Posted January 21, 2020
By Devin Steele (DSteele@eTextileCommunications.com)
Editor’s note: The economic environment continues to stay hot and to bode well for many U.S. textile, apparel and cut-and-sew companies and their suppliers – but not all. Following are reports by a cross-section of companies in those sectors who responded to an eTC questionnaire about how business fared in 2019 and how prospects are looking as 2020 kicks into gear.
Apex Mills
Technical textiles supplier Apex Mills, based in Inwood, N.Y., with manufacturing operations in N.C., reported that revenues held steady from the prior year. This follows an increase from the previous two years, so overall, the company is seeing slow growth, according to Jonathan Kurz, president & CEO.
“Interestingly, although our revenues are steady, we’ve seen fluctuation in buyer behavior and the type of goods sold,” he said. “Last year, with the GM strike, we had experienced decreased sales in the automotive sector – however, other industries accelerated their buying. We saw an increase in the purchase of scrim and substrate fabrics as well as greige goods. We also saw a slight spike in the orthopedics market.”
Looking ahead, Apex Mills is forecasting that 2020 will show further growth, Kurz said. As the industry continues to consolidate and level, new opportunities will be presented, he noted.
“We have dedicated resources for R&D and have made great strides in developing innovative functional, smart and e-textiles,” he said. “We have expanded our capabilities and with the addition of new machinery and design flexibility, we can deliver today’s most comprehensive and complex fabric solutions. We have seen more advanced yarns and fabric finishes that we are adding to our product line making our custom fabric design and finishes limitless. From sustainable yarns and biodegradable fabrics to CBD infused and additives to promote healing and wellness, there are many options available to increase the efficacy of textiles.”
Having achieved ISO certification, Apex Mills has made the commitment to continuous improvement and that has helped to streamline and improve its internal processes, Kurz pointed out. This benefits not only the company, but it enables it to pass along the benefits to its customers in the form of better-quality fabric with fewer defects, quicker delivery systems and less waste, making its operations more sustainable, he said.
“Although we are optimistic about the coming year, we are also cautious,” Kurz said. “An election year will bring about change. The newly negotiated trade agreement with China, the fluctuating price of crude oil and the availability of talent in our industry are all unknown, so we will need to keep a finger on the pulse to see how things evolve.”
Auburn Manufacturing
Auburn Manufacturing, Mechanic Falls, Maine, experienced a “huge” increase in demand for its industrial fabrics, according to President & CEO Kathie Leonard.
Order backlog grew to new highs as the company struggled to ramp up production, she reported. According to Leonard, major market drivers were 1) Duties on Chinese silica imports due to Auburn Manufacturing’s anti-dumping case in 2017, coupled with the President Trump’s tariffs on textiles in general; 2) A shift towards reshoring by U.S. industry; 3) Export activity remaining strong, despite – or because of – the threat of trade wars; and 4) Defense Department demand for industrial fabrics.
“We expect a much better year of sales in 2020 as we fulfill in-house orders,” Leonard said. “We did a lot of heavy lifting to get here last year – adding equipment, hiring/training people and strengthening our supply chains.”
The increased level of industrial demand that Auburn saw in 2019 must be sustainable in order for the company to commit to further investments in its business, she added.
Commenting on the prospects for U.S. textile manufacturing and reshoring, Leonard said that the U.S. textile supply chain “became rather rusty” over the last two decades as American industry offshored its own production – primarily to China.
“The lure of China’s heavily subsidized exports left U.S. textile makers with the choice of 1) transforming from a manufacturer into an importer/distributor business; 2) investing in offshore textile operations that demand our IP and market knowledge; or 3) leave the market altogether. We’ve seen some restoration of our textile supply chain, but it’s been a difficult process. And in order to speed the recovery, we need some certainty that our government will sustain its stand against Chinese dumping. An on-and-off tariff war doesn’t instill confidence that’s necessary to invest in plants, people and equipment.”
Authentically American
Authentically American, LLC, a Nashville, Tenn. brand, celebrated its second anniversary in operation in 2019 – a year that saw its business nearly double, according to founder Dean Wegner.
Wegner created Authentically American to sell premium, competitively priced consumer branded apparel and other merchandise that is ALL made in USA – no exceptions, he said.
“We are a new business, and everyone is just now beginning to find out about us,” said Wegner, a former Army Ranger who previously owned U.S. military dress uniform provider Omega Apparel.
