Roadways To Profitability
In The Driver's Seat Creating New USA-Made Business Models
Outdoor Research has been successfully making high-performance apparel and gear domestically for decades at its headquarters in Seattle. But when the time came for the company to increase capacity and accelerate product development, Seattle wasn’t the solution; the local labor market was tapped out. A hunt to find a place with the best characteristics for a new factory involved site visits to Puerto Rico, Rhode Island, Texas, New Jersey, eastern Washington state and California. A year ago the company’s El Monte, California manufacturing facility opened. The new Outdoor Research factory is on track and profitable making technical gloves and accessories for military and tactical markets.
MMI Textiles exhibited a new EcoThriv fabric collection at the Outdoor Retailer/Snow Show in Denver earlier this year. The fabrics were developed specifically with sustainability, performance and domestic manufacturing in mind targeting the consumer athleisure/athletic marketplace. Ohio-based MMI Textiles may be best known for its military and industrial business and the company will retain that model, however, being open to diversification is a strategic direction. Outdoor brands are already showing interest in EcoThriv and the company is optimistic about gaining traction with a whole new audience.
In April the ISAIC Learning Factory will open in Detroit with the aim of training people not only in traditional skills, but also skills that are going to be required for advanced manufacturing. ISAIC stands for Industrial Sewing and Innovation Center, an organization that has garnered support from an important local partner: Carhartt. Carhartt donated the 12,000 square feet of prime Detroit real estate, as well as funds for the $1.8 million build out and a beginning inventory of sewing machinery for the creation of the ISAIC Learning Factory. While Michigan’s industry remains humble compared to places like New York, the number of apparel manufacturing establishments in the state has nearly doubled since 2009, from 72 to 120 in 2018. The number of people employed in the state’s apparel manufacturing and cut-and-sew sectors has also increased from 793 in 2009 to 1,471 in 2018, according to Bureau of Labor Services data.
A grassroots effort in North Carolina is educating workers and businesses to more effectively connect with textile suppliers. The Carolina Textile District has received 2200 applications in recent years and classes scheduled for 2020 are almost completely booked. Entrepreneurs who are either launching a brand or product, or scaling up and outgrowing current production and are ready to work with contract manufacturers are driving demand. This category of “Crafted Production” is giving rise to a new kind of work environment attracting next generation talent and revitalizing the region.
Whether its investing in the latest machinery for new manufacturing methods, or forging relationships to build traction in new markets, or innovating programs to create a modern workforce pipeline for a USA supply chain, paths to profitability are clearing the way forward for American-made in the future. Here are their stories:
Engineering Factory Efficiency
“We ended up in Los Angeles because the bones of that sewing community is still there,” explains Jason Duncan, head of tactical, innovation, and CSR at Outdoor Research. El Monte also offered affordability, strong community support and a pool of workers – the company received 1,000 applications to work at the factory. “Of that about 20 percent were great sewers. But that’s what we needed. We started with about 70 and are now up to 100,” says Duncan.
The company retrofitted a brand new, but empty, El Monte warehouse with a focus on cutting-edge machinery, technology and engineered efficiency. Outdoor Research has six mechanical engineers on staff, with degrees from schools such as M.I.T., Cal Poly and University of Denver, who work along with “old heads” machinists. Duncan describes this hybrid model of young minds working together with experienced equipment experts as fantastic. Outdoor Research even has a mathematician on staff doing predictive analysis based on factory capacity plans. “The minutes we save on the production line are massive,” says Duncan. “Letting people with the skill set solve problems is a better approach, than thinking this is the way we’ve always done it.”
The company has updated to cad cam cutting, significantly reducing waste while increasing cutting efficiency to 90 percent, up from 68 percent. The factory does a lot of auto sewing and cycle machine sewing; workers with a lower skill set operate these machines.
Duncan estimates investment in El Monte as $3 to $5 million. This factors in the training needed to produce high-tech military grade gloves. “Gloves are really difficult, seam allowances are really small, and we build waterproof gloves so its even more difficult sewing and then to seam seal after that is difficult. It calls for significant sewing skills,” states Duncan, adding, that teaching that level of glove making is an expensive investment that requires a lot of trial and error. “We budgeted for having to throw away product until sewers got up to speed, but that is a necessary part of development.” The factory also makes gaiters, headwear, balaclavas, accessories, and some apparel. Branded textile suppler partners include Gore, Brookwood, Polartec, Super Fabric and PrimaLoft.
“We are a technology story, and a first-generation story and a military story,” states Duncan, who sees value in being a wholly owned factory that offers a benefits package. He concludes: “If you can diversify and keep your factory full, it is a nice business to have. But it’s not for the faint of heart, that’s for sure.”
Growth By Diversfication
MMI Textiles CEO Amy Bircher recalls numerous conversations in recent years with industry executives during which it became apparent that what’s missing in the supply chain is access to small run stock programs of athletic fabrics for athleisure apparel. “There is a movement of wanting USA product, not relying on Asia, and supporting jobs on U.S. soil, and this is our world that we live in,” Bircher explains.
