Global sourcing strategy for Adamo

ADAMO

AISHWARYA J.

YI L.

MAGDALENA A.

SHANIYA S.O.

Executive Summary

This book brings together our efforts to develop a global sourcing strategy for Adamo – a luxury womenswear denim company designed by Aishwarya Jonnalagadda, Magdalenda Atencio, Shaniya Shabrach-Ortiz and Yi Lin at the Savannah College of Art and Design. Inspired by the thought leaders behind the brand's inception – the four styles have been named Ash, Maggie, Lin and Shay to establish a personal connect with all women that wear them.

Over ten weeks, we formulated an extensive approach to manufacturing four styles of women's denim in China, Egypt, Mexico and Vietnam. The exercise involved an in-depth research into each country's economic, political and social conditions along with the state of their apparel and textile industries. The on-going trade relations were a focal point into deciding tariffs and schedules and overall costs of each style of jeans.

Risks were analyzed and contingency plans were formulated to help us understand how we can better manage them; without compromising manufacturing cycles, timely shipments and commitment to the customer.

Picking the right supplier in every country was a decision made keeping in mind several factors – their capabilities, services offered, risk management abilities, current clientele and adherence to our sourcing guidelines. We finally picked Vera Cruz, Mexico; Ho Chi Minh City, Vietnam and Port Said, Egypt as our ports of origin. The incoming one million units will live in our warehouses in Atlanta, Georgia and Henderson, Nevada to fulfill direct-to-retail and direct-to-customer orders. Parallelly, supply chain providers were looked into for logistics, warehousing, inventory management and fulfillment purposes. UPS topped the list with its worldwide reach, reduced lead times and credibility. The goal at every stage was to collaborate with partners that have global presence as their future outlooks. Our belief is to grow with them at every step of the way, empowering the entire supply chain.

Our main objective is to provide our customers in the United States with the best fitting jeans they've owned yet. We want to make them feel confident, free and be themselves. We want them to be a part of the community Adamo wishes to create.

" give a girl the right pair of jeans, and she can conquer the world."

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Table of Contents

INTRODUCTION - 08 BRAND OVERVIEW - 09 STRATEGY DEVELOPMENT PROCESS - 13 SOURCING STRATEGY - 81 DISTRIBUTION STRATEGY - 113 CONCLUSION - 116 APPENDIX - 118

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Introduction

Our supply chain strategy for Adamo will take you through our Brand Overview, Strategy Development Process, Strategy Development, Sourcing Strategy and Distribution Strategy. The Brand Overview section will discuss our company values, mission and vision statement, our ideal target customer, price points and product details.

Following this is our Strategy Development Process that will include country reports and rankings of China, Egypt, Mexico and Vietnam as potential countries of manufacturing. A detailed costing analysis has been undertaken to identify the best country to manufacture the four styles of jeans in.

Next comes the Sourcing Strategy, outlining explanations of our chosen country and supplier with a line plan and placement strategy. Lastly, we will include our Distribution Strategy that will showcase our channels of distribution along with our selected logistics companies.

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Vision To defy the everyday denim in order to empower women all over the world to be the best version of themselves.

Mission To create a global denim phenomenon where we bring women closer to celebrate their individuality, culture and freedom. We want to champion efforts into developing unprecedented sustainable practices in crafting our denim.

Values Creativity Integrity Recognition Competition Environment Prosperity Appearance Honesty

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Target Customer Adamo is targeted towards affluent women who want to invest in a perfect pair of jeans.

They are between the ages of 25 to 45, living in metropolitan cities around the world and are extremely successful and entrepreneurial. Their academic accomplishments speak volumes, allowing them to draw salaries between 55,000 USD and 100,000 USD or more per annum.

They have a high affinity to form and fashion. These women are driven, sophisticated, outgoing, confident and thoroughly knowledgeable. their interests lie in indulging in art, pop culture, eclectic cuisine, traveling, networking and sustainable fashion.

The Product

Adamo's perfect fitting jeans are inspired by the motto of form meeting functionality.

They want to be with any woman that travels places in her jeans, thereby offering style and comfort at the same time. They are sure to add freshness to a wardrobe with a variety of cuts and washes. They come in sizes XS, S, M, L, XL, XXL in three color ways.

Ash - The regular-fit, mid rise jeans perfect for every day.

Maggie - The skinny-fit, mid-rise jeans so you can show off your curves in.

Lin - The wide-legged high-rise jeans sure to make a statement.

Shay - The mid-rise capri jeans that will be your spring/summer partner.

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Sourcing guidelines Adamo expects its suppliers and vendors to be o highest standards, thereby complying with all the guidelines it has laid down. An Annual Code and Compliance Review will be undertaken to check for adherence to guidelines. Subcontracting is not tolerated at any point.

We want to see working conditions as fair, with working hours being in accordance to what the country's government asks. Hiring practices should hold room for discrimination of grounds of gender, race, place of birth, caste or sexual orientation.

At no point do we want to tolerate child labour or forced labour.

We want the employees to have Freedom of Association and Collective Bargaining, health benefits and safety of the workplace they are in, without any harassment or abuse. We do not want to encourage accepting gifts or hospitality from our employees.

Taking care of the environment is a prime focus, thereby investing in Environmental Management Systems, Wastewater Treatment Policies and Procedures, Water Quality Programs, Animal Welfare, Sustainable Packaging Materials and saving electricity. We also want to watch closely the chemical inventory and restricted substances list, making sure it does not cause any damage to the localities existing close to the factories. Our chemical handling and disposal procedures will be as per universal standards and monitored on regular basis.

Cargo security will be assured for all units being transported into the United States, data will be protected with state-of-the-art security systems. Lastly, we wish to maintain traceability of every element that goes into manufacturing our jeans.

Strategy Development Process

The strategy development process is a very important piece to Adamo's supply chain strategy. In this section, we will uncover our country selection and how we narrowed down the fields to our final country selection. This will summarize information about the country and textile industry, our potential supplier, costing and margin requirements.

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Country Research Adamo aims to house the best pairs of jeans in the market. In order to do that, we need to partner with the very best suppliers and vendors.

We have researched several countries globally and narrowed it down to three to potentially source and manufacture our products. The countries in question are China, Egypt, Mexico and Vietnam. They have brilliant reputations for producing high quality apparel products. We researched country stability, culture, domestic suppliers, lead-times and state of the apparel industry.

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China With the launch of Adamo, a new luxury denim brand for women, it is important to analyze every aspect of its production through the supply chain cycle. After creating a unique design, drafting a tech pack and costs, it is now imperative to decide where the product’s suppliers and manufacturers will be located. This document provides the current and necessary information in order to determine if China is a viable country in which to conduct our business.

Specifically, what is covered includes country traits, country stability, lead-time of production, cultural insights, state of the apparel and textile industry, suppliers within the country, trade agreements, product classification, transportation and risks and benefits of manufacturing in China. This analysis will present the necessary tools in order to make a final decision on the production location of Adamo denim.

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Country Stability Political The Peoples Republic of China (PRC) is currently under the control of the Communist Party of China (CPC) which constitutes as a people’s democratic dictatorship. The country’s President is Xi Jinping who has been in leadership since March 2013. As of March 2018, President Xi was reelected for an additional five years in office. The Chinese parliament recently ruled in favor of capping the terms on presidency per ruler, therefore Jinping is eligible for reelection in 2023 and it is expected that he will once again be re-elected. The country’s one-party led government means that it is able to impose policies without having to engage in democratic discussions.