He added that he expects 2020 to “definitely be better,” especially after the recent national media attention it received. That includes three appearances on Fox and Friends, including two with NASCAR legend Darrell Waltrip, a company investor, and a feature article in FORBES.
“I believe it continues to be a great time for anyone who stakes a claim to made in USA,” Wegner said.
BTSR USA
For BTSR USA, Kernersville, N.C., the North American sales arm of Italy-based BTSR International S.p.A., 2019 started very slow but ended high, said General Manager Scott Yates. That was the flip of 2018, when it started strong and finished soft, he added.
“Also for the dip from year-end 2018 to the rise in 2019, there really is no reason that one can put a finger on, per se,” he said. “However, most of the upswing last year was due to an automation project – with more to follow this year – a start-up company in Canada and a big order within the diaper manufacturing sector. Our product is generally recession-proof due to its fantastic development of technology.”
Yates added that he predicts at worse a comparable year to the last two.
“However, we came in strong in the new year and have several sizable quotations that were submitted last year for the 2020 budgets that could change that,” he said. “And, we are expecting a huge new product rollout by the end of the first quarter.”
“The biggest thing that happens in our world is the priority that we get in the budget pool,” he continued. “We are always in the pool, but rarely get to be the first project out. And, of course, it totally depends on how soon BTSR rolls out the new products. Until then, we just have to keep combing the market for new projects.”
Yates pointed out that the revamping of NAFTA into the new USMCA bodes well for North America manufacturers.
“It’s clear that manufacturing is solid here in many key markets,” he said. “For us, we have so many products that point towards the likes of medical, automotive, industrial, apparel, floor covering, technical, etc. … such that there are always markets that are hot. Our products help end users automate their processes, such that they know how to track raw material in through finished product out. This is a major paradigm shift to the industry.”
As this is a U.S. presidential election year, there’s always uncertainty, Yates said. “However, with the current leadership that is in office right now, seeds have been deeply planted that favor the manufacturing sector, such that we should at least be OK for the next couple of years,” he said.
“And after the election, there is a strong foundation already in place for it to stand on,” he said.
Buhler Quality Yarns
David Sasso, vice president of Sales and Marketing for Buhler Quality Yarns, Jefferson, Ga., said the company experienced a healthy year.
“Our business has been more robust than the past couple of years,” he said. “Retail, market uncertainty and demand generated more business for our high-end and technical yarns.”
The company’s projections for the first quarter, at least, seems “very positive,” he said. New yarn products coming online will help Buhler sustain a higher level of sales activity for the rest of the year, he added.
“Projections are no longer accurate,” Sasso said. “Flexibility and supply chain leadership can carry the business long term.”
Uncertainty gives Buhler Quality Yarns new opportunities, but fabric and product development seems to be lagging behind, he pointed out. “Retailers have yet to understand how to harness the potential of the hemisphere,” he said. “As long as this continues, our struggles will continue.”
Sasso went on to call the economy good, but as it relates to apparel and textiles production in the U.S., the industry must focus on product, innovation and speed to continue the growth of reshoring, he noted.
“Of what is left in the U.S., our supply chains need to be able to complement each other,” he said. “There are holes in our capabilities that one without the other limits our ability to effectively source here.”
He added: “Business is trying to come back. We need to pay attention to what is trying to come back.”
Cotswold Industries
New York City-based Cotswold Industries, which has a global presence and manufacturing facilities in the Southeast U.S., reported that business in 2019 was mostly flat compared to the last two years.
“Our business model for our USA production facilities is in the process of changing as we move away from commodities and towards a more technical product mix,” said CEO James McKinnon. “Demand for innovative products that reflect consumer trends has driven this change and we will see that development continue through the next 15 to 18 months.”
McKinnon said the company anticipates a stronger 2020 due to the expected resolution of trade issues surrounding NAFTA and China. The uncertainty surrounding the “new NAFTA,” the USMCA, has stifled long-term planning for its customers in this hemisphere and, with its resolution, “we feel that capital will be released and demand will improve.”
“Reshoring has not really materialized,” McKinnon said. “What we have seen through the implementation of tariffs is a production shift away from China and towards other low-cost producing regions. Customers are not willing to pass along the steep tariff increases, so they have turned to cheaper and more secure production environments.”
He also said that the Cotswold believes that value-driven manufacturing techniques and continued development of environmental innovation will drive USA textiles into the next decade.
“Our core focus is in the sustainability profile of our products and in helping translate that to our consumer-focused customers,” he said.
