Mexican Firms Concentrate on Capital Inve$tment

A look inside the operations of four Mexican apparel manufacturers reveals significant investment in machinery, CAD and information technology.

We all know by now that Mexico is a hotbed of activity for the sewn products industry What may not be so well known, however, is that capital investment in new machinery and technology is a major focus for Mexican manufacturers that are committed to competing on a global scale.

While on the scene in Mexico this past fall during a Lectra Systems Inc.-sponsored technology tour, Bobbin visited the facilities of four apparel firms based in Mexico City and Puebla, and interviewed leaders of the firms about their business strategies and approaches to software and machinery investment. Here's what we learned from Qualytel de Puebla S.A. de C.V., Kanan Hit S.A. de C.V., Industrias Cavalier S.A. de CV. and Industrias Argaman S.A. de C.V.

Qualytel Focuses on Fashion, Explores Garment Dyeing

A vertically integrated company, Qualytel de Puebla S.A. de C.V. has been in operation for eight years and employs more than 1,000. The company manufactures textiles, in addition to fashion T-shirts, pants and sweatshirts for customers including Old Navy, The Gap, Lands' End, The Limited and Tommy Hilfiger. Many of the shirts manufactured at Qualytel feature screenprinting, which is done by the firm's 6.8 million-pieces per-month screenprinting division.

With annual sales of $50 million and an overall production capacity of more than 800,000 pieces per month, Qualytel considers itself a true NAFTA company in that it is made up of several divisions that together offer full package services to the U.S. market. The firm's first division, Tauro, began in 1979 as a yarn spinning plant with 170 employees. Then in 1989, Qualytel was incorporated with the addition of two fabric plants and three facilities for cutting, screenprinting, packaging and shipping. Since 1994, the company has added three sewing operations, Knit Confecciones, QualyConf and Confecciones Tepeaca, under its corporate umbrella. And in 1997, it completed its full package picture with the establishment of Expor Mex, a U.S. distribution center located in Laredo, TX.

At Qualytel, the emphasis is on fashion-oriented clothing. "We are not just making T-shirts; we are making fashion," says Javier Elenes, executive general director, emphasizing that the Mexican apparel industry in general manufactures much more than basics.

To remain competitive in the new millennium and support growth amid increasing customer demands, Qualytel has implemented what it calls the "[Q.sub.1+1] 2000" plan -- with a focus on quality and Quick Response. Interestingly, the [Q.sub.1+1] 2000 plan is being rolled out in conjunction with a management development program and supply chain management initiative.

The major challenge for Qualytel, Elenes explains, has been to grow fast enough to meet customer demands for direct shipping, electronic data interchange (EDI), shorter cycle times and improved quality, logistics and flexibility. "The NAFTA market is 25 times that of the Mexican economy, and there are many demands that need to be met," he observes.

Investment in new machinery is a key part of the company's game plan. Qualytel's textile facilities are equipped with circular knitting machines and the latest in Scholl dyeing machinery. In fact, a Scholl automatic dye dispenser and Datacolor Spectraflash 500 spectrophotometer enable the company to provide color matches to customers in seven days. Moreover, the firm's cutting and embellishment operations are equipped with automated machinery from Lectra for cutting and spreading, Bierrebi for die cutting and MHM for screenprinting.

To improve its level of Quick Response service, Qualytel is planning to add garment dyeing to its array of capabilities. Currently in the pilot study phase, a proposed garment dyeing facility would reduce lead times from up to 12 weeks down to four weeks, Elenes estimates.

Kanan Hit Expands Reach Beyond In-House Brands

Located in Mexico City, Kanan Hit SA. de C.V. manufactures all types of women's clothing -- from basics to high fashion items--primarily in its own brands, which include Marsel, Kansai and Barbara Barbara. The company has two sewing plants in Mexico City, and with help from subcontractors, produces some 40,000 units per month for the Marsel brand and 160,000 units per month for its other brands.

During its 33 years of serving the Mexican market, Kanan Hit has established the Marsel name as a brand of clothing for the active and modern Mexican woman, says Moises Kanan Tawil, general director. The Marsel brand is sold through department stores, Marsel retail stores, distributors and regional boutiques throughout Mexico. The company also plans to enter the U.S. market with the brand by opening a retail store in North Carolina.

Kanan Hit is investing heavily in technology in order to stay ahead of the competition, Tawil notes. For example, all design for the company's brands is done in-house in a four-workstation CAD department equipped with Lectra Systems pattern making, grading and marker making software. Luz Caballero Gaytan, marketing manager, emphasizes that the use of CAD is very important at Kanan because it allows for maximum fabric use and ensures uniformity in size across all garments.

