LIVIN
LIVIN’ ABOUT US MISSION AND VISION VALUES SOURCING GUIDELINES TARGET MARKET
PRODUCTS LOGISTICS PRODUCT CATEGORY SIZE RANGE PRICING
SOURCING COUNTRY ANALYSIS SUPPLIER ANALYSIS RANKINGS
STRATEGY PUBLICATION CONCLUSION
PLANNING & COSTS LINE PLAN UNIT BREAKDOWN COSTING SHEET TECH PACKS
LIVIN’ MISSION LIVIN’ creates luxurious products using unparalleled materials. These indulgent and timeless investments will enhance the most tranquil moments of your day.
VISION LIVIN’ wants to continuously create items made of premier materials using expert craftsmanship. These garments will be of the utmost quality for a clientele that wants the best in loungewear.
VALUES Luxury Quality Abundance
SOURCING GUIDELINES WORKERS’ RIGHTS AND RESOURCES All workers are expected to treat others with courtesy, respect and dignity. No form of harassment or intimidation will be tolerated. Discrimination of any kind, including but not limited to race, color, national origin, religion, gender, age or disability will not be permitted. All workers must be of legal age as defined by each country of production. No workers below the age required to be in compulsory education can be employed. Workers will not be placed into any compromising positions related to physical, mental emotional health. In the event this does occur, appropriate resources and coaching will be made available to ensure that similar issues will not happen in the future. All workers will be paid appropriately based off the country’s respective minimum wage and provided any mandated benefits. Workers will work an average of 40 hours a week and during peak times of year, will work no more than 50 hours, and be adequately compensated for any overtime work. Workers have the freedom of association and the right to collective bargaining. Individuals can participate in organizations of their choosing and employers must recognize this right.
FACTORY AUDITING AND STANDARDS Factories must be up to code and have accessible amenities for workers. Factories will not subcontract production without discussion and approval. All factories must confirm and prove they are not participating in slave or forced labor. Factories must keep a record of hours worked by each individual and ensure breaks are taken. Factories will go through auditing processes to ensure they are adhering to our principles. We strive to develop strong relationships with factories and support them through training programs and education on proper practices.
LAWS & CUSTOMS COMPLIANCE Laws of all nations involved in our production will be abided by. All trade agreements between countries in our supply chain will be abided by.
ENVIRONMENTAL IMPACT Any relevant laws regarding the environment and its well being will be adhered to. All material used in our products will be responsibly sourced. We will seek out new ways to minimize our impact on the environment. Farms will be held accountable and expected to treat animals fairly. Humane tactics must be used to gather animals’ hair. Animals must be adequately fed and given space to move freely.
INTERNAL MONITORS All workers will be informed of codes and managers will confirm they are being followed. Workers and management will be provided and required to sign a document listing all codes of conduct and rules that must be followed. Implement an incentive for management to empower workers to fill out an annual survey addressing labor rights and factory experience. Said surveys will then be sent to a predetermined third party auditor as a metric for review. Surprise audits will be performed by a third-party agency as well as upper management from corporate. This will include checking all documentation and certification of manufacturer. A platform will be provided that allows workers to easily and responsibly report any indiscretions. Work with factories to remedy issues when they arise, as opposed to pulling out of agreements if issues occur, have an open dialogue with factories that allow all indiscretions to be reported
EXTERNAL MONITORS Complying with laws and ordinances of all nations involved in production - Any licenses, contracts or protocols mandated by the respective country will be acquired. All proper papers will be displayed and maintained properly to ensure everything is up-to-date and can be referred to at any moment. Acquire cite certification for legal and fair use of Vicuùa hair via the Peruvian government. Become a Fair Labor Association’s (FLA) Participating Company—adhere to their code of Conduct to maintain membership as one of their participating companies
FLA ACCREDITATION REQUIREMENTS Companies are assessed by the Principles of Fair Labor & Responsible Sourcing: Adopting and communicating workplace standards Training staff to assess and remediate noncompliance issues Conducting internal assessments of facilities Providing workers with confidential reporting channels Accreditation is awarded every three years upon a satisfactory FLA evaluation
TARGET MARKET AVA , 3 6 Toronto, Canada
O C C U PAT I O N CFO of her father’s independently-owned media company
INCOME $750,000
M A R I TA L S TAT U S Engaged
ANECDOTE Loves unwinding with a glass of Chianti while watching The Crown on Netflix.