FIT USA Manufacturing
Troy Olson, CEO and owner of Ormond Beach, Fla.-based FIT USA Manufacturing, is riding the wave of the made-in-America movement, you can say.
“We see a 50 percent growth in sales with a good bit of customers bringing their business back to the States,” he said. “Our 2020 pipeline currently is trending to stay on the uphill climb.”
A full-package apparel production company, FIT USA specializes in sublimated athletic apparel. Some of its major areas of focus are sublimation, cut and sew, pattern making and grading, fabric sourcing, warehousing and logistics.
Turn times have been one of the biggest positive factors in the company’s growth, and its biggest challenge is finding labor heading into the new year, Olson added.
Frankl & Thomas
Greenville, SC-based Frankl & Thomas, a systems, machines, parts and equipment supplier for textile manufacturing, saw a 10 percent increase in sales in 2019 – but with caveats, according to President Al Thomas.
“These are challenging times,” he said. “The economy is excellent and that is reflected in our good customers enjoying strong sales. The downside is plants keep closing. Every time a customer plant closes, we have to make up that revenue and sometimes we get stuck with inventory that we kept just for one customer. Many of our products are No. 1 or No. 2 in the market. That allows us to keep sales even and sometimes increase.”
Thomas added that, generally, the company expects sales to increase this year. As such, it it currently adding inventory to support that premise.
“As always, competition is strong,” he said. “We have to be careful because it’s easy to miscalculate and have more inventory than the market can support.”
Frankl & Thomas has provided textile manufacturers of all types with innovative and customized product solutions for more than 60 years. The company provides partnerships for complete plants for high-tech fiber production, carbon fiber lines, laboratory and pilot scale lines, nonwovens equipment as well as a wide range of plant processing machinery, components and processing aids for high-tech polymer and fiber production.
Thomas said he supports President Trump but hopes the tariff war will end soon.
“We would like for the circus in Washington to end and Congress get back to work for the American people,” he said.
Glen Raven
North Carolina-based fabric maker Glen Raven experienced a good 2019 – the difference between “good” and “great” being the uncertainty surrounding global trade, according to company President & CEO Leib Oehmig, who serves as chairman of the Washington, D.C.-based National Council of Textile Organizations (NCTO).
“As a company with a global footprint, Glen Raven continues to navigate a dynamic trade environment and is tuning its investment and market strategies to take advantage of new opportunities and deliver new innovations in support of our global customer base,” he said.
Absent some an unforeseen event impacting the global economy, Glen Raven is anticipating a better year in 2020, he pointed out.
“Our tuned strategies are producing desired results and we are optimistic that, directionally, we are focused in areas where we can have the greatest positive impact on our current and prospective customers,” Oehmig said. “Our focus remains on supporting our customers in growing their businesses.”
Glen Raven has invested a great deal of time and energy into its scenario planning, he added. “Therefore, we will execute at a high level on those things we can control, adapt to the volatility in the global markets we serve and remain optimistic regarding the possibilities for a successful 2020.”
Given the strength and trajectory of the U.S. economy, prospects for U.S. manufacturing remain strong, Oehmig added.
“At 127 months, this is the longest cycle of economic expansion that has ever been recorded in the U.S.,” he said. “I recall speaking with a leading economist a few years ago who stated that we would likely see an economic downturn beginning sometime in 2020. Well, the economic metrics we monitor remain positive and many outlooks now suggest a positive economic climate through the current U.S. election cycle.
“Therefore,” he continued, “with the possibility of a more stable global trade environment, USMCA heading to the President’s desk and a passionate group of U.S. manufacturers bringing substantial innovations to the market, I am excited about the possibility of an even more robust manufacturing environment in the United States.”
He concluded: “The U.S. is the greatest market in world and is supported by manufacturers whose incredibly talented associates invest so much of themselves into manufacturing in the United States. And, while we remain hopeful that our Administration will support the U.S. textile industry through thoughtful trade legislation, U.S. manufacturing will remain resilient and focused on producing the most innovative products ever created.”
GTI Graphic Technology, Inc. (GTI)
Bob McCurdy, president of GTI Graphic Technology, Inc. (GTI), Newburgh, N.Y., reported that overall, its business in 2019 was consistent with previous years.
“We are happy to report that we did see growth in the textile segment – sales were up about 14 percent,” he said. “We believe this growth can be attributed to the success of our OEM relationships and because of our focus in that area – we participated in four major textile exhibits – two in Europe and two in the U.S.”
