Supply chain management by Mudan Yang

S U P P LY C H A I N S T R AT E G Y LXFM720 Supply Chain Management Strategy Professor Grace Canepa A m e l i a S h o e m a k e r, Y i c h i H u a n g , M u d a n Ya n g

Table of Contents Executive Summary Company Summary Country Reports Sourcing Strategy Placement Strategy Distribution Strategy Supply Chain Strategy and Conclusion Appendix

Executive Summary

Vivace is an athleisure and athletic wear clothing company made for and inspired by women. This New York based company offer

women adaptable style options that empower them to achieve beauty, fitness and health goals. The athleisure and athletic wear fuses together performance and style to create confidence. Vivace means lively and in our clothing women are able to a live a life full of spark, energy and spirit. Vivace’s mission is to provide a product that allows all women to incorporate fitness, fun, and flare into their on-the-go lifestyles. We intend to empower women to lead healthy and positive lives with style.

This document will formalize Vivace’s plans on achieving the best value for manufacturing and shipping their product. Along with

achieving the best quality and price, the supply chain strategy also gives explanation on how countries and suppliers were chosen based on their capabilities and the company’s sourcing guidelines. Vivace’s strategy will first explain the company’s basic business vision and requirements. Based on the company’s vision and needs, the country and supplier selections will be explained. Then the justification of Vivace’s sourcing and distribution strategy will be outlined. In conclusion, the sourcing strategy and distribution strategy’s ability to execute Vivace’s company standards, goals and growth will be explained.

Company Summary

Established in 2017, Vivace is a New York Based fashion company that sells womenâ&#x20AC;&#x2122;s woven bottoms in the US market. The

company aims to distribute to mass retailers and own website and Vivace Storefront. We also intend the brand to be available in plus size and petite to align with our vision of creating stylish athletic and athleisure wear for all women.

Mission Statement

Our mission is to provide a product that allows all wom-

en to incorporate fitness, fun, and flare into their on-the-go lifestyles. We intend to empower women to lead healthy and positive lives with style.

Vision Statement

The vision of Vivace is to offer women adaptable style

options that empower them to achieve beauty, fitness and health goals. The athleisure and athletic wear fuses together performance and style to create confidence. Vivace means lively and in our clothing women are able to a live a life full of spark, energy and spirit.

Core Values

Target Market

The target market for Vivace is women who are â&#x20AC;&#x153;sweat-mindedâ&#x20AC;? and goal oriented. They pursue the high-quality life, enjoy fitness

and a positive healthy lifestyle. These women are in the 21-35 age range and have their own purchasing capacity. Their income ranges from $60k-$150k per year. They are educated with families or single. Women who buy and wear Vivace live on-the-go lives are go-getters who want to dress for their day with ease and panache. These women also push themselves to reach personal and physical goals. Their need for adventure and travel also leaves them in need of a staple, everyday, go to clothing option. Whether itâ&#x20AC;&#x2122;s running their first marathon or running errand, Vivace provides these women with performance wear that gives makes them feel confident with style and performance.

Sourcing Guidelines

In efforts to create a safe and ethical supply chain, our company abides by the Business Supply Chain Transparency on Trafficking

and Slavery Act of 2014 and other regulations and disclosure expectations. The Business Supply Chain Transparency on Trafficking and Slavery Act of 2014 declares that slavery and human trafficking are crimes under state, federal, and international law. With that said, our company takes steps to disclose information to our customers so they can make an educated purchasing decision. In order to uphold our company values and ethical sourcing practices, we make extensive efforts in verification, factory audits, certification, company accountability, and educating the public. We ensure that our vendors meet internationally recognized standards and our Vendor Code of Ethics requirements. Our brand is committed to protecting the lives and wellness of those who help create our product.

Vivanceâ&#x20AC;&#x2122;s Vendor Code of Ethics includes no tolerance toward forced and bonded labor including, involuntary overtime, imprison-

ment, and indentured or bonded labor. All work must be done by free will and legally. Employees must be able to remove themselves from their position under any extenuating circumstances, and voluntarily leave when their regular hours are completed.

As employers, our vendors must not hinder their

workerâ&#x20AC;&#x2122;s ability to retrieve identity documents, charge recruitment fees or deposits, or withhold wages. Our Vendorâ&#x20AC;&#x2122;s compliance with this Code of Ethics is a non transferable precondition in order to be involved in any business relationship with Vivace. All manufacturing partners involved in our production including, cut and sew facilities, mills and subcontractors, are held to the same standards outlined in the Code of Ethics. A Certificate of Compliance is signed by all our partners. They must remain cooperative and transparent.

All of our manufacturing partners must abide by the laws of the country in which they are doing business. Auditing is done by

Vivaceâ&#x20AC;&#x2122;s company team of experts and our third party auditing companies. These audits are done on announced, semi announced, and unannounced basis, as well as regular follow-up visits and verification. If infractions of the Code of Ethics are found, then we require the vendor to confront and correct the problem immediately. Our company will conduct an investigation and more frequent audits will be conducted. If non-compliance or violation continues, we reserve the right cease the business partnership. The goal of the Code of Ethics is to establish and maintain partnerships with companies that share our values. We persistently protect the morality of our supply chain by educating our partners about human trafficking, slavery, other developing issues and new regulations.

Line Plan

The inventory method would be to order basic all season colors year round and seasonal colors and patterns will be replenished

seasonally. The plan will keep up three basic all season colors that will continuously be in stock. There will be two fashion colors and patterns for each style that will be replenished based on seasonal demand. There will be a new launch in styles every season and best selling fashion colors and patterns will come back seasonally. Vivace’s competitive advantage will be the unique and exclusive colors and prints we offer to our customer. We also intend the brand to be available in extend sizes to align with our vision of creating stylish athletic and athleisure wear for all women.There are many holidays in November and December, like black friday, thanksgiving day,christmas and new year. The September is the time for back to school. More and more young persons like to buy the new sportswear for their new semesters. In these mouth the demands of consumers will increase so we may sell more products for prepare the special months.

COMPANY VIVACE LINE PLAN

SEASON

STYLE #

SP/SU JAN Quantities

Style #1 Style #2 Style #3

NAME Jogger Capri Yoga TOTAL

15000 50000 25000 90000

Fall/Winter 2017-2018

FEB

SUMMER MAR APR

MAY

Quantities

10000 20000 20000 50000

10000 25000 20000 55000

Quantities

10000 30000 20000 60000

20000 45000 20000 85000

JUN

Fall/ Winter JUL

AUG

SEP

OCT

HOLIDAY NOV DEC

Quantities

25000 20000 15000 60000

15000 30000 15000 60000

15000 30000 30000 50000 20000 35000 65000 115000

20000 30000 25000 75000

30000 55000 45000 130000

TOTAL

Quantities

45000 245000 60000 445000 50000 310000 155000 1000000

Wholesale

Cost

Per Unit

Total

Per Unit

Total

$ 49.03 $ 50.23 $ 40.05 $ 34.83

$ 12,012,350.00 $ 22,352,350.00 $ 12,415,500.00 $ 11,695,050.00 Average

$ 14.42 $ 17.32 $ 9.54 $ 10.32

Margin

$ 3,532,900.00 $ 7,708,290.00 $ 2,956,160.00 $ 3,549,337.50 Average

$ 34.61 $ 32.91 $ 31.60 $ 24.51 Average

Margin % 70.59% 65.51% 76.19% 70.76% Average

Products Line 100% Cotton Yoga and Jogger Pants, and 90% MicroPoly, 10% Spandex Capri pants

Price Points Provide high quality with moderate prices

Product Requirements Yoga pant Jogger pant Capri Pant

Follow Vivace’s code of conduct, and fulfill the requirement of high quality fabric

Product Style 1: Capri Pant

The capri style will retail for $100 and be $50 at wholesale cost. It iill be the more expensive garment because of the material and

complex design components. Vivace will plan the most units for this item because it is expected to be the most popular style for fashion and athletic purposes. Capri Pants are creating a more natural fit and added coverage while the wearer bends and stretches during a warm up. The slim fit skims the body from the hip to the knee for a fit that is flattering to the figure. Capri Pants are suitable for wearing in four seasons and has the highest consumer demands. Therefore, Vivace plans to sell more capri pants compare to other two styles in order to meet consumer demand.

Products Style 2: Yoga Pant

Yoga will have the second most in inventory because it is more basic, staple piece. The Yoga pant will retail for $80 and be $40

at wholesale cost. Yoga pants are a type of flexible, form-fitting pants designed for the practice of yoga as well as other physical activities that involve a lot of movement, bending and stretching. They are typically worn for sports and physical exercise, martial arts, dancing, pilates, or aerobics.This style is versatile and expected to be popluar with the more middle aged women in Vivaceâ&#x20AC;&#x2122;s target market.

Product Style 3: Jogger Pant

The Jogger style will have the least amount of inventory because it is a trend piece in comparsion of the more traditional designs.

The jogger will retail for $49 and be $100 at retail. The jogger style is a growing athleisure wear trend that can be worn for sports and for fashion. It is made from cotton and has a loose fit around the thighs and hips then slims towards the calves and ankles. Women are seeen wearing this style to work, errands and for sports. The line plan takes into account that this style may be more popular around the holidays in November and December and back to school.

Country Reports

The success of a company’s supply chain heavily relies on the ability to source and manufacture new product. Where the com-

pany decides to carry out these step of the supply chain can determine their success in almost all aspects of their business, but most importantly price point, quality, turnaround, and corporate responsibly. It is important that a company chooses manufactures that uphold their same values, has flexibly for high demand, and is knowledgeable about the product being produced. Picking the right country to do business within is also important for all of these same factors.  This sourcing guide will give insight into manufactures within the Dominican Republic, Vietnam and Cambodia. It provides information on the topics above in order for us to carry out an educated business decision on where to manufacture our apparel product. Other relevant factors that will be researched are the country’s socio economic, geography, political standing, and culture. These many facets of the country are vital in ensuring our business is successful and secure in the company’s selection. The risks and benefits of manufacturing in these countries will be weighed in the strategic business plan.

Dominican Republic

Introduction

The Dominican Republic is an island in the Caribbean known mostly as a beautiful tourist destination. This island is an exporter

of sugarcane, coffee and cotton to the United States. The Dominican Republic’s economy is experience positive growth and its social stability is improving. Its growing textiles industry also makes this country a strong canidate for apparel manufacturing.

Country Traits Location: Caribbean, eastern two-thirds of the island of Hispaniola, east of Haiti.  Population: 8,862,000 Capital: Santo Domingo Area: 18,704 square miles Language: Spanish  Religion: Roman Catholic Climate: tropical maritime  Agriculture: Sugarcane, coffee, cotton, cattle Inflation (CPI): 3% Industry: Tourism, sugar processing, ferronickel and gold mining and textiles  Exports: Ferronickel, sugar, gold, silver, coffee Currency: Dominican peso  Life Expectancy: 69  GDP per Capita: U.S. $6,300  Literacy Percent: 85% Unemployment: 15%

Country Stability Economic Status

The Dominican Republic has one of the fastest growing economies in its region due to lower oil prices, steady increases in tourism

and remittances from other countries. With new incentives and less restrictions on new businesses, the country has been able to diversify its industrial and manufacturing landscape. For example, the country is now growing in the textile industry. The Dominican Peso is also performing well at 46.3800 and the Central American Bank rating is said to be stable for the future. According to Exhibit 1.1, the Dominican Peso’s value is expected to increase over the next year (Exchange Rates, 2016). Inflation rates in Exhibit 1.2 have also steadily increased, but are expected to be stable and decline in 2017 (Trading Economics, 2016).

Exhibit 1.1 www.tradingeconomic.comomics.com

Exhibit 1.2 www.tradingeconomics.com

Socioeconomic Status

In addition to the government implementing ways to support new and current businesses, the infrastructure has also greatly

improved allowing for easier to trade across borders. “The Dominican Republic is among the 50 economies of the world where trading across borders is easiest” (The World Bank, 2017). This is due to the investment in fixing electric lines, more accessible electricity to the poor, improved roads, and an expansion of the Punta Cana Airport. Other infrastructure improvement, like the restoration of the Olga and

Noel Dams and farm lands, offer better preparedness for climate change and natural disasters. In regards to crime, the country has seen less political uprisings over the lack of access to electricity and water. Drug related crime is still a concern for the country. The government has invested in efforts for cocaine seizures, which have increased since 2013. Job assistance is another way the government is helping improve to improve communities for its citizens. With government assistance, citizens are joining job programs and life skills training courses for their impoverished communities. “38,000 vulnerable youth have been trained to increase their employability,” because of these government programs (World Bank, 2017). These efforts have caused employment rates to increase. In order to improve municipal practices to implement these new programs, “31 local governments received training on participatory budgeting, development planning, financial management, procurement and contracting, human resources and municipal services” (World Bank, 2017).

Cultural Insights

The Dominican Republic culture can be described as the typical perception of island life. The Dominican Republic is known for

its hospitality, family values and cultural arts. Dominicans are very loyal to their family members and likely live in the same area as their immediate family. There is often a matriarch that makes all family decisions. There is little opportunity to move up in social class and the landscape consists of European settles that are upper class, middle class of African and European descent and a mixed lower class. People are very aware of material items and appearance, but also recognized family background as equating the most to wealth. There are also certain social etiquettes in the Dominican when it comes to business. Meetings are often formal and proper. Gifts can even be exchanged as a sign of hospitality or partnership. In business they do not respond well to high pressure, so building more rapport with your partners in crucial. Also they are very respectful of authority so dealing directly with the ultimate decision maker is a sign of respect. Art and music are also the spirit of the island and the center of social activities.

State of the Textile and Apparel Industry

The apparel manufacturing industry took a downturn from 2000-2009 with “employment in the garment industry falling by 82%”

(Birnbaum, 2014). Brands, like Hanes and Levi Strauss, were cutting back orders in the Dominican Republic. This goes back to the lack of access to electricity and that then added to the cost of manufacturing for customers. Presently, there is a more positive outlook for the country to gain back power in the textile industry. The location being close to the United States has a lot to do with this because companies are expecting faster product turnaround and shorter lead times. There have also been extensive infrastructure improvements to enhance the country’s industrial segments. The Dominican Republic is also a part of trade organizations, like The Dominican Republic-Central America FTA. This organization improves working environments, gives more opportunity for the region. The apparel industry accounts for 6% of the Dominican Republic total workforce and cost of labor is high compared to other countries. An exact labor cost amount is not known, but aistorically the minimum wage has increased due to the exchange rate and the peso value, which then increases overall labor rates. Textiles are one of the top exports for the Dominican Republic. With improved transportation, large labor forces and skilled workers, the projections for growth in the industry are high leaving them to be predicted as the 12th largest export market of textiles to the US according to International Trade Administration.

Suppliers within the Country BYP Overseas: Apparel manufacturer specializing in knit and performance garments. BYP has a total of 4 companies that include a cutting, distribution, sewing, elastic and tie dying. This manufacturer offers a full service from marker making, cutting, sewing and packaging. BYP manufacturer has in place auditing practices and safety compliance measures that align with OSHA. They have well trained employees that are skill in all cross-functional technical tasks. Some of their clients include Ralph Lauren, Victoriaâ&#x20AC;&#x2122;s Secret, Gap, Champion and Wrangler.

Ocean Apparel Dominicana: Apparel manufacturer with no specific specialization. They offer marker making, cutting, sewing and packaging. They are a high capacity factory with the ability to cut 110,000 units per week and sew 150,000 units per week. They also offer fabric sourcing services. This manufacturer is committed to environmental and labor standards upheld by OSHA. Some of their clients include Mudd, Wrangler and Dickies.

Apparel Offshore: This manufacturer specializes in woven and knit fabrics They offer full service packaging and production. Their site gives little information on their capacity and their compliance practices. They also offer outsourcing options for certain processes that they are not equipped to complete.

Trade Agreements Dominican Republic-Central America-United States Free Trade Agreement (CAFTA-DR):This free trade agreement created in 2006 includes United States, El Salvador, Guatemala,Honduras, and Nicaragua. By 2015, these countries will not be subject to tariffs or the merchandise processing fee. “CAFTA-DR creates new commercial opportunities for the United States while promoting regional stability, economic integration, and economic development for an important group of U.S. neighbors” (exportgov, 2105). U.S. imports of finished apparel from the CAFTA-DR countries now account for 54 percent of all products imported from these countries. Under the FTA, there are small production-sharing arrangements during the assembly process that “will encourage further regional integration among the Parties and the expansion of production-sharing arrangements through the requirement that goods benefiting from duty-free entry under the FTA be made substantially of materials produced by one or more of the Parties” (United States Employment Impact Review of the Dominican Republic, 2005).

Product Classification The tariff rate for Vivace’s apparel will be 0% because of the CAFTA-DR. The HTS code is 6104.23.00.32.

Transportation

There are 13 seaports in the Dominican Republic and 2 container port located in Santo Domingo and Rio Hana. The standard

container dimensions used are shown in Exhibit 1.3. For this size container at full capacity, the cost is expected to be around $1,200 shipping from the Santa Domingo Port to the Miami Port.

Exhibit 1.3 www.zim.com ZIM: Established in 1945, ZIM offers reliable, efficient and skilled expertise in shipping. They service the Caucedo and Rio Haina ports in the Dominican Republic. The company aligns with schedules to receive merchandise at the Miami Port in an estimated 5 days.

Marfet: This freight company consists of two companies Marseille Fret and Marfet. They offer container tracking and testing to their customers. Express freight services that align with the Miami Port schedule will be offered at the Rio Haina ports. Express service offers an arrival time in 3 days.

