Reuters reported that US apparel retailers sensed the rising price and cost of Chinese apparel in recent days and a bigger rise is expected next year.
Reuters reported that US apparel retailers sensed the rising price and cost of Chinese apparel in recent days and a bigger rise is expected next year. It is tough for US retailers, big and small, who have been battling erratic sales trends this year amid high unemployment and lingering financial insecurity. And they are finding ways to solve the problem.
“Some of them are more expensive over there” said Stan Park, the general manager of the Umgee USA apparel brand, “It's just not worth it!".
As the economy in US did not recover completely, vendors and retailers cannot raise their prices quite yet. So finessing price strategies were top of mind for vendors and retailers at the Magic apparel trade show in Las Vegas, where buyers place orders for the newest styles.
Some retailers have solved this problem by making much of their product domestically in hubs like Los Angeles. But for larger brands that require the big volume that only China can supply, rising prices are a reality.
However, whether people would accept it or not is still a myth. Warnaco Group (WRC.N) Chief Executive Joe Gromek said that they are just not going to raise prices across the board. But where they think that they have somehow done things to create added value, then they will make the necessary moves.
Offering longer-term contracts in exchange for price reductions is anthor way to combat the inflation, said Peter Gabbe, chief operating officer of Carole Hochman, a sleepwear and intimate apparel company that licenses labels such as Ralph Lauren and Jockey.
“A rise of up to 10 percent will be seen next year. The American consumer will have to accept it.” said Perry Ellis (PERY.O) Chief Executive George Feldenkreis.
Elan Savir of the Elan USA line said he has wanted to "make nicer stuff," but knows a more expensive price tag will turn off key customers like Nordstrom (JWN.N), which depend on him to fill a niche for fashionable yet inexpensive products.
"They're looking for stuff they can put in their stores for $49 and $59," Savir said, showing off a draped T-shirt that sells at wholesale for $12.50.
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