Rainwear | Everyday | Everywhere
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2
Contents Company Overview
5
Customer Analysis
8
Product Overview
10
Line Plan
14
Country Strategy & Selection
17
Supplier Stragegy & Selection
21
Conclusion
25
Works Cited & Appendix
27
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4
Company Overview
Regn, pronounced as in wren, is Danish for rain. Regn is also an ethical rainwear startup company based out of Seattle, Washington. At Regn, are socially concious, contemporary, and dedicated to providing our customers with the highest quality sustainable rainwear. Our mission is to provide elevated rainwear suitable for the everyday, sourced ethically from sustainable and recycled materials. Regn believes in the environment, because it is our responsibility to do something to make the world better. We believe in personal style, as it is a reflection of your inner self. We believe in creativity, because innovation is the best way to make a difference int he world. And lastly, we believe in function and quality, not as two mutually exclusive entities, but as one overarching theme in the production process. As a company, we value the connection between the earth and our company, the company and the customer, and the customer and the earth. We believe that there is an equal flow and responsibility among the three to work toward a better tomorrow through sustainable practices. Locally, we reach out to our community, partnering with charities that provide arts education to children who may otherwise not be exposed to the arts. On a national scale, Regn donates regularly to nature protection organizations, such as the the American Tree Farm System. And globally, Regn supports anti-hunger efforts through The Hunger Project. We are Regn.
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Company Overview Community
Because Regn is dedicated to preserving the environment, they will donate yearly sales numerous outdoor conservation and recreation organizations around the United States. In addition to supporting the community through taking care of the environment, Regn is dedicated to bettering the community with domestic and international outreach. Internationally, Regn donates 5 percent of each purchase during November and December to the Hunger Project. The Hunger Project is a non-profit organization that plans to end hunger and poverty by pioneering sustainable, grassroots, women–centered strategies and advocating this concept throughout the world. Domestically, Regn employees are given 40 paid hours a year to take off from work and volunteer at local Seattle schools to further push programs in the arts.
Environment
6
Since Regn creates products that are suppose to enhance their customers’ relationship with the outdoors, Regn wants to do everything possible to minimize harmful impact to the earth throughout the entire supply chain. Efforts Regn partakes in for environment improvements are sustainable forestry initiatives, recycling, energy conservation, greenhouse gas measurement and reduction, alternative fuel use, green building practices, sustainable products and packaging reduction.
Logistics Regn will begin its opperations solely as an online retailer, through our personal website to start. We have chosen to foregoe the traditional brick and mortar storefront startup in favor of the more contemporary business method of beginning solely online. We believe that establishing a strong online presence within our brand will give our product an opportunity to grow and gain exposure while investing minimum overhead, and taking on minimal startup risk. Once our individual marketing potential is realized, we will begin wholesale opperations. We aim to partner with outdoor retailers such as REI, as well as attainable luxury ecommerce sites such as Net-a-porter; places that can effectively sell to both our outdoorsy customer, and our fashion concious customer.
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Customer Analysis
target market Our target customer is a concious, responsible consumer between the ages of 30 and 65. Our male or female is working in a job they enjoy, maing a modest to high income. He or she is active, possible in multiple outdoor activities, or possibly just within his or her city. Our target customer enjoys taking leisurely strolls around the block, or around the woods. Urban or rural, city or country, the Regn customer is always ready for an outdoor adventure. Our customer is interested in functionality and quality, but is also interested in maintaining his or her personal style, appearance, and ease of wear.
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Customer Analysis
»Gender: Male »Age: 55 »Economic Status: Middle class »Occupation: Urban Farmer »Location: just outside Los Angeles, ca »Income level: $60,000 - 70,000 »Lifestyle: relaxed & simple daily life, spends most his time outdoors working »Hobbies : Gardening, Fishing, Hiking, Reading
»Gender: Female »Age : 35 »Economic Status: Middle class »Occupation: marketing Manager »Location: San Francisco »Income level: $48,000 - $58,0000 »Lifestyle: Fastpaced & Busy, love to attend outdoor sporting events with friends »Hobbies: Gardening, Reading, Shopping and Hiking
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Product Overview
Regn is curently focused solely on providing rain-ready footwear. However, as a company, we do not want to supply your typical rainboots and golaches. We are dedicated to suppling our creative customers creative solutions to rainwear, by making shoes that can be worn everyday, whethere it’s raining or not. Creating multifunctional, multipurpose, stylish and footwear is our biggest However, we recognize opportunities for expansion of our product category later on down the line into rain apparel and accessories.
