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U.S. Stores Trawl ShanghaiMart Fair

SHANGHAI — The three-day 2005 ShanghaiMart for Spring Women’s Apparel Fair wrapped up last week with both excitement about the nonquota world...

SHANGHAI — The three-day 2005 ShanghaiMart for Spring Women’s Apparel Fair wrapped up last week with both excitement about the nonquota world and concern over its impact.

The fair, which ran March 21-23, was organized by ShanghaiMart, one of the city’s first exposition centers, in cooperation with the Dallas Market Center, the Guangdong Association of the Garment and Garment Articles Industry, the Fujian Province Costume and Finery Association, the Jiangsu Federation of Industry and Commerce Garments Chamber and the Shanghai International Merchandising Center.

Richard Chen, vice president of marketing at ShanghaiMart, said the fair attracted 3,000 visitors in its first two days, including some 300 international buyers from 15 countries. Companies attending included Wal-Mart, Target, Kohl’s, Gap, Ann Taylor and KarstadtQuelle of Germany.

ShanghaiMart plans to make the fair a regular, biannual event; the fall 2005 fair is scheduled for Oct. 24-26.

There were 117 mainland Chinese women’s apparel producers exhibiting last week, with the goal of increasing their business with Western retailers. Liu Junquan, chief executive officer of ShaXi Hi-Fashion Manufacturing, which participated in the fair's first edition last fall and also has a permanent showroom at ShanghaiMart, said both times were very valuable. The Zhongshan City, Guangdong Province-based ShaXi manufactures women’s formal wear — 95 percent of which is for export, primarily to the U.S. — at a factory employing 1,500 people.

Liu and other exhibitors said the fair was useful primarily for networking, while orders would follow after retailers visited the factories. Guo Bei, production and trade department vice manager of Sanyou Group, described the fair as “extremely well-managed”compared with most trade fairs they attend annually. The 50-year-old Sanyou Group, in Nantong City, Jiangsu Province, employs 5,000 and produces entirely for export.

Special events during the fair included several fashion shows, primarily of participating exhibitors, and an international forum on March 22 titled “Trade and Buying in the New World of Women’s Apparel,” jointly organized by China Textile and the Dallas Market Center. It featured talks by Thomas Burns, senior vice president of Doneger Group; trade lawyer Roy Delbyck; Larry King, director of Li & Fung Shanghai, and Wei Lin, vice chairman of the China National Garment Association.

King and Wei spoke mostly regarding trade policy and domestic production, with Wei describing how Chinese textile and apparel production is segmented into geographic clusters of expertise to gain the most benefit from economies of scale. There currently are more than 200 such clusters, but the Chinese government has recognized and named only 99 of them, said Wei. These account for about 25 percent of the country’s textile and apparel production.

There already are concerns about cost and labor pressures in China, however, Wei indicated. In Eastern China, the scarcity of labor is causing costs to rise. In coming years, he predicted that production would migrate from the coastal regions where it currently is centered to central and western China, where land and labor are abundant and costs are lower.

But the audience, predominantly Chinese garment suppliers looking to expand exports, seemed more interested in the international speakers’ exposition on recent trends and developments in Western, primarily American, markets than in China’s industry. Delbyck, an American attorney with offices in Hong Kong and Mill Valley, Calif., discussed the end of quotas and explained the minutiae of safeguards, which currently are being discussed by the U.S. government and which he described as “old wine in new bottles,” in American trade law. In his view, “safeguards will come; the question is when.”

“Duty will become the chief differentiator,” in production of textiles and apparel, Delbyck said. “People will factor duty into their sourcing decisions.”

Burns served as emcee and provided the forum’s opening address. His wide-ranging talk touched upon fashion’s role in the larger global economy, the latest consumer trends and the changing retail business. As fast-moving consumer goods besides apparel become more shaped by fashion, he said, they start to directly compete with fashion. This is becoming the case particularly with electronics, and he cited the iPod as the most notable recent example; consumers “are more interested in buying the latest cell phone than the latest jacket.”

He stressed the need for producers to market to specifically targeted consumers with differentiated products to respond to the age of mergers and consolidation and online shopping to create a “strong brand experience.” He provided as examples of this more integrated department stores that combine dining and spa options along with shopping. Burns concluded by identifying a trend toward a simple, streamlined, unostentatious “deluxe minimization” in 2005 collections, along with looser fits, a revival of vintage retro looks, rustic motifs in casual wear and quality over whimsy in accessories.

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