NORA, 52 Forte dei Marmi, Italy
O C C U PAT I O N 3 time New York Times best selling Author
INCOME $1,250,000
M A R I TA L S TAT U S Has a life partner
ANECDOTE Owns a stake in a vineyard
JACQUELINE,43 Hartford, Connecticut
O C C U PAT I O N Lawyer - Hoping to make partner
INCOME $350,000
M A R I TA L S TAT U S Married, with one child
ANECDOTE Spends her days in a power suit and Jimmy Choo’s but needs something cozy to change into when she gets home
LOGISTICS LOCATIONS Sold exclusively though Bergdorf Goodman in New York City
PRODUCT CATEGORY Women’s loungewear
SIZE RANGE Products will be available in Small, Medium or Large
PRICING $2,000 - $4,500
SOURCING COUNTRY ANALYSES
SINGAPORE Singapore is a small country located in Southeast Asia, positioned on the end of Malaysia. In December 2014, Singapore began revising their emission standards for diesel and petrol vehicles with the proper emission requirements taking effect for diesel in January of 2018 and petrol in September of 2017. As a result of its location, the country is vulnerable to rising sea levels. The primary labor law in Singapore is the Employment Act, which covers the standards of full-time and part-time employees and ensures the fair treatment of workers in all industries. Singapore is aiming to get involved in the capital-intensive space industry. They are also increasing technology developments and were granted 797 patents by the USPTO in 2013 alone. Some of the top exports from Singapore are machinery and equipment (including electronics and telecommunications) as well as refined petroleum products. The major trade agreements Singapore is involved in are the US Free Trade Agreement, the European Union Free Trade Agreement, and the Peru-Singapore Free Trade Agreement. The country does not have a set minimum wage in. Due to the aging population, Singapore’s government expenditure on things such as healthcare and pensions is due to increase.
ITALY Italy is located in the south of Europe and consists of a peninsula that juts out into the Mediterranean sea as well as the islands of Sardinia and Sicily. To the north, it is bordered by France, Switzerland, Austria, and Slovenia. The country is working to further enhance its sustainability efforts through the help of consultancy firm, Eco-Age. The country has strong intentions to better social justice and environmental protection policies moving forward. In Italy, most employees are members of a trade union which determines their wages through collective bargaining. Since they are a member of the European Union, the country must adhere to any mandated laws and regulations by the union. Industria 2015 was an initiative created to invest in R&D within Italy and contribute more to students quality of learning in the classrooms. Education is a weak spot for the country. It also aims to incentivize companies to invest in Italy by offering tax credits to projects that are funded within the country. Major trade agreements that Italy is involved in are the Italy Friendship, Commerce and Navigation Treaty, the Transatlantic Economic Council, the EU - U.S. Open Skies Agreement, and the General Agreement on Tariffs and Trade. The average monthly wage is 2300 EURO, the equivalent of about 2443 USD a month and there is no set minimum wage.