Risks and Benefits Benefits Benefits Proximity- Close to United States creating quick to market opportunity and turn times. Climate and Culture- Tropical climate leaves less risk for poor weather to affect transportation or manufacturing. Labor Pool- Large unemployed population ready Stable Economy- the economy is stable, inflation is low and the value of the peso is expected to rise. Free Trade Agreements and Free Trade Areas Risks High Labor Costs- it is costlier for textiles manufacturing Infrastructure- although here have been improvements with electricity and roads, this could still add costs for manufacturing. Corruption and Crime- Drug related crime is high in the Dominican Dependence on the United States- The country is very dependent on the success of the United States economy because of the amount of business they share.

Conclusion

In conclusion, the Dominican Republic is a medium risk candidate for our apparel production. The future outlook for the country

is stable and the Textile industry is growing in the region. The major benefit from doing business in this country would be its geographic location enabling quick turn times for our product. There are not many options for athletic wear apparel production and the risk of hiring a manufacturing company with little expertise is evident. In the clothing line there are two items made 100% cotton and have simple designs. These items may be better options to source in the Dominican, rather than our technical running pant. The Dominican Republic may be a viable option when their textile industry becomes more stable, has more options for sourcing, and obtains a greater knowledge of apparel manufacturing.

Cambodia

Introduction

Cambodia is multiparty liberal democracy under a constitutional monarchy. Situated on the Indochinese peninsula, it is bordered

by Thailand and Laos on the north and Vietnam on the east and south. The Gulf of Thailand is off the western coast. The size of Missouri, the country consists chiefly of a large alluvial plain ringed by mountains with the Mekong River to the east. The plain is centered around Lake Tonle Sap, which is a natural storage basin of the Mekong. After the 1993 elections, the Cambodian government formulated comprehensive macroeconomic and structural reforms towards a market-oriented economic system. Since 2000, the economic development of Cambodia has been attributed to the stabilization of the currency, reduction of the inflation rate, and enhancement of export activity, mainly led by foreign direct investment.

Country Traits Chief of state: Hun Sen

Language: Khmer (official) 96.3%, other 3.7% Country size: 181,035 sq km Population: 15,957,223 Labor Force: 6.643 million Median age: 24.9 Education expenditure: 1.9% of GDP Literacy rate: 77.2% Poverty: 20.5% Religions: Buddhist (official) 96.9%, Muslim 1.9%, Christian 0.4%, other 0.8%

Country Stability Economic Status

Cambodia has experienced strong economic growth over the last decade, the tourism, garment, construction and real estate,

and agriculture sectors accounted for the bulk of growth. Around 600,000 people, the majority of whom are women, are employed in the garment and footwear sector. However, it is still one of the poorest countries in Asia. Long-term economic development remains a daunting challenge because it is inhibited by endemic corruption, limited human resources, high income inequality, and poor job prospects. The Cambodian Government has been working with bilateral and multilateral donors, including the Asian Development Bank, the World Bank and IMF, to address the country's many pressing needs; more than 30% of the government budget comes from donor assistance (Factbook). In addition, the exchange rate between US dollar and KHR has changed drastically over the years with a current conversion of 1 USD to 4058,27 KHR (XE). Currently, Cambodia has a record-high inflation rate at 3.61% (Trading Economics). A major economic challenge for Cambodia over the next decade will be fashioning an economic environment in which the private sector can create enough jobs to handle Cambodia's demographic imbalance. It could be a good chance for economic development because U.S.-Cambodia cooperation is growing in a number of areas.

Social Status

For the society, Freedom of speech is not fully protected (Sopheap, p1). A 2010 law criminalizes defamation and bars written crit-

icism of public officials or institutions. In addition, Cambodia has a small number of independent unions, and workers have the right to strike (Paul, p2). During 2015, the government drafted a new Trade Union Law that many union leaders characterized as a means of suppressing labor disputes. If passed, the legislation would impose more government regulations on forming and operating unions, increase financial reporting requirements, and restrict the right to strike. Gender discrimination, child laborer, and the unfair treatment also exist in this underdeveloped country. Women suffer widespread discrimination, particularly in the economic sphere. Men, women, and children are frequently trafficked to and from Cambodia for prostitution and forced labor. Cambodian men are often forced to work in slavery-like conditions on fishing vessels in international waters, and women have been drawn into forced prostitution or factory labor after traveling to China for brokered marriages (Freedom, p32).

Political Landscape

The monarchy of Cambodia highly revered as a symbol of na-

tional unity. The constitution guarantees the rights to freedom of travel and movement, and the government generally respects these rights in practice. However, the constitution explicitly protects the rights of “Khmer people” only, leaving ethnic Vietnamese, Chinese, and other minorities vulnerable to political exclusion. Corruption always remains a serious obstacle to Cambodia’s economic development and social stability (Freedom, p12). In 2010, a law established the Anti-Corruption Unit (ACU), but its implementation has been slow. On the other hand, increased investment in mining, forestry, agriculture, textile manufacturing, tourism, hydropower, and real estate has brought notable economic growth in recent years, but these enterprises frequently involve land grabs by powerful politicians, bureaucrats, and military officers. Moreover, many in the ruling elite abuse their positions for private gain. Land and property rights are also regularly abused for the sake of private development projects. The state has seized 12 percent or more of Cambodia’s land for such concessions. Hundreds of thousands of people have been forcibly removed from their homes, with little or no compensation or relocation assistance, to make room for commercial plantations, mine operations, factories, and high-end office and residential developments (Penh, p4).

Lead-time of Production

Cambodia is located in located in the tropics. The central and southern are plains. From past until today, flood is always the big-

gest natural hazard that affect the lead-time of production.

Cultural Insights

Respect is one of the most important cultural values within Cambodia, and it is through initiating respect that successful communi-

cation will occur, especially pertinent when using non-verbal cues in Cambodia(Communicaid). For instance, if people accept a gift from a supervisor must receive with two hands, portraying the respect and gratitude you are imparting to the gift and supervisors. As a guest, removing footwear can make house owners to get the high esteem and tell Khmer people that you are appreciative. In order to portray respect within society or to those you are communicating with, style of dress is crucial as a guest in a Cambodian household or business. It enables the opposing communicator to understand how you perceive them (Cic, p3). Thus, while conducting business, it is necessary to wear formal attire to generate a positive first impression and get the most effective conversations or interactions with Khmer people. In addition, material possessions are highly valued in Cambodian culture, and men will often wear pieces of jewelry or signs of wealth in order to portray their strength and behaviors. Punctuality is important. People should always aim to arrive a bit ahead of the stated time. Cambodian are more willing to schedule all meetings ahead of time, usually several weeks in advance. During business meetings, it can make Cambodian counterparts lose face if someone ask personal questions because the concept of face is essential in Cambodian culture. Furthermore, Cambodians like establishing good relationships before conducting business, especially when working with foreign

counterparts. Greeting people with compliments as this is highly valued (Wetzel, p21). The common way is to put hands together at chest height and bow the head saying â&#x20AC;&#x2122;susdayâ&#x20AC;&#x2122;. The younger person or person of lower rank usually initiates the greeting to show respect. However, Cambodian counterparts will not feel at ease if you are overly friendly with subordinates or household staff. Therefore, it is important to spend time to get to know each other during the first few meetings in order to establish trust (p22). Some Cambodians will not speak up even if they do not agree with their foreign counterparts in a business negotiation because silence can be a way of showing consideration about what the speaker is saying. On the other hand, Cambodians have great respect for hierarchical relationships. Almost everything in Cambodian life is led by hierarchical position, like bosses to subordinates. Based on it, Cambodian counterparts will always ask some questions to be able to place you hierarchically to know how to behave. There are some taboos that people should notice while communicating with Khmers (Cic, p3). Offering knives to Cambodian people, it expresses a desire to break the relationship. Don't touch a member of the opposite sex and refuse tea or food when offered by Cambodian counterpart. It is considered impolite. Never pass anything over someoneâ&#x20AC;&#x2122;s head as it is the most sacred part of the body.

State of the Apparel and Textile Industry

Although the apparel and textile is one of the most important industries in Cambodia, it has almost no upstream suppliers in fabrics,

threads, accessories and trims. They have to import primarily from China and Taiwan. The current foundation of the apparel industry in Cambodia was established by the foreign investors from Hong Kong, Taiwan, Malaysia and Singapore in around 1994 (Bargawi 2005). This is one of the biggest challenges to the growth of Cambodia's garment sector. In 1996, Cambodia was granted the status of Most Favored Nation (MFN) by the United States and European Union (EU), which accelerated foreign direct investment into the Cambodian garment sector, for the purpose of utilizing the low tariff rate in those markets (Hatsukano 2005). At the same time, the government encouraged the creation of factory association and trade unions. Trade unions also played an active role in ensuring the respect of the ILO core labor standards and Cambodia labor.With close to 500 factories, Cambodia has roughly 500,000 textile and apparel workers. A monthly minimum wage of a garment workers approximately $100 and the average monthly income is around $150. It is lower than $160 demanded by the unions. In recent years, more than 1,500 active unions and ongoing strikes, which made the Cambodian garment sector faces significant challenges. Furthermore, the importance of the garment industry to Cambodiaâ&#x20AC;&#x2122;s economic output is clear: $5.7 billion in clothing and footwear was exported in 2014. On the basis of Ministry of Commerce data, it shows that garment industry growth has continued its downward trend. Compare with the 35% growth a few years ago, shrinking to only 4% in 2014 (Cambodia, 2015). However, the United States imports from Cambodia is increasing in these years. Given the current climate in Cambodia textile and garment sector, Cambodia will keep developing textile and apparel sourcing industry for the foreseeable future, especially cooperate with America.

Suppliers within the Country Blue bird (Cambodia) Garment Ltd:

Blue bird (Cambodia) garment Ltd is main sewing supplier for many department stores in US, such as Wall-mart, K-mart & Sears,

JCPenny, Keywood and target in Cambodia. Its factory with more than 1, 300 workers, more than 50 technical directors from China Mainland for introduction local workers how to many high quality garment. There are more than 50 Philippine who in charge of QA and QC department, all these organisational instruction make guarantee of the quality and delivery for CMP (cutting, making and packing) garment order. Business Type: Manufacturer, Trading Company Main Markets: North America Western Europe Product/Service: Woven garment, Printing fabric, Knitting garment Employees: 501 - 1000 People Website: https://www.gmdu.net/corp-452468.html NEW ORIENT (CAMBODIA) GARMENT CO LTD:

New Orient was established in year 1999, located in city of Phnom Penh, Cambodia. With a travel time ten (10) mins. Away from

the Phnom Pen Int'l Airport. They mainly produce knitted and woven garments from Buyers namely: JCPENNEY, K-MART & SEARS, FOOTLOCKER, VF, PVH, KELLWOOD, MISS ELAINE, American EAGLE OUTFITTERS etc. Their manpower is composed of skilled sewers, well trained QC's, organized merchandisers and other committed workers with the unwavering support from the Management on attaining and achieving their goal. Business Type: Manufacturer, Trading Company Main Markets: North America, South America, Eastern Europe, Southeast Asia Product/Service: fabric, trims, sewing thread, accessories Employees: Above 1000 People

Website: https://www.gmdu.net/corp-647242.html

TZICC clothing manufactures (Pty) Ltd:

TZICC clothing manufactures (Pty) Ltd is a manufacturer of garments. The main products are knitted tops, bottoms, pants, shorts,

jackets, sportswear and underwear. They have their own printing and embroidery. Monthly capacity is 100, 000 dozen and the annual turnover is US $30 million. They are fully AGOA compliant and can offer duty and quota free privileges to the USA and to Europe.

Business Type: Manufacturer Main Markets: North America South America Eastern Europe Africa Oceania W Product/Service: sportswear, T-shirt, apparel, bottoms, pants, shorts, jeans Employees: Above 1000 People Website: https://www.gmdu.net/corp-46695.html

Trade Agreements Investment Framework Agreement (TIFA)

U.S.-Cambodia cooperation is growing in a number of areas. In

2006, the United States and Cambodia signed a Trade of Investment Framework Agreement (TIFA), which created a cooperative mechanism to focus on deepening and expanding the bilateral trade and support Cambodiaâ&#x20AC;&#x2122;s efforts to implement its WTO commitments and domestic reforms. In 2012, the United States and Cambodia agreed to begin exploratory discussions of a potential bilateral investment treaty (BIT).

Free Trade Area (AFTA)

The EU-Cambodia Textiles Agreement allowed Cambodian pro-

ducers to export garments to the EU based on rules of origin. Cambodia is also a member of the Association of South-East Asian Nations (ASEAN) which is engaged in an economic integration process, including the ASEAN Free Trade Area (AFTA) currently being implemented and the establishment of the Asian Economic Community (AEC) set as the end goal of economic integration by the year 2020. Cambodia also granted duty free and quota free by the Japanese and Canadian governments

World Trade Organization (WTO)

Cambodia accessed to the World Trade Organization (WTO) in September 2003. It became a member of WTO in October 2004. In

1993, Cambodia was granted Most Favored Nation (MFN) status by the EU which gave equally privileged market access to EU markets. Cambodia benefits from the Generalized Scheme of Preferences (GSP) that provides tariff reductions without quantitative limitations in the EU markets. Cambodia is entitled to duty-free and quota-free access to the EU for all its exports under Everything but Arms (EBA).

International Organization for Standardization (ISO)

Cambodia joined the International Organization for Standardization (ISO) in 1995. It is also a member of the ASEAN Consultative

Committee on Standards and Quality (ACCSQ). Cambodia ratified the ASEAN Framework Agreement on Mutual Recognition Arrangements. It has signed numerous trade agreements, including the U.S.-Cambodia Trade and Investment Framework Agreement (TIFA) in 2006. The TIFA also provides a forum to address bilateral trade issues and allows Cambodia and the United States to coordinate on regional and multilateral issues.

Product Classification

Cambodian garment exports mainly concentrate in the US market, which accounted for over two-thirds of the total garment ex-

ports. About 70 percent of the garments that are exported from Cambodia are knitted fabric based garments (Code 61). The rest are woven fabric based garments (Code 62), which include trousers, pants, sportswear, shirts, dress, blouses, jeans etc. For both types of garments, the US market is its largest importer, with a particularly high share in the export of woven fabric based garments.

Transportation

There are three main international ports in Cambodia, Sihanoukville on the Gulf of Siam, Phnom Penh on the Mekong river, and

the provincial port of Koh Kong. There are some shipping companies that has shipping containers services from Cambodia to the United States. I prefer to choose ZIM and NEX as the main shipping companies.

ZIM Integrated Shipping Ltd: Established in 1945, and has developed into one of the largest, leading carriers in the global container shipping industry. Star Shipping Agency (Cambodia) Co., Ltd. has served as ZIMâ&#x20AC;&#x2122;s general agent in Cambodia since February 2010. The agency provides worldwide import/export services for containers entering and exiting the port of Phnom Penhhas, with competitive rates and good transit time to America. It also has a North American headquarters in Norfolk, Virginia, which is more convenient to follow tracking and communicate between the two countries. Through the port-to-port calculater, it would take 30 days to ship a container from Sihanoukville to New York.

EX Worldwide Express: EX is specialized in domestic & international Air Express Courier, Freight forwarding and Ocean/Air cargo services. It has established in 2001. Since then, it have become a reliable and cost effective shipping services provider for domestic, International logistics and supply chain management. Using its shipping calculater, the transit time would be approximately 33 days from Sihanoukville to Savannah, GA. According to the World Freight Calculator ship a 40â&#x20AC;&#x2122; st container from Sihanoukville to New York, shhipping would approximately cost $ 1,039 - $1,450.

Risks and Benefits Risks

Benefits

Political Corruption

Some supportive trade agreements

Low education levels

Big exporters with the U.S.A.

Limited skilled workers

Relatively cheap freight

Natural disasters (flood)

Growing apparel industry

Limited human resources

Well known and trusted suppliers

Abuse rights

Low unemployment rate

Backward economy

Positive culture value

Poor infrastructure

Fast growing economy

Unstable society

Good Business Culture

Conclusion

Cambodiaâ&#x20AC;&#x2122;s challenges exist in the global garment value chain. Turbulent social phenomena, corrupt bureaucrats, and underde-

veloped socio-economic, are all hampered the development of the garment industry. Although there are some trade agreements protect their business, they still take into account of existed Based on it, Cambodian garment industry needs to develop its own backward linkage industries to ensure smooth supply of yarn and fabrics and accessories without depend on other factors to be globally competitive. For them to enhance workersâ&#x20AC;&#x2122; productivity since the current productivity level in Cambodia is lower than that of Bangladesh and Vietnam based on Chinese benchmark. In addition, corruption is a critical issue for companies operating in Cambodia. The government should try to solve this situation and Pay more attention to workersâ&#x20AC;&#x2122; benefits and rights. Only in this way, it is possible to attract more countries to choose Cambodia to be their business partners and promote the development of apparel and textile industry.

Vietnam

Introduction

Vietnam is a country located in Southeastern Asia. Neighboring countries include Cambodia, China, and Laos. The geography

consists of hills and densely forested mountains in the northwest. Vietnam is a small and beautiful country with victorious history, profound patriotism and wonderful landscapes. Vietnam has five major cities or municipalities: Can Tho, Da Nang, Hai Phong, Ha Noi, and Ho Chi Minh and 59 provinces. Vietnam is one of the larger and more densely populated countries in the Asia region. Vietnam has a small surface area which is only the worldâ&#x20AC;&#x2122;s 65th largest in terms of landmass alone. This report will analyze the Vietnamâ&#x20AC;&#x2122;s situations and consider whether Vietnam will be a good place to conduct the new business.