McCurdy added that he anticipates a better year this year, in part because GTI sells into many markets, including textiles, automotive, paints and coatings, packaging, commercial printing and more.
“We have positive indications out of several segments and look forward to a good 2020,” he said.
Reshoring or near-shoring to the U.S. is a positive for GTI, he added.
“Every time a new plant or research center opens in the States, it presents an opportunity for us,” he said. “Since we manufacturer all our products at headquarters in Newburgh, N.Y., we are well positioned to service any U.S.-based company.”
However, McCurdy added, one reason for concern is the ongoing trade turmoil, as tariffs and high shipping costs can make it difficult to sell into international markets.
“There are many reasons for optimism – the main one is that we make a good product, offer it at an affordable price and believe we are gaining market share in the industrial color markets,” he said.
Photos by Devin Steele
Companies offer mixed reports as year of uncertainty kicks off
Hemingway Apparel
As a cut-and-sew contractor, Hemingway Apparel, Hemingway, S.C., experienced a good year in 2019, according to President Chris Marsh.
“Hemingway was at or above capacity all year,” he said. “While we aren’t entirely certain, we believe that a portion of it relates directly to the building out of the supply chain domestically, combined with the reservations in foreign investment surrounding the uncertainty of global trade. We also experienced a higher-than-normal dialogue with startups this year.”
Marsh added that the company is anticipating 2020 to be cautiously strong and slightly better than 2019.
“As a domestic contract cut-and-sew facility, we experience the trickle of international trade policies,” he said. “While we aren’t directly involved with those policies, many of our customers are. It remains to be seen how the USMCA and likely future concessions with China will ultimately impact us, hence the optimistic caution.”
Marsh also pointed out that unemployment levels are at historic lows, interest rates are steady and production capacity for 2020 is filling fast. “All indicators are that the economy is doing very well, at least in our industry sector,” he said.
But trade deals will play a major role this year, he noted.
“I’m not exactly sure of the impact they will have on those of us producing apparel locally,” he said. “We are optimistic for the year and I personally believe a byproduct of the ‘trade wars’ is that it strengthens the supply chain at home by leveraging business across many sectors and regions, rather than just a few global hot spots.”
Henderson Machinery Co.
Greensboro, N.C.-based Henderson Machinery Co., which represents numerous global textile and sewn products equipment providers, saw improved business in 2019 compared to last year, reported Sean Burke, cut-and-sew consultant and sales rep.
“The Henderson Machinery team – management, technicians, sales and spare parts – being proactive and listening to customers’ concerns and throwing around ideas internally to propose to our customers played a key role in our success in 2019,” he said. “Our machine suppliers are embracing technology and offering flexible and innovative equipment to produce a final product and also eliminate labor-intensive operations.”
Burke added that the company expects an even better year this year as it expands outside of its “comfort zone” of hosiery.
“New customers are meeting our highly skilled staff and understanding our level of professionalism and experience when it comes to installing new equipment and after-sales service,” he said. “As we continue to grow, marketing and quick LinkedIn updates on what we are installing will continue. Putting a face to the name or email has been a good executive decision and is a good reinforcement to our staff that they are greatly appreciated.”
Being more active on social media by offering updates on LinkedIn in recent months has expanded Henderson Machinery’s network of connections and has given the company the opportunity to have meetings and discuss new equipment for companies it has tried to connect with for years, Burke said.
“Tradeshows and conferences are always beneficial in meeting new people, too, but for 2020 the main show will be Texprocess Americas/Techtextil North America,” he said. “And SEAMS’ conferences and events are always great for us to network and get educated on what is going on in the industry.”
Henderson Sewing Machine Co.
Frank Henderson, CEO of Henderson Sewing Machine Co., Andalusia, Ala., ties much of the vagaries of his business to what’s happening Inside the Beltway – and, so far, so good, he said.
“Last year has been a good sales year, thanks in part to the Trump Administration,” he said. “Many companies are reshoring and near-shoring more production. Micro-factory installations and IoT (Internet of Things) 4.0 installations are pacing ahead of previous years. And, finally, (there is) implementation … not just talk.”
He called 2020 “highly anticipated” and promising – “IF the Democrats in Washington, D.C., would stop their witch hunt and radical, resistance and revenge politics of President Trump and an administration that has done more for American business in three years than the previous three administrations.”
