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Even in peacetime, military sales can be a fairly reliable niche that includes underwear, socks, dress shirts and formal uniform sales. The government-outfitting sector is also growing in other areas, like Customs and other agencies adding personnel for homeland security.
"It’s a great business," said Martin W. Mankowski, Jockey International’s director of marketing services and military sales. "You know going in what you’re in for. You know that if business gets tough, the government isn’t going to come back to you with markdowns, request for fixture money or co-op advertising."
But longtime military contractors like Jockey can lose out in the bidding process, like what happened recently when it lost a renewal contract to supply T-shirts. Even though Jockey had the lowest bid, it lost to a small business. Small companies get preferential treatment if their bids are within 10 percent of the lowest.
So Jockey is sitting out the Iraqi war.
"We’ve been around for 127 years," Mankowski said. "In just about all the wars, Jockey has been involved. We’ve made tents and underwear for them over the years. It’s a little bit frustrating because when they need you, you’re there. When you need them, they’re not."
Once a firm gets the contract, the DLA can be as demanding as any retailer that wants inventory just when they need it. Contracts also have surge clauses that require a company to double production on the spot, which is happening now in many cases.
"When you bid a contract, you have to keep that capacity ready, willing and able to perform for as long as a year," said Rick Cepille, president of American Apparel Inc., with four factories and 1,500 workers in Alabama devoted entirely to producing battle uniforms, raincoats, utility coveralls and other military apparel, its primary business.