PERU Peru is located on the western coast of South America with Ecuador on its northern and Chile to its southern border. Colombia, Brazil, and Bolivia are adjacent to its Eastern border. The Vicuña population was added to the endangered species list in 1976 due to the illegal poaching and trading of its fiber. An initiative was setup to regrow the population and the current Vicuñas count has increased to over 180,000. Peru is one of the only homes of the Vicuña and has the capabilities of properly shearing the coat. Deforestation, soil erosion, urban air pollution, and pollution of water are all environmental impacts affecting Peru and its industries. The maximum legal working hours in the country are eight hours per day or fortyeight hours per week. The average wage is 750 PEN, the equivalent of about $225 USD. Since Peru is a developing nation, they have limited amounts of technology but do intend to develop more in the future. Currently, President Pedro Pablo Kuczynski is expanding and developing infrastructure. In 2013, Peru started, the National Industrial Development Plan (PNDI) to empower industries in impoverished regions in the mountains and jungles. This initiative was sponsored by the executive branch of the government. The uncertainty of the TTP plays a huge role in Peru’s trade potential due to the agreement opening up the Asian market. Since the US withdrew from TPP, things remain uncertain in Peru. Major active trade agreements that Peru is currently a member of are the US-Peru Free Trade Agreement, the European Union Free Trade Agreement and a Peru-Singapore Free Trade Agreement. In addition, the country is a WTO and MERCOSUR member. The exchange rate between the Peruvian Nuevo Sol and the US dollar is 3.363 to 1. The monthly minimum wage is $225/ month and there is no specific hourly minimum wage.
SUPPLIER ANALYSES LEE YIN KNITTING FACTORY PTE LTD 994 Bendemeer Rd, Singapore 339943 Phone: +65 6296 7014
Lee Yin Knitting Factory was founded in 1980 and manufactures a range of products including sweaters, knit/woven items and accessories. This location is one of five throughout the continent of Asia. Lee Yin is best known for their sweater manufacturing and provides design/sampling services to their customers. This is a smaller factory, with under 100 employees in total. This manufacturer aims to develop and grow through investments and utilizing renewable resources. Lee Yin is a member of the Textile and Fashion Federation in Singapore. Doing business with this supplier would boast a high level of care and treatment of the labor force.
MANIFATTURA LORO PIANA S.R.L. Via Parini 52 Sillavengo, 28064 Italy Phone: +39 32 182 4180
Loro Piana’s independently owned knitwear manufacturing is an ideal location to work with Vicuña yarn. The brand has a long standing tradition with the fiber and has made tremendous efforts to preserve the population of Vicuñas. Loro Piana’s well established skill set in handling the fiber will result in highquality production under the company’s workforce. This manufacturer includes a laboratory dedicated solely to quality control. The fibers are sent here from suppliers and are scrutinized to confirm the quality is up to their expectations. Working with Manifattura Loro Piana S.r.l. would result in highquality products with a strong availability to skilled workers and renowned production recognition.
KNIT COUTURE S.A.C. Av. Mexico 1039 Piso 6 Lina, Lima 13 Peru Phone: (51) 323 - 4058
Knit Couture, located in Lima Peru, has been a manufacturer of knitwear for well over 20 years. Their client list includes well-regarded brands such as Barney’s and Donna Karan. This manufacturing company prides itself on craftsmanship and strong relationships with their clients. The production lead time is 60-120 days, depending on the yarn being used and its availability. The production staff consists of about 60 people that have worked for the company for since its genesis. Knit Couture is tech-savvy using knitting machines and programmers to electronically design garments. The country of Peru has Free Trade Agreements with the US which results in no quotas or duties being applied to these products upon arrival. The factory is in an ideal location with respect to the Vicuña farms where raw materials would come from. Overall, Knit Couture has the strongest direct benefits in location and lead time.