Country Traits Location: Southeastern Asia bordering the Gulf of Thailand, Gulf of Tonkin, and Pacific Sea, Area: 331,211.6 square kilometers, just a bit smaller than Japan (377,944 square kilometers), Type of Government: Communist State Capital name: Hanoi (Ha Noi) The head of state: Tran Dai Quang Population: 95,112,808(1/29/2017)(Vietnam Population Clock) Language: Vietnamese (official), English, some French, Chinese, and Khmer Religion: Buddhist 9.3%, Catholic 6.7%, Hoa Hao 1.5%, Cao Dai 1.1%, Protestant 0.5%, Muslim 0.1%, none 80.8% Literacy Rate: 97.3% (1/15/2016) Poverty Rate: 8.4% (2015)(Central Intelligence Agency)

Country Stability Political Status

Vietnam was unified under a communist government but remained politically isolated. In 2007. The communist party of Vietnam

remains committed to the apparel textile market. U.S. relations with Vietnam have become deeper and more diverse in the years since political normalization. The two countries have broadened their political exchanges through regular and regional security. The political situation in Vietnam remaining stable in the coming years, with attention focusing primarily on maintaining internal stability and social cohesion at a time of rapid economic change. Debate within the Party will revolve around the right pace, depth and extent of economic reform required for Vietnam to catch up with its ASEAN partners, without imperiling certain core values and socio-political tenets. Social Status

In Vietnamese society, hierarchy has a great impact on Vietnamese life.

Demonstrating respect of inferiors to superiors is highly concentrated in social relations. Older people are generally considered superior to younger people, men to women, the wealthy to the poor, and those of higher occupation or status to those of lower. Vietnam government has been helping rural areas get out of poverty. Vietnam is not known for its public terrorists attacks, but it is shown that there are events of terrorism that do take place in Vietnam, that sadly are the cause from the government to scare its people. The Vietnamese government has been using many scare tactics, and some include violent attacks on protest leaders to try and silence their works.Vietnam has a large population of 25-54 years. Vietnam has strong spending power and labor force, and a strong ability to accept new things because of more young people. More young labor will benefit for the new business.

Economic Status Currency: 1 USD = 22592.5000 Dong (VND) Labor force: 54.93 million (2016 est.)

Vietnam's economy grew by 6.21 percent for full year of 2016, slowing from a 6.68 percent expansion in the same period a year

earlier (Trading Economics). In the last 5 years, Vietnam's exports have doubled as competitive minimum wage and low costs of utilities boosted foreign direct investment in the manufacturing sector. In recent years, the nation has been rising as a leading agricultural exporter and an attractive foreign investment destination. Vietnam has been strengthening its trade and is hoping to increase exports and diversity its export sector, such as telephone and spare parts and textiles, shoes and footwear. Textiles are the Vietnam main exports have increasing opportunities in the manufacturing.

Vietnam is experiencing the quickest rate of growth in real GDP since the onset of the global financial crisis. Domestic demand

has recovered in a favorable environment of low inflation, accommodative monetary policy, and consumer confidence, and is likely to stay robust. Furthermore, overall growth has been driven by strength in export-oriented manufacturing, which continues to be powered by foreign direct investment (FDI). Vietnamâ&#x20AC;&#x2122;s real GDP grew 6.7 percent in 2015, surpassing the target growth rate of 6.2 percent. Both manufacturing and construction in Vietnam have been buoyed by the continued inflow of FDI. The Trans-Pacific Partnership is likely to keep foreign investors interested in the country.

Lead-time of Production

The Central of Vietnam experiences the hot and dry winter from mid January and mid August while the South's climate remaining

hot and humid throughout the year. On rare occasions during winter, snow may fall in the highest elevations of northern Vietnam. The location of Vietnam make it one of the most natural disaster prone countries in the world, suffering from typhoons, tropical storms, floods, drought, seawater intrusions, landslides, and forest fires. Typhoons and floods are the most frequent of these hazards. The storm season is from May to December. Therefore, the risk of Typhoons and floods could have a major impact on getting product on time from Vietnam. Energy crisis is the biggest sector causing the late lead-time of production in Vietnam. During the weekdays, business hours are typically 8:00 a.m. to 5:00 p.m. with a one hour lunch break. On Saturdays, work hours are from 8:00 a.m. to 11:30 a.m. Vietnamese government offices have recently moved to a 5-day workweek and are no longer open on Saturdays. Cheaper labor and long-working hours are advantages for developing countries wishing to attract foreign investment. These elements will all have influences on lead-time of production in the country.

Cultural Insights

There are some business etiquette and protocol to follow for better business with Vietnamese. First, having a local contact is fun-

damental in doing business. Appointments are required and should be made several weeks in advance. The best means of doing so is through a local representative who can act as a reference and translator. Meetings are considered very formal in Vietnam. The Vietnamese are punctual and expect others to be so. Dress conservatively will give a good impression for others. Handshakes are used upon meeting and departing. Handshakes only usually take place between members of the same sex. Some Vietnamese use a two-handed shake, with the left hand on top of the right wrist. Always wait for a woman to extend her hand. If she does not, bow your head slightly(Commisceo Global).

To be successful introduction part, business cards are exchanged on initial meetings and should be presented with both hands.

When receiving business cards ensure you show proper respect to it and do not simply glance at it and put it on the table. Hierarchy and face manifest in different ways within business meetings. For example, the most senior person should always enter the room first. Silence is also common in meetings where someone disagrees with another but remains quiet. Relationships are critical to successful business partnerships. Always invest time in building a good relationship based on both personal and business lines. Any initial meeting should be solely used as a â&#x20AC;&#x153;getting to know youâ&#x20AC;? meeting. The spoken word is very important. Never make promises that you cannot keep doing, as this will lead to a loss of face. Negotiations can be slow so it is important to bear in mind that decisions have to go through a lot of red tape and group consultation.

Business gift giving is common at the end of a meeting or during

a meal in honor of your business associates. Gifts should be small but not expensive. Something with your company logo or something typical from your country both makes excellent gifts. Therefore, when doing a business in Vietnam, this different culture will remember for better communicates with Vietnamese people.

State of the Apparel and Textile Industry

Vietnam has a rapidly growing and vibrant textile industry, largely based on imported inputs. The apparel and textile industry were

almost 20% of exporting in apparel and textile in 2015. Vietnam has the mature apparel and textiles industry and high-quality fabric. There is a huge void in textile production, and as Vietnam’s technical textile industry continues to evolve, this will only increase opportunities for exports from the United States. Vietnam is a true emerging market, offering ground floor and growing opportunities for U.S. exporters and investors. Moreover, Vietnam has a distinct cost advantage over other countries such as China, and they have plentiful competitively priced labor. Vietnam’s textile and garment sector has seen fast and sustainable growth over the past years, playing an important role in national socio-economic development. Demand for labor in the sector is huge. Every year, the sector gives employment for 2.2 million people, generating income for the workers. Export value of textile and garment products in recent years has been ranking number two in the country’s total export revenue, earning a major source of foreign exchange and contributing significantly to Vietnam’s gross national product and budget.

Suppliers within the Country Young Style Fashion Joint Stock Company

They are garments, apparels, clothing-manufacturing company specializes in

T-shirt, polo shirt, sublimation printing shirt, sportswear, jacket, blazer, women dress, kid clothes. This company is a professional clothing manufacturer offering CMPT, FOB, CIF, OEM, ODM services for T-shirt and all types of knitwear products. With over 13 yearâ&#x20AC;&#x2122;s experiences in this field, they are able to handle an entire process of making garment from yarn until the finished product. Thus, they can ensure the exceptionally high quality of the product as well as the best price. Their main customers are Kouyu, Lauriel, Loushous, Jarvis Walker, Buffalo Sportswear. They do all types of garments related requests from our customers.

Cong Nam Phat Garment Co.,Ltd

They are private company and 100% owned by Vietnamese. With more than

10 years experiences in sewing industry, 10 sewing lines, and experiences experts and technical people, they provide high quality services with affordable price. Their capacity is about 300000 - 400000 pcs of garments per month which depends on the style including pants, shorts, sportswear and others. Their customers are diversify from USA, UK, Canada, France, Germany, Australia, Japan, Korean, Hong Kong with such brands like Primark, Le temp des carier, GAP, Adidas, Banana republic, Oasis. They major in all kind of men, women or children wear but from Polyester, Spandex, Cotton, Jersey, Visco, Chifon fabric. Their factories have been approved for labor safety regulation, fire fighting & protection, working environment.

9 mode Clothing Manufacturer

9 mode clothing manufacturer was founded in 2006 in Dist 12, Ho Chi Minh

city, Vietnam. They specialize in custom-made clothes, ship to USA, Australia, UK, Singapore, New Zealand, and serve to all English-speaking clients worldwide. They do everything in house at our factory that has four sewing lines, and cutting, quality control and finishing dept all together about 250 workers. They manufacture clothes for adult including T-shirt, jeans, polo shirt, dress, sportswear, swimwear, custom uniform and other custom products. Due to the fluctuating demands of the market and their target is providing their clients good quality clothes at low cost; they have developed outsourcing and temporary workers as a contingency plan during the high season. From 10 days - 25 days from the date they have collected all information for production. They create clothes prototype, making clothes sample and mass produce, and offers very reasonable minimum order quantity like 100 pcs per style. They have been working with many world famous brand names in fashion industry like Forever21, Love21, Ellen Tracy.

Trade Agreements

Vietnam is a member of the Association of Southeast Asian Nations (ASEAN) and subsequently, a member of Asia-Pacific Eco-

nomic Cooperation (APEC). Vietnamese authorities have reaffirmed their commitment to economic modernization and a more open economy. Vietnam joined the WTO in January 2007, which has promoted more competitive, export-driven industries. In 2017, Trump withdrew the US from the ambitious trade agreement, delivering a blow to Vietnam that was forecast to be among the biggest beneficiaries of the 12-nation pact. One of only a few countries in Asia where exports are still growing, Vietnam is boosting ties with neighbors to help protect its manufacturing industry. Vietnam’s exporters will have access to the massive U.S. market on a competitive basis, greatly enhancing Vietnam’s ability to export and to attract foreign investment.

Product Classification

The products is women’s woven bottom with 7 trendy colors, for example, Dark Night, Envy Green, Jewel Blue, Pixels and Wine

in Fall/ Winter 2017-2018. The products are constructed from 100% Cotton print cloth fabric for Yoga pants and Jogger pants, and 90% MicroPoly, 10% Spandex for Capri pants. The duty in Vietnam is 14.9%. The HTS Code is 6109.10.00.37 with the product description as “women’s underwear of cotton, knit” (Harmonized tariff schedule).

Transportation

Vietnam has an extension inland waterway system include a number of regional and international flight options. Growing levels of

foreign investment encourage further trade and spin-off industries. Vietnamâ&#x20AC;&#x2122;s four major seaports are Hochiminh City port named Saigon port, Haiphong port, Cai Mep-Thi Vai port and Danang port. Cai Mep-Thi Vai port will reduce transit times from Vietnam to the U.S. West Coast and Western Europe by four days and eliminate bottlenecks and the need for costly transshipments.

Vietnam is at a disadvantage compared to other Asian countries. The cost to export is average $756 and import is $940 per con-

tainer, which is higher than other countries in Asia. Ho Chi Minh City is the main port of shipping. The average estimate time within three logistics companies is one mouth depends on the routes and the number of stops get port to port. According to the World Freight Rates, the cost of freight is from $4300 to $4900 with insurance. Freight Company Duc Viet Cargoteam Everich VietNam

Route Vietnam - New York Vietnam - New York

Shipping Time 20 days 25-30 days

Cost $4535 $4350

Shipping Frequency weekly weekly

Risks and Benefits Risks

The business in Vietnam is very difficult for many reasons. The weak economic environment may reduce the Vietnam manufac-

tures or even closure finally because of the high cost of imported raw materials, rising inflation, and a decline in demand for garments in domestic market. In addition, the climate may affect overall business in Vietnam. Natural disasters such as typhoons and floods often happened in Vietnam may harm the manufacturing process without any warning.

Benefits

The apparel and textile industry were almost 20% of exporting in apparel and textile in 2015. Vietnam has the mature apparel and

textiles industry and high-quality fabric, which can fulfill our company’s requirements. The Vietnam government’s open policy to foreign investment and strong support for the apparel and textile industry promote our company’s cooperation with local suppliers. The trade agreements between Vietnam and United States were strong which will be beneficial to our business.

Conclusion

In conclusion, Vietnam is one of the faster growing countries in the world and the resources of labors and raw materials will add

more values to the country. Vietnam has several advantages to develop the apparel manufacturing and textile industry such as the cheap labor cost, and the textile industry is one of the main industries in Vietnam. The U.S. is already become one of the most important importers for Vietnam. However, Vietnam’s freight would be the most expensive compare to other countries in Asia. Therefore, Vietnam is a decent choice but not the best choice for our company.

Sourcing Strategy

Introduction

A sourcing strategy formalizes a company’s supply chain plan on how to achieve the best value for manufacturing and shipping

their product. Along with achieving the best quality and price, the sourcing strategy also gives explanation on how countries and suppliers were chosen based on their capabilities and the company’s sourcing guidelines. Vivace’s sourcing strategy will first explain the company’s business requirements and the reasoning behind each of the country and supplier selections. Then the justification of Vivace’s different placement scenarios will be outlined and the line plan strategy. In conclusion, the final placement’s ability to execute Vivace’s company standards, goals and growth will be explained.

Sourcing Guidelines and Business Requirements

The country and suppliers that Vivace has chosen to manufacture its products must abide by the values and policies outlined in

their sourcing guidelines. Vivace’s sourcing guidelines include a Code of Ethics that requires its suppliers to abide by Occupational Safety and Health Administration’s (OSHA) laws and regulations. The guidelines also specifically state that the suppliers must follow policies outlined by the Business Supply Chain Transparency on Trafficking and Slavery Act of 2014. All manufacturing partners involved in our production including, cut and sew facilities, mills and subcontractors, are held to the same standards outlined in the Code of Ethics.

Vivace business strategy requires that the suppliers have the ability to support our inventory and pricing strategies. Our inventory

method is to order basic all season colors year round and seasonal colors and patterns will be replenished seasonally. We plan to keep up to three basic all season colors that will continuously be in stock. There will be five fashion colors and patterns for each style that will be replenished based on seasonal demand. There will be a new launch in styles every season and best selling fashion colors and patterns will come back seasonally. The supplier should be able to support a 45-day lead time for a minimum quantity order of 5,000 pieces. This lead time includes 25 days to time to cut, sew and package. Then 20 days to ship the product to the United States and receive the product at our distribution facility. This quick to market strategy will require that the supplier be vertically integrated. This means that the supplier will need to offer full-service, including pattern making, grading, marking, cutting, sewing and packaging. They must have the ability to source materials for manufacturing needs also.

COUNTRY RANKING Scale of 1 to 10 with 1 being the worst and 10 the best Vietnam Explanation

D.R.

Explanation

Cambodia

Explanation

Textile industry not well-developed leaving littlte 7 textile manufactures to conduct business with

One of the most essential business in Cambodia; good business culture (respectation, punctuality, politeness)

Stable bank system to support its apparel and textile industry. Government supported foriegn business investments.

Costs

Attractive, inexpensive manufacturing, high freight costs cue to far location, but low wages for workers. The countryâ&#x20AC;&#x2122;s national minimum wages increased by 12.4% in January 2016 7 to $155 per month, which is competitive compared to China (where the minimum wage stands at $327).

Up to $1 lower cost in comparison to other countries

Attractive; lower labors than many Asian countries (China, Vietname, India, Indonesia etc.)

Government

Communist state with an increasingly market oriented economy. quite stable 8 politically, with no high risk of terrorism or civil unrest.

Strong relationship with U.S., but very interdependent. The Dominican Republic does a large amount of business with the United States. If the United States' economy were to sufffer, then this puts the Dominican Republic at risk.

Not very stable; endemic corruption; political exclusion to forerigners and minorities; abuse their positions for private gain

Location

Very far away from the United States, nearly 20-30 days.

Only 2 hours by plane to Miami port and 3 days 5 by boat

Very far; would take 30-35 days to the United States

Risks

Natural disasters: typhoons, tropical storms, floods.often happened in Vietnam may harm the manufacturing process without any warning.

Risk in obtaining workers that are skilled in textile manufacturing. The country as a whole is 7 also not known for textile manufacturing but the business is growing.

Political Corruption rights; natural disasters, especially flood; the unfair treatment

Hard workers. a single-party socialist state with a high degree of ethnic, linguistic, and religious homogeneity.

Socially the country is improving with the help of goverment programs that are teaching the lower class skilled labor and how to find jobs. Haiti relations are becoming less of a threat because more Haitians are moving to the Dominican Republic and becoming more amicable.

Underdeveloped infrastructure; backward economy; unprotected freedom of speech; workers have the right to strike; gender discrimination

Business Climate

Social Stability

Child labor issues and lower workers productivity will influence sourcing produce and collect. Low education levels will also have a effect on business development in the future.

Sourcing Guidelines 7

In place. not developed very well,raise environmental awareness. Need to be on the lookout for violations.Build 8 capacity on key issues such as health and safety, working hours, grievance mechanisms and social dialogue.