10
Country Analysis
11
Product Overview- WOMEN’S WOMEN
Colors:
REGN Women’s Ankle Boots Price: $125 Size: 5- 11 A women's ankle boot handcrafted from waterproof rubber. With a shorter shaft, the boot is designed for a relaxed look and easy wear featuring a low block heel and tread on the sole for added grip.
REGN Women’s Ori Price: $190 Size: 5- 11 REGN introduces ou interpretation of the Original Refined boo silhouette, a streamli extended top front th rainboot is both stylis
MEN Colors:
rs:
Colors:
ots
dcrafted from waterproof t, the boot is designed for ar featuring a low block or added grip. 12
REGN Women’s Original Refined Rainboot Price: $190 Size: 5- 11 REGN introduces our new sartorial interpretation of the iconic rainboot, the REGN Men’s Original Short Boots Original Refined boot. With a more tailred Price: $140 silhouette, a streamlined toe box, and an Size: 7- 13 extended top front the Original Refined A men’s version of the women’s ankle boot. rainboot is both stylish and functional. Handcrafted and completely waterproof design
REGN Men’s Fieldside R Price: $155 Size: 7- 13 Fusing the unique design Tall with new developme varied terrains. Boot is m
MEN
Colors:
Colors:
Product Overview- MEN’S
Colors:
Boots
handcrafted from waterproof shaft, the boot is designed for wear featuring a low block ole for added grip.
REGN Women’s Original Refined Rainboot Price: $190 Size: 5- 11 REGN introduces our new sartorial interpretation of the iconic rainboot, the REGNRefined Men’s Original ShortaBoots Original boot. With more tailred Price: $140 silhouette, a streamlined toe box, and an Size: 7- 13 extended frontofthe Refined A men’stop version theOriginal women’s ankle boot. rainboot is both stylish and functional. Handcrafted and completely waterproof design made from natural, vulcanized rubber. The design is built on a men's last and features signature Regn details.
Colors:
Short Boots
women’s ankle boot. letely waterproof design canized rubber. The n's last and features
Color
REGN Men’s Fieldside Rainboot Price: $155 Size: 7- 13 Fusing the unique design style of Tall with new developments. This varied terrains. Boot is made from rubber compound; flexible with a buckle and a durable lugg sole.
Colors:
REGN Men’s Fieldside Rainboot Price: $155 Size: 7- 13 Fusing the unique design style of the iconic Original Tall with new developments. This boot is suited for varied terrains. Boot is made from a soft, recycled rubber compound; flexible with a weatherproof buckle and a durable lugg sole.
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Line Plan
TableTable 1 1 Line Line Plan Plan 11/10/2015 11/10/2015 Style Style # #
Season Season
NameName
January January
February February
March March
AprilApril
May May
Quantities Quantities Style Style #1 #1
Women’s AnkleAnkle BootsBoots Women’s
75
75
79
79
88
88
32
32
24
24
Style Style #2 #2
Women’s Women’s Original Original Refined Refined RainRain BootsBoots
35
35
39
39
43
43
25
25
16
16
Style Style #3 #3
Men’sMen’s Original Original ShortShort BootsBoots
76
76
77
77
80
80
30
30
23
23
Style Style #4 #4
Men’sMen’s FieldField Side Rain Side Rain BootsBoots
43
43
44
44
45
45
21
21
14
14
108 108
77
77
229 229
239 239
UNIT UNIT BREAKDOWN BREAKDOWN
256 256
1/121/12
Retail/ Retail/ Per Unit Per Unit
RetailRetail TotalTo
Style Style #1 #1
Women’s Women’s AnkleAnkle BootsBoots
33% 33%
33000000% 33000000%
2750000% 2750000%
$125.00 $125.00
$7
Style Style #2 #2
Women’s Women’s Original Original Refined Refined RainRain BootsBoots
17% 17%
17000000% 17000000%
1416714167
$190.00 $190.00
$6
Style Style #3 #3
Men’sMen’s Original Original ShortShort BootsBoots
32% 32%
32000000% 32000000%
2666726667
$140.00 $140.00
$8
Style Style #4 #4
Men’sMen’s FieldField Side Rain Side Rain BootsBoots
18% 18%
18000000% 18000000%
1500000% 1500000%
$155.00 $155.00
$5
TotalTotal Average Average
14
1000000 1000000
$28
$7
Line Plan
June
July
August
September
October
November
21
20
25
26
75
83
74
622
15
15
18
18
35
46
39
344
20
20
27
29
76
80
74
612
15
15
24
18
43
50
40
372
71
70
94
91
229
259
227
1950
otal
Cost/ Per Unit
Cost Total
Margin
December Total
Margin %
$77750.00
$48.75
$30322.50
$76.25
$65360.00
$74.10
$25490.40
$115.90
$85680.00
$54.60
$33415.20
$85.40
$57660.00
$60.45
$22487.40
$94.55
$286450.00
$237.90
$111715.50
$372.10
$71612.50
$59.48
$27928.88
$93.03
61%
61%
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Country Analysis
16
Country Stragegy
What we’re looking for
»Since Regn is based in Seattle, Washington, countries in proximity to the U.S are ideal. In addition to distance, Regn needs countries that have several ports, a 15 to 25 day lead-time and low freight cost.