China has ties with numerous countries, nevertheless its strongest influence is with the African continent. As of 2009, the African continent surpassed the United States and became the country’s largest trading partner. It also has solid relationships with countries in South and South East Asia where it has financed ports, pipelines and naval bases, among others. Nevertheless, Japan and other countries in the same area accuse China of creating instability for the purpose of looking for authority and expansion in the oceanic region. At the moment, China also has a complicated relationship with India due to border disputes of two separated pieces of territory.

Another turbulent relationship is that of China with the United States. Their affairs can be defined as a complex mix of intensifying diplomacy, growing international rivalry, and increasingly intertwined economies. There has never been a good relationship with the United States, nevertheless disagreements began escalating in 2017 when President Trump broke diplomatic relations by accepting a conversation with Taiwan, a separated province from China. This was followed by the Trump administration setting tariffs in March 2018 on as much as $60 billion Chinese imports (BBC, 2). It specifically targeted steel, aluminum, clothing, shoes and electronic imports. China retaliated in April 2018 on a range of U.S. products as well, and as a result, many are calling this the beginning of a “trade war” between the world’s largest economies.

91 Since then, both countries have issued even more tariffs on incoming products. This has triggered global market unrest by causing instability in financial markets with growth slowing in China and higher interest rates beginning to affect the U.S. Nevertheless, at the G20 Summit in Argentina this past December both countries agreed to place a 90day temporary truce on tariffs. If they do not agree on a deal before March 27, $280 billion worth of sanctions will increase from 10% to 25% (Wibawa, 3).

Therefore, there is hope that President Trump and President Xi will meet this month and a consensus will be reached in order to alleviate the tension between the two countries to some extent. There is uncertainty as to what specific accord will be made between both countries, but many stipulate that the increase in tariffs would cause an even bigger dent in their economies and none of the administrations will follow through with it.

The “trade war� could affect our viability to produce our denim in China because if both countries do not come to an agreement and more tariffs are imposed, it could become unreasonable to import our product into the U.S. It would not make sense to pay such a high tariff when there are viable options to produce our denim elsewhere. The month of March will be critical as a consensus is said to be reached before the end of the month. Following this, we will be able to see the effect that this will have on our product specifically or hopefully none whatsoever.

Economic

USD to CNY Chart in the Last Ten Years

https://www.xe.com/currencycharts/?from=USD&to=CNY

02 China’s foreign exchange rate to the U.S. dollar is $1 dollar to 6.71 Chinese yuan as of March 4th. The yuan has remained constant during the last 10 years with a maximum fluctuation of $1 U.S. dollar during this period. The current inflation rate of the country is 2.61% compared to 2018. Inflation is estimated to increase at approximately the same rate as previous years for the next three years while not being artificially controlled (Statista, China: Inflation Rate from 2012 to 2023). It has achieved a 7.5 over 10 in the Foreign Investment Index means the country is at a high level of foreign investment viability.

Since China’s initiation of its economic reforms that welcomed foreign trade, the country has registered extraordinary economic growth. The power of the economy lies in the country’s creation of a more market-oriented environment which is fueled by relatively cheap labor and economies of scale. It is the fastest growing economy in the world, with a GDP of $23.12 trillion, which is approximately a 9% annual increase over the last 20 years. Since 2015, the GDP growth rate has lowered to average 5% annually and the country is now characterized by slower, safer and more sustainable improvement. The success of the economy can also be attributed to the increased access to foreign markets by having joined the World Trade Organization (WTO) in 2001. It is now one of the world’s largest trading countries and global economic forces and the second-largest economy after the United States (MarketLine: PESTLE Country Analysis Report: China, 23).

China: Growth Rate of Real GDP from 2011 to 2023

https://channellife.com.au/story/us-china-trade-war-a-double-edged-sword-for-ict-spending

12 China’s widespread availability of cheap labor has also negatively impacted the country by “Made in China” products having a bad reputation world-wide. In fact, Chinese-made products have a below average image when ranked for product attributes. Overall, the problem is attributed to the country needing a higher-skilled labor force. Approximately two-thirds of China’s labor force did not attend high school (Country Watch: China Country Review, 248).

The country needs to invest in human capital if it wants to be able to achieve a higher-value economy in the years to come. Since January of this year, China’s exports have fallen to the lowest point in the last two years and its imports are also down too (Yu, 1). This can greatly affect China’s economy in 2019 because if the “trade war” does not come to a truce, the country could come to see even lower numbers.

Although President Xi announced tax-cuts and higher infrastructure spending at the beginning of the year, its economy has seen better moments. A slowing Chinese economy is not positive for U.S. companies that depend on Chinese consumers to increase their sales (Frost, 2). Nevertheless, with the slowing down of the economy, conducting business in the country could be beneficial seeing as though prices would lower, given that the “trade war” with the U.S. comes to an end.

Social China has the largest population in the world, within the population there are a variety of ethnic groups, the Han Chinese being the largest which constitutes about 92% of the population, followed by 50 other minority groups. Although there are seven major Chinese dialects, Mandarin Chinese is spoken by about 70% of the population. China is officially an atheist country, but the most practiced religion is Buddhism followed by Christianity and Islam (MarketLine: PESTLE Country Analysis Report: China).

In 2013, the government partially changed the long-standing one-child policy to a two-child per family rule. As a result, the country has experienced a decrease in population growth with improvements in life expectancy but has increased in the aging population and will continue to grow. The aging population is a problem for the country because it can affect the economy by placing pressure on the government to increase spending on public pensions to take care of the elderly (Rapoza, 2).

22 It will also lead to a shrinking workforce which can impact the nature of conducting business in China since labor costs will continue to increase (Liang, 1).

China’s rapid industrialization has caused a labor migration to urban areas in search of better employment. As a result, there are large concentrations of migrant populations in major cities. This places pressure on urban infrastructure, congestion, pollution and elevates real-estate prices in the area. A uniform development of other provinces must be developed in order to confront the migration problem and alleviate density. The government has confronted these issues through the implementation of the 13th five-year plan which focus on improving social-welfare payment, healthcare and raising wages through 2020 (Country Watch: China Country Review, 351). This can also lead to increased labor costs in the country and therefore making it more expensive to manufacture in China.

Share of population aged 60 and older in China from 1950 to 2100

https://www.statista.com/statistics/251529/share-of-persons-aged-60-and-older-in-the-chinesepopulation/

Technological China’s most recent technological improvements are fueled by a change in policy focus initiated by the government from joint ventures to independent innovations. The Chinese used to rely on foreign investors to ignite technology through joint ventures, but due to an increased competitive environment world-wide, the country has shifted to promoting independent innovation with the goal of becoming a leader in global innovation.

32 By 2020, China aims to invest 2.5% of its GDP in research and development in order to continue to limit its dependency on imported technology.

China has prioritized research and development in the areas of information and communications technologies (ICT), aerospace, and nontechnology. Additionally, as set forth by the 13th five-year plan initiated in 2016, China will heavily focus on highend technology industries to improve the country’s overall image through 2020. The plan’s main aim is to improve energy-efficiency and clean energy through technology improvement (Country Watch: China Country Review, 421). This could positively affect the apparel industry since the country would adhere to more sustainable practices through technology improvement.