The biggest positives that policies have brought about that are benefiting his business are numerous, Henderson said. Among them: employment is at an all-time high; unemployment is at an all-time low; U.S. brands, retailers and manufacturers are moving more production and sourcing back to the USA or near USA markets; manufacturers are adopting smaller lot production models that are personalized, customized and manufactured after being sold; fast, speed-to-market-driven production is rising; and manufacturers are adopting demand-then-supply models rather that supply-then-hope-for-demand in sales.
As for prospects going forward, Henderson pointed out that 2020 is an election year, and it’s difficult to forecast projections during such an unpredictable environment.
“We have a bunch of Democratic ‘morons’ colluding with a ‘biased press’ trying to impeach a sitting president in a ‘power grab’ to cover up the collusion of a former administration to rig an election and destroy a duly elected president,” he said. “Trump and his administration have been exonerated by The Mueller Report, the House Intelligence Committee proof and findings by Devin Nunes over a two-year ‘uncover’ of the facts. These issues and others are the biggest deterrent to business in the USA.”
Another concern, Henderson added, is workforce development.
“People are our biggest concerns to the continual growth of the textile and sewn products industries in 2020,” he said. “But there is opp0ptimism: Companies are moving manufacturing back to the USA; micro-factory models are being built; and IoT 4.0 is REAL and works for USA manufacturers.”
Jason Mills
Jason Mills, Milltown, N.J., was still sorting through the numbers at the time this report was made, but it was expecting an approximate 3 percent to 4 percent increase in revenue in 2019, according to President Michael Lavroff.
“Margins remained intact as most tariff-related yarn issues were passed on,” he said. “We’ll be reevaluating all prices as we head into 2020 to make sure we are staying ahead of the curve in regard to costs. As far as factors affecting sales, the continued economic expansion plus several niche areas that seemed to see significant growth, such as materials used in the recreational trade, can be credited as the primary drivers.”
The company – a complete sourcing, manufacturing, warehousing and distribution partner for all mesh, fabrics and industrial textile manufacturing – plans to keep things close to the vest this year, Lavroff added.
“That is how we prepare – find the sweet spot between keeping your customers supplied on a timely basis – not Just In Time! – and a steady level on inventory,” he said. “With the presidential election coming up, things may be a bit volatile, but at a minimum I would expect us to maintain revenue levels.”
Asked what the biggest factors affecting his outlook for next year, Lavroff said: “If we get into the weeds, it all comes down to national politics,” he said. “The Democrats have a couple of candidates that could freak out the economy, and I think that happening is an unlikely scenario. Maintaining the current administration or changing to a moderate Democrat will keep things politically at their normal level of incompetence, and thus maintain even economic growth.”
Assuming the latter scenario is the outcome in November, textiles and apparel as a part of the U.S manufacturing sector should increase at moderate levels – akin to the GDP, he added.
“While having a nominal effect on jobs, reshoring definitely helps U.S. business overall,” Lavroff said. “Tariff pressure and international volatility juxtaposed with technological advances, in my opinion, remain the chief drivers of reshoring.
“The last point,” he continued, “is to always maintain an eye on the future. We always must look forward in regard to design and performance. Not embracing the concept of creative destruction ultimately will leave a company behind. Here’s to a good year!”
Lang Ligon & Co.
Hesitancy caused a slowdown at Greenville, S.C.-based Lang Ligon & Co. in 2019, according to President Harrell Ligon.
“Profit reduced by two-thirds as we had a lot of quotations – and we were busy, but customers simply delayed decisions more than the year before,” he said. “I expect this year to be about as good as the previous year. There is real hesitation by decisionmakers, which I expect is temporary, actually.”
Although trade policy is in turmoil, Ligon said he expects that it will be smoothed out soon.
“Reshoring should strengthen, and this is a positive aspect of trade negotiation and the tariffs dance,” he said. “Also, the entrance of micro-consumer product producers – my term – using the Internet to make very special products and buy only a few machines to do their unique offerings will strengthen.”
Ligon added that he anticipates that manufacturer confidence will return.
“I have a theory that if on one day every prudent manufacturer decided to just wait one month before making that purchase decision that he needs to make, capital machinery sales would go to zero for one month,” he said. “I hope soon there is a buildup of confidence, and that should release a small flood of activity for capital purchases.”
Minnesota Knitting Mills
Business at Minnesota Knitting Mills (MKM) of Mendota Heights, Minn., a manufacturer of knit trim, cuffs, bands, collars, braid knit, hats and custom fabric components for various apparel markets, continues to see growth with its existing customer base as well as increased product development with new customers wanting to purchase in the USA, reported Pat Hickey, managing director.