Aligns with our company values of upholding OSHA laws and Business Supply Chain Transparency on Trafficking and Slavery Act of 2014. DR is praised for working conditions and efforsts for higher minimumn wage.

Textile Industry

Well developed and have great emplyees, fast and sustainable growth,textile industry is one of the top active industry in Vietnam. Vietnam's 6 apparel industry is growing rapidly. With an export growth of 20 percent a year.

Currently there are little manufactuers suited for mass production of apparel goods. The industry 7 is growing and there are suppliers that will fit our business needs.

A Big exporter with the U.S.A., over two-thirds of the total garment exports to US market ; rely on other countries to import apparel materials and facbrics (Taiwan, Hongkong, China etc.); high share in the export of woven fabric based garments

Trade Agreements 4

APEC, ASEAN,Trump kills TPP,needs 10 to be watched.

Free Trade Agreement with U.S (no tariff). Centeral American Free Trade Agreement

TIFA, AFTA, ISO; U.S.-Cambodia cooperation is growing in a number of areas; The United States and Cambodia agreed to begin exploratory discussions of a potential bilateral investment treaty (BIT).

Trained Work-force 8

Well-educated workers.Some 60% of Vietnamâ&#x20AC;&#x2122;s 90m population are young people, making for a promising manufacturing labour force. With a 94% literacy rate, workers have a significant potential to learn multiple skills as well as productivity improvement techniques.

Compared to other countires with welldeveloped textile industries, the Dominican Republic has fewer options for skilled workers for our product. They do have a focus on cotton 6 products, so the needs for two of our items can be met. One of our products required is more technical and deals with performance material, which will require more skilled labor.

Because of the low education levels, there are limited skilled workers and human resources, which makes the choiment of product and production less. It is a disavantage to appeal more contries to cooperate with them to creat products there.

Socio-eco-political

Quite stable politically, with no high risk of terrorism or civil unrest..Export a lot on textile industry. Human rights are raising.

Stable. The government is making infratructure improvements that are giving lower income people access to water, electricity and better roadways. The government is also giving job services to the lower class.

Still not very stable., but the low un-employment rate and growing economy will reduce crime rate in some extent.

Total

Average

6.7

7.5

6.3

SUPPLIER RANKING Country 1: Vietnam Young Style Fashion Joint Stock Company

Cong Nam Phat Garment 9 mode Clothing Co.,Ltd Manufacturer

T-shirt, polo shirt, sublimation printing shirt, sportswear, jacket, blazer, women dress, kid clothes

manufacture garments depend on the style including pants, shorts, sportswear and others with Polyester, Spandex, Cotton, Jersey, Visco, Suede, Chifon fabric.

manufacture clothes for adult including Tshirt, jeans, polo shirt, dress, sportswear, swimwear, custom uniform and other custom products

Country 2:DR

Supplier 1: BYP Overseas

Supplier 2: Ocean Apparel Dominicana

Blue bird (Cambodia) garment Ltd

Only lists knit and woven garments

Printing fabric, Knitting garment, Woven garment, Sublimation paper,

knit and woven garments. Tshirts, uniforms, sleepwear, underwear, baby clothing. No specialty in performance wear.

Performance and knit garments. Tshirts, uniforms, athletic apparel, sleepwear, underwear, baby clothing

Country 3: Cambodia

Supplier 3: Apparel Offshore

Abilities

Capacity

Lead-time

Quality

Customers

Sourcing Guidelines

Services Offered

Strategic Outlook

Total 61 Average 7.625

65 8.125

64 8

69 8.625

67 8.375

29 3.625

63 7.875

18,000 units/days

Rapid response to order

exceptionally high quality of the product

Kouyu, Lauriel, Loushous, Jarvis Walker, Buffalo Sportswear

Employee care, community concern, labor and environment.

offering CMPT, FOB, CIF, OEM, ODM services,and handle an entire process of making garment from yarn until the finished product.

Innovation, aim to work on shortening lead time and high quality.Strong future stability outlook,

300000 400000 pcs of garments per month

less than 4 weeks in average

provide high quality services with affordable price. Primark, Pep&Co, Suzy, Best&Less, Le temp des carier, GAP, Adidas, Banana republic, Oasis,

labor safety regulation, well working environment.

Mainly focus on sewing and manufacturing, cutting, marker making, packing, shipping and delivery.

Potential growth opportunity as it has esblished for a long tome with large customer base.

30,000 units/days

From 10 days 25 days from the date they have collected all information 8 for production providing their clients good quality clothes at low cost

Forever21, Love21, Ellen Tracy.

Social responsibility. Maintains the relationship between employees.own factories.

Private label tag, Sourcing fabric,Design pattern, Sourcing and provide custom accessories, Sewing,Custom printing,Custom embroidery, Packing, Shipping and 9 delivery A long-time sustainable focus for their customers. Expansion production scales.

20,000 units per day

5 Days (2 to manufactuer 3 to ship)

highly trained workers and knowledge of the textile industry Ralph Lauren, Victoriaâ&#x20AC;&#x2122;s Secret, Gap, Champion and Wrangler.

Comply with OSHA

Sewing, packaging, CMT Contracts, Cutting, Marker Making, Marker Plotting, Binding, Tagging Tape Cutting, Tye Dying.

Strong future stability outlook, stable custmer base. Consists of 4 companies across the world.

150,000/week

5 Days (2 to manufactuer 3 to ship)

highly trained workers and knowledge of the textile industry Dickies, Champion, Wrangler, Ralph Lauren, Hanes

Comply with OSHA

Sewing, packaging, CMT Contracts, Cutting, Marker Making, Marker Plotting, Binding, Tagging Tape Cutting, Tye Dying.

Strong future stability outlook, stable custmer base. Consists of 4 companies across the world.

Not listed. No answer on quote

5 Days (3 to manufactuer 3 to ship)

lacks textile industry knowledge on a large scale.

None listed

Company standards not highlights and standards not listed

Only Cut and Sew

Does not seem to show any growth abilities on a mass scale

Monthly 100,0000 units

Less than 4 weeks

Overal is good; the quality of some products is 8 average Wall-mart, Kmart & Sears, JCPenny, Keywood and target

Have their own factories; welleducated workers and directors

QA and QC department cooperate well with each other; delivery for CMP; special machines

Technologica l innovation; update textile machines

New Orient (Cambodia) Garment Co LTD

Sport's Wear, Sleep Wear, Ladies Blouses. Woven and knit garments.

Weekly 200,000 units

Around 25 days

Good; could also provide high quality

JC Penney, K-mart & Sears, Footlockers, VF, PVH, Kellywood, Miss Elaine, American Eagle Outfitters 8 etc. Own well developed factories; long- term cooperative partners

Skilled sewers; well trained QC; combined with organized merchandis ers and other committed workers

TZICC clothing manufactures (Pty) Ltd

T-shirt, clothing, apparel, s and kids, knitted tops, bottoms, pants, shorts, jackets, sportwear, underwear, bra, panty, lingerie, 9 jeans Weekly 100,000 units

64 8

62 7.75

the continuous improvemen t of workers and factories; improve a cooperation 8 of workforce

Over one month

Good

Target, Sears and JC Penney

Have its own printing and embroidery

Offer duty and quota free privileges to the USA and to Europe; fully AGOA compliant

Maintain enterprise security standards; improve production scale

Vivace price points will range from $80-$100 at retail based on a 68% margin goal and the assumption that the retail markup will be

50% on the wholesale price, which ranges from $40-$50. Compared to competitors and the market this places Vivace in the better price category for athletic and athleisure apparel. Being in the better price category, the suppliers will be expected to uphold a higher level of quality.

Country and Supplier Selections Dominican Republic Supplier: BYP Overseas International

The Dominican Republic is ranked as Vivace’s first choice in location for the manufacturing of its products. Although this country is

not known for its apparel manufacturing, with new incentives and less restrictions on new businesses, the country has been able to diversify its manufacturing landscape and grow the textile industry. The apparel manufacturing industry took a downturn from 2000-2009 with “employment in the garment industry falling by 82%” (Birnbaum, 2014). Brands, like Hanes and Levi Strauss, were cutting back orders in the Dominican Republic. This was due to the lack of access to electricity that then added to the cost of manufacturing for customers. Presently, there is a more positive outlook for the country to gain back power in the textile industry. The location being close to the United States has put the country in a better position to grow its apparel industry because companies are expecting faster product turnaround and shorter lead times. There have also been extensive infrastructure improvements to enhance the country’s industrial segments. This has improved the access to electricity, mitigating this issue for manufacturing plants and decreasing overall costs. The Dominican Republic is also a part of trade organizations, like The Central American Free Trade Agreement. This organization improves working environments, gives more opportunity for the region. Central American Free Trade Agreement also imposes a 0% tariff on apparel products entering the United States. In the Dominican Republic, Vivace will be able to meet the margin goal of 68% and the pricing strategy goal of a wholesale price of $40$50 and retail of $80-$100. With exception of the yoga pant style, the Dominican Republic offers the lowest overall cost for the company’s

products. The jogger cost will be $14.20, capri $18.18 and yoga $9.53. (See Appendix Figure 1.1 Cost per Country by Item). BYP Overseas is Vivace’s top ranked supplier to manufacture its products because of their ability to meet business need and the sourcing guidelines. BYP Overseas highly skilled workers specialize in knit garments and services high profile clients, like Jockey, Old Navy, Hanes, and Victoria’s Secret. Their products include underwear, children’s wear, sportswear and sleepwear. They are vertically integrated offering pattern making, grading, marking, cutting, sewing and packaging. BYP Overseas also offers sourcing services for textile materials.

Along with their ability to meet quality standards and basic manufacturing needs, BYP Overseas also meets shipping a capacity

needs. Their factory capacity is 20,000 units per day and can meet the lead time goal of 45 days. Being in close proximity to the United States makes the shipping lead time only three days to the Miami port Vivace will use. With the capacity of 20,000 units a day, the factory can produce the minimum order quantity of 5,000 units in two days.

BYP Overseas will also abide by Vivace’s sourcing guidelines and code of ethics. They are incredibly transparent when it comes to

their manufacturing processes. The company itself and its partners are audited by labor and safety compliance assessors. The facilities are rated as Low Risk at all locations.

Vietnam Supplier:Cong Nam Phat Garment Co.,Ltd

Vietnam is ranked as Vivace’s second choice for manufacturing its products, which had an average score of 6.7 (See Appendix

Figure 1.2 Country Rankings and Figure 1.3 Supplier Ranking). Compare to Cambodia, Vietnam ranked highly because of its business climate, strong textile industry, and trained work force. Vietnam has the strength as one of the faster growing countries in the world and the resources of labors and raw materials will add more values to the country. Vietnam is geographically close to other major sourcing countries in particular China and global supply chains, and is therefore well placed to both receive raw materials and other inputs, and forward on finished goods.

Vietnam has several advantages to develop the apparel manufacturing and textile industry such as the cheap labor cost, and

the textile industry is one of the main industries in Vietnam. The country’s national minimum wages increased by 12.4% in January 2016 to $155 per month, which is competitive compared to China where the minimum wage stands at $327. However, Vietnam’s freight would be the most expensive compare to other two countries, and very far away from the United States, nearly need 20-30 days for transportation. The apparel duty charges 14.9% and without free trade agreements with the USA. The cost of three style products are S14.67,$18.62 and $10.84 in Vietnam (See Appendix Figure 1.1 Cost per Country by Item).

The supplier selection is Cong Nam Phat Garment Co.,Ltd because their ability to achieve Vivace’s business needs and the

sourcing guidelines, who get the highest average score 8.125. They have more than 10 years experiences in sewing industry, 10 sewing lines,and experiences experts and technical people, they provide high quality services with affordable price.

Their customers are diversify from USA, UK, Canada, France, Germany, Australia, Japan, Korean, Hong Kong with such brands

like Primark, Pep&Co, Suzy, Best&Less, Le temp des carier, GAP, Adidas, Banana republic, Oasis, warehouse. They have many collaborations with many famous sport brand, which is more suitable for Vivace because of more manufacturing experience. The lead time is less than 4 weeks in average. They are mainly focus on sewing and manufacturing, cutting, marker making, packing,Shipping and delivery. Compare to other two suppliers, Cong Nam Phat Garment has the ability to provide the strong production capacity, best quality and competitive cost.

Cambodia Supplier: New Orient (Cambodia) Garment Co., LTD

This country has experienced strong economic growth over the last decade, the tourism, garment, construction and real estate,

and agriculture sectors accounted for the bulk of growth. However, it is still one of the poorest countries in Asia because it is inhibited by endemic corruption, income inequality, and poor job prospects. Gender discrimination, child laborer, and the unfair treatment also exist in this underdeveloped country.

Cambodian garment exports mainly concentrate in the US market, which accounted for over two-thirds of the total garment ex-

ports. Although the apparel and textile is one of the most important industries in Cambodia, it has almost no upstream suppliers in fabrics, threads, accessories and trims. They have to rely on other countries to acquire apparel materials, which is also one of the biggest challenges to the growth of Cambodiaâ&#x20AC;&#x2122;s garment sector. In addition, the apparel duty charges 24% and without free trade agreements with the USA. The cost of Cambodia is relatively high than the other two countries, which are $16.13, $17,32, and $9.4 (See Appendix Figure 1.1 Cost per Country by Item).

New Orient Garment Co LTD mainly produce knitted and woven garments from Buyers namely: JC Penney, K-mart & Sears, Foot-

lockers, American Eagle Outfitters etc. They can product many different types of products, such as sports wear, sleepwear, ladies blouses, woven and knit garments. etc. Their manpower is composed of skilled sewers, well trained QCâ&#x20AC;&#x2122;s, organized merchandisers and other committed workers with the unwavering support from the Management on attaining and achieving their goal. Based on it, the supplier could offer guaranteed quality to With the capacity of 200,000 a week, the lead time is relatively short than other manufacturers, which just takes 25 days. It is a good to save delivery time and satisfy the productsâ&#x20AC;&#x2122; demand.

Placement Strategy Scenario 1:

For the first scenario, Vivace wanted to place product based on the country ranking, and also took into consideration quality, margin

and proximity. So half of the total products are mainly went to DR which is the best choice for Vivace. The rest 50% of total units went to Cambodia and Vietnam. The freight fee in Cambodia is cheaper than Vietnam, so there is 30% of total units went to Cambodia, and 20% of total units went to Vietnam. The cost per unit of jogger products are $14.42 in DR and $ 14.67 in Vietnam. The jogger in Cambodia is $16.13 which is more expensive than produced in DR and Vietnam. This is the reason why Vivace consider to produce jogger in DR and Vietnam not in Cambodia. The capri in Cambodia is the cheapest about $17.32 per unit, while it cost $18.18 in DR and $18.62 in Vietnam. Therefore, Vivace focus on producing capri in Cambodia for the cheaper price. This placement strategy yielded a profit margin of 68.73%. The average cost per unit in this scenario is the highest price in three scenarios which is $33.1, but the margin is not the highest one. Therefore, this scenario is not the best choice for Vivace. MARGINS INITIAL

Scenario 1

Total Units per country

Supplier: Cong Nam Phat Garment Country 1 DR Supplier: OYPOverseas Country 2 Cambodia Supplier: New Orient Garment Co LTD Country 3 Vietnam Co.,Ltd Style 1: Jogger Style 2: Capri Style 3: Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga 1,000,000 200,000.000 0.000 300,000.000 0.000 300,000.000 0.000 200,000.000 0.000 0.000

Wholesale Cost per Unit Margin % Total Wholesale Total Purchase Total Margin

$46,697,100.00 $13,875,400.00 $32,821,700.00

Avg Wholesale Avg Purchase Avg Margins Avg Margin %

$47.09 $13.99 $33.10 68.73%

Average Cost per Unit

$33.10

$49.03 $14.420 $34.608 70.588%

$0.000 $0.000 $0.000 0.000%

$40.05 $9.536 $30.515 68.750%

$0.000 $0.000 $0.000 0.000%

$50.23 $17.322 $32.912 65.517%

$0.000 $0.000 $0.000 0.000%

$49.030 $14.670 $34.360 70.080%

$0.00 $0.000 $0.000 0.000%

$9,805,600.000 $2,884,000.000 $6,921,600.000

$0.000 $0.000 $0.000

$12,015,360.000 $2,860,800.000 $9,154,560.000

$0.000 $0.000 $0.000

$15,070,140.000 $5,196,600.000 $9,873,540.000

$0.000 $0.000 $0.000

$9,806,000.000 $2,934,000.000 $6,872,000.000

$0.000 $0.000 $0.000

Scenario 2:

The second scenario of Vivace places manufacturing the capri units are spread between Dominican Republic and Vietnam, the

jogger units are spread between Cambodia and Vietnam, the yoga is just placed in Cambodia to produce. We plan to regard jogger as Vivace NO.1 product and product the largest quantity. To consider that, Vivace choses the suppliers of New Orient Garment Co LTD and Supplier Cong Nam Phat Garment Co. Ltd are both good and well-developed manufacturers to create good quality sportswear. The cost of jogger from the suppliers of two countries are also lower, which are $16.13 and $14.67 respectively. Similarly, Cambodia owns the lowest slave labor. The cost of yoga is also the cheapest in this country, which is the main reason that Vivace places its product on this country. However, it is the lowest quantity in scenario 2 because it might not be the most popular one in the category of women woven bottom. For the rest of product, capri, plans to place in Dominican Republic and Vietnam. This placement also gives a higher margin that is above the 68% goal.