Lead times in China China is one of the countries with the fastest production lead times in the apparel industry. On average, a garment lead time in China takes approximately 30 to 60 days.

China is also one of the greatest textile manufacturers worldwide, therefore a lot of the fabrics and threads are sourced from within the country to many of the manufacturers.

Its mature and modern road and train network also help to support the quick delivery of materials within the country. Nevertheless, there are many important factors that should not be overlooked that may affect the lead times of production in China.

China has a lot of national holidays where operations shut down in all of the production facilities of the country. Two of the most important holiday’s which companies manufacturing in China should be aware of as they entail multiple consecutive nonworking days are the Chinese New Year in mid-February and the Chinese National Holiday in early-October (exact dates range depending on the year).

Nevertheless, during these holidays many factories close up to two weeks prior to the holidays and some may not open with a full-staff until two weeks after the holidays depending on where the factory is located and how far workers must travel to get to their families.

42 More importantly, during these holidays China’s ports also close. Other Chinese national holidays that companies manufacturing in China should take into consideration include the Qing Ming Festival early-April, May Labor Day early-May, Dragon Boat Festival mid-June and the Mid-Autumn Festival late-September.

Nevertheless, there are many other local holidays that some manufacturers may observe depending on the factory’s location (Baktiono, 2).

China’s large geographical area and diverse climate makes the country one of the most affected by natural disasters world-wide. Some of the natural disasters which have had the most impact on the country throughout history include earthquakes, typhoons, floods, forest fires and hail. Approximately 200 million people are affected by a natural disaster every year. Businesses across the country are also largely affected as these may cause the damage or destruction of crops, factories and infrastructure among others. (Prevention Web: China Disaster & Risk Profile).

If choosing to manufacture in China, companies should plan ahead and be very aware of national holidays as well as other observed holidays by the chosen manufacturer.

They should also be very knowledgeable on the supplier’s corporate customs as to approximately how many days it plans to shut-down during the holidays. Insuring products is also very important as a natural disaster can have a large negative impact on the company. Overall, companies should include extra days in their expected lead times as a way to buffer unforeseen causes that might affect the delivery of their goods.

Cultural Insights Business etiquette is of the upmost importance in China and something which must not be overlooked if a company chooses to conduct trade in the country. It is essential to adhere to the norms and practices as there are certain cultural drivers and expectations which may affect a company’s viability, or lack-thereof to successfully do business in China.

Hierarchy The Chinese are strongly influenced by Confucianism and its emphasis on respect towards age, authority and education. Although, nowadays much of the Chinese population may not adhere to this religion, it is still regarded as the norms and customs of how to appropriately conduct business.

52 The older person will receive more respect from the younger and the senior from the subordinate. Respect towards age, authority and education is something very important to keep in mind as Chinese believe the root cause of the problems of the Western hemisphere is lack of their adherence to hierarchical values.

Greetings and Titles A handshake is becoming the standard way to greet men and woman in a business setting. Depending on the seniority of the person, Chinese people might choose to nod or bow their head when shaking hands as well.

The handshake will tend to be light, and as it is impolite to look people straight in the eye, it is customary to look down as a sign of respect. Knowing a few common phrases in Mandarin such as “ni hăo” (hello), “xièxie” (thank you) and “zàijiàn” (goodbye) can go a long way. It is important to note that surnames are placed first, therefore Mr. Yao Shing should be addressed as Mr. Yao. Many women also choose to keep their maiden names, so it is best to not assume that their title is Mrs. and instead refer to them as Ms. Business Cards Business cards are generally exchanged before the beginning of a meeting. It is greatly appreciated if companies translate all the information to Mandarin on the back of the card. A person should also plan to bring plenty to a meeting as exchanging business cards is a common practice. The handing of a business card should follow strict rules as the Chinese place a strong emphasis on symbolism. It should be presented using two hands, between each thumb and index finger on the top corners. Never demonstrate that you are taking out your business card from your skirt or pants pockets as this can symbol that you are sitting on a person. Finally, when given a business card, it is seen as polite to examine it and offer positive feedback to the person who handed to you. Treat the card with respect as it symbolizes the person (McKay, 3).

Chinese ‘Face’ A person’s “miànzi” or face in China refers to how you come across as an individual. It is divided into two parts, ‘loosing face’ and ‘giving face’.

62 ‘Loosing face’ refers to showing a weakness in your counterpart or criticizing them in public and it can lead to both them and yourself ‘loosing face.’ Other ways in which a person can ‘loose face’ include interrupting or contradicting a superior, or even refusing an invitation to dinner or an event. ‘Giving face’ refers to giving someone a compliment or an expensive gift to demonstrate gratitude and therefore earn them or yourself a ‘giving face.’ A ‘giving face’ can also be achieved through inviting someone to dinner and paying for the meal as well. Overall, face is a very important aspect to conducting business in China seeing as though it can influence the ability to close a deal (InterNations: Understanding Chinese Culture).

Networking ‘Guanxi’ “Guanxi” can be literally translated as connection, relationship and or network. It is key to conducting good business in China as they believe that relationships and networks take time to build.

These include dinners, drinks, or even karaoke which is known as a favorite medium for developing relationships outside of the office. The Chinese expect to spend time outside of the office in order to build good business relationships (InterNations: Understanding Chinese Culture).

Negotiations Combining ‘face’ and ‘guanxi’ are the ultimate means of ensuring good negotiations. Before beginning a meeting, it is important to engage in small talk as it is considered rude to directly approach the main discussion. Expect negotiations to be pacific as Chinese will rarely ‘loose their face’ and will expect the same from you. Overall, negotiations in China take time, therefore it is expected that a successful compromise benefitting both parties will occur over a period of time, and not automatically.

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State of Apparel and textile Industry China is the world’s largest producer and exporter of textiles and apparels. The industry accounted for a total revenue of $366 billion U.S. dollars in 2018.

Nevertheless, the country is currently going through a period of transition due to increased labor costs, the U.S. trade war and overall international uncertainty.

Although for many years China’s clothing and textile industry focused on producing quantity, the country is now shifting towards more quality-oriented products. Even though the industry is going through a painful transition, growth of the apparel and textile industry is set to continue growing but at a slower pace (Leng, 3). Overall, China still holds at a great advantage over other important textile and apparel producing countries like the European Union and India.

As China’s economy grows and stabilizes, it can no longer maintain its low labor costs at a competitive advantage. Labor costs in China have steadily increased since 2002 when they were at $0.6 per hour to an impressive $5.78 per hour this year (Statista, Manufacturing Labor Costs per Hour for Select Countries from 2002 to 2019). This is also caused by policy makers adjusting the country’s economic growth so that it depends less on export manufacturing and more on service sand domestic consumption.

In order to cope with the transition of the industry, manufacturers are focusing on upgrading their industrial infrastructure, modernizing their production process, and adhering to global environmental policies. Some of these include lowering their carbon dioxide emissions and investing in solar and bioenergy. This is largely due to the widespread global stigma associated to “Made in China” products, and specifically related to apparel as well. With the country’s investment in high technology to develop advanced manufacturing systems and adopt world-class practices, China is still on route to increase its annual real manufacturing value of textiles and apparel by an additional $52 billion by 2021 (IBIS World, Apparel Manufacturing China). This means that we will be able to source more high-end products from China which can be beneficial for Adamo as a luxury women’s denim company. This is also impacted by the fact that the country is shifting from low labor costs to higher labor costs and more dedication to high quality products.