Seeing an opportunity, MMI Textiles consulted with experts, met with domestic knitting and weaving mill partners, as well as ingredient suppliers, to learn the viability of creating a new sustainable line of apparel fabrics are made in the USA.
The new EcoThriv collection, a line of five fabrications, features environmentally responsible performance. A solution-dyed fleece fabric called “Willow” is made of 100 percent recycled polyester with CiCLO additive that allows polyester to biodegrade, and is finished with fluorine free HeiQ EcoDry DWR. Repreve recycled poly, recycled cotton, and Tencel fibers feature in materials suitable for a variety of end-uses from yoga pants to baselayers to jackets. Says Bircher, “We’ve been so successful in other market space, that we feel we did our homework, and that we could make worthwhile investment in this space.”
The company is classified as a manufacturer by the government, but doesn’t own its own equipment; the making is its converting process. This “virtual manufacturer” model, has served MMI Textiles well as a global diversified supplier of industrial and custom fabrics. The firm sources internationally but complies with U.S. Berry Amendment mandates for its military and tactical business. The company has experienced steady growth since its founding in 1997 and Bircher is optimistic not only about the year ahead but her business in general.
Last July the company acquired the assets of Competition Textiles, a woven fabric converter as well as fabric importer, based in Indianapolis, IN, enhancing MMI’s existing stock line for domestic and international customers. More recently MMI has brought on board Jeff Papalia in a new-created VP position to help with operations as the company continues to grow.
While Bircher is hoping that EcoThriv becomes a success, perhaps even jumpstarting a small brand to become the next Lululemon, she realizes that big orders could jeopardize domestic sourcing. “The difficulty is finding skilled labor,” Bircher explains. “If worker availability were abundant, and the manufacturing footprint here were bigger, there would be huge movement to come back to USA. It’s not, and that’s the big challenge.”
Right Shoring Vs. Reshoring
“There’s all this talk about ‘reshoring’ happening, but we like to refer to it as ‘right shoring,’ and what we mean by that is not looking to rebuild the way the industry used to operate, we’re looking to build in a different way,” states Jennifer Guarino, CEO and chair of the Industrial Sewing and Innovation Center (ISAIC) in Detroit. “We train and apprentice for the future of work.”
ISAIC’s Industrial Sewing Related Technical Institute (RTI) offers 200 hours of training at Henry Ford College in Dearborn. Seen as a starting point, students completing the program have options to advance; for example, to apply for entry-level sewing or apply to ISAIC’s paid apprenticeship or use their course credits for higher education. ISAIC’s apprenticeship program takes place at a brand new Learning Factory in midtown Detroit.
Skills taught at RTI can feed into many industries such as upholstery, footwear, automotive (making car seats) or denim manufacturing. Similarly apprentices become competent to move ahead in a variety of fields from product development, and robotics to quality control. The intention is to teach traditional skills and advanced manufacturing skills to the same group of people so their comprehensive skill set enables equity in the industry of tomorrow.
For example, ISAIC members believe that people and technology can be really good together. Guarino cites the organization’s partnership with Juki, as example, and hands on learning that provides on the most advanced sewing machines.
Guarino emphasizes the importance ISAIC places on laying out avenues for success, by investing in people to be a future pipeline. “Our industry has not done a good job of giving very specific paths to advancement in different ways from production management, technical design to equipment and maintenance technicians,” explains Guarino, who previously served as Shinola’s VP of manufacturing. “So our job is to provide those paths so that people want to stay in our industry. Its one thing to want to foster talent, but another to also want to retain them.”
The Carolina Textile District has ridden a wave of change since its inception in 2013 experiencing first hand a shift within in the industry from traditional business models based on large orders and working with established companies to a new generation of businesses with different production needs. “This has required a new thinking on the part of the textile industry,” says Tanya Wade, project coordinator for the Carolina Textile District (CTD).
The CTD has created a platform to educate, support and revitalize the local textile community. The organization offers a Sewn Goods workshop that not only teaches skills, but all aspects of the textile industry, improving individuals’ ability to effectively connect with suppliers. “We do the nitty-gritty on how to make product — all the things not being taught anymore. Today’s design programs focus more on “wanting to eat the sausage, not wanting to make the sausage,” states Wade, who adds, “Our program is such that when attendees leave the workshop they can answer supplier questions on price point, start orders, etc. This has been the big disconnect in the past. “Companies have no time for hand-holding!”
The District, as its known in the area, also offers clients a week long Crafted Production session once a year focused on how owner-operated businesses can find and retain employees. (This is separate from start-ups contracting production from outside resources, Wade explains.)
According to CTD participant surveys, many businesses in the Crafted Production category (56 percent) are seeking small runs of 100 to 5,000 units and the majority of them (nearly 80 percent) are doing their first production run in textiles or their first production run for the product they are inquiring about. Participants launching new domestically manufactured products are younger (67 percent under the age of 40), have some capital (91 percent have at least $2,500 to put toward the design and development of their product) and have a direct-to-consumer distribution strategy (with 76 percent planning to sell online).
At the end of the day, says Wade, “it’s not about creating jobs, but creating good jobs and thriving careers with fair wages.”