MARGINS INITIAL

Total Units per country

Scenario 2 Supplier New Orient Garment Supplier Cong Nam Phat Country 1 DR Supplier OYPOverseas Country 2 Cambodia Co LTD Country 3 Vietnam Garment Co.,Ltd Style 1: Jogger Style 2: Capri Style 3: Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga 1,000,000 0.000 250,000.000 0.000 150,000.000 0.000 100,000.000 350,000.000 150,000.000 0.000

Wholesale Cost per Unit Margin % Total Wholesale Total Purchase Total Margin Avg Wholesale Avg Purchase Avg Margins Avg Margin % Average Cost per Unit

$48,612,000.00 $15,833,750.00 $32,778,250.00 $39.76 $15.58 $26.93 68.08% $26.93

$0.000 $0.000 $0.000 0.000%

$50.23 $18.180 $32.050 63.806%

$0.00 $0.000 $0.000 0.000%

$49.03 $16.130 $32.900 67.102%

$0.000 $0.000 $0.000

$12,557,500.000 $4,545,000.000 $8,012,500.000

$0.000 $0.000 $0.000

$7,354,500.000 $2,419,500.000 $4,935,000.000

$0.000 $0.000 $0.000 0.000%

$40.05 $9.404 $30.646 76.519%

$0.000 $4,005,000.000 $0.000 $940,400.000 $0.000 $3,064,600.000

$49.03 $14.670 $34.360 70.080%

$50.23 $18.629 $31.601 62.913%

$0.00 $0.000 $0.000 $0.000

$17,160,500.000 $7,534,500.000 $5,134,500.000 $2,794,350.000 $12,026,000.000 $4,740,150.000

$0.000 $0.000 $0.000

Scenario 3:

Vivaceâ&#x20AC;&#x2122;s third scenario places manufacturing of the jogger and yoga style in the Dominican Republic and the capri units are

spread between Cambodia and Vietnam. Two different styles and the most units have been awarded to the Dominican Republic and the BYO Overseas because they are both ranked overall first. Also, these two styles are simpler designs made from cotton knit that Vivace believes can easily be executed given their specialty. The Dominican Republic offers the lowest cost for the jogger and the second lowest for the yoga pant. Vivaceâ&#x20AC;&#x2122;s capri style is more complex and requires more experienced manufactures. Vietnam is the second ranked country and New Orient Garment Co Ltd. is the third ranked among all the suppliers from the different countries. It offers the lower cost for the capri and also has more skilled workers that can execute the complexity of the capri design. Cambodia is the third ranked country and Cong Nam Phat Garment Co., Ltd is the second ranked supplier. Less units are placed here because their workers are less skilled and their economy is not as stable, but they offer the lowest cost for a complex design made from technical materials. This allows for a higher margin and ultimately more profit. It produced the highest margin in the three scenarios but also took into account the other factors that were important like balancing quality with costs with process. MARGINS INITIAL

Total Units per country

Scenario 3 (Final Placement) Supplier New Orient Garment Supplier Cong Nam Phat Country 1 DR Supplier OYPOverseas Country 2 Cambodia Co LTD Country 3 Vietnam Garment Co.,Ltd Style 1: Jogger Style 2: Capri Style 3: Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga 1,000,000 200,000.000 0.000 350,000.000 0.000 200,000.000 0.000 0.000 250,000.000 0.000

Wholesale Cost per Unit Margin % Total Wholesale Total Purchase Total Margin

$49.03 $14.420 $34.610 70.589% $46,427,000.00 $14,296,650.00 $32,130,350.00

Avg Wholesale Avg Purchase Avg Margins Avg Margin %

$47.39 $14.94 $32.44 68.89%

Average Cost per Unit

$32.44

$9,806,000.000 $2,884,000.000 $6,922,000.000

$0.00 $0.000 $0.000 0.000%

$40.05 $9.404 $30.646 76.519%

$0.000 $14,017,500.000 $0.000 $3,291,400.000 $0.000 $10,726,100.000

$0.000 $0.000 $0.000 0.000%

$50.230 $17.320 $32.910 65.519%

$0.00 $0.000 $0.000 0.000%

$0.000 $0.000 $0.000 0.000%

$50.23 $18.629 $31.601 62.913%

$0.000 $0.000 $0.000 0.000%

$0.000 $10,046,000.000 $0.000 $3,464,000.000 $0.000 $6,582,000.000

$0.000 $0.000 $0.000

$0.000 $12,557,500.000 $0.000 $4,657,250.000 $0.000 $7,900,250.000

$0.000 $0.000 $0.000

Final Placement

Vivace will use the third scenario as the final placement strategy for its product manufacturing. In the final placement, the yoga

and jogger style pants are to be manufactured in Dominican Republic and the capri is placed in Cambodia and Vietnam. Overall the countries and suppliers that will be award business in this placement strategy offer the best cost, quality and meet Vivaceâ&#x20AC;&#x2122;s sourcing guidelines and business needs. FINAL PLACEMENT & MARGINS 68% minimum margin requirement

Supplier New Orient Garment Co Supplier Cong Nam Phat Country 1 DR Supplier OYPOverseas Country 2 CambodiaLTD Country 3 VietnamGarment Co.,Ltd Style 1: Jogger Style 2: CapriStyle 3: Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga Style 1: Jogger Style 2: Capri Style 3:Yoga Total Units per country1,000,000 200,000.000 0.000 350,000.000 0.000 250,000.000 0.000 0.000 200,000.000 0.000 Wholesale Cost per Unit Margin %

Total Wholesale $46,427,000.00 Total Purchase $14,231,200.00 Total Margin $32,195,800.00 Avg Wholesale Avg Purchase Avg Margins Avg Margin % Average Cost per Unit

$49.03 $14.420 $34.610 70.589% $9,806,000.000 $2,884,000.000 $6,922,000.000

$0.00 $0.000 $0.000 0.000%

$40.05 $9.404 $30.646 76.519%

$0.000 $0.000 $0.000 0.000%

$50.230 $17.320 $32.910 65.519%

$0.00 $0.000 $0.000 0.000%

$0.000 $0.000 $0.000 0.000%

$50.23 $18.629 $31.601 62.913%

$0.000 $0.000 $0.000 0.000%

$0.000 $14,017,500.000 $0.000 $3,291,400.000 $0.000 $10,726,100.000

$0.000 $0.000 $0.000

$12,557,500.000 $4,330,000.000 $8,227,500.000

$0.000 $0.000 $0.000

$10,046,000.000 $3,725,800.000 $6,320,200.000

$0.000 $0.000 $0.000

$47.39 $14.94 $32.44 68.89% $32.44

The Dominican Republic is the top ranked country with a stable economy and a promising future outlook for the textile industry.

The strategy places the jogger and yoga styles will be made in the Dominican Republic with 200,000 units of the jogger and 350,000 of the yoga to be manufactured by BYP Overseas. This is the best placement because this country and supplier specialize in manufacturing knit apparel and offer skilled labor in this category. This placement offers the lowest cost for jogger and second lowest for the yoga and the highest margin rates allowing for higher probability. (See Appendix Costs per Country by Item Cost). An advantage to this placement is also the close geographic location to the United States. This allows for lower lead times and quicker to market opportunities. BYP Overseas values and practices align with Vivace code of ethics and sourcing guidelines.

The capri manufacturing business will be awarded to Vietnam and Cambodia. Vietnam is the second ranked country and New

Orient Garment Co Ltd. is the third ranked among all the suppliers from the different countries. (See Appendix Country Rankings and

Supplier Ranking). It offers the lower cost for the capri and also has more skilled workers that can execute the complexity of the capri design. Cambodia is the third ranked country and Cong Nam Phat Garment Co., Ltd is the second ranked supplier. (See Appendix Figure Country Rankings and Figure Supplier Ranking). Less units are placed here because their workers are less skilled and their economy is not as stable in comparison to Vietnam, but they offer the lowest cost for a complex design made from technical materials. This allows for a higher margin and ultimately more profit.

Overall this placement allows for the lowest average cost exceeds the margin goal of 68% and offers the lowest cost per unit. (See

Costs per Country by Item Cost and Scenario 3). In addition to meeting bottom-line business probability expectations, this placement minimizes risks and maximizes opportunities. By placing a majority of the business in the Dominican Republic, Vivace is able to take advantage of lower costs, no tariffs and shorter lead times. Although the Dominican Republic is not known for their apparel manufacturing, BYP Overseas International offers skilled labor in the textile industry, is vertically integrated and aligns with Vivaceâ&#x20AC;&#x2122;s sourcing guidelines. This placement minimizes risks because BYP Overseas is a stable business in an improving and stable socio-economic environment. Awarding business to Cambodia and Vietnam allows for some risks because the socio-economic condition and unstable economies could cause issues with supplier aligning with Vivaceâ&#x20AC;&#x2122;s sourcing guidelines. It maximizes opportunities because these suppliers offer skilled labor for manufacturing the capri style, are vertically integrated and offer low costs.

SWOT Analysis for Final Placement Strengths

Weaknesses

1. Best value 2. Lowest cost per unit 3. Highest margin 4. Meets retail price goal 5. Skilled labor in Vietnam 6. Aligns with sourcing guidelines 7. Dominican Republic Free Trade 8. Capacity abilities meet needs 9. All suppliers are skilled in knit apparel manufacturing

1.Cambodia and Vietnam has less skilled workers 2. Longer lead times from Vietnam and Cambodia 3. Poor working conditions in Cambodia

Opportunities

Threats

1. Dominican Republic has a growing textile industry 2. Quick to market ability with Dominican Republic’s geographic location

1. Cambodia weak economy 2. Tariff rates for Vietnam and Cambodia add to costs 3. Vietnam and Cambodia are least likely to align with the company’s code of ethics

Conclusion

In conclusion, each country and vendor has its own advantages and disadvantages. However, through the analysis and compar-

ison, Vivace’s placement strategy decided to place the largest product capri on Cambodia and Vietnam, produce the products of Yoga and jogger in Dominican Republic. The suppliers have the ability to support our inventory and pricing strategies and expected to uphold a higher level of quality. Moreover, All manufacturing partners and production including, cut and sew facilities, mills and subcontractors, are held to the same standards outlined in the Code of Ethics. The business strategy not only the most suitable choice to meet Vivace company’s standard and achieve the margin goal, but also promote the company’s long-term business development capabilities.

Distribution Strategy

Distribution Channel Strategy

Vivace’s distribution channels will include mass department store retailers, Vivace branded stores, e-commerce and discount re-

tailers. Our strategy will focus on mass department store retailers in the beginning to gain brand recognition and save on operational costs of having our own storefronts. We have placed 45% of Vivace inventory in department stores like Nordstrom, Macy’s and Neiman Marcus because they align with our company values and our brand’s customer shops with these retailers. We will distribute to these retailer’s stores across the United States. 20% of Vivace’s inventory will go to its own specialty branded stores that will be located in select major metropolitan areas in high end retail locations. For example, Atlanta’s Lenox Square shopping center. The second largest part of our inventory will be allocated to e-commerce with 30%. This amount has been dedicated because e-commerce is a highly penetrated market for athleisure and athletic wear. Vivace will be highly visible on this platform and the overhead cost will be very small. We expect our web presence and sales to increase our brand recognition and drive in store sales also. Lastly, Vivace will dedicate 5% of its inventory to discount retailers, like Nordstrom Rack and OFF 5th. Discount retailers are seeing large successes in the retailer world at the moment and it is important that we are able to gain customers from this channel to maybe come back and buy our apparel at full price. These outlets also give us an opportunity to sell-through out of season inventory and increase our turns.

Logistics Supplier

With Vivaceâ&#x20AC;&#x2122;s three distribution channels, the logistic supplier partner needs to have a competitive shipping cost, invoicing and

order information, returnsâ&#x20AC;&#x2122; management, inventory visibility, quick turnaround, and EDI capabilities. These are the most important logistics factors for Vivace and its retail customers. DHL

DHL Express is a division of the German logistics company Deutsche Post DHL pro-

viding international express mail services.The company was primarily interested in offshore and inter-continental deliveries.The cost is cheaper than any other logistics companies, and just $1.75 per unit per outbound carton for pick and pack. The lease time for order turn around is only 24 hours, and the size of DHL is not huge compare to UPS company, just 19 distribution centers in the Americas.DHL serves some apparel industry but not focuses on the international logistics, so DHL is not suitable for our company.

XPO Logistics

XPO Logistics is a top ten global logistics company. It has excellent warehouse man-

agement systems, provides omni-channel retail, reverse logistics and center management, which are all Vivace need for the distribution strategy. The order turn around time of XPO Logistics is 24 hours, it offers direct fulfillment and inventory visibility with delivery, assets facilities and operations in 34 countries with over 87,000 employees. The lower cost of XPO and the complete freight brokerage and global forwarding are beneficial for Vivace to delivery products whatever for e-commerce or department store.

UPS

UPS is one of the largest supply chain solution companies in the world. The lead time from order turn around is only 24 hours.

With services across the United States, UPS has a large advantage in meeting the quick to market requirements of online retailing world. Compare to other logistics suppliers, UPS is more suitable for our company because it has integral and abundant services, including pick and pack, pre-distribution services, inventory control reporting, design and planning of supply chain management and labeling and the experience in shipping apparel goods. See the details of Pros and Cons for UPS below.

Vivace plans to utilize 3 UPS distribution centers in Atlanta, Newark and Las Vegas. These central locations will better service the

south east, west coast, northeast and midwest. These locations will service our mass retailers distribution centers and stores. Vivace plans on being in one-hundred mass retailer stores and ship to their distribution centers based on region demand. For example, if Nordstrom has high sales in the jogger pant in the Seattle region, we will distribute from our Las Vegas location to their distribution center in Washington to create quicker turnaround. The branded stores and ecommerce businesses will also be served by these three centers with this same strategy in mind.

UPS:

PROS

EDI Capability Inventory control Inventory visibility Order Turnaround 24 Hours Offers in-store packing and shipping services Large Facilities and Multiple Locations Well-known Apparel Customers Experience Shipping App Warehousing Capabilities Onsite Crating Computers and UPS Shifting Service Same Day Services Cargo/Port Services

Cons $1.95 per unit per outbound carton for pick and pack, discount may have when shipped over 25-35 times per week.

SUPPLY CHAIN SOLUTIONS RANKING Rank from 1 to 10, with 10 the highest CATEGORY UPS Inventory control Inventory visibility Unique inventory storage environments Data and physical security Reporting, Inventory measurement, and Management compliance FTZ (Foreign Trade Zone) and bonded

Order Turn Around

Pick and Pack

DHL Inventory control Inventory Visibility Omni-channel Retail Reverse logistics center management Directto-consumer e-commerce fulfillment Import DCs

10 10 24hours Offers in-store packing and shipping services 7 days a week, and has a professional packing and shipping resource.

10 10 24 hours Pick-and-pack Business-tobusiness Direct-toconsumer Workforce management Lotcode/date-code tracking Mixing centers Displays: point-of-purchase, retail and pallet

10 Prominent & Leading Service Provider from Pune, offer Consignment Moving Services, Onsite Crating, Computers and UPS Shifting Service, Loading and Unloading Services, Parcel Service and Same Day Services.

Value added services

Costs 8

$1.95 per unit per outbound carton for pick and pack, discount may have when shipped over 25-35 times per week.

$1.75per unit per outbound carton for pick and pack

10 10 24 hours Received, sorted, and repackaged efficiently

9 Drayage Expedite Freight Brokerage Global Forwarding Last Mile LessThan-Truck load Intermodal Managed Transportation Shipping

Barrett Bergen The Apparel Logistics Group, Inc. NFI Inventory control; Quality Inventory control and Warehouse control; Apparel inventory warehousing; Quality management systems; software; Foreign Trade control; Order fulfillment; Tier-one WMS Zone (FTZ) warehouse Garment-on-hanger software; Real-time services; Fulfillment shipping; Flax-box visibility of inventories, shipping; Price-tag order status, shipment application; tracking, history, and customized repors for clients and customers.

Outsource Fulfillment services; Sophisticated & Scalabel IT Platform; Product returns center; Centralized freight management and control; Quality control; Advanced WMS & EDI Services; ERP & e-commerce integrations; Intergrated Process Visibility; Retail Trading Partner Integrations & 9 Managed EDI Services $1.90 per unit per outbound carton for pick and pack

Inventory control and visibility; Quality control; Foreign Trade Zone; Return process; Technological product provider; Reverse logistics

Patterson Warehouse, Inc. XPO Logistics Inventory control Inventory control; Order Inventory Visibility fulfillment; Automated Omni-channel Retail stock rotation; Distribution Reverse logistics to major retailers; Lot center management tracking Direct-to-consumer ; Direct-to-consumer ecommerce shipping; Comprehensive fulfillment Warehouse Management Import DCs System

9 10 24 hours Pick & pack 24/7, anywhere; Track the location in the inventory; Track the status fo the order; Scanning and receiving goods by unit; Real-time movement of the inventory

9 7 2-3 days Customerized Pick and Pack Service

9 8 2 days Customerized Pick and Pack Service

9 8 1-2 days Customerized Pick and Pack Service

$1.8 per unit per outbound carton for pick and pack

New store roll-outs/wall sets; WMS software; Prepacks; Repairs; Web fulfillment and drop-ship services; Quality assurance inspection; Labeling; Pricing; Kitting; Specialized testing; EDI and network support;

Contract packing; Light manudacturing; Ticketing and tagging; Bonded warehouse; Labeling; Kitting; Freight consolidation/deconsolida tion; Rework; Transloading

International and domenstic transportation management; customer service; EDI, ASN, and other IT-related support; Accounting serveces; Imports management for the apparel industry; Cross-docking; Merchandising

Quality control; Ecommerce order fulfillment; Minor alterations; Style changes; Label changes; Back office solutions; EDI solutions

10 Average range between $0.50 - $0.80 per individual unit per outbound carton for pick and pack 6

9 10 24 hours Pick-and-pack Business-to-business Direct-to-consumer Workforce management Lotcode/datecode tracking Mixing centers Displays: point-of-purchase, 10 retail and pallet Drayage Expedite Freight Brokerage Global Forwarding Last Mile Less-ThanTruck load Intermodal Managed Transportation

9 Product Inspection & Compliance Product Localization Light Manufacturing & Assembly Packaging & Crating Services Product Rework & Recycling

Average range between $2-$2.5 per order

$1.7 per unit per outbound carton for pick and pack

$1.85 per unit per outbound carton for pick and pack

Inventory Control / Operations, Pre-shipment purchase order and vendor management services, International transportation including directto-store, Merchandise processing including labeling, tagging, and quality control, Customs brokerage and international trade compliance, Free Trade Zone warehousing and duty mitigation programs, Special programs for samples, returns, and store displays, Performance analytics and 10 benchmarking. 10 24 hours Customerized Pick and Pack Service

8 $1.8 - $2.5 per individual per outbound carton for pick and pack

Expeditors

maintain over 35 million square feet of distribution and warehousing facilities, strategically located at approximately 1,000 sites in more than 120 countries.