»Regn is aware of the harsh impact of the apparel industry on the planet;
countries that are also aware and have implemented environmental initiatives countrywide are of high interest.
»Regn believes that workers throughout the entire supply chain should
have basic living standards met, and should work in safe conditions whether they are hired domestically or internationally.
»Any country doing business with Regn needs to actively use modern technology, be knowledgeable of industry production trends and partake in green manufacturing.
»Regn does not need the country to have a free trade agreement with
the United States, it would be preferred, but a strong trading history and relationship will suffice.
»Production expenses initially need to be kept low since Regn is at the
beginning stages, however, not at the expense of the labor workers. Fair trade must always be met.
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Country Selection
(for further information see appendix item I)
China China offers endless opportunities for production. Comparitavely, conducting business in China is relatively easy, though the Chinese economy is currently slowing after years of explosive growth. Through that time, the USD to RMB conversion rate has stayed continued to stay steady. Currently, minimum wage falls somewhere between 800-1,250 RMB per month, which in most areas is enough to support a living wage. The Chinese goernment is highly influential into the lives and bussinesses of its people. Changes in leaders provides a cascade of new policies, making business more difficult to operate smoothly. Although these policies at times may seem intrusive by western standards, the Chinese government has been making big strides to ensure green production standards due to the country’s well known environmental and air pollution problems that resulted from years and years of unregulated production. Recently, China has been doing more to enforce intillectual property laws in an attempt to decrease the business of knockoffs and counterfeits in their country. This makes doing business in China slightly more attractive.
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No trade agreements exist between China and the United States. However, a moderate lead time of 13-24 days from China to the port of Long Beach makes China a viable option for time based production.
power of the conutry. Currently a new constitution is being written that will hopefully lead to a more stable system.
Financially, the country is unergoing modest recovery from a weak GDP, but even though the The Chinese textile and production economy is reaching a more steady industry is well equipt to produce state, political uncertainty means just about anything, which means that improvements are precarious that sourcing rainboots from this at best, and overall the economy country would not prove to be has stayed relatively stagnant. difficult, however, recently the Althought improvements have Chinese textile industry has slowed been made in the areas of worker due to a rise in labor costs and a rights, Thailand, overall, has pooly skilled, but againg workforce. educated, low skilled workers. Production wise, Thailand is Thailand technically capable of supporting Thailand is known as a great travel Regns entire supply chain, as destination, but it’s also a great natural and recycled rubber country for production sourcing. resources are readily available in Thailand has earned the ranking of this country. Additionally, Thailand 46 out of 189 in the World Bank’s is known for innovative textile country rankings for 2016. research and manipulation. But unfortunately, despite infrastructure Thailand is appealing to Regn for for socially and environmental its inexpensive production rates. production being available, most However from a CSR standpoing, factories in Thailand are not as minimum wage has just increased concerned with the environmental to 300 baht per day, which is just implications of production as say, over $8 USD. Hong Kong or China, making production in this region less The Thai government is politically appealing to Regn, as a socially and unstable. Due to recent political environmentally concious company. turmoil, the military has siezed
Additionally, out of the three countries Regn has considered doing business with, Thailand has the longest lead time: 19-22 days to Los Angeles. As a former industry leader in production, Hong Kong has maintained their “good for business” reputation, despite industry changes. With economic growth, a competent government, ease of trade and business, and conduction Hong Kong is quite an attractive prospective country for Regn.