“And we anticipate another year better than the previous,” he said. “To accommodate growth, we are adding depth to our management structure, capital expenditures and continuing to focus on our overall labor market.”
Labor continues to have major impacts on business, he reiterated. Most importantly, recruiting and retaining qualified individuals with a desire to excel in their positions, whatever the responsibility, is a huge challenge, he said.
Going forward, he said he believes MKM needs to stay the course with the entire supply chain, “having a vivid understanding that we need performance out of one another to achieve overall success. Specifically, we need timely delivery of raw materials, equipment and manufacturing to provide automated solutions now – not next year – and customers understanding the true value of buying USA.”
On a related note, Hickey said that reshoring is happening, but not yet at the rate it should be.
“And the availability of raw materials and fibers is increasing, albeit slowly,” he said. “More than in past years, there is a recognition of dependency upon one another in U.S. textile/apparel production. Those things coming into play along with a strong economy provide feelings of opportunity and optimism.”
MMI Textiles
MMI Textiles, Westlake, Ohio, had a “decent” year, slightly better year over year, but it did see a softer side on government contracting, reported founder and CEO Amy Bircher. However, “it was still our best year yet in sales since the start of MMI in 1997,” she said.
The company is anticipating a “phenomenal” year in 2020, due to some much-anticipated new product launches and investment in both personnel and continued product development, she added. The biggest factors affecting that outlook are a current backlog on orders, conversations and commitments with current and potential customers on new products being launched and its new sustainable line of apparel fabrics that are made in USA and will capture a new audience for MMI, she said.
“The demand is there – we have to find the people to do these jobs and that is where the struggle is for most manufacturers,” Bircher said. “Reshoring and near-shoring have been occurring and will continue to only get stronger. The tariff issues and political turmoil that has resulted from the U.S.-China trade war has many companies working feverishly to develop an alternate pipeline outside of China.”
In summary, she said that sustainability is not a buzzword – it is real, although certain parts of the U.S. don’t see it as much as others.
“Textile companies need to work on their sustainability story and how they are going to nurture the need to be mindful of the environment when it comes to textile and apparel production,” Bircher said. “Circularity is a real thing and needs to be taken seriously. We are committed to this mission and excited to roll out our sustainable fabric line at Outdoor Retailer.”
Navis TubeTex
Finishing machine manufacturer Navis TubeTex, Lexington, N.C., reported that 2019 was a “great year.”
“We had the largest yearly revenue in the history of the company,” said President & CEO Will Motchar. “We realized orders across many applications as well as all geographies. Highlights were in specialty technical markets. We also launched several new products that greatly improve the sustainability of the process. These were well received in the market, which translated into the increased sales.”
And 2020 is poised to be an even better year, he added, as the company’s backlog is at all-time levels. As such, the company is focused on increasing its capacity to meet increased demand.
“The economy continues to be strong,” Motchar said. “Companies are aggressively investing in new equipment. Our U.S. activity has been strong with companies indicating further capital expenditures.
“I think U.S. textile production will continue on its current path,” he continued. “This is not a wholesale move in production from offshore to the U.S., but production in the U.S. is growing, especially in the technical/specialty areas.”
Palmetto Synthetics
David Poston, president of Palmetto Synthetics, Kingstree, S.C., said that 2018 was “very strong” for most domestic fiber products, but 2019 was generally lower.
“While our demand remained fairly high, it was not as robust as 2018,” he said. “All of our business segments, from automotive to textiles, were softer in 2019 compared to 2018. Lower demand for autos and textiles, as well as cheap imported fiber, negatively affected our overall demand.”
Barring any catastrophic change in supply, the company expects 2020 to be comparable to 2019, Poston noted.
“We are seeing a slight reduction in automotive demand in 2020,” he said. “There have been numerous predictions of an automotive ‘correction.’ While we are not sure if that’s correct, we do expect overall car sales to be lower.”
At least for Palmetto Synthetics’ business, reshoring has not increased its demand, Poston said. More business has indeed returned, but so has less-expensive imported fiber that has been the offset, he added.
Supreme Corporation
Supreme Corporation, Conover, N.C., witnessed a 30 percent contraction in the PPE industry, and as a company it finished the year about 20 percent behind where it expected to be, according to CEO Matt Kolmes. The PPE business in North America is closely tied in to the commercial construction industry and when that Industry contracts, so does the sale of PPE, he pointed out.
“We expect a better year than 2019, and we are expanding our sales and marketing efforts at targets outside of North America now,” he said. “Since our target is business development outside of North America, the big three (factors) for us are shipping, duties and taxes.