82 Manufacturing Labor Costs For China, Vietnam, Mexico from 2016 to 2020

https://www.statista.com/statistics/744071/manufacturing-labor-costs-per-hour-china-vietnam-mexico/

Suppliers Within China Crystal International group Crystal International Group is a manufacturer that was founded in Hong Kong in 1970 and its headquarters still remain in the city. It specializes in women’s, children’s and infant clothing and accessories. The company has a total of 20 self-operating manufacturing facilities across five countries. It’s corporate culture of caring stresses that it works “for the greater good” of its customers, colleagues, society and the global environment overall. Crystal International Group’s most relatable and important clients include Banana Republic, Old Navy and Target. More information can be found on the company website: https://www.crystalgroup.com/at-a-glance

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Springdale Group Springdale Group is a manufacturer that was founded in Hong Kong in 1984 and its headquarters still remain in the same city as well. The company specializes in in men’s, women’s and children’s blouses, dresses, pants, jeans, shorts and skirts. It has a current output capacity of over 1 million pieces a year and it is committed to innovation and society. Specifically, it maintains high ethical and social standards.

Springdale Group’s most relatable and important customers include Everlane, H&M and J.Crew. More information can be found on the company website: https://www.springdale.com.hk/hk-goals_h.php

J.D. United Manufacturing Corporation Ltd. J.D. United Manufacturing Corporation Ltd. Is the world’s largest denim producer.

The manufacturer was founder in 2005 and it is headquartered in Jiangsu, China. It specializes in men’s, women’s and children’s denim, jackets and skirts and it is comprised of a total of 31 factories. The company upholds four major core values which are integrity, empathy, courage and embracing change. Its most relatable and important customers include Levi’s, Gap and Uniqlo. More information can be found on the company website: http://www.jdunited.com/en-us/product.php

Trade Agreements As of today, China has a total of 14 signed free trade agreements and 24 additional currently under negotiations. China’s top countries to which it exports textiles and apparels include United States, Japan and Vietnam, in that order. Nevertheless, of those countries, it only has a free trade agreement with Vietnam as part of the ASEAN free trade agreement. Therefore, all products that are made in China must pay duties upon entering the United States.

03 The ongoing “trade war” with the U.S., as previously mentioned is also increasing the tariffs on many Chinese imported goods. If both countries do not come to an agreement, manufacturing in China could become very costly as the U.S. is set to continue increasing tariffs. Nevertheless, there is hope that all will be resolved this month. Therefore, the only reason that manufacturing in China would be beneficial, is if the manufacturing costs plus duties are lower than those of manufacturing in another country that does have a free trade agreement with the U.S. Our company must analyze as well whether the quality of manufacturing in China will also outweigh the disadvantage of having to pay an import duty upon arrival.

Product Classification The HTS code for women’s denim, which is the product that we will shipping to the U.S. is 6204.62.15.11. This HTS code applies to women’s trousers, of cotton, specifically made of blue denim. Seeing as though China has no trade agreement with the United States, the product must pay a duty of 16.6% upon entering the U.S.

Transportation Major Ports Port of Shanghai The Port of Shanghai is the largest port in the world to date. It is comprised of three ports total, nevertheless, our cargo would utilize the Baoshan Terminal as it is for general cargo and bulk. The Treaty of Nanjing makes this port a hub for international shipping. Its strategic location between river and deep-sea make the port very convenient and versatile.

The Port of Hong Kong is the third most important port in China. It is a deep-water seaport which mainly services South-East and East Asia as it located in the South China Sea. It is an economic gateway to mainland China which is dominated by trade of containerized manufactured products and raw materials and passengers to a lesser extent. Overall, it is the world’s sixth busiest container port in terms of traffic.

Port of Shenzhen The Port of Shenzhen is the name utilized to encompass a large number of ports along the coastline of Shenzhen, China. As a collective port overall, it is the fastest growing container port in the word, specifically the third busiest port globally and the second most important port in China after the Port of Shanghai. It services mostly international trade from the South of China.

Major Shipping Companies Seko Logistics Seko Logistics is a shipping company that was founded in Chicago in 1976. It has a total of 120 offices in 40 countries worldwide as well as a global reputation of being an innovative and flexible provider of first-class logistics services. The company is committed to developing efficiencies and optimizing supply chains. Specifically, it has five offices in China including Shanghai, Ningbo, Shenzhen, Xiamen, and Qingdao. The local offices in China and USA are all intimately familiar with local customs laws and regulations as well. Using this provider, it would take approximately 31 to 39 days for our shipment to arrive to the Port of Los Angeles from the Port of Shanghai. The approximate cost to transport a 40-foot FCL with this company would be $4,686.

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Port of Hong Kong

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Cma Cgm CMA CGM is one of the leading worldwide shipping groups which is currently present in 160 countries. The company specializes in anticipating the needs of the customers in order to provide them with innovative partnerships and intelligent solutions. The service 420 out of 521 commercial ports around the world and they pride themselves in being transparent, responsible and ethical. CMA CGM also has local offices in Savannah, GA. Using this company, it would take approximately 30 to 37 days for our shipment to arrive to the Port of Savannah from the Port of Hong Kong. The approximate cost to transport a 40-foot FCL with this company would be $4,380.

Maersk Maersk is the largest container ship and supply vessel operator in the world. It is currently present in 130 countries worldwide. The company specializes in developing solutions to meet customer needs from one end of the supply chain to another and it is known for its reliable, flexible and eco-efficient services. It also has port and terminal operation in Shanghai. Using this company, it would take approximately 25 to 30 days for our shipment to arrive to the to Port of Savannah from the Port of Shanghai. The approximate cost to transport a 40-foot FCL with this company would be $4,443.

China is the largest apparel and textile manufacturing country in the world. At a first glance, it would make sense to manufacture in this country. Nevertheless, after having reviewed China’s political, economic, social and technological landscape, state of the apparel and manufacturing business, lead-times, suppliers and transportation, there are a series of risks and benefits to conducting our business in China.

Some of the benefits from conducting business in China include that the country is the largest apparel and textile manufacturing country world-wide therefore it has a lot of experience in the industry and ability to produce large orders. The country also has endless amounts of suppliers and distributors from which to choose from.

As well as the fact that lead times in China could be shortened due to a vast array of textiles and other materials manufactured within the country. Finally, another benefit is that the government is investing in manufacturing infrastructure and adhering to global environmental policies therefore shifting to become more efficient and sustainable.

While some of the risks to conducting business in China include that the country has a bad diplomatic relationship with the United States and the unresolved “trade war” could impose higher tariffs on cotton products entering the country. The country has also seen an increase in labor costs annually and they are expected to continue to rise. Furthermore, there is stigma attached to “Made in China” products manufactured in the country and this can affect the perception of our denim line.

As well as the fact that culture and language barriers can make it difficult to negotiate and conduct business successfully in the country. Finally, it is important to mention that the minimum transportation time from China to the U.S. is 25 days from port to port, which can be considered very long if we need to receive our product fast.

Conclusion China is the second largest economy in the world and the biggest exporter of apparel and textiles worldwide. Although it is set to continue growing economically, it has various issues that could affect the production of our denim in the country. China has a very important unresolved issue with the United States. The “trade war” between both countries is predicted to come to an agreement soon, nevertheless it can heavily impact our business if it is not resolved. Furthermore, rising labor costs and “Made in China” stigma attached to many products produced in the country do not make it very appealing for a company producing luxury denim. Although China offers many benefits, we believe that the disadvantages might outweigh the advantages specifically for our company values and product.