Hong Kong From an economic standpoint, Hong Kong has been steadily growing. The currently HKD is
women into the workforce, fostering a sense of equality. As a small island country, Hong Kong has limited area for production, and a strong alliance to protecting its remaining green Hong Kong has a rising GDP, but space. With a history of air societal tensions, particularly with pollution, Hong Kong ramains Mainland China, puts strain on at the forefront for the adoption economic and political systems. Much of Hong Kong’s industry has of green industry practices. been relocated to mainland China, Infrastructure has been steadily swithching to become more which makes Hong Kong’s textile and production industries vunerable environmentally friendly. to a slow down. Hong Kong is known as a producer Through social reform, Hong Kong of high quality goods, and is innovative in technologic growth is dedicated to decreasing poverty making it a hub for global sourcing. and increasing education, making Lead time is the shortest of the their workforce both healthy, skilled, and educated. Additionally, three countries we surveyed, at 1521 days to Los Angeles. Hong Kong strives to bring more 7.75 to 1 USD and the minum working wage in Hong Kong is $3,480 per month HKD, equivalent to about $450 USD.
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Supplier Stragegy & CSR
Supplier & CSR Guidelines Forced labor-No employee should be under the age of 14 or younger. Employers must have valid identification of all employees with date of birth. Auditing –Factories will annually be benchmarked and reviewed by third party factory monitoring programs at random. Fair Wages - Reign recognizes that wages are essential to meeting employees basic needs. Employers should pay employees at least the minimum wage required by local law or the industry wage. Overtime Wages- In addition to their compensation for regular hours of work, employees should be compensated for overtime hours at a premium rate or at least double to their regular hourly compensation rate. Working Hours – Employees should not be required to work more than 48 hours per week and 12 hours of overtime. Health and Safety – Employers should provide a safe and healthy working environment to prevent accidents and injury in the course of work or as result of the operation of employer facilities. Sustainable Production- Employers must comply with all environmental laws of the country followed by having separate best practices initiatives to meet Regn’s standards. Traceability – All aspects of the business must be must be able to be tracked and monitored. Employers should be able to give a clear map of where materials and services came from at all times. Fair + Equal Treatment- Every employee should be treated with respect and dignity. No employee should be subject to any physical abuse.
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Supplier Strategy
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(for further information see appendix item II)
Supplier Strategy
Wuhu Fenquxe Rubber Company- CHINA Wuhu Fenquxe is well known within the industry as a top producer of rubber rainboots. Main customers include top rainwear companies BOGS, Hunter, and Burberry. While quality is high, and their capacity and ability to produce in large quantities is a valid reason to enter into business with them, this company’s brand transparency, CSR, and environmental innitiatives are the lowest of the three suppliers which earned them a 48 out of 80 overall ranking by our standards.
Sri Trang Agro Industry - THAILAND
Sri Trang Argo excells in three categories: growth of devleopment, lead time, and qulaity of production. This allstar company is a major producer of green, envoronmentally friendly sheet rubber. Their factory opperates under environmentally protective laws, and they are committed to the concept of safe energy, producing with minimal waste and pollution. Although they do not currently produce rainboots, the infrastructure to be a great rubber footwear supplier is all in place. Sri Trang Argo is attractive becasse of its ablilty to adapt to new technology, and strong potential for rubber footwear production.
Stella International Holding Limited - HONG KONG This company is well versed in shoe production. Known for luxury footwear, Stella International Holding Limited is highly capable of executing complex structures in high quality. However, this company mainly uses leather, and upstart costs to work with in constructing full rubber shoes may be pricey. Stella has an extensive client repotoire for both luxury and casual footwear. Clients include Balmain, Burberry, Clarks, Timberland, and Cole Haan to name a few. Stella is fairly transparent in CSR, reportedly commits to providing fair and kind business transactions, and holds craftmanship to the highest standard. recieved our highest overall ranking comparatively, coming in at 71/80, making this a top choice for production.