Kolmes added that the challenges in finding labor, especially skilled labor, remain the largest hurdle facing the textile industry with respect to production and reshoring.
TSG Finishing, LLC
TSG Finishing, LLC, based in Devon, Pa., with manufacturing operations in Hickory, N.C., reported a flat 2019 year over year, but individual market breakdowns were mixed due to the company’s being so diversified, according to CEO Brian A. Rosenstein.
The woven upholstery market was down by as much as 10 percent, but the industrial side – construction, filtration, automotive, medical, etc. – was up by roughly the same amount, he said.
“As of right now, we are anticipating another year similar to 2019,” Rosenstein said. “Managing costs on the operations side in conjunction with launching new technology is going to be key in 2020.”
The woven upholstery market is very volatile right now primarily due to the global trade situation, and people are unsure of how to respond, he added.
“Unfortunately, on the industrial side, natural disaster such as wildfires, hurricanes, tornados, etc. create a demand for products in the construction/filtration industry, of which TSG plays a big role,” Rosenstein said. “And 2020 is already seeing its share of disasters around the world.
“The level of uncertainty due to the current administration is at an all-time high,” he continued. “And given how this is an election year, I expect that manufacturers across all industry segments are keeping things close to the vest.”
An election year is always more difficult, regardless of the outcome, he noted.
“However, for obvious reasons, this year looks to be especially interesting,” Rosenstein said. “I am also very upset at the lack of education and understanding surrounding the U.S. environmental regulations and technology for the woven upholstery market. People are making decisions prematurely and then having to pivot further down the road when they realize their initial thoughts were wrong.
“This disrupts the supply chain, which makes for very little consistency and is difficult to manage,” he added. “The need to better control the supply chain is also the reason why more upholstery fabric suppliers are going vertical. 2019 alone saw at least four major fabric suppliers make strategic U.S. acquisitions in order to shore up their product supply.”
Universal Sewing Machine Co. / Unicraft Corp.
Despite a strong economy overall, Martin Gopman, owner and president of Universal Sewing Machine Co. / Unicraft Corp. noted that 2019 was one of the company’s worst years in a decade.
Sewing machine sales were down almost 20 percent from the previous year, and cutting room equipment sales and dealer sales were about 25 percent down.
“It seems that investments and expenditures for capital equipment were put on hold until the uncertainties of tariff wars were resolved,” he said.
However, the new year has begun with a “bang,” he said, “as if all the pent-up demand from 2019 boiled to the surface. The tariff negotiations seem to be coming to a conclusion, so I expect 2020 to be a banner year, barring any unforeseen international or political calamity.”
Gopman said his optimistic outlook for 2020 hinges primarily on a positive conclusion of tariff negotiations with China. It is becoming more apparent to clothing manufacturers that there are compelling reasons to bring some production back to the Americas, in spite of labor cost differential, he posited.
“Historically, economies in election years are strong, and indications are that it will be so this year, regardless of what the stock market may do,” he said. “I expect apparel production to do even better than the overall economy, based on early indications, as if to make up for last year. Consumer demands and expectations are changing in a way that require speed to market, smaller lots and larger variety – all of which point to near-shoring.”
Venus Group
Another company reporting a good year is California-based Venus Group, with manufacturing operations in Fort Lawn, S.C., a producer of textile products for hospitality, institutional laundries, healthcare, government and home fashion. The made-in-the-USA movement, outstanding quality and quick shipping orders all played a large role in the company’s fortunes, according to Dennis Jackson, vice president of manufacturing, distribution, product development and quality.
“I expect 2020 to be an even better year,” he said, adding that the economy, political turmoil and tariffs could throw a monkey wrench in things. “We continue to bring in new automated machines and expand our product line.”
But Jackson advised that he is “very optimistic” about the economy but concerned the political climate could hurt the growth seen in the last three years.
“The USMCA should be good for our industry and I think we will continue to see more reshoring due to tariffs and labor increases worldwide,” he said.
Zünd America
Digital flatbed cutter producer Zünd America, Oak Creek, Wis., continues to see a healthy increase of cutter sales year after year in the textiles and apparel segment, according to Andy Arkin, strategic account manager – Industrial Applications.
“With on-demand, quick turn, fast fashion, personalized, customized, short run taking over this segment, single-ply, easy-to-operate, versatile, small footprint cutters are more desired and in demand,” he said. “Zünd is rapidly replacing old, large, multi-ply cutting solutions all over North America.”