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Risks and Benefits

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Egypt The first step when building a sourcing strategy is to research potential countries in which the company will want to conduct business in.  This research will give clear insight on the position and condition of Egypt. It will specifically present the country traits, an in-depth look at the political, economic, and social stability of the country, lead time of production, cultural insights, the state of the apparel and textile industry, suppliers within the country, trade agreements, the product classification, transportation, and the overall risk and benefits.  By doing this analysis we will be able to determine if the suppliers share the same values as our company and will be able to instill our guidelines throughout all levels of the supply chain. The long-term goal is to see if Egypt is a viable country to source women’s denim jeans.

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Country Stability Political Presidential elections took place in March 2018 and former president and Chief of the Egyptian Armed Forces, Abdel Fattah el-Sisi, won by a landslide. He then appointed Mostafa Madbouly to become the new Prime Minister of Egypt. Before this, Egypt had dealt with years of political instability. In 2011 President Mubarak handed over his powers to the Supreme Council of the Armed Forces (SCAF) and in 2013 President Morsi was removed by the military. El Sisi was trying to gain control over the public through “the curtailment of press freedoms and the suppression of civil society groups” (Abdel).

This only contributed to the people’s objection to the overall authority.

President El Sisi even went as far as “signing into law a new media regulatory framework that created three government-dominated supervisory bodies with sweeping powers over content and licensing, while providing few protections for the press” (Abdel). Egypt is ranked 3rd globally for its rate of putting journalists behind bars and has blocked over 400 websites for being a part of “illegal activity” or speaking negatively about the President. The government has been trying to eliminate freedom of expression through digital censorship as a way of gaining back control.

A current strength for Egypt’s political stability is support from the World Bank.

According to the World Bank, “it was key for international financial institutions to support the Egyptian economy” (Egypt). They have been focusing on projects that will foster prosperity and diminish poverty. In April of 2018, the government and World Bank made an agreement to support the Egypt Education Reform Project worth $500 million. This will help improve the teaching and learning conditions in Egypt’s public education system.

One of the ongoing challenges Egypt faces is the War against Islamic State. Within the past 3 years, this fight has only escalated. Sinai has long been a major territory for radical groups to grow and operate. In 2016, Egypt aligned with Israel and Hamas against ISIS in Sinani and in 2017 deployed militias in Sinai because a huge part of the Peninsula had been taken over by ISIS. ISIS also attacked Coptic Churches in Egypt killing at least 47 people and injuring over a 100. It was from that incident that Egypt declared a state of emergency.

83 On January 13th, 2019, the Egyptian government approved to extend the state of emergency for another 3 months. This was the 7th time it was being renewed since the attack in 2017. This has not only affected the Egyptian people, “The security services treat the Bedouin who live in Sinai as part of the security threat, which is consistent with the government’s long history of treating the symptoms of terrorism, not the underlying causes. So far, the government’s counter-insurgency strategy has not succeeded in eliminating the insurgency in the Sinai” (European Parliament). With all of these issues, Egypt is not considered stable. The people aren’t happy with the new regime and feel very isolated and frustrated due to the rules and early curfews.

Economic

Egypt’s economy has struggled for the past few years because of the 2011 revolution in Egypt, which forced one of Egypt’s most influential leaders, President Hosni Mubarak from power. Due to the political turmoil, there was an increase in unemployment and a decrease in growth rates, tourism, foreign investment and the value of the Egyptian pound.

There was a 60% drop in foreign exchange reserves and 25.2% of Egyptians sat below the poverty line, with 23.7% just above it. This set the country back and since then Egypt has been trying to dig themselves out of the hole.

Tourism is one key factor contributing to the local economy. However, due to the major threat of terrorism many tourists have steered clear from Egypt. The main reason is because in 2015 ISIS attacked a Russian plane that ended up crashing in the Sinai Peninsula, killing all 224 passengers on board. The aftermath was International governments stopped all flights going to Egypt because they deemed it unsafe. This caused tourism to drop to the lowest numbers in years at just 4.8 million. However, in late 2017 Egypt began to see a positive growth in tourism again due to an improved security situation. The improvement was due to an absence of terrorist attacks, new security measures at their airports, fully secured tourist sites, and other countries lifting their travel bans. In 2017, 8.3 million people visited Egypt and in 2018 the number was projected to be even higher.

93 One way the country is trying to boost the economy is with the Suez Canal since it is Egypt’s main source of foreign exchange. Before the expansion the canal capacity was 49 ships, by 2023 that number will increase to 97. By using the Suez Canal, ships are able to eliminate 10 days of their trip instead of sailing around Africa. With this expansion, the Suez Canal has the potential to double the amount of boats going through each day. The canal has also adopted flexible marketing policies that have attracted new shipping lines for the canal. This has really benefitted Egypt and helped boost their economy. For the 2017-18 year the canal hit the highest ever revenues at $5.6 billion compared to the previous year at $5 billion. When it came to ships, 17,845 crossed the canal, which increased by 841 vessels (4.9%) then the preceding year. They also recorded 97.6 million tons of total cargoes transferred, which increased by 9.8%.

Egypt has been aiming to attract a large amount of foreign investments. One way they are going about it is by amending their investment laws. This idea seems to be working as Egypt has attracted the Saudi Public Investment Fund, Kuwait, UAE, and companies such as Nissan and Toyota. Most of the FDI’s have been in oil gas and renewable energy.

However, potential investors are starting to look into healthcare, consumer goods, textiles, and manufacturing as these industries offer a $98 million domestic market.

Since the revolution and major terrorist attacks Egypt has been trying to improve with a bold reform program. The first set of reforms focused on trying to rebalance the macroeconomy with the VAT Law, reduce energy subsides, and fix the Egyptian pound.

The second set aimed at improving their investments situation with the Civil Service Reform law and the removal of investment barriers. One of the biggest reliefs to Egypt’s economy has been from their deal with International Monetary Fund (IMF).

This was a 3-year loan program worth $12 billion that aimed to achieve macroeconomic stability. This deal has benefited Egypt greatly. Unemployment was 11.8% in 2017 and it will fall to 10.4% in 2018. It has also helped in accelerating growth rates, lightening inflation, reduce the budget deficit and create more resources for social programs to support the most vulnerable. As reform momentum is continued, economic activity is expected to improve, and imbalances are expected to decline. Egypt’s GDP is expected to grow by 5.55% in 2020 and up to 6.0% in 2023 from 5.3% in 2018. This growth is expected to come from investments, strong private consumption, and a gradual increase in exports.

04 Egypt’s economy is slowly working its way back to a stable economy. Its growing population, low cost labor force, and large domestic market are positive factors contributing to the overall goal. Egypt’s next phase should be continuing to put forth new investment laws and revise their bankruptcy law.

Social Egypt is the most populous country in the Middle East and the second most populous country in Africa. The question becomes how Egypt will manage to provide for all of its people? The problem with the growing population is that it is concentrated in one small area. The urban centers will struggle to provide resources for the community: housing, food, jobs, sanitation, and education. In rural areas in Egypt 21.3% have poor access to food 8.8% in urban areas, and in rural upper Egypt 38.7%. As a way to create better access the government increased the allocation of food smart cards and offered cash transfer programs. Also, just this past May, Egypt’s Ministry of Supply and Internal Trade (MoSIT) and the World Food Programme (WFP) signed a 5-year contract to enhance social safety nets to support the food and nutrition needs of the less fortunate. Since started there has been 246.73 mt of food assistance distributed, $1.88m cash-based transfers made, and 489,145 people assisted in December of 2018.