19 distribution centers 30,000-200,000 square feet

MA- 3 facilities (260,000 sq ft, 205,000 sq ft, 50,000 sq ft); NJ2 facilities (115,000 sq ft, 140,000 sq ft); NY- 1 facility (90,000 sq ft); TN- 1 facility (650,000 sq ft); MD- 1 facility (275,000 sq ft); VA- 1 facility (50,000 sq ft); CA- 2 facilities (220,000 sqft, the other is unknown)

Size

Customers

Multiple locations

Office: Alpharetta,GA. Warehouse: MA,MO, CA.East Coast, Middle, And West Coast with nationwide services. More than 4,300 independently owned locations in the U.S. Location

10 85 9.444

29 millions square feet of public and contract warehouse space

10 Bonobos; Foxcroft; Chooze; Enro; Damon; Marker & Comapny; EPIC Group

9 8 warehouse. Massachusetts, New Jersey, New York, Tennessee, Maryland, Virgina and California

Customers include Anheuser-Busch InBev, Nestle Waters North America, Vought Aircraft, Hanesbrands Inc., Wal-Mart, Lowes, Trader Joe's and more.

9 North Dalls, TX

3 facilities in New Jersey, 1 facility in California, 1 facility in Belgium

8 8 Both the East Coast and Covering the East Hubs: 2 (CVG, MIA) West Coast of the USA; Coast, West Coat, MidGateways: 2 (JFK, LAX) EU, Canada and Asia Atlantic and Southest. Service Point Locations: Approx. 6,700 DHL Express Quality Control Centers (QCC) located in Cincinnati (US), East Midlands (UK), Leipzig (Germany) and Singapore (Singapore) monitor shipments to and from the United States on a real-time 24/7 basis. Using cutting-edge technology, the QCC centers proactively manage shipments from origin to destination, taking decisive action when necessary to ensure fast 9 9 10 and secure delivery 81 78 80 9 8.666666667 8.888888889 8

total Averge

assets in 34 countries, with over 87,000 employees and 1,425 locations

Strategically located at approximately 1,000 sites in more than 120 countries.

High-end fashion clients in RTW, sportwear, footwear, dresses, outerwear, accessories and handbags

Amazon, Elila Underwear, Barbour Apparel, Best Buy, Five Figers, Tivoli Audio, The Lagoon Group, Pacific Coast Producers 6

1.58 million square feet distribution center and 6.2 million cubic feet of apparel distribution warehouse space (plus room to expand)

9 Wal-Mart, Hershey, Pep Boys, Procter & Gamble, Bayer Healthcare, Caterpillar, Exxon Mobil, Ford Motor, Goodyear Tire & Rubber,Toys “R” Us, Xerox

Retailers: Adidas, Nikon, Deer Stags, G3 Genuine Guide Gear, Kingsdown,Skirts Plus, Land's End Inc. and J.C. Penney Co

East Coast (3 North Bergen facilities) – over 1,000,000 square feet of GOH, flat pack, bonded and non-bonded facilities; B to C fulfillment as well as B to B distribution from all facilities; West Coast (Cerritos) – 154,000 square feet, 25% GOH and 75% flat pack items; EU 200,000 square feet facility, GOH receiving & shipping and flat pack; Canada (Brampton/Toronto) – 50,000 square feet facility, GOH receiving & shipping and flat pack; Asia (HongKong) - 100,000 square feet facility, GOH receiving & shipping and flat pack

5 67 7.444444444

Antec, Black & Decker, Conair, Crayola and Home Depot, among others.

9 79 8.777777778

Boeing, Home Depot, Ikea, L'Oréal

5 CA, BC, CO, OK, TX, LA, MS, GA, FL, NC, TN, MO, MN, IL, MI, WI, KY, IN, PA, OH, ON, OC, NB, NS

Assets in 34 countries, with over 87,000 employees

Memphis, TN

215 locations within large warehouse and rent a center 9

1 own DC and partners on both the East Coast and West Coast

2 million square feet of contract warehouse space features the amenities required for efficient and secure delivery

5 66 7.333333333

8 Amazon,DKNY, Fifth Circuit Court of Appeals

8 1,425 locations

10 2 operational campuses – one inside the Airport Aerotropolis Zone in Memphis and the other just across the state line in North Mississippi

25 million square feet of warehousing space across over 300 facilities across 50 countries.

8 Atlanta- A central location to south and east coast. Most of our prodcut will arrive in Miami.

8 83 9.222222222

A global network of 331 locations in 109 countries on six continents.

Maintains 66 additional offices and satellite locations in the United States and 373 leased locations throughout the world, each located close to an airport, ocean port, or on an important border crossing. The majority of these facilities contain warehouse facilities. Expeditors opens a Disaster Recovery Center in Spokane, Washington to manage all global backup IT requirements. Regional headquarters in Frankfurt, Germany opens in a new, sustainable, green-built office.

7 75 8.333333333

Supply Chain Strategy and Conclusion

In conclusion, Vivace’s supply chain stragey involves utilizing the most cost effective manufactuing and placement methods.

This involves Cambodia, Vietnam and the Dominican Republic, with the Dominican Republic being the country with the largest amount of awarded business. Our country choices align with the company’s ethics model and the needs of Vivace’s business bottom line. The sourcing strategy creates a cost effecitve plan for the manufacturing of the company’s product. This, paired with the UPS distribution strategy, will lead Vivace to success in delvering quick to market, quality fashionable, and affodable product to its customers.

Appendix

Works Cited Vietnam “Best time to visit Vietnam - weather by month - climate - seasons”. www.selectiveasia.com. Retrieved 2015-11-18. Countrymeters. Vietnam Population Clock. Accessed January 29, 2017. http://countrymeters.info/en/Vietnam. Central Intelligence Agency. Accessed January 29, 2017. https://www.cia.gov/library/publications/the-world-factbook/geos/vm.html. Commisceo Global. Accessed January 29, 2017. http://www.commisceo-global.com/country-guides/vietnam-guide. Commisceo Global. Award Winning Culture Guides. Accessed January 29, 2017. http://www.commisceo-global.com/country-guides/ vietnam-guide. Gmdu,net. Accessed January 29, 2017.https://www.gmdu.net/corp-913125.html. Minimum Wage in the Apparel Industry Continues to Rise in Most Asian Countries in 2016. Accessed January 29, 2017.https://shenglufashion.wordpress.com/2016/01/28/minimum-wage-in-the-apparel-industry-continues-to-rise-in-most-asian-countries-in-2016. Rajib Shaw, Juan Pulhin, Joy Pereira. Climate Change Adaptation and Disaster Risk Reduction: An Asian Perspective. Emerald Group Publishing. 12-12-2010. Trading Economics. Accessed January 29, 2017. http://www.tradingeconomics.com/vietnam/gdp-growth-annual. U.S. Department of State. U.S Relations with Vietnam. https://www.state.gov/r/pa/ei/bgn/4130.htm. Accessed January 29, 2017. U.S. Department of Commerce. International Trade Administration. Industry & Analysis . 2016 ITA Technical Textiles Top Markets Report. “Vietnam’s new-look economy”. BBC News. 18 October 2004. Retrieved 21 November 2015. Vu Duc Thinh. Presentation at the WTO Forum. Ministry of Industry: Vietnam Textile& Garment Corporation. Ethnomed. Accessed January 29, 2017. https://ethnomed.org/ Vietnam’s Growth Strategy: Roads, Rails, Rivers. Accessed January 29, 2017. https://www.atkearney.com.au/transportation/ideas-insights/article/-/asset_publisher/LCcgOeS4t85g/content/vietnams-growth-strategy-roads-rails-rivers/10192.

Cambodia “Analysis: Cambodian land rights in focus.” IRIN. N.p., 01 Dec. 2015. Web. 31 Jan. 2017. Associates, Runckel And. “International Ports in Cambodia.” International Ports in Cambodia. N.p., n.d. Web. 31 Jan. 2017. “Cambodia: a long way towards freedom of expression.” Cambodia: a long way towards freedom of expression. N.p., n.d. Web. 31 Jan. 2017. “Cambodia Cross-cultural and Language Training | Communicaid.” Cambodia Cross-cultural and Language Training | Communicaid. N.p., n.d. Web. 31 Jan. 2017. “Cambodia”. Infoplease, n.d. Web. 31 Jan. 2017. “Cambodia profile - Leaders” BBC News, n.d. Web. 31 Jan. 2017. “Cambodia – Trade Agreements.” Export.gov. N.p., n.d. Web. 31 Jan. 2017. “Cambodia | United States Trade Representative.” Cambodia | United States Trade Representative. N.p., n.d. Web. 31 Jan. 2017. “Home.” Cambodia - Language, Culture, Customs and Etiquette. N.p., n.d. Web. 31 Jan. 2017. “New Orient (Cambodia) Garment Co., Ltd., No. 17, Work, Canadia Industrial Park, Phnom Penh, Cambodia, 12405 | Supplier Report — Panjiva.” , No. 17, Work, Canadia Industrial Park, Phnom Penh, Cambodia, 12405 | Supplier Report — Panjiva. N.p., n.d. Web. 31 Jan. 2017. “Non-Verbal.” Cambodia Intercultural Communication. N.p., n.d. Web. 31 Jan. 2017. “OPINION: To understand Cambodia’s labor crackdown, open your closet.” Al Jazeera America. N.p., n.d. Web. 31 Jan. 2017. “Poverty has fallen, yet many Cambodians are still at risk of slipping back into poverty, new report finds.” World Bank. N.p., n.d. Web. 31 Jan. 2017.

Dominican Republic David, Birnbaum. Government Giveaways Stifle Government Industry Growth.Just Style. N.p., 12 Aug. 2014. Web. 1 Feb. 2017. Dominican Republic Textile and Apparel Export Competitiveness. Nathan Associates INC, n.d. Web. 1 Feb. 2017. Dominican Republic: Country Insights. MBDA. N.p., n.d. Web. 01 Feb. 2017. Dominican Republic Textile and Apparel Export Competitiveness. Nathan Associates INC, n.d. Web. 1 Feb. 2017. Dominican Republic Inflation Rate | 1984-2017 | Data | Chart | Calendar. Dominican Republic Inflation Rate | 1984-2017 | Data | Chart | Calendar. N.p., 17. Web. 01 Feb. 2017. Harmonized Tariff Schedule of the United States (2017). N.p., n.d. Web. 2 Feb. 2017. International Trade Update. International Trade Administration. N.p., 2016. Web. 01 Feb. 2017. International Trade Update. International Trade Administration. N.p., 2016. Web. 01 Feb. 2017. Dominican Republic: Country Insights. MBDA. N.p., n.d. Web. 01 Feb. 2017. US Dollar (USD) to Dominican Peso (DOP) exchange rate history. US Dollar (USD) to Dominican Peso (DOP) exchange rate history. N.p., 2016. Web. 01 Feb. 2017. The Impact of Substantial Labor Cost Increases on Apparel Retail Prices. Workers Right Consortium, 11 Oct. 05. Web. Textiles and Apparel: Assessment of the Competitiveness of Certain Foreign Suppliers to the U.S. Market, Inv. 332-448. Google Books. N.p., 98. Web. 02 Feb. 2017.

Tech Pack

PAGE #1 ILLUSTRATION SHEET PAGE #2

DESIGN SHEET COMPANY NAME: VIVACE

STYLE # 00078

COMPANY NAME: VIVACE

STYLE #: 00078

ADDRESS:

SKETCH

New York, USA

ADDRESS: New York, USA

GROUP NAME: Woven Bottoms (non-denim)

PHONE: 212-213-2017

CLASSIFICATION:

SEASON: Fall/Winter 2017-

Women’s Jogger Pants

2018

FAX:212-213-0116 GARMENT INFORMATION

PHONE: 212-213-2017

GARMENT LABEL: 100% Cotton Made in USA Machine Wash Warm Only Non-Chlorine Bleach Tumble Dry

GROUP NAME:

Medium Low

Woven Bottoms (non-denim)

FAX: 212-213-0116

CLASSIFICATION:

COLORWAY:

Women’s Jogger Pants SEASON:

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles

Fall/Winter 2017-2018

Wine

GARMENT LABEL:

SKETCH

FABRIC CONTENT: 100% Cotton

COLORWAY:

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

DESCRIPTION:

•

Mid- rise

•

Slim fit through hips and thighs

•

Slim leg with ruching on ankles

•

Pull-on styling with drawstring

•

Slant pockets at sides and back

Designer Initials

AS FABRIC INFORMATION

STYLE # WIDTH

SIZE RANGES

DELIVERY

COMMENTS

DATE 100% Cotton fabric,

Contempura, North

XL,2X, 3X

Carolina

Sample size: M

DATE CREATED: 1/20/17

DATE MODIFIED: 1/20/17

DATE RELEASED:1/20/17

Designer Initials

DATE CREATED: 1/20/17

See fabric sheets

XS, S, M, L,

Delivery not set TBD

yet with jobber

DATE MODIFIED: 1/20/17

DATE RELEASED: 1/20/17

FABRIC SHEET PAGE #3 DETAIL/CONSTRUCTION SHEET PAGE #4 COMPANY NAME: VIVACE

STYLE #:

ADDRESS: New York, USA

GROUP NAME: Group 3 Woven (non-denim)

PHONE: 212-213-2017

CLASSIFICATION:

SEASON:

Women’s Jogger Pant

Fall/Winter 2017-2018

COMPANY NAME: VIVACE

STYLE #: 00078

ADDRESS: New York, USA

GROUP NAME: Group 3 Woven (non-denim)

GARMENT LABEL: 100% Cotton Made in USA Machine Wash Warm Only Non-Chlorine Bleach Tumble Dry Medium Low

FAX: 212-213-0116

COLORWAY:

CLASSIFICATION:

SEASON: Fall/Winter 2017-

Women’s Jogger Pant

2018

PHONE: 212-213-2017

FABRIC CONTENT: 100% Cotton

FAX: 212-213-0116

COLORWAY:

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles

Wine

SKETCH

SWATCHES

DETAIL

FRONT

BACK

Waistband: 1 panels 1/4 in Edge Stitch Seam

Logo on back 1/2in. slant pockets

Drawstring and slant pockets on front.

1/2 in. Edge stitch seam for inseam

Designer Initials

AS FABRIC INFORMATION

STYLE # WIDTH

SIZE RANGES

100% Cotton fabric,

29”

XS, S, M, L,

Contempura, North

XL,2X, 3X

Carolina

Sample size:

DELIVERY DATE

DATE CREATED: 1/20/17

COMMENTS

TDB

Sourced

DATE MODIFIED: 1/20/17

Pieces: 2 Front Panels 2 Back Panels 1 Waistband Panels

Fabric Patterns

1/2 in. Edge stitch seam for inseam

DATE RELEASED: 1/20/17

DATE CREATED: 1/20/17

DATE MODIFIED: 1/20/17

DATE RELEASED: 1/20/17

“Women’s Jogger Pants” COMPONENT SHEET PAGE #5 [PRODUCT DESCRIPTION] by [VIVACE] TECHNICAL-SHEET COMPANY NAME: VIVACE

STYLE #: 00078

ADDRESS: New York, USA

GROUP NAME: Group 3 Woven (non-denim)

CLASSIFICATION:

SEASON:

Women’s Jogger Pant

Fall/Winter 2017-2018

PHONE: 212-213-2017

FABRIC CONTENT: 100% Cotton

FAX: 212-213-0116

COLORWAY:

COLORS

Dark Night Envy Green Jewel Blue Marble Pixels Water

Triangles Wine

ITEM-VENDOR-

CONTENT

SIZE-QUANTITY-

LOCATION

COLOR

COMMENTS

All seams, stitches and hems

Black

All seams, stitches and hems

Blue

100% Polyester 50S/3

#138-100 Yard per Garment

#DS-72g- SewBizFabric s

100% Cotton Drawstring

#DS-72g-1.2 ft per Garment

100% Polyester 50S/3

#138-100 Yard per Garment

BACK FRONT !00% COTTON

PLEASE NOTE: Colors shown are for reference only. For closest match,

#138-100 Yard per Garment

see PMS colors;; for exact match, samples are available.

