the next China, one of the speakers, Mercedes Gonzalez, a New York-based buyer in the garment industry with over 25 years’ experience who runs her own firm, Global Sourcing Companies, urged that South Africa aim to be the new Italy. “You want quality. You want small production. You want craftsmanship. All these things you can do.”
According to another speaker. Geoffrey Lurie, from retail consulting and international brand-building company Marvin Traub Associates, “What happens in China is: you have the fabric and piece goods, the manufacturing ability, and the ports to be able to support just-in-time inventory. But, if you’ve got the mills that can produce the fabrics here in Africa so that you can deal with orders through the manufacturing process, through the shipping process so that the days to delivery are shorter, you have a chance of making it in America.”
Instead of aiming for the mass-market chains or big department stores, Gonzalez and Lurie agreed, local designers and manufacturers would do better off targeting the smaller specialty stores, little boutiques around the country that speak to a sophisticated clientele looking for something different and well made.
Quality is not an issue; buyers have noted that the level of quality they see coming out of Africa is very good, and manufacturers should capitalise on that.
Gonzalez tends to work with emerging designers; one South African designer who has made an impression on her is Suzaan Heyns.
“When you work with young, emerging designers, however, they typically tend to be a hot mess,” she said. “They’re overpriced, they don’t know what they’re doing, their deliveries are terrible. They watch Project Runway or some reality TV show and think they know how the business is run. So we developed a programme to try to get a better product from these emerging designers, because the consumer is hungry for something new.”
The consumer, she added, was tired of product development. “They don’t want to wear the same denim jacket, the same leggings, the same shirt that everybody has. They don’t want to drink the same Starbucks coffee everybody.”
Continuing with the coffee analogy, Gonzalez said Ethiopian coffee is universally recognised as the best coffee in the world. “Why can’t Africa be as internationally recognised for its textiles and quality clothing and footwear? But it’s going in that direction. I feel it.”
Doing business in the US
In a presentation, she laid bare her primer for doing business in the US. She said that any designer or manufacturer wanting to enter the American market has to decide: Who is your target market? What are your price points? What retailers fit your market? What is your niche? How will you contact retailers?
In other words, as another speaker Len Pesko advised, “be prepared and do your homework”.
Pesko is a footwear retail specialist with many years of experience in the footwear industry. He runs his own East Coast-based global sourcing and consulting firm, Modern Pulse Consulting Group, which he co-founded in 2009. “What retailers are looking for are viable, reliable business partners.”