COUNTRY RANKING Singapore
Italy
Peru
Business Climate
9
7
7
Costs
8
8
7
Government
8
5
7
Location
7
8
8
Risks
7
6
7
Social Stability
8
8
5
Sourcing Guidelines
5
5
5
Textile industry
6
7
6
Trade Agreements
9
9
9
Trained Work Force
7
4
4
Socio-Eco Political
8
7
7
Total
82
73
72
7.45
6.64
6.55
Average
Singapore
Italy
Peru
Abilities
6
8
7
Capacity
5
9
7
Lead Time
4
6
8
Quality
7
9
8
Customers
5
9
7
Sourcing Guidelines
8
7
5
Services Offered
5
8
7
Strategic Outlook
6
7
8
Total
46
63
57
5.75
7.88
7.13
Average
SUPPLIER RANKING
STRATEGY After analyzing Peru, Italy and Singapore as potential countries to manufacture in, we feel that there are many opportunities to capitalize on. In addition, the three suppliers we considered all possess certain attributes that would benefit the development of our products. Due to the scarcity of our material, there is a natural barrier to entry in finding a reasonable and consistent amount of Vicuña fiber. Furthermore, there is an additional challenge in finding a labor force that possesses the existing skill set to handle such a rare and precious material. While Singapore possessed the highest total ranking for our country analysis, the lack of natural resource and labor availability deterred our team from initiating business here. Although the free trade agreements would be beneficial for business, the cost of transport and investment in teaching employees how to work with Vicuña would ultimately outweigh the benefits. Peru was a natural choice for our country analysis due to its market availability of Vicuña and small established network of labor equipped to handle the extremely rare fiber. Sourcing and producing within an extremely close proximity holds incredibly strong advantages, but long lead times and weak social stability deterred our company from using their suppliers. In the end, Italy proved to be the strongest destination for our production due to it’s highly skilled labor force and international recognition for quality. Utilizing the experience and skill set of Loro Piana’s manufacturing location will enable our company to produce the highest quality products in a cost effective and timely manner.
CONCLUSION Manifattura Loro Piana S.r.l. in Italy is the manufacturer we believe will most successfully make our knitwear at the quality standard we aim to achieve. The “Made in Italy” label is very important to our brand values and the country’s rich history of high-quality manufacturing is something we want to utilize. Italy has strong trade relations with the US as well as a Free Trade Agreement with Peru due to its membership in the EU. These bode well for our supply chain, starting in Peru with the sourcing of Vicuña fibers, manufacturing in Italy then shipping to the US.
P L A NNI NG & CO STS LINE PLAN
UNIT BREAKDOWN
PULLOVER
ADVISORY SPEC Style: Pullover Description: Crewneck pullover sweater Spec #: 10001 Sample Size: M S
M
L
Front body length
24 1/4”
25”
26 1/2”
Chest 1” below armhole
20 1/2”
21 1/2”
22 1/2”
CB sleeve length
30 1/4”
31”
31 3/4”
20”
21”
22”
Bicep 1” below armhole
6 1/2”
7”
7 1/2”
Neck drop
3 1/7”
3 1/7”
3 1/2”