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Supplier Analysis
24
Conclusion
Country Strategy & Conclusion
focused on maintaining sustainable business practices, therefore we worked very hard to make sure that the companies we deciede to enter business with abide by envoronmental protection laws, despite being located in heavy factory production sectors in developing countries.
Overall, Hong Kong and China proved to be the likely best We selected China, Thailand and solutions, meeting our comapany Hong Kong as potential countries to source from for the simple reason guidelines and country sourcing guidelines the best. Thailand and that they had the best available resources in rubber prouction, and its chosen supplier were a great option when it came to sourcing were more likely to be capable natural, green and ethically of completing our shoes from manufactured rubber sheeting, start to finish. As three major apparel industry competitors, these however the risk of establishing opperations within a company countries are capable of not only that doesn’t currently have the producing rainboots, but they are equipment needed to mold and capable of doing so on a larger assemble rainboots made this scale than say Indonesia, which is option less appealing. another country we considered. Through our extensive research As a whole, our chosen suppliers we came to the conclusion that show the largest disparities in the thse three conutnries were the sectors of sustainability and CSR most likely to be able to meet our practices, sourcing, and strategic sourcing strategy guidelines, and outlook. Cost wise, China is the do so at a reasonable price with lowest option, however when minimal risk. it comes to quality, Hong Kong wins out. Regn is committed to A large part of our sourcing producing the highest possible strategy hinges on the level of quality product for our price, so environmental protection (or in for this reason, Thailand’s Shri some cases, lack thereof) that a Trang Argo is the least reasonable producer and or country abides sourcing option. by. As a company, Regn is quite
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Works Cited
Bariso, Justin. “Going Global: 6 Things You Need to Know About Doing Business in China.” Inc.com. N.p., 20 Jan. 2015. Web. 14 Nov. 2015. <http://www.inc.com/justin-bariso/going-global-doing-business-in-china.html> “Chinese Exports In Numbers – Statistics And Trends.” GOGlobe. N.p., 21 Mar. 2015. Web. 14 Nov. 2015. <http://www.go-globe.com/blog/chinese-exports-numbers/> “Doing Business in Hong Kong.” Export.gov -. N.p., 7 Sept. 2015. Web. 14 Nov. 2015. <http://www.export.gov/ hongkong/doingbusinessinhongkong/index.asp> Mitchell, Michelle M. “Hong Kong Textile Industry Profile.” Textile World Asia. Billian Publishing Inc, n.d. Web. 14 Nov. 2015. < http://www.textileworldasia.com/Issues/2007/July-August/Features/Hong_Kong_Textile_Industry_Profile> “Industry Overview Thailand Rubber Industry.” Insight Alpha. N.p., n.d. Web. 13 Nov. 2015. <http://insightalpha.com/news_details.php?cid=173&sid=75&nid=240>
Johnston, Nigel. “China Leading the Way In Green Manufacturing.” Shanghai Daily. N.p., 13 July 2015. Web. 14 Nov. 2015. < http://www.shanghaidaily.com/opinion/Chinas-leading-the-way-in-green-manufacturing/shdaily.shtml> “Main Content.” Trade and Industry Department: Trade Policy. N.p., 19 Dec. 2014. Web. 14 Nov. 2015. <https:// www.tid.gov.hk/english/aboutus/tradepolicy/trpolicy.html> “Rainboots in Hong Kong.” Panjiva. Panjiva Inc, 2015. Web. 12 Nov. 2015. < https://panjiva.com/search/globalsupplier?q=Rainboots&x_history=eJx1jctOwzAURP_F6woc5-VUYoFALGgXVBQ2CF05ttNE9SPyo7RC_ “Research and Markets: China Footwear Outlook to 2017.” Research and Markets: China Footwear Outlook to 2017. Business Wire, 12 Sept. 2013. Web. 14 Nov. 2015. <http://www.businesswire.com/news/ home/20130912006282/en/Research-Markets-China-Footwear-Outlook-2017> “Thailand: Trade Statistics.” GlobalEDGE: Your Source for Global Business Knowledge. Michigan State University, n.d. Web. 14 Nov. 2015. < http://globaledge.msu.edu/countries/thailand/tradestats>
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Appendix (item I)
China Wuhu Fenquxe Rubber Company Abilities
6
Capacity
7
Lead Time
5
Quality
8
Customers
7
Sourcing Guidelines
5
Services Offered
5
Strategic Outlook
5
Total
48
Average
6.5