Another issue with the growing population is the toll it puts on the job sector. Two thirds of Egypt’s population are under the age of 29 which puts a strain on public finances, but also increases the job demand. This causes an issue because the demand is faster than what the job sector can generate. The outcome is that many people are struggling to find a job. As mentioned previously, the unemployment rate has decreased however, this is one of the main reasons it was so high to begin with. The World Bank Group (WBG) launched the Development Marketplace (DM) competition in Egypt in November 2012, in order to create jobs in the agricultural sector in Upper Egypt. The winners of the competition are given financial and technical support by the WBG and they receive expert advice in different areas from the International Finance Corporation (IFC).

In healthcare there have been three major initiatives one being, in June of 2018, the government and the World Bank made agreement to support the goal of improving Egypt’s public health care system worth $530 million. The money will be used to expand family planning services, boost its Hepatitis C program, and support the new health insurance system.

14 Another was in July 2018, where Egypt's Ministry of Investment and International Co-operation and the US Agency for International Development (USAID) signed agreements worth $45 million, $5 million will be spent on family planning as well as a 2018 survey on health and demographics. The other initiative also in July 2018, Sahar Nasr, Investment and International Co-operation Minister, and World Bank Director Nagy bin Hussein, signed a $530 million agreement to support the development of the healthcare sector in Egypt.

In the 2017–2018 Global Competitiveness Report, Egypt was ranked 100th out of 137 countries in terms of the quality of health and primary education; this demonstrates the need for improvement. However, Egypt has been taking steps in the right direction to boost the overall well-being of its people. The only thing to keep in mind is that the political turmoil will have an immediate effect on everything else.

Lead Times in Egypt According to World Bank, Egypt’s Logistic Performance Indicator (LPI) score was 2.82 out of 5 (1 = low 5= high) and their LPI rank was 67. The LPI is the weighted average of the country’s scores on 6 key dimensions: efficiency of the clearance process, quality of trade and transport related infrastructure, ease of arranging competitively priced shipments, competence and quality of logistics services, ability to track and trace consignments, and timeless of shipment in reaching destination within the scheduled or expected delivery time. Being that Egypt has a predominantly dry climate, there are very few delays that should occur due to inclement weather. One factor that could delay the lead time of production is the celebration during the holidays. The biggest holidays in Egypt are Ramadan, Eid Al Adha, and El Hijra. During Ramadan working hours for business and government officials are shortened. It will also need to be kept in mind that the work week in Egypt is from Sunday to Thursday.

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Cultural Insights Egyptian business values are influenced by traditional culture: Islam, family, pride, and education. Honor and hierarchy are highly valued. The person with the highest-ranking title will be the one making the final the decision. However, it is still important to have experienced and knowledgeable people beside you. Business meetings in Egypt are very formal. Men should come dressed in a suit and tie and women should be very modest with long sleeves or a dress / skirt that covers the knees. When conducting Egyptian business, it is recommended to have an Egyptian representative who can act as a middle man. An email followed by a phone call is the best way to reach out to someone. When scheduling meeting times it is important to make them a week in advance, as well as keeping in mind that business is not conducted on Friday’s.

When it comes to greetings, a hand shake is appropriate, as well as addressing them by their title, followed by their surname. A business card is usually exchanged at this time, with one side being in English and the other in Arabic. At the beginning of meetings, it is common for a gift to be given. When giving or receiving a gift, you must use either both of your hands or just your right hand, as using the left is deemed disrespectful.

The gift should be opened later. It is also common to start out with drinks and small talk. It is very important to not rush this process. During small talk it is not appropriate to discuss female family members or politics. You can however ask about their overall family or health. This helps to establish a personal connection with them beforehand.

In giving the actual proposal, Egyptians appreciate a very thorough presentation, you must make sure to include two dates the Georgian and the Hijrah, as well as making direct eye contact. This is considered a sign of honesty. Expect interruptions throughout the meeting. Avoid high pressure tactics, bargaining is an essential part of Egyptian culture and not making another proposition is viewed as a sign of weakness.

For business dinners, it is recommended to show interest in the culture and local cuisine. You must only eat with your right hand. It is considered polite to leave a small portion of food on your plate, this lets everyone know you’ve had enough to eat. When preparing for negotiations, Egyptians must know and like you to conduct business.

34 Personal relationships are necessary for long term business. US firms should wait until they establish a friendly relation with Egyptians, then they may begin negotiations, but make sure there is a good understanding between both parties. Overall, the pace in Egypt is much slower, it may take several meetings to accomplish a task. Decisions are not taken lightly and are thoroughly thought over. If a decision is not reached, it is essential to schedule another meeting with a concise date, place and time.

State of the Apparel and Textile Industry Egypt has a vertically integrated apparel and textile industry starting from the raw materials all the way to the finished apparel. This is the second largest sector next to agriculture and plays a pivotal role in the Egyptian economy. It is accountable for 16% industrial growth and employs almost 30% of Egypt’s industrial workers (1.2 Million people). “The apparel sector accounts for 3% of GDP and 27% of the industrial output.

25% of the total industry is focused on textile production, of which 12% are engaged in home textiles, 8% in cotton yarn, and 5% in other textiles” (fibre2fashion).

In 2018, Egypt had over 1,500 garment factories. According to the Ministry of Trade and Industry (MTI), exports increased by 12% and imports declined by 59% in 2017, showing that Egypt has been more focused on sourcing most of their goods from other countries.

The US is the number one export country for Egyptian textiles according to the General Organization for Export and Import control. The US receives 53.5% and the EU with 31.7%.

One factor benefiting Egypt in the global market is Egypt has 15 commercial ports that help facilitate all of its exports. Another factor being a low-cost environment. Egypt signed a QIZ agreement with US and Israel where it allows its manufacturers tariff and quote fee access into the US markets. The trade agreement section below goes more in depth into how companies can qualify for duty free.

The goal from the government is to keep boosting the local textile industry. One way they are going about it is by signing a 2-year deal worth $1.72 million with the Industrial Development Organization and the Italian Agency for Development Cooperation to increase the added value of Egyptian cotton.

44 The goal from the government is to keep boosting the local textile industry. One way they are going about it is by signing a 2-year deal worth $1.72 million with the Industrial Development Organization and the Italian Agency for Development Cooperation to increase the added value of Egyptian cotton.

This deal helped pave the way for the future of the industry, for example, the Vision 2025 policy. The vision of this policy is for Egypt to become the leading exporting MENA country in the textiles industry, focusing on high and medium value-added products catering to the world’s largest retailers and manufacturers with reliable and agile delivery. With this policy the government is aiming to create one million jobs in the textile and apparel industry.

“The agreement includes capacity-building training for 400 cotton farmers, workers, and students at 15 textile companies” (oxfordbus). With this deal in place, farmers were able to sell long staple crops at $180 per qintar and short / medium staple at $125 per qintar.

Suppliers Within the Industry Lotus garment group They have over 24 years of experience in the denim industry and employ 11,800 people.

