Cablegate: Titas 2004 Focuses On Facing 2005:

This record is a partial extract of the original cable. The full text of the original cable is not available.





E.O. 12958: N/A
SUBJECT: TITAS 2004 Focuses on Facing 2005:
Regional Textile Manufacturers' Differ in Strategy

1. Summary. The Taipei International Textile &
Apparel Show 2004 (TITAS 2004) kicked off on
September 21. 280 domestic/foreign companies
participated in the three-day event. Aside from
the exhibition, 13 seminars by various agencies
including the American Apparel Producers' Network
(AAPN), Jockey International Inc., Vietnam Textile
and Apparel Association (VTAA), Karnali Cashmere
Industries and Trade Card, discussed improvement
in supply-chain management, customer relations,
product research and development trends, and
strategies for facing the elimination of the
Multifiber Agreement. End summary.

TITAS 2004: Bigger than Ever

2. TITAS 2004, the premier textile trade show in
Taiwan, was held at the Taipei World Trade Center,
September 21-23. Participation in this year's
event was up over 20 percent from 2003.

3. Two hundred ten domestic, 18 foreign, 24 PRC
based textile manufacturers and 28 related
domestic/foreign associations sponsored 550 booths
in the 2004 show. In 2003, there were 420 booths
for 182 manufacturers and related agencies.

4. Fifty-one percent of the exhibitors represented
the apparel and garment industry, 8 percent were
home/furniture textile related, 36 percent were
technical/engineered textile related, and the rest
were associated products/services such as
designers, media, inspection & certification
agencies and planning and consulting companies.

5. 18,402 people attended this year's event, a
twenty percent increase over 2003. Ninety-one
percent represented domestic industries and nine
percent were foreign visitors. In 2003, the ratio
was ninety-four percent and six percent

Seminars Discuss Boosting Competitiveness

6. Exhibitors from different regions tended to
focus on different aspects of the textile trade to
boost their competitiveness. U.S. manufacturers
were focused on brand and wholesale management
strategies, Central-America countries were
interested in production investment input, Taiwan
manufacturers prioritized upgrading product
quality, and Chinese companies are looking to
strengthen market channels.

7. In a seminar titled "The Changing American
Apparel Industry", Mr. Mike Todaro from the
American Apparel Producers' Network (AAPN) pointed
out the importance of price, supply-chain and the
instant message. His message was that the origin
of production is no longer important, price is now
the crucial factor. Todaro predicted that
companies with their own brands and markets must
streamline their supply chains. Whoever owns the
most powerful and efficient supply chain will have
the competitive advantage. Companies also need to
cut short the distance between themselves and the
customers by providing better and quicker
services, such as on-line services.

8. Mr. Brad Beal from Jockey International Inc.,
in the seminar "Executing a Successful Central
American Business Plan", pointed out the
advantages of investing in Central America in
anticipation of the Central America Free Trade
Agreement (CAFTA). Investors will be able to
increase the speed of receiving raw materials and
accessing the U.S. market. According to Beal,
cost competitiveness and worker efficiency in
Central America also appeal to manufacturers.
Beal emphasized that manufacturers in Central
America are heading toward what he called the
"full packaging" stage, including tightening the
supply chain and moving closer to markets.

9. In a discussion on "Branded Clothing from
China", Ms. Chia Hwa from Pei King E-Wan Garment
Co., Mr. Chen Kuan Chan from Chuan Guen Gran
Garment Co., and Mr. Chu Gan-ching from Pei King
Chen Pei Technology Co. shared their experiences
of establishing brands and opening markets in
China. They emphasized the importance of market
orientation, interaction with employees and
customers, and service packaging (after service,
special-day gifts, anniversary booklets).
Regional Differences as Manufacturers Prepare for
Lifting of MFA

10. COMENT: According to seminar participants,
global manufacturers are pursuing different
strategies to strengthen their market position in
preparation for the lifting of textile quotas in
January 2005. Those companies that have their own
brands are trying to cut down production time and
cost by centralizing suppliers and shortening
supply chains. They also seek to build closer
relationships with their customers so they can be
more responsive to consumers needs. Asian and
Central American textile manufacturers are
shifting production lines to places with lower raw
material and labor costs, as long as time to
market is not compromised.

11. Manufacturers in Taiwan and China appear to
be adopting very different strategies in the face
of a seismic shift in the textile industry.
Taiwan based companies are focusing on product
development and upgrading in an attempt to remain
competitive in the global market, but have done
little to develop their own brands or build
relations with end users. Chinese companies,
conversely, seem to be paying little attention to
product quality but are focused on branding and
marketing, especially within the Chinese domestic


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