For spreading, the company has two manual spreading machines and one Lectra automatic spreader.

While Kanan Hit devotes almost all of its production to its own brands, it is exploring the possibility of manufacturing for some major U.S. firms. Plans are underway to increase production capacity by opening more sewing plants in order to take on this new business. "We would like to be known as a production resource for U.S. manufacturers; and we are actively looking to manufacture for other private labels," Tawil says.

Industrias Cavalier Keeps Global Quality Perspective

Located in a residential section of Mexico City, Industrias Cavalier S.A. de C.V. manufactures men's suits, trousers and sports coats for Christian Dior (for which it is the licensed distributor in Mexico), Hartmarx and Liz Claiborne. The 31year-old company, which also produces its own Cavalier and Clark Collins brands, employs 900, has annual sales of approximately $2 million and manufactures about 80,000 pieces per month.

Jorge Levy Bloch, general corporate director, notes that 50 percent of the company s coat production is exported to the United States, and the other half is destined for Brazil, Canada, Central America and Mexico. Of its trousers production, 70 percent goes to the United States and Puerto Rico.

Looking at the firm's approach to equipping its operations, Bloch notes that Industrias Cavalier has "always been very intent on trying to have the most modern systems in manufacturing."

As evidence of this strategy, the company's CAD center features four Lectra workstations, equipped with Modaris software for pattern making and grading and the Diamino program for "expert level" marker making. The company also uses Lectra's Optiplan package for cutting room management.

On the sewing room floor, Industrias Cavalier uses automatic sewing machines, including models manufactured by Juki Union Special Inc., Brother International Corp., Singer/Pfaff and Durkopp Adler.

Bloch told Bobbin that Industrias Cavalier strives to manufacture products of equal or better quality than garments produced by companies outside of Mexico in order to remain globally competitive. "The competition is not only from other manufacturers here in Mexico [but also from] other countries and regions of the world such as Central America, the Dominican Republic, the Ukraine and the Far East," Bloch relates, adding: "It is important for the Mexican apparel manufacturing industry to be prepared and competitive in case the CBI region is granted parity."

Future plans for the company include increasing its trouser production, and perhaps diversifying its product line to include airline employee uniforms. In addition, there are plans to consolidate the firm's six facilities around Mexico City into three buildings, one of which would house the company's raw materials warehouse, cutting room and distribution center.

Industrias Argaman Raises Exporting Goals

In operation since 1984, Industrias Argaman S.A. de C.V. manufactures its own line of children's wear under the Kidoko and Argamini brands, which are sold in major Mexican department stores, such as Suburbia, Cifra, Gigante and Comercial Mexicana. In addition, the company manufactures goods for OshKosh B'Gosh, Dillard's and Kids R Us, among other U.S. customers. Overall, the firm produces about 300,000 pieces per month.

Jacobo Ganani, quality control manager, emphasizes that investing in technology and software has been essential to the company's competitiveness. For instance, Industrias Argaman has been using Lectra's ProStyle CAD software for eight years to design pants, shirts and jackets for its two in-house labels, and for the past two years, has used Lectra's Modaris for pattern making. The company's CAD center features six workstations, with four running ProStyle and two running Modaris. Lectra's Graphic Spec package also is used for grading.

In the business-to-business software realm, the firm uses EDI to facilitate communication and job tracking for its U.S. customers, as well as its Mexico-based retail customers, including Suburbia and Gigante.

In the cutting room, Industrias Argaman is equipped with 12 spreading tables and 10 spreading machines, including two fully automatic and four semiautomatic machines. Cutting is done with 16 manual cutting machines, and two automatic cutters from Lectra.

Embroidery also is an important part of the company's operations. Many designs from both the Kidoko and Argamini collections -- which are updated for the spring/summer and fall/winter seasons in seven different size groups -- feature embroidery, which the company produces using six-color and nine-color Tajima machines with a total of 240 heads.

While Industrias Argaman currently exports between 25 percent and 30 percent of its production to the United States, the firm's executives would like to see that level increase to 50 percent, despite competition from other countries in Latin America. As Ganani concludes: "The competition from Asia is not as strong as it used to be; we feel it more from Costa Rica and Colombia."

Olga West is the associate editor of La Bobina, the leading Spanish-language publication for the sewn products industry and a sister publication of Bobbin.

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