Lotus has a daily capacity of 54,000 pieces of denim. They are located in Port Said Public Free Zone, P.O. Box20 - Port Said 42111, Egypt, which would be beneficial to ADAMO because they are in the QIZ zone and therefore our products would be duty free. Some of their customers include Wrangler, Polo, Gap, Chaps, Lee, and Levi’s. They have received many certifications for example: ISO 9001, ISO 14001, OHSAS 18001, Global Security Verification, and WRAP. They are prepared to the meet the sustainability future challenges of production with less water and chemicals, reusing water, and solar energy.

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T&C garments They were established in 2011 and produce more than 6 million denim bottoms a year.

They are planning to expand to be able to produce up to 13 million garments a year.

They are located in 67, Cairo Alexandria Agriculture Road, Kalioub Station, Cairo – Egypt in the QIZ zone. Some of their clients are Levi’s, American Eagle, and Calvin Klein. The certifications they have received are: OHSAS 18001, ISO 9001, ISO 14001, and WRAP. Being that Levi’s is one of their customers they will comply with all of Levi’s guidelines and code of conduct, so they will definitely meet ADAMO’s as well.

Vertical Jean Company The last supplier is Vertical Jean Company. Vertical is a private free zone company established in 1998. They employ 1,000 people, and export 100% of their product to the US and Europe. They are located in the QIZ zone at 38 El Mooltalca El Araby Bldg Sheraton Heliopolis Cairo Egypt. Some of their customers are Kohls, Walmart, K-Mart, and Target. Vertical has the WRAP, GSU, ISO 9001, ISO 14001, and ISO 18001 certifications.

They are committed to meeting the needs of their clients.

Trade Agreements There are no existing free trade agreements between Egypt and the United States.

However, the US introduced the Qualified Industrial Zones (QIZ) in 1996 with the hopes of restoring peace in the Middle East and creating relationships that will benefit Israel and Arab countries. In December of 2004, Egypt signed the QIZ, which allowed for duty free entry into the US for products manufactured by Egypt and Israel. In order for these products to be considered eligible, the country input shares must total 35% of the appraised value of the product at the time it enters the US, Egypt must contribute 11.7% of this value, and Israel must contribute 10.5%. The benefits to QIZ are easy access to the US market, low factor costs, huge supply of labor force, and exemption from tariff and non-tariff barriers. A positive impact from this agreement is that many companies have been looking to locate and qualify their businesses within these zones.

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Product Classification The HTS code for women’s denim, which is the product that we will shipping to the U.S. is 6204.62.15.11. This HTS code applies to women’s trousers, of cotton, specifically made of blue denim. Seeing as though China has no trade agreement with the United States, the product must pay a duty of 16.6% upon entering the U.S.

Transportation Some of the major ports in Egypt are Alexandria, Damietta, Suez Dekheila, Suez, Petroleum, Port Said, East Port Said, Arish, Adabiya, Nuwaliba, Al-Tour, Sharm El Sheikh, Hurghada, Sokhna, and Safaga. When it comes to the transportation route there are no stops in between. It will take a total of around 20-25 days. Both shipping lines offer the same lead times and routes. The transit time between the Egyptian port and Savannah port is around 20-25 days. Maersk and Mediterranean Shipping are freight companies that will ship to the US. The cost of shipping from Port Said to Savannah Georgia; Maersk: $4,383 and Mediterranean $4,644.

Risk and Benefits It is essential to analyze both the benefits and risks of the manufacturing apparel in Egypt.

The political turmoil really took a toll on the country; however, in the past few years, the government has been trying to make a turnaround. They have put policies into place that will help the economy and continue to try and attract foreign investors. For example, the QIZ is one of the policies that has been the most effective and will be beneficial for the apparel manufacturing industry, as well as our company.

There is a lack of stability in the political, economic, and social aspects. The ongoing war between the Islamic state has lessened the overall safety and in turn has caused a decrease in tourism. Egypt has also faced numerous issues regarding human rights, poor education, unemployment, and food safety. Each of these factors into the overall health and prosperity of its people.

74 However, the government has been launching programs to help improve these issues.

Egypt has a growing population, low costs of skilled labor, and large domestic market that makes it a great option for manufacturing. With their unemployment rate set to keep decreasing in 2019 it makes it a viable candidate for our company.

Conclusion After conducting in depth research on Egypt, it is evident Egypt holds major potential for business opportunities. Â While there has been a lack of stability and some turmoil, the country has been generating a lot of positive changes and therefore the benefits outweigh the risks. Â There are threats that need to be kept in mind, but the future outlook for Egypt looks very promising. It has the capability to continue to be one of the largest players in the denim industry and is a great choice for manufacturing. Â The key to the overall success is finding a supplier that meets our standards and will be transparent on all levels of the supply chain.

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Mexico Since the establishment of WTO on January 1995, Global trade has developed rapidly in just two decades. Especially in the apparel industry, the manufacture factories and logistic are playing a crucial role when the apparel industries continue optimization of collaboration.

This document will bring forth the sourcing opportunities and difficulties faced while importing from Mexico for our brand ADAMO Women’s jeans. Introducing aspects such as Mexico’s country traits, its current and future economic, political, social and technical position, the culture, the companies we wish to source from along with transportation companies. A briefing on the state of the apparel industry, Trade agreements that affect the lead time, were also used the analyze the benefit and risk associated with sourcing from Mexico.

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Country Stability Political The government is separated in three different levels, the federal union, the state government and the municipal government. In the Congress, there are eight parties represented. The biggest parties are the conservative Partido Accion Nacional, the liberal Partido de la Revolucion Democratica and the Partido Revolucionario Institucional (Donquijote.Org, [referred 10.12.2016]). The Federal Executive branch is headed by the President of Mexico, who is Head of Government, Head of State, and Commander in Chief of the Armed Forces. The President, the Governors of each state and the Mayor of Mexico City serve a single six-years term in office with no opposability of re-election. The Legislative Branch is constituted by a bicameral Federal Congress, which is divided into a Senate (Upper Chamber) and a Chamber of Deputies (Lower Chamber). The Legislative Branch of each of the thirty-two federal entities is composed of one single chamber: those belonging to the thirty-one states are called local congresses and for Mexico City it is called the Legislative Assembly.

On July 1st, 2018, federal and local elections were held in Mexico for President, Andrés Manuel López Obrador, candidate of the coalition “Juntos Haremos Historia” formed by MORENA (National Regeneration Movement), PT (Workers Party) and PES (Social Encounter Party), was elected President of Mexico. López Obrador won 53% of the vote.

President Melo takes power with vow to transform Mexico and he promised to fix poverty, corruption, and crime on behalf of ordinary Mexicans.

The current government has announced several reforms meant to create more dynamic environment for competition, boost the economic growth of Mexico, create more jobs and take actions against corruption, to name a few goals of the reforms (Ahonen, 2015, 59). (Gobierno de La Republica, 2016). They are currently in process and divided into ten sections.

25 These reforms that the government is doing are listed as follows: – Telecommunications reform – Economic competition – Financial Reform – Tax Reform – Labor Reform – Education Reform – National Criminal Procedure Code – Appeal Law – Political-Electoral Reform – Transparency Reform.

These reforms are part of President Pena Nieto plan to influence the economy of Mexico. From the perspective of American companies, all these reforms are conducive to the stable development of production and manufacturing in Mexico.