Green

Waistband

Black

CARE INSTRUCTIONS

Waist

23.5-

26-29

29-

31.5-

34.5-

100% Cotton Made in USA Machine Wash Warm Only

31.5

34.5

38.5

Hips

33-

35.5-

38.5

41-

44-

35.5

38.5

-41

31.2

31.5

Regular

31.5

Inseam

Non-Chlorine Bleach Tumble Dry Medium Low

31.7 5

Notes

Fabric Information 100% Cotton

DATE MODIFIED: 1/20/17

All seams, stitches and hems

SIZE

DATE CREATED: 1/20/17

UNIT OF MEASURE

Solar Guard Bonded Polyester Thread- Superior Threads Solar Guard Bonded Polyester Thread- Superior Threads Solar Guard Bonded Polyester Thread- Superior Threads

CODE-ORIGIN

Triangles Wine

Dark Night Envy Green Jewel Blue Marble Pixels Water

DATE RELEASED: 1/20/17

Color

Black Night

Wine

Jewel Blue

Envy Green

Pixels

Marble

Wine

LABEL/PACKING SHEET PAGE #7 COMPANY NAME: VIVACE

STYLE #: 00078

ADDRESS: New York, USA

GROUP NAME: Woven Bottoms (non-denim) CLASSIFICATION:

SEASON: Fall/Winter 2017-2018

Women’s Jogger Pant

PHONE: 212-213-2017

FABRIC CONTENT: 100% Cotton

FAX: 212-213-0116

COLORWAY:

DESIGN SHEET

GARMENT INFORMATION

GROUP NAME: Women Woven Bottoms CLASSIFICATION: Capri Pants SEASON: Fall/Winter 2017-2018 GARMENT LABEL: FABRIC CONTENT: 90% MicroPoly, 10% Spandex COLORWAY:

Wine

CONTENT

CODE-ORIGIN

Poly Bag

SIZE-QUANTITY-

LOCATION

COLOR

Over

Clear

COMMENTS

UNIT OF MEASURE

Polypro-

1 Per Pant

pylene

Folded Pant

STYLE #190017 SKETCH

ADDRESS: New York, USA PHONE: (212) 213-2017 FAX: (212) 213-0116

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles

ITEM-VENDOR-

PAGE #01

COMPANY NAME: VIVACE

Fold Vertical then Horizontal Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

DESCRIPTION: 90% MicroPoly, 10% Spandex, Slim fit Mid-rise，Mesh panels improve breathability Rounded leg opening

Designer Initials

DATE CREATED: 1/20/17

DATE MODIFIED: 1/20/17

DATE RELEASED: 1/20/17

DATE CREATED: JAN. 16, 2017

DATE MODIFIED:

DATE RELEASED:

FABRIC SHEET PAGE #03 ILLUSTRATION SHEET PAGE #2 COMPANY NAME: VIVACE

STYLE #: 190017

COMPANY NAME: VIVACE

STYLE #: 190017

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

CLASSIFICATION: Capri Pants

PHONE: (212) 213-2017

GARMENT LABEL: 90% MicroPoly, 10% Spandex

PHONE: (212) 213-2017

GARMENT LABEL: 90% MicroPoly, 10% Spandex

FAX: (212) 213-0116

COLORWAY:

FAX: (212) 213-0116

COLORWAY:

SEASON: Fall/Winter 2017-2018

CLASSIFICATION: Capri Pants

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

SKETCH

SEASON: Fall/Winter 2017- 2018

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

SKETCH

Fabric 90% MicroPoly, 10% Spandex FE780MF Weight: 7.5 oz/yd², 12.5 oz/L.yd Width: 60″ Roll Size: ~55 yds Minimum: 1 yd (split charge applies to orders < 1 roll) Finishing: Superior moisture management, PFP

Front Back FABRIC INFORMATION

STYLE # WIDTH

SIZE RANGES

90% MicroPoly, 10% Spandex FE780MF

60’’ wide

XS, S, M, L, XL, XXL

Yarrington Mills Co. DATE CREATED: JAN. 16, 2017

DELIVERY DATE

DATE MODIFIED:

COMMENTS

TBD

Sample size: M DATE RELEASED:

Designer Initials

FABRIC INFORMATION

STYLE # WIDTH

SIZE RANGES

60’’ wide

XS, S, M, L, XL, XXL

90% MicroPoly, 10% Spandex FE780MF Yarrington Mills Co.

Sample size: M

DELIVERY DATE

TBD

DATE CREATED: JAN. 16, 2017

DATE MODIFIED:

COMMENTS

DATE RELEASED:

COMPONENT SHEET PAGE #5

DETAIL/CONSTRUCTION SHEET PAGE #04 COMPANY NAME: VIVACE

STYLE #: 190017

COMPANY NAME: VIVACE

STYLE #: 190017

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

CLASSIFICATION: Capri Pants

SEASON:Fall/Winter 2017-2018

CLASSIFICATION: Capri Pants

SEASON: Fall/Winter 2017-‐‑2018

PHONE: (212) 213-2017

FABRIC CONTENT: 90% MicroPoly, 10% Spandex

PHONE: (212) 213-2017

FABRIC CONTENT: 90% MicroPoly, 10% Spandex

FAX: (212) 213-0116

COLORWAY:

FAX: (212) 213-0116

COLORWAY:

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

ITEM-VENDOR- CODE-ORIGIN

DETAIL

FRONT

BACK

Panels on legs. Different color than leg panels 1/2 in. Edge stitch seam for inseam

Solar Guard Bonded Polyester Thread-‐Superior Threads

Waistband: 2 panels. 1/4 in Edge Stitch Seam

Solar Guard Bonded Polyester Thread-‐Superior Threads

Pieces: 2 Front Panels 2 back Panels 2 Waistband Panels 2 small leg Panels

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

CONTENT

SIZE-QUANTITY-UNIT OF MEASURE

LOCATION

COLOR

100% Polyester 50S/3

#138-100 Yard per Garment

All seams, stitches and hems

Black

All seams, stitches and hems

Blue

100% Polyester 50S/3

#138-100 Yard per Garment

COMMENTS

Solar Guard Bonded Polyester Thread-‐Superior Threads

1/2 in. Edge stitch seam for inseam

100% Polyester 50S/3

#138-100 Yard per Garment

All seams, stitches and hems

Green

DATE CREATED: JAN.16, 2017

#DS-72g SewBizFabrics

100% Cotton Drawstring

#DS-72g-1.2 ft per Garment

Waistband

Black

DATE MODIFIED:

DATE RELEASED:

DATE CREATED: JAN.16, 2017

DATE MODIFIED:

DATE RELEASED:

[PRODUCT DESCRIPTION] TECHNICAL-SHEET

“Capri Pants” by VIVACE

COLORS

LABEL/PACKING SHEET PAGE #7 COMPANY NAME: VIVACE

STYLE #: 190017

ADDRESS:

GROUP NAME: )'!( ).!( ),,)'+ CLASSIFICATION: SEASON: && $(,!*

New, York USA

Capri Pants

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

PHONE: 212-213-2017

FABRIC CONTENT: 90% MicroPoly, 10% Spandex

FAX: 212-213-0116

*% $"#, (.1 *!!( !/!& &-! * &! $0!&+ ,!* *$ ("&!+ $(!

ITEM-VENDOR-

FRONT BACK

Poly Bag

90% MicroPoly, 10% Spandex

POINTOF MEASUR E Waist (in.)

Hips (in.)

Regular inseam Short inseam Tall inseam

A4 A5

General PMS

23.5- 26 33- 35.5 31.2

26- 29 35.5- 38.5 31.2

29- 31.5- 34.5- 31.5 34.5 38.5 38.5- 41- 44- 41 44 47 31.5 31.5 31.75

XXL 38.5-42.5

CARE INSTRUCTIONS

LOCATION

COLOR

Polypro-

1 Per Pant

Over

Clear

)& !*,$ & ,#!( )*$2)(, &

31.75

29.5

29.5 29.75

29.75

33.25 33.25

33.5

33.5 33.75

33.75

DarkNight

Marble

Pixels

19-3908

17-0000

19-4906

7540

430C

5535C DATE CREATED: JAN. 16,2017

COMMENTS

Folded Pant

47-50

29.25 29.25

Notes

FABRIC INFORMATION Textile PMS

SIZE-QUANTITY- UNIT OF MEASURE

pyrene

PLEASE NOTE: Colors shown are for reference only. For closest match, see PMS colors;; for exact match, samples are available. CODE

CONTENT

CODE-ORIGIN

DATE MODIFIED:

DATE RELEASED:

DESIGN SHEET

PAGE #01

COMPANY NAME: VIVACE

STYLE #11050 SKETCH

ADDRESS: New York, USA PHONE: (212) 213-2017 FAX: (212) 213-0116 GARMENT INFORMATION GROUP NAME: Women Woven Bottoms CLASSIFICATION: Yoga Pants SEASON: Fall/Winter 2017-2018 GARMENT LABEL: 100% Cotton FABRIC CONTENT: 100 % Cotton Fabric COLORWAY:

ILLUSTRATION SHEET PAGE #02 COMPANY NAME: VIVACE

STYLE #: 11050

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

CLASSIFICATION: Yoga Pants

PHONE: (212) 213-2017

GARMENT LABEL: 100% Cotton

FAX: (212) 213-0116

COLORWAY:

SEASON: Fall/Winter 2017-2018

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

SKETCH

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

DESCRIPTION: 100% Cotton, Excellent muscle support for hip, Warm stretch, Reduces muscle vibration reducing fatigue, Perfect tights for light to medium physical activity

DATE CREATED: JAN. 16, 2017

DATE MODIFIED:

DATE RELEASED:

Front Back

Designer Initials

FABRIC INFORMATION

STYLE # WIDTH

SIZE RANGES

100% Cotton fabric, 16117554, Technocraft Industries India Ltd.

See fabric sheets

XS, S, M, L, XL, XXL

DATE CREATED: JAN. 16, 2017

DELIVERY DATE

TBD

Sample size: M

DATE MODIFIED:

COMMENTS

DATE RELEASED:

FABRIC SHEET PAGE #03

DETAIL/CONSTRUCTION SHEET PAGE #04

COMPANY NAME: VIVACE

STYLE #: 11050

COMPANY NAME: VIVACE

STYLE #: 11050

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms

CLASSIFICATION: Yoga Pants

SEASON: Fall/Winter 2017- 2018

PHONE: (212) 213-2017

GARMENT LABEL: 100% Cotton

FAX: (212) 213-0116

COLORWAY:

CLASSIFICATION:

SEASON:

Yoga Pants

Fall/Winter 2017- 2018

PHONE: (212) 213-2017

FABRIC CONTENT: 100% Cotton

FAX: (212) 213-0116

COLORWAY:

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

SKETCH

SWATCH 100% Cotton, poplin fabric/woven, 16117554

DETAIL

Yarn count:21S*21S

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

Density:90*88 Weight:120-260GSM Width:58/60’’inch

Designer Initials

FABRIC INFORMATION

STYLE # WIDTH

SIZE RANGES

58/60’’ Wide

XS, S, M, L, XL, XXL

100% Cotton fabric, 16117554, Technocraft Industries India Ltd.

Sample size: M

DELIVERY DATE

TBD

DATE CREATED: JAN. 16, 2017

DATE MODIFIED:

COMMENTS

DATE RELEASED:

DATE CREATED: JAN.16, 2017

DATE MODIFIED:

DATE RELEASED:

[PRODUCT DESCRIPTION] TECHNICAL-SHEET

COMPONENT SHEET PAGE #5 COMPANY NAME: VIVACE

STYLE #: 11050

ADDRESS: New York, USA

GROUP NAME: Women Woven Bottoms CLASSIFICATION: Yoga Pants

“Yoga Pants” by VIVACE

COLORS

SEASON: Fall/Winter 2017-2018

PHONE: (212) 213-2017

FABRIC CONTENT: 100% Cotton

FAX: (212) 213-0116

COLORWAY:

Dark Night Envy Green Jewel Blue Marble Pixels Water Triangles Wine

ITEM-VENDOR- CODE-ORIGIN

CONTENT

SIZE-QUANTITY-UNIT OF MEASURE

LOCATION

COLOR

Solar Guard Bonded Polyester Thread- Superior Threads

100% Polyester 50S/3

#138-100 Yard per Garment

All seams, stitches and hems

Black

Solar Guard Bonded Polyester Thread- Superior Threads

100% Polyester 50S/3

All seams, stitches and hems

Blue

Solar Guard Bonded Polyester Thread- Superior Threads

100% Polyester 50S/3

#DS-72g- SewBizFabric s

100% Cotton Drawstring

#138-100 Yard per Garment

COMMENTS

All seams, stitches and hems

Green

Waistband

DATE CREATED: JAN.16, 2017

DATE MODIFIED:

Hips (in.)

Regular inseam(in. ) Short inseam(in. ) Tall inseam(in. )

#DS-72g-1.2 ft per Garment

POINTOF MEASUR E Waist (in.)

Black

CODE

#138-100 Yard per Garment

DATE RELEASED:

FRONT BACK *6-ounce, 100%cotton knitted

General PMS

23.5- 26 33- 35.5 31.2

26-29

31.5- 34.5 41- 44 31.5

34.5- 38.5 44- 47 31.7 5

38.5-42.5

35.5- 38.5 31.2

29- 31.5 38.5- 41 31.5

29.25 29.25

29.5

29.7 5

29.75

33.25 33.25

33.5

33.7 5

33.75

Notes

FABRIC INFORMATION Textile PMS

PLEASE NOTE: Colors shown are for reference only. For closest match, see PMS colors;; for exact match, samples are available.

XXL

47-50 31.75

CARE INSTRUCTIONS

Soaking is not recommended, as it may cause excess dye to bleed onto light areas of fabric. Wash separately in plenty of water the first few times to remove any excess dye that may have remained on the fabric surface. Recommend washing before sewing, because cotton always shrinks in the first wash.

DarkNight

Marble

Pixels

19-3908TCX

17-0000TCX

19-4906TCX

7540C

430C

5535C

LABEL/PACKING Â SHEET Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â PAGE Â #7 Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â Â COMPANY Â NAME: Â VIVACE Â

STYLE Â #: Â 11050 Â

ADDRESS: Â Â

GROUP Â NAME: Â Â )'!( ).!( ),,)'+ Â CLASSIFICATION: Â Â Â SEASON: && $(,!*

New, Â York Â USA Â

Yoga Â Pants Â Â

PHONE: Â 212-Â213-Â2017 Â

FABRIC Â CONTENT: Â 100% Â Cotton Â

FAX: Â Â 212-Â213-Â0116 Â

*% $"#, (.1 *!!( !/!& &-! * &! $0!&+ ,!* *$ ("&!+ $(!

ITEM-ÂVENDOR-Â

CONTENT Â

CODE-ÂORIGIN Â

Poly Â Bag Â

SIZE-ÂQUANTITY-Â

LOCATION Â

COLOR Â

Over Â

Clear Â

Polypro-Â Â pyrene Â Â

1 Â Per Â Pant Â

Folded Â Pant Â

)& !*,$ & ,#!( )*$2)(, &

DATE Â CREATED: Â JAN. Â 16,2017 Â

COMMENTS Â

UNIT Â OF Â MEASURE Â

DATE Â MODIFIED: Â Â

DATE Â RELEASED: Â Â

Cost Sheet VIVACE COMPANY

Date

2/7/2017

Style # Style Name Description

78 Women's Jogger Pants Women's Woven Bottoms

Season

Fall/Winter2017-2018

FABRICS

Mill

Style #

Description

COST SHEET

$/yard*

Fabric 1/ Raw Material 1: COTTON Pocketing (Same Cotton Material as Pants) Other (describe): Cotton Draw String TOTAL FABRIC COST *to include freight Components

Vendor

Style #

Thread (T-24 Perma Core)* all operations

A&E

#138-100

Care label(Material:cotton printing,Width: 5200 mm)

JCBasic Garment Accessories Co.,Limited

carelabel01(221897)

Woven label TOTAL COMPONENT COSTS

JCBasic Garment Accessories Co.,Limited

H5813

PACKAGING

Vendor Shenzhen Bothwinner Plastic Electronic Factory Cruz label Cruz label Shenzhen Xinyamei Packing Products Co., Ltd.

Style # BW 2406021 F210 F388 OEM-Shrink Bag

$/unit

Vendor ULINE ULINE ULINE

Style # S-4505 S-444 S-5037

$/unit

Cost/min

#of mins

0.075(Vietnam)

0.07(Cambodia)

0.12(DR)

8.5mins

Hangtags(Material:Kraft) Prize Tkt Size Tkts Poly bags (Plastic,PVC EVA,18*19 inch) TOTAL PACKAGING COSTS PACKING Cartons(size: 18*16*24) Tape(100ft) Labels TOTAL PACKING COSTS LABOR Patternmaking Grading Marking Cutting Sewing Prepacks Admin

TOTAL LABOR *Includes pressing & packing unless otherwise noted. OTHER Freight(To New York) Per container(1180 cartons/ container) Insurance Per container Total Labor+Packing+Packaging+Components+Fabrics+Frieght+Insurance Duty Broker* TOTAL OTHER

GRAND TOTAL

Per container Per container

**must include waste $/unit

Vietnam

1.5

5 0.5

0.35 1.38

2 0.69 10

$Total

Quantity**

0.00125

199.83

0.2497875

0.05 0.02

1 1

0.05 0.02 0.3197875

0.02 0.065 0.065 0.045 0.195

0.027 0.01 0.07 0.11

0.05 0.01 0.05 0.11

0.0102 0.0102 0.0102 0.102 1.02 0.06 0.5 1.7126 12.1954

$0.01 $0.01 $0.01 $0.06 $0.60 $0.06 $0.50 1.2324 11.7751

$0.01 $0.01 $0.01 $0.06 $0.64 $0.06 $0.50 1.2804 11.8232

0.024 0.065 0.065 0.045

Quantity

Quantity 0.8 0.01 0.07

Cost Cambodia

Dominican Republic Cambodia Total

Yield**

Cost Vietnam

3296 6592

4350 8,700

14.90% 500

14.90% 600

$Total

1 1 1 1

$Total

30 1 1

$Total

Cost ($) Cost DR Units Cost ($) Cost ($) 0.096 1200 34500 0.0347826087 0.1260869565 0.191 2,400 34500 0.06956521739 0.252173913 14.150 12.58 12.84 14.90% 400

34500 34500

1.87 0.0115942029 1.84

2.110 0.014 1.98

1.91316 0.01449275362 1.83

14.42

16.13

14.67

VIVANCE COMPANY COST SHEET Style # Style Name

190017 Capri Pants

Date Season Wash

Description

Women Woven Bottom

Wash Description

FABRICS 90% Micropoly, 10% Spandex

Mill Yarrington Mills Co.