Abilities - How many types of products can this supplier manufacture Lead Time - Amount of time it takes to produce product from P.O issuance to delivery Quality - Evaluated based on certiďŹ cations and customers Customers - Brand Recognition Sourcing Guideline -Visible CSR initiative, Transparency, and Sustainability Capacity- How much does this manufacturer produce on a monthly and weekly basis Service Offered- What all can they do? Inventory Management, Transportation, Design, and Development Strategic Outlook- Growth and development in number of factories, technology and clientele
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Appendix
Thailand
Hong Kong
Sri Trang Agro Industry
Stella International Holding Limited
6
9
9
8
10
7
10
10
5
10
9
9
7
9
10
9
66
71
8
9
29
Appendix (item II)
China
Business Climate
7
Costs
7
Government
8
Location
7
Risk
7
Social Stability
7
Explanation Economy slowing from explosive growth. Government wants to become less dependent on fixed investment and more on domestic consumption. Conversion rate $1 USD to 6.37 RMB. Largest manufacturer of footwear and close to raw materials Increase in minimum wages and welfare benefits. 800 - 1,250 RMB per month Government has too much influence. Change in leaders bring in a cascade of new policies. Economic issues = Political Issues Lead time 13 - 24 days to Long Beach Enforcement of Intellectual Property Laws. Rise in labor cost. Excess capacity industry and aging workforce Growing GDP. Capital used to maintain stability. Gender imbalance causing sexual violence. Decline in poverty and inequality but low population growth
Thailand
6
8
5
7 6
6
Green Manufacturing, living wages Sourcing Guidelines
Textile Industry
8
8
7 Wide range of products and innovative materials. Textile industry has slowed because of rise in labor cost and allocation of service to other countries
7
No trade agreements with the United States
30
Trade Agreements
7
Trained Work Force
8
8 Skilled but aging workforce
Socio-Eco-Political
6
Total Average
80 7.5
5 Suffering from slow growth because of industrial over capacity. Economic reforms in place for long-term economic health. Territorial disputes. Local debt
5 70 6.5
Appendix
Explanation Instable government. The US dollar is strong against the Baht benefiting foreign investments conversion of $1 USD to 35.5 THB. Largest producer of raw materials and has several companies that have competitive cost
Minimum wage has increased 300 baht per day Instable political environment. Military seized power of country. New constitution is being written. Islamic attacks Lead time 19-22 days to Los Angeles Unstable political environment. Shortage of skilled workers and higher labor cost due to national wage increase Undergoing modest recovery from weak GD. More stable but growth is affected by political uncertainty constraints.
Several companies have CSR in place for manufacturing One of few countries that can supply the entire textile industry chain because readily available raw materials. Innovative textile research No trade agreements with the United States but strong trading history. Possibility that Thailand will join TPP
Hong Kong
8
6
7
8 8
9
Explanation Economic growth. Government supports the trading industry and addressing demographic change. Complying with the global green manufacturing trend and stronger infrastructure. Conversion rate $1 USD to 7.75 HK. Close to raw materials and large manufacturer of high end products Minimum wage is $3,480 per month Political reform for a pro-democracy system. Large protest for change. High degree in autonomy when it comes to trade and capital Lead time 15-21 days to Los Angeles Economy vulnerable to slowdown. Industry relocated to Mainland China. Lack of transparency of financial data Rising GDP. Societal tensions. Rising inequalities in territory. Initiatives to decrease poverty and elevate environmental protection and education. Bring more women into workforce Green Manufacturing, living wages
8
8
Reputation of being a supplier of quality goods. Strong manufacturing in numerous categories. Global hub for global sourcing. Growth in technological innovation No trade agreements with the United States
7
Poor quality education and low skilled workers
High educated and skilled but healthy workforce 9
Stagnant economy because of political turmoil. Deforestation and pollution as a result of the rapid industrialization
8
Basic human rights are respected. Growth in domestic demand. Well capitalized banking system and strong fiscal position. Air pollution. Growth in service industry.
86 8.5
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