For example, regarding labor reform, workers can be better protected by law, and the minimum wage level is guaranteed and there is a better working environment.

Economic

According to MarketLine, in 2016 and 2017, the economy grew at moderate rate of 2.29% and 2.27%, respectively, driven by the strong manufacturing and services sectors.

The growth was based on the strong export-based manufacturing sector due to strong demand from the US and a weakening peso. According to MarketLine, the economy grew modestly by 1.97% in 2018. and the GDP composition of Mexico in 2018 was sectored by service industry (64.6%), industry accounting for 31.7% and agriculture accounting for the remaining 3.6%

35 In addition, the Trump presidency is having a detrimental effect on the peso, which, as of March 2017, had fallen by 12% since the US election of 2016. Trump's rhetoric on trade and immigration, which directly effects Mexico, is causing the currency to trade idiosyncratically. Now, 1USD=18.99MXN.

However, from the perspective of American companies, most of the transactions like this that take place within Mexico are dollar denominated sales. There are lower costs that result in a higher margin and improved profitability as the peso devalues.

Mexico's exports are growing steadily, according to the IMF, Mexico’s exports reached a total of $398.0 billion in 2016, as compared to $403.5 billion in 2015. According to the CIA World Factbook, the key export partner of Mexico in 2016 was the US, accounting for 81.0% of total exports. On the other hand, the major importing partners in 2016 were the US (46.6%), China (18.0%) and Japan (4.6%), the United States is still the largest exporter to Mexico.

External trade of Mexico2012-16, Country Statistics from Marketlines, Mar. 2018.

The unemployment rate in Mexico has been declining year by year. According to MarketLine, the unemployment rate averaged around 4.39% during 2012-17. In 2018, unemployment rate is estimated to be 3.26%. Unemployment Rate in Mexico is expected to be 3.20% by the end of this quarter, according to Trading Economics global macro models and analysts’ expectations. In the long-term, the Mexican Unemployment Rate is projected to trend around 3.50% in 2020, according to our econometric models. From the perspective of American companies, the low unemployment rate indicates that the quality of workers has become higher., and it could also keep Mexico's manufacturing sector growing.

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Social Mexico, officially the United Mexican States, is a federal republic in North America. It is bordered on the north by the US, on the south and west by the Pacific Ocean, on the southeast by Guatemala, Belize, and the Caribbean Sea; and on the east by the Gulf of Mexico. Covering over 760,000 square miles, Mexico is the fifth largest country in the Americas by total area and the 13th largest independent nation in the world. With an estimated population of over 113 million, it is the eleventh most populous and the most populous Spanish-speaking country in the world and the second most populous country in Latin America. According to OECD, in Mexico, the average net adjusted disposable income of the top 20% of the population is an estimated $32,756/ year, whereas the bottom 20% earn an estimated $2,570/ year.

Mexico is the most populous Spanish-speaking country in the world and the second most-populous country in Latin America after Portuguese-speaking Brazil. About 76% of the people live in urban areas. Many Mexicans emigrate from rural areas that lack job opportunities–such as the underdeveloped southern states and the crowded central plateau–to the industrialized urban centers and the developing areas along the U.S.-Mexico border. According to Population Report of Mexico, the population of the area around Mexico City is nearly 22 million, which would make it the largest concentration of population in the Western Hemisphere. Cities bordering on the United States–such as Tijuana and Ciudad Juarez–and cities in the interior–such as Guadalajara, Monterrey, and Puebla–have undergone sharp rises in population in recent years.

55 According to MarketLine, as of 2017, an estimated 26.9% of the Mexican population is aged 14 years and below, while just 7.1% are 65 years or older. Approximately 65.99% of the population is aged between 15 and 64 years old. This implies that Mexico has a large working age population.

Mexico has made great strides in improving access to education and literacy rates over the past few decades. According to a 2017 World Bank report, enrollment at the primary level is nearly universal, and more children are completing primary education. The average number of years of schooling for the population 15 years old and over was around 8 years during the 2017-2018 school year, a marked improvement on a decade earlier–when it was 6.8 years–but low compared with other Organization for Economic Cooperation and Development (OECD) countries.Almost all children attend elementary school, and around three out of every four attend middle and junior high school.

Nevertheless, a high dropout rate from high school traps most Mexicans in a vicious circle of poverty and low skilled work.

Technological

Mexico's textile workers are specialists and are diversifying. Because of the growth in China in the manufacturing sector, Mexico had slipped from their largest apparel supplier to the sixth largest by the end of 2017. However, from the perspective of American companies, this drop-off exposed an asset to the apparel manufacturers seeking partners in Mexico’s specialized workers in textile and apparel industry remained, such as cotton manufacturing and specialty fabrics producers for such products as jeans that required a more skilled labor force. By 2017, US specialty and industrial fabric exports to Mexico accounted for approximately 50 % of total specialty and industrial textile exports from the US, representing a 1.13 % increase over the previous year.

Mexico’s technology space boasts significant opportunities for growth. With growth in foreign investments in almost all economic sectors and the construction of new economic zones, the scope for development in the IT sector has increased more than ever before. In recent years, indicators such as the number of Internet users, PCs per capita, and mobile density have shown significant progress.

65 According to MarketLine, mobile penetration was estimated at 90.4 per 100 people in 2017 with total subscribers at 111.7 million. Mobile subscribers grew by an average of 6.0% during 2008-17. Internet users as of 2017 stood at 77.8 million, with a penetration rate of 62.9% of the total population in the same year. Internet subscribers grew at an average rate of 13.7% during 2008-17. From the perspective of American companies, Mexico 's technology space boasts significant opportunities for growth. The benefit in production equipment update and the development of technology, so as to provide better production efficiency and product quality. On the other hand, the development in the IT sector makes it easier for American companies to share real-time data with Mexican suppliers and create digital platforms. More conducive to communication and supervision between overseas companies.

Outlook: Due to structural reforms being brought in by the Mexican government, Mexico’s medium-term outlook is better. Mexico is considered to have strong growth prospects due to its anticipated commercial growth and its proximity to the US. However, with Trump’s pledge to get jobs back in his country and his hateful campaign against Mexicans, the Mexican economy might just become a casualty of its neighbor’s protectionist agenda.

However, from the perspective of American apparel companies should consider the problems such as labor market inefficiencies and weak competition in certain key domestic sectors, low levels of lending by the banking system and poor educational outcomes.

Lead Times In Mexico, the conditions that may affect production lead-time are diverse. Among the conditions listed and approved by the government, natural disasters influencing leadtime include drought in North America, drought occurring in Mexico and the Southern United States, fire season, the blizzard in North America, and winter storm of the Gulf Coast. Another natural occurrence influencing the effectiveness and timely delivery of production targets concerning lead-time entail the outbreak of tornado 4th flood in Texas, events that occurred in 2015. Reports documented by the Mexican government highlight that the country is not excluded from natural disasters. Specifically, some of the disasters classified under the natural disasters category comprise active volcanoes, flooding, hurricanes, and earthquakes. Although the scenic beauty of Mexico is commendable, the supply and logistics side of the country always sits on the verge of extinction from natural causes.

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Cultural Insights

The possibilities and opportunities of launching and conducting business in Mexico are numerous. However, the potential risks of business performance and sustainability are many if the business entity is not aware of the business and communication culture in Mexico (Espinoza, Ignacio, and Aguiló 42). In business, engaging in overseas exportation or opening local and international outlets