For similar reasons, the company is expecting a “great” 2020 in this segment, he added. In addition, as tariffs continue to add pressure, products made with textiles in the U.S. and Canada will continue to increase, he pointed out.
“However, we still have a labor force and cost issue with sewing stateside,” Arkin said. “The cost to produce in the U.S. needs to be addressed, along with tariffs on finished goods only, not raw materials. Conversations with big brands and retailers is to not change the current overseas supply chain. They want to know what is happening so they can react if they need to. The current/old way still works for them. New businesses and entrepreneurs are who have embraced opened factories and purchased state-of-the-art equipment with as much automation as possible to produce in the U.S.”
Zimmer
Business in 2019 exceeded at expectations at OEM Zimmer America, the North American arm of Zimmer Austria, according to Roland Zimmer, vice president of Sales–North America.
“We had a 100 percent increase in three of the areas Zimmer is active in, which are digital textile printing machines, textile coating machines/lines and conventional (analog) screen printing machines sold,” he said. “This is quite remarkable and to some extend not expected.”
Specifically, he explained: digital textile printing was driven by the rising demand for digital pigment printing; textile coating was driven by absolute niche applications (mostly medical) and only to a smaller part by commodity outdoor fabric coating; and conventional (analog) screen printing was driven and dominated by military demand for camouflage printed textiles.
Only digital carpet printing was flat, but driven by an increase of capacity on the PES carpet side, which has gained more than 50 percent market share compared to PA nylon-made carpet
“It is going to be hard to keep that pace in 2020 given a U.S. presidential election year, but we predict that we can actually match 2019 numbers in 2020,” Zimmer said.
Reshoring is a fact and will continue in 2020, especially on the conventional (analog) screen printing side and digital printing side, he added.
“We might even see an uptick in domestic cut-and-sewing operations in 2020, driven by new technology in this area,” he said.
Anonymous fiber producer
A fiber producer who wished to remain nameless said his company saw a significant increase in business this year and is expecting an even better 2020.
He said that scientific innovation, private investment and tariffs will be big drivers this year, adding that he is betting on further opportunities developing. Plus, active lifestyle products continue to grow, he added.
Anonymous dye supplier
Business was flat to a little down compared to previous year, according to an industry supplier who asked to remain anonymous. The company attributed this to a general slowdown in manufacturing in its business areas, coupled with rising raw material costs due to uncertain Asian supply situations and governmental tariffs.
“We anticipate a better year, and we even saw an uptick in the end of 2019,” he said. “In response to 2019’s slowness, we have optimized product lines and procedures and increased efforts to broaden our customer base.”
The Asian supply situation has stabilized to some degree, he said, even though it has normalized to a higher cost level, which he referred to as the “new normal.”
“Because the overall economy remains strong, we expect the manufacturing sector to remain strong in the industries we target,” he said.
He added that the company expects the strong economy will raise the outlook for U.S. manufacturing. Continued efforts by the U.S. textile industry to rely on innovation will begin to pay dividends, he added. Supply chain will remain dynamic, and efforts to broaden the supply base – additional qualified vendors and close business relationships with current vendors – will help to smooth any speed bumps on the supply side, he pointed out.
“Due to the continued strong economy, company product line optimization, a stabilized – to some degree – supply chain and continued U.S. textile innovations, we expect 2020 to be a very positive year,” he said.
Anonymous components supplier
Last year was comparable to previous years at a components supplier, who wished to remain nameless. Most customers ran at full capacity for most of the year, but the fourth quarter was a little slower than anticipated, he said.
“We’re expecting 2020 to be very comparable to 2019,” he said. “Even though the financial markets appear to be strong, there appears to be some uncertainty in the textile market forecast for 2020.”
The uncertainty in the national political scene, along with tariffs and the trade wars, appear to be creating some reservation in investment in the industry, and uncertainty in 2020 is forecast for business, he added.
“The economy is strong and I think there will continue to be some reshoring but on a small scale,” he said.
Anonymous sales agency
A North American representative for textile machinery and equipment, who asked to remain anonymous, said that capital equipment orders last year were softer than the years before and that customers postponed many projects for various reasons.
“Projects were postponed, not cancelled, in 2019,” he said. “The number of projects we have in our pipeline is good. We are expecting a better year than 2019.
He added that the trade war and renegotiating NAFTA / USMCA have brought some past uncertainty, but going forward, it “seems more predictable what we have to deal with.”