1. Changing Trade Competitiveness: The ITC Approach
6 Technical Assistance Needs
6 ITC responses

2. 1st Need: A Sector Strategy (Action Plan)
Develop overall country response
Build critical country mass
Build PPP based on strong sector associations
Make a sector value chain analysis
Critical Mass: significant amount of companies. Small companies alone won’t survive

3. 1st Response: The SHAPE

4. 1st Response: The SHAPE Analyse Brainstorm Action Plan Strategy
A Structured Thinking Process:
Analyse
Brainstorm
Action Plan
Strategy

5. The SHAPE – Ten Step Approach
1. Analyse Domestic Supply/Exports/Imports
2. Analyse the Value Chain (VC)
Analyse
3. Identify problems in the VC and define the Actions
4. Identify export and sourcing Opportunities and define the Actions
Brainstorm
5. Group Similar Actions together
6. Prioritize Actions and assign Time Frames
Action Plan
7. Working Group
8. Finalize Strategy
9. Official Launch
10. Implement and Monitor the Strategy
Strategy

6. Clothing Associations Textiles Associations
AGENTS/BUYING HOUSE
Clothing Associations
CUSTOMS PROCEDURES
MACHINERY
YARNS
ACCESSORIES
& PACKAGING
TEXTILE
Mnf. & Exporter
RMG
DESIGN
INSTITUTE
LARGELY KNITWEAR FABRIC SUPPLIED
Textiles Associations
MARKET
RESEARCH
TESTING
AGENTS
BORDER
DOMESTIC
SUPPORT SERVICES
TPO
RAW MATERIALS
DONOR
ACTIVITIES
Other Associations
Sales
(+Marketing,
and Services)
Outbound Logistics
Customs-GSP/Quota
Export Clearance
Business
Inbound Logistics
Customs,
Import Clearance
Sourcing

7. Quotas stifle competition Now competitors are everywhere
2st Need: Know your Competitors
Quotas stifle competition
Now competitors are everywhere

8. 2st Response: THE FiT

9. THE FiT: Benchmarks performance
It is divided into 4 broad areas
Management & Organization
Sales & Marketing
Financial Planning
Production, Sourcing & Operations
Questionnaire distributed, association responsible

11. 3rd Need: Information on Sourcing and Supply Chain Management Skills
Cost-structure of a woven shirt up to the FOB point
75% of cost = sourcing

12. Input supplies & Logistics
Fabrics: $0,59
Trimmings:$0.16
Labour
$0.07
Overheads
$0.08
Profit $0.10
Input supplies & Logistics
$0.75
Labour
$0.07
Overheads
$0.08
Profit now $0.16
$0.69 !
WOVEN SHIRT: For every 1 Dollar earned
approximately 60cts is spent on inputs
A 60 % increase in its Gross profits without increasing sales
A 10 % reduction in the supply cost of fabric and trimmings =
… Any reduction in purchasing and logistics costs has a direct and large impact on export competitiveness

13. 3rd Response: “Source-it” ITC textbook
1.- New ITC textbook on fabric sourcing, training and supply information
1.Introduction  
2.Material Sourcing Process
3.The Buyer/Designer Side
4.The Factory Side
5.Salesmen Samples
6.Ordering Stock Materials
7.Fabric Inspection
8.Final Checks
9.Trim
10.Production Schedule
11.Things Go Wrong
The Art of Sourcing
12.Where to Source What
13.Satisfying the Buyers’ Needs
2.- Training
3.- Sourcing Data Base (SAARC and ASEAN countries)

14. 4th Need: Understand changing markets and adapt products accordingly
Numerous competitors and complex trade structure;
Opportunities in higher-end and niche markets with value-added products;
Exploit market potential in other developing countries, especially in a regional context.
Big old markets remain. Now markets growing faster (Brazil, Turkey, China, India...)

15. 4th Response: Providing Information
A new T&C website
T&C workshops on the business implications and how to prepare for increased competition
Development and implementation of tailor-made projects

17. Providing Business Information

18. Providing Data Analyis
The outcome of STEP 4 is a set of ACTIONS to be carried on in order to overcome the problems identified in the VC.
Once the Value Chain is mapped, we have to identify bottlenecks and problems, analyse their causes, brainstorm for alternatives and finally work towards finding solutions or Action.

19. Providing Technical Assistance

20. 5th Need: E-Trade to attract larger buyers
The use of «e» in light of the quota phase-out
Overview of technology developments
e-requirements imposed by buyers in the US and EU
The role of HGK & Singapore trading houses
Case studies of e-successful manufacturers
Dissemination and training

21. 5th Response: Business Guide
A Business Guide on e-Applications in the T&C Sector

22. 5th Response: Business Guide
A Business Guide on e-Applications in the T&C Sector
Overview of technology developments
e-requirements imposed by western buyers
The role of HGK & Singapore trading houses
Case studies of e-successful manufacturers
Dissemination and training
In STEP 7 all the ACTIONS grouped into Categories should be now Prioritized by Difficulty and Importance and then assign time frames.

23. Market Pressure on Clothing Manufacturers after the quota phase-out
e-influence
e-influence

24. Likely evolution of the T&C Industry
Today
Producer
Conflicts
Retailer
Competition
Future
Response
Demand
Customer

25. The Global T&C Value Chain and the use of e-Applications
E-Linking of the Value Chain
Sales Info + Direct Order
Delivery Status Info
Fabrics
Clothing
Agent
Retailer
MARKET
Physical Delivery
Clothing Value Chain
R&D
Inbound Logistics
Production
Outbound Logistics
Marketing to Retailers

26. Strategic Response: Critical (country/regional) mass
6th Need: Develop a Regional Approach
Strategic Response: Critical (country/regional) mass
Rules of Origin require regional cooperation
Regional/Sub-regional Partnership
Regionally integrated industry
Link foreign investors to local business

27. South-South Trade Development
6th Response: Strengthen regional trade cooperation
South-South Trade Development
Regional trade development along the regional value chain
GSTP: General System of Tariff (trade) Preferences
GSP (General System of Preferences) among developing Countries

28. ITC’s TA to the Clothing Sector
Need 1: Sector Strategy Development
Clothing Sector Strategy Development «the Shape»
Need 2: Know your competitors
Benchmarking tool The « FiT »
Need 3: Sourcing Information and SCM skills
Skills development & regional supply information
Need 4: Understanding changing markets
New website; workshops; tailor-made projects
Need 5: E-Applications in T&C
A Business Guide
Need 6: Intra-regional trade along the value chain
South South Trade Development Approach

29. Sourcing Manufacturing Sourcing Manufacturing
Sales
(+Marketing,
and Services)
Inbound Logistics
Customs,
Import Clearance
Outbound Logistics
Customs-GSP/Quota
Export Clearance
1.- Sectror Strategy
Develpment
“The SHAPE”
Sourcing
Manufacturing
Sales
(+Marketing,
and Services)
Inbound Logistics
Customs,
Import Clearance
Outbound Logistics
Customs-GSP/Quota
Export Clearance
2.- Undersatnding it’s
own and competitors’
performance
“The FiT”
3.- Developing fabric
sourcing skills to
become
“full-package”suppliers
Sourcing Guide
and
database
4.- Understanding
changing markets
Garment-Maps
and
ITC T&C website
5.- Applying
e-applications in the
T&C sector
Business Guide
in e-commerce for T&C
Implementing tailor
made market penetration
approaches in line with
buyer requirements
ITC
Tailored Consultation