Style #

$/yard*

190017 FE780MF,Weight: 7.5oz/yd2, 12.5oz/L.yd,Width: 60''

TOTAL FABRIC COST *to include freight Vendor

Style #

Thread (T-24 Perma Core)* all operations

A&E

#138-100

Care label (Material:cotton printing, Width: 5-200mm) Woven label Brand label

JCBasic Garment Accessories Co. JCBasic Garment Accessories Co.

carelabel01(1221897) H5813

0.249

1 1

0.050 0.020

TOTAL PACKAGING COSTS PACKING Cartons Tape (100ft) Labels

Vendor ULINE ULINE ULINE

Style # S-4505 S-444 S-5037

$/unit

Cost/min(Cambodia)

Cost/min(Vietnam) Cost/min(Dominican Republic)

Quantity

$Total 1 1 1 1

30 1 1 #of mins

0.1200

Cost(Vietnam)

10.0000

Cost(D G)

0.320 0.024 0.065 0.065 0.045

0.32 $ 0.32 Vietname Dominican Republic 0.024 0.024 0.065 0.065 0.065 0.065 0.045 0.045

0.200 0.2 $ 0.20 $Total Vietname Dominican Republic 0.02667 0.02667 0.02667 0.01 0.01 0.01 0.07 0.07 0.07

Quantity 0.8 0.01 0.07

Cost(Cambodia)

Dominican Republic

199.83

0.024 0.065 0.065 0.045

0.075

Vietname

$ 11.57

0.05 0.02

Hangtags (Material: Kraft) Prize Tkt Size Tkts Poly bags (Plastic, PVC EVA, 18*19 inch)

0.07

11.57

0.00125

$/unit

TOTAL PACKING COSTS LABOR Patternmaking Grading Marking Cutting Sewing Prepacks Admin [ *Includes pressing & packing unless otherwise noted. OTHER

$Total

Quantity**

Vendor Style # Sheznzhou Bothwinner Plastic Electronic Factory BW 2406021 Cruz Label F210 Cruz Label F388 Sheznzhou Bothwinner Plastic Electronic Factory OEM-Shrik Bag

PACKAGING

CAMBODIA VIETNAM Dominican Republic Yield** Total 8.8 1.2 11.570 11.570 11.570 11.5700

**must include waste $/unit

Components

TOTAL COMPONENT COSTS

02/06/2017 F/W 2017-2018

# units

0.3467 0.3467 $ 0.35 $Total Vietname Dominican Republic 0.007 0.0075 $ 0.01 0.0070 $ 0.01 $ 0.01 0.0070 $ 0.01 $ 0.01 0.0700 $ 0.08 $ 0.12 0.7000 $ 0.75 $ 1.20 0.0600 $ 0.06 $ 0.06 0.5000 $ 0.50 $ 0.50 1.3510 1.4075 1.9100 13.7900 13.8450 14.3470 $Total Vietname Dominican Republic

Freight

Per container

3296

4350

1200

34500

0.096

0.126

Insurance

Per container

2500

8700

2400

34500

0.072

0.252

0.069

13.960

14.223

14.451

Total Labor+Packing+Packaging+Components+Fabrics+Frieght+Insurance

0.035

Duty

Per container

24%

15%

34500

3.350

2.135

Broker*

Per container

500

600

400

34500

0.014

0.017

$ 0.01

TOTAL OTHER

GRAND TOTAL

3.532

2.53

$ 0.11

17.320

18.620

18.180

VIVACE COMPANY

Date

2/7/2017

Style # Style Name Description

11050 Yoga Pants Women Woven Bottom

Season

Fall/Winter2017-2018

FABRICS

Mill

Style #

Fabric 1/ Raw Material: 100% cotton

Technocraft Industries India Ltd.

Description 100% cotton, poplin fabric/woven, Density:90*88, Weight:120-260GSM

COST SHEET

TOTAL FABRIC COST *to include freight Components Thread (T-24 Perma Core)* all operations Care label(Material:cotton printing,Width: 5200 mm) Woven label TOTAL COMPONENT COSTS

Vendor

GRAND TOTAL

**must include waste $/unit

Style #

A&E

#138-100

JCBasic Garment Accessories Co.,Limited

carelabel01(221897)

JCBasic Garment Accessories Co.,Limited

H5813

Vendor PACKAGING Hangtags(Material:Kraft) Shenzhen Bothwinner Plastic Electronic Factory Prize Tkt Cruz label Size Tkts Cruz label Poly bags (Plastic,PVC EVA,18*19 inch) Shenzhen Xinyamei Packing Products Co., Ltd. TOTAL PACKAGING COSTS PACKING Vendor Cartons(size: 18*16*24) ULINE Tape(100ft) ULINE Labels ULINE TOTAL PACKING COSTS LABOR Cost/min Patternmaking Grading Marking Cutting Sewing 0.075(Vietnam) Prepacks Admin TOTAL LABOR *Includes pressing & packing unless otherwise noted. OTHER Freight(To New York) Per container(1180 cartons/ container) Insurance Per container Total Labor+Packing+Packaging+Components+Fabrics+Frieght+Insurance Duty Broker* TOTAL OTHER

16117554

Per container Per container

$/yard*

Yield**

5.12

1.35

Cambodia

Dominican Republic

7.26 7.26

$Total

Quantity**

0.00125

199.83

0.2497875

0.05 0.02

1 1

0.05 0.02 0.3197875 $Total 0.02 0.065 0.065 0.045 0.195 $Total 0.027 0.01 0.07 0.11 $Total 0.00525 0.00525 0.00525 0.0525 0.525 0.06 0.5 1.15325

0.05 0.02 0.3197875

0.02 0.065 0.065 0.045 0.195

0.05 0.01 0.05 0.11

0.0049 0.0049 0.0049 0.049 0.49 0.06 0.5 1.1137

0.0084 0.0084 0.0084 0.084 0.84 0.06 0.5 1.5092

0.126 0.252 9.416

0.096 0.191 8.171

0.06 0.07 9.524

1.403 0.017 1.798

1.218 0.015 1.52

0 0.012 0.142

10.836

9.404

9.536

Style # BW 2406021 F210 F388 OEM-Shrink Bag

$/unit

Style # S-4505 S-444 S-5037

$/unit

Cost/min

#of mins

0.07(Cambodia)

0.12(DR)

7mins

COST (Vietnam) 4350 8700

COST(Cambodia)

0.024 0.065 0.065 0.045

Quantity

Quantity 0.8 0.01 0.07

14.90% 600

Vietnam Total

3296 6592 14.90% 500

1 1 1 1

30 1 1

COST(DR) # units $Total 1200 34500 2400 34500 0.00% 400

34500 34500

Preliminary Placement MARGINS INITIAL

Scenario 1

Total Units per country

Wholesale Cost per Unit Margin % Total Wholesale Total Purchase Total Margin

$46,697,100.00 $13,875,400.00 $32,821,700.00

Avg Wholesale Avg Purchase Avg Margins Avg Margin %

$47.09 $13.99 $33.10 68.73%

Average Cost per Unit

$33.10

MARGINS INITIAL

Total Units per country

Avg Wholesale Avg Purchase Avg Margins Avg Margin % Average Cost per Unit

$0.000 $0.000 $0.000 0.000%

$40.05 $9.536 $30.515 68.750%

$0.000 $0.000 $0.000 0.000%

$50.23 $17.322 $32.912 65.517%

$0.000 $0.000 $0.000 0.000%

$49.030 $14.670 $34.360 70.080%

$0.00 $0.000 $0.000 0.000%

$9,805,600.000 $2,884,000.000 $6,921,600.000

$0.000 $0.000 $0.000

$12,015,360.000 $2,860,800.000 $9,154,560.000

$0.000 $0.000 $0.000

$15,070,140.000 $5,196,600.000 $9,873,540.000

$0.000 $0.000 $0.000

$9,806,000.000 $2,934,000.000 $6,872,000.000

$0.000 $0.000 $0.000

Wholesale Cost per Unit Margin % Total Wholesale Total Purchase Total Margin

$49.03 $14.420 $34.608 70.588%

$48,612,000.00 $15,833,750.00 $32,778,250.00 $39.76 $15.58 $26.93 68.08% $26.93

$0.000 $0.000 $0.000 0.000%

$50.23 $18.180 $32.050 63.806%

$0.00 $0.000 $0.000 0.000%

$49.03 $16.130 $32.900 67.102%

$0.000 $0.000 $0.000

$12,557,500.000 $4,545,000.000 $8,012,500.000

$0.000 $0.000 $0.000

$7,354,500.000 $2,419,500.000 $4,935,000.000

$0.000 $0.000 $0.000 0.000%

$40.05 $9.404 $30.646 76.519%

$0.000 $4,005,000.000 $0.000 $940,400.000 $0.000 $3,064,600.000

$49.03 $14.670 $34.360 70.080%

$50.23 $18.629 $31.601 62.913%

$0.00 $0.000 $0.000 $0.000

$17,160,500.000 $7,534,500.000 $5,134,500.000 $2,794,350.000 $12,026,000.000 $4,740,150.000

$0.000 $0.000 $0.000

MARGINS INITIAL

Total Units per country Wholesale Cost per Unit Margin %

$49.03 $14.420 $34.610 70.589%

Total Wholesale Total Purchase Total Margin

$46,427,000.00 $14,296,650.00 $32,130,350.00

Avg Wholesale Avg Purchase Avg Margins Avg Margin %

$47.39 $14.94 $32.44 68.89%

Average Cost per Unit

$32.44

$0.00 $0.000 $0.000 0.000%

$9,806,000.000 $2,884,000.000 $6,922,000.000

$40.05 $9.404 $30.646 76.519%

$0.000 $0.000 $0.000 0.000%

$0.000 $14,017,500.000 $0.000 $3,291,400.000 $0.000 $10,726,100.000

$50.230 $17.320 $32.910 65.519%

$0.00 $0.000 $0.000 0.000%

$0.000 $0.000 $0.000 0.000%

$50.23 $18.629 $31.601 62.913%

$0.000 $0.000 $0.000 0.000%

$0.000 $10,046,000.000 $0.000 $3,464,000.000 $0.000 $6,582,000.000

$0.000 $0.000 $0.000

$0.000 $12,557,500.000 $0.000 $4,657,250.000 $0.000 $7,900,250.000

$0.000 $0.000 $0.000

COMPANY VIVACE LINE PLAN

SEASON

STYLE #

SP/SU JAN Quantities

Style #1 Style #2 Style #3

NAME Jogger Capri Yoga TOTAL

15000 50000 25000 90000

Fall/Winter 2017-2018

FEB

SUMMER MAR APR

MAY

Quantities

10000 20000 20000 50000

10000 25000 20000 55000

Quantities

10000 30000 20000 60000

20000 45000 20000 85000

JUN

Fall/ Winter JUL

AUG

SEP

OCT

HOLIDAY NOV DEC

Quantities

25000 20000 15000 60000

15000 30000 15000 60000

15000 30000 30000 50000 20000 35000 65000 115000

20000 30000 25000 75000

30000 55000 45000 130000

TOTAL

Quantities

45000 245000 60000 445000 50000 310000 155000 1000000

Wholesale

Cost

Per Unit

Total

Per Unit

Total

$ 49.03 $ 50.23 $ 40.05 $ 34.83

$ 12,012,350.00 $ 22,352,350.00 $ 12,415,500.00 $ 11,695,050.00 Average

$ 14.42 $ 17.32 $ 9.54 $ 10.32

$ 3,532,900.00 $ 7,708,290.00 $ 2,956,160.00 $ 3,549,337.50 Average

Margin $ 34.61 $ 32.91 $ 31.60 $ 24.51 Average

Margin % 70.59% 65.51% 76.19% 70.76% Average

COSTS PER COUNTRY BY ITEM Please plug in country name as appropriate

ITEM IMAGE Jogger

Capri

Yoga

COST Margin Dominican Republic $14.20 70.589% $34.61

$18.18

$9.53 76.19% $30.646

COST Margin COST Margin Cambodia Vietnam $16.13 0% $ 14.67 0%

$17.32 65.519% $32.91

$9.40

$18.62 62.913% $31.601

$10.84

REQUEST FOR PROPOSAL DATA ACQUISITION QUESTIONNAIRE Date: Feb. 28, 2017 Account Name: Vivace Contact: Amelia Shoemaker E-mail: amelia.m.shoemaker@gmail.com Anticipated Start Date: July 2017 Product Type: Please describe the different types of commodities that would be handled: Women’s Athletic Bottoms(Jogger, Yoga, Capri) Projected Volume: Please list your company’s total projected volume, in units, for the next 12 months. Jan, 2019 Feb, 2019 Mar, 2019 Apr, 2019 May, 2019 Jun, 2019 90000 50000 55000 60000 85000 60000 July 2018 60000

August 2018 65000

September 2018 115000

October 2018 75000

November 2018 130000

December 2018 155000

What is the approximate projected inventory level, in units, that you will maintain throughout the year? *25% safety stock added to months expected to have higher volume. 10% added to out of season months January February March April May June 112500 62500 68750 66000 93500 66000 July August September October November December 66000 71500 143750 93750 162500 193750 Desired Location (City, State): Newark, NJ Atlanta, GA Las Vegas, Nevada Space Requirements: Please provide your space requirements by distribution locations: Location Units Pallets Square GOH Footage Atlanta 350,000 150,000 ft² no Recycled Wood, Newark

350,000

Las Vegas

300,000

Dimensions :40.00" x 48.00" Recycled Wood, Dimensions :40.00" x 48.00" Recycled Wood, Dimensions :40.00" x 48.00"

150,000 ft²

129,000 ft²

General Account Information: Number of total items 108 SKUs. 3 styles 6 colors 6 sizes (SKUs) Average cases per 21 individual cases on a pallet pallet $300 Average case value 15 lbs Average case weight 30 units for all Average units per case 40 lbs. (18.2 kgs) Average pallet weight 80" Average pallet stack height (on floor) Yes,Packages within the pallet do not require address or tracking labels Can pallets be racked? Cube sizes (average 18x24 cubes sizes of your average inbound cartons) Peak season (list July beginning of winter orders. Peak sales September-February. start/end months) Peak-season pallets September-November inventoried (average) Inventory turnover 2:1 (times per year)

Please list the different types of retailers to which your company will be distributing, as well as the percentage amounts. Type Example Percentage Department store Nordstrom 15 Macy’s 15 Neiman Marcus 15 Mass merchandisers No 0 Ecommerce Yes 30 Specialty stores Yes (VIVACE Branded 20 Stores) Discounters Yes, (Examples:Nordstrom 5 Rack, TJMaxx, Off 5th) What percentage of your overall shipping 50% is replenishment? Please list any value-added services that Ticketing and hanger, label changes would be specific to your type of distribution (i.e., ticketing, hanger changes, label changes, pressing) Inbound Information: % Truck

100% Container

Technology – The following section will allow us to evaluate the various types of file interchanges, EDI capabilities, and reporting requirements that your company would require. Service Yes No E.D.I. (850, 810, 856) Yes,Transmit an EDI 856 Ship Notice for each PO and destination facility immediately after trailer loading is completed. Barcoding Yes, printed on the Newborn Screening Forms DOH- 1514/MCH-3 UPC tickets Yes 940 No 945 No Excel file Yes Proprietary flat file Yes Average order lead time Yes,3-5 days Order receipt notification (fax, EDI, other) Yes,Fax,EDI Shipment confirmation (fax, EDI, other) Yes,Fax,EDI Daily reported information required Yes Weekly reported information required Yes Monthly reported information required Yes Special reporting requirements Yes, Final inventory count every month.

100 since everything’s coming via ocean.

What is the average number of cartons in an INBOUND container? Average inbound loads per week? monthly. What percentage of your freight will be 100% will be received as carton received as garment on hanger versus carton? Domestic production: What percentage of None. For this class everything is produced out of your product is domestically produced? the country. Outbound Information: Freight classification Road & Ocean Average orders per day average 75 orders a day Average lines per order average 23 lines per order. Average units per line average 120 units per line Average cases per order average 2 cases per order Average SKUs per order 50

None What software package do you currently use? No, no distribution facility Is it currently integrated with your distribution facility?

* Changes in the scope of services will be reviewed periodically and may be subject to review. Rate schedules are based on the information provided on this questionnaire.