Waist
20
21
22”
Sleeve opening
2
2 1/7
2 1/7”
Comments
Bottom sweep
Code
BILL OF MATERIALS Style: Pullover Season: F/W & S/S PM: Amelia Sanda, Mikenna Rase, Courtney Lucido, Janis Shane
Item Body Fabric
Description: Crewneck pullover sweater Wash/Finish: Dry clean only Size Range: S - M - L Fold Size: 13 x 15 inches
Description/Details 100% Vicuña
Color
Size
Beige
S-L
Packaging: 1 per poly bag 1st Delivery: Feb. 1, 2018 Proj. Qty: 132 Target Price: $1,200.00
Qty Usage/Placement
Grey Collar
100% Vicuña
Beige Grey
Main Label
Made in Italy, LIVIN’
Below inside neck
Care Label
Dry Clean Only
Lower left seam
Content Label
100% Vicuña
Lower left seam
Hang Tag
Leather emboss with logo and
Attached with yarn and
made in Italy
pinned to main label
JOGGERS
ADVISORY SPEC Style: Joggers Description: Jogger pant with ribbed stretch ankle cuff
Spec #: 10002 Sample Size: M
S
M
L
Waist
25 1/4”
26 3/4”
28 1/4”
Hip
38 1/2”
40 1/4”
41 3/4”
Inside Leg
25 1/4”
25 1/4”
25 3/4”
Rise
12 1/2”
13”
13 1/2”
Leg Opening
4 3/4”
5”
5 1/4”
Comments
Code
BILL OF MATERIALS Style: Joggers Season: F/W & S/S PM: Amelia Sanda, Mikenna Rase, Courtney Lucido, Janis Shane
Item Body Fabric
Description: Jogger pants with ribbed stretch ankle cuff
Wash/Finish: Dry clean only Size Range: S - M - L
Description/Details 100% Vicuña
Color
Size
Beige
S-L
Fold Size: 13 x 15 inches Packaging: 1 per poly bag 1st Delivery: Feb. 1, 2018 Proj. Qty: 96 Target Price: $1,000.00
Qty Usage/Placement
Grey Main Label
Made in Italy, LIVIN’
Below inside neck
Care Label
Dry Clean Only
Lower left seam
Content Label
100% Vicuña
Lower left seam
Hang Tag
Leather emboss with logo and
Attached with yarn and
made in Italy
pinned to main label
ONESIE
ADVISORY SPEC Style: Onesie Description: Onesie with drawstrings Spec #: 10003 Sample Size: M S
M
L
Length
23 1/4”
24 1/2”
25 1/4”
Bust
32 1/4”
35 1/2”
38 1/2”
Waist
33”
37 3/4”
40 1/4”
Hip
34 1/2”
38 1/2”
41”
Inside leg
26 3/4”
26 3/4”
26 3/4”
Leg opening
4 3/4”
5”
5 1/4”
CB sleeve length
17 3/4”
18”
19”
6”
6 1/2”
7”
3 1/7”
3 1/7”
3 1/2”
2”
2 1/7”
2 1/7”
14 1/2”
16”
17”
Comments
Sleeve width Neck drop Sleeve opening Shoulder
Code
BILL OF MATERIALS Style: Onesie Season: F/W & S/S PM: Amelia Sanda, Mikenna Rase, Courtney Lucido, Janis Shane
Item
Description: Onesie with drawstrings Wash/Finish: Dry clean only Size Range: S - M - L Fold Size: 13 x 15 inches
Description/Details
Color
Size S-L
Packaging: 1 per poly bag 1st Delivery: Feb. 1, 2018 Proj. Qty: 60 Target Price: $2,000.00
Qty Usage/Placement
Body Fabric
100% Vicuña
Beige Grey
Buttons
Pearl Oyster Shell
Beige Grey
Collar
100% Vicuña
Beige Grey
Drawstring
100% Vicuña
Main Label
Made in Italy, LIVIN’
Beige Grey
Care Label
Dry Clean Only
Below inside neck
Content Label
100% Vicuña
Lower left seam
Hang Tag
Leather emboss with logo and made in Italy
Lower left seam Attached with yarn and pinned to main label
COATIGAN
ADVISORY SPEC Style: Coatigan Description: Open-front cardigan Spec #: 1004 Sample Size: M S
M
L
47 1/4”
47 3/4”
48 1/2”
34”
35 1/2”
37 3/4”
14 1/4”
15”
15 3/4”
Sleeve
19”
19 1/4”
20”
Waist
34”
35 1/2”
37 3/4”
4 3/4”
5”
5 1/4”
Comments Length Bust Shoulder
Sleeve Opening
Code
BILL OF MATERIALS Style: Cardigan Season: F/W & S/S PM: Amelia Sanda, Mikenna Rase, Courtney Lucido, Janis Shane
Item Body Fabric
Description: Open-front cardigan Wash/Finish: Dry clean only Size Range: S - M - L Fold Size: 13 x 15 inches
Description/Details 100% Vicuña
Color
Size
Beige
S-L
Packaging: 1 per poly bag 1st Delivery: Feb. 1, 2018 Proj. Qty: 120 Target Price: $2,000.00
Qty Usage/Placement
Grey Main Label
Made in Italy, LIVIN’
Below inside neck
Care Label
Dry Clean Only
Lower left seam
Content Label
100% Vicuña
Lower left seam
Hang Tag
Leather emboss with logo and
Attached with yarn and
made in Italy
pinned to main label
COST SHEET
Cost Sheet
Pullover
Cost Sheet
Cost of Material
Cost of Material
Vicuña wool
200
CMT Total first cost
10 Total
Shipping Agents Commission (5%) Duty (16.4%) Landed MFG (60%) Retail Price (70%)
Jogger
Total
Vicuña wool
175
Metal grommets (2)
0.08
210
Vicuña drawstring
4.16
CMT
10.5
Total first cost
5 10 Total
190.08
34.44
Shipping
259.1
Agents Commission (5%)
9.5
Duty (16.4%)
31
625 2083
Landed MFG (60%) Retail Price (70%)
4.16
Total
235.46 588.65 1962
Cost Sheet
Cost Sheet
Onesie
Cost of Material
Cost of Material
VicuĂąa wool CMT Total first cost
Total
Shipping Agents Commission (5%)
400
VicuĂąa wool
375
10
Buttons (4)
0.12
410
Tie strong
4.16
Grommets (2)
20.5
CMT
67.24
Duty (16.4%) Landed
Onesie
Total
502
Total First Cost
5 0.08 10 Total
4.16
Shipping
MFG (60%)
1255
Agents Commission (5%)
Retail Price (70%)
4183
Duty (16.4%) Landed
390.20
19.51 64 Total
478
MFG (60%)
1195
Retail price (70%)
3983
REFERENCES https://www.iclg.co.uk/practice-areas/employment-and-labour-law/employmentand-labour-law-2016/peru http://0-web.b.ebscohost.com.library.scad.edu/bsi/ pdfviewer/pdfviewer?vid=7&sid=a649e27b-f778-4207-9b51a59a103ac6af%40sessionmgr104&hid=125 http://eco-age.com/green-carpet-fashion-awards-italia-2017/ https://www.permanentstyle.com/2011/12/loro-piana-quarona-factory-visit.html https://www.bloomberg.com/profiles/companies/7732712Z:SP-lee-yin-knittingfactory-pte-ltd http://www.knit-couture.com/index.php/about-us.html http://www.apparelsingapore.com/wp/ambassadors/lee-yin/ http://www.jobstreet.com.sg/en/companies/766780-lee-yin-knitting-factory http://www.peruthisweek.com/news-perus-industrialization-plan-to-developpoorest-regions-100800 http://0-web.b.ebscohost.com.library.scad.edu/bsi/pdfviewer/ pdfviewer?vid=8&sid=b8c9be19-8645-4031-be5e-3e0b06c5660a%40sessionmgr 101&hid=128 http://0-web.b.ebscohost.com.library.scad.edu/bsi/pdfviewer/ pdfviewer?vid=11&sid=b8c9be19-8645-4031-be5e-3e0b06c5660a%40sessionmg r101&hid=128 http://0-web.b.ebscohost.com.library.scad.edu/bsi/pdfviewer/ pdfviewer?vid=15&sid=b8c9be19-8645-4031-be5e-3e0b06c5660a%40sessionmg r101&hid=128 https://www.iclg.co.uk/practice-areas/employment-and-labour-law/employmentand-labour-law-2016/peru http://0-web.b.ebscohost.com.library.scad.edu/bsi/ pdfviewer/pdfviewer?vid=7&sid=a649e27b-f778-4207-9b51a59a103ac6af%40sessionmgr104&hid=125
COURTNEY LUCIDO | MIKENNA RASE | AMY SANDA | JANIS SHANE | PROFESSOR LEVY | FASM 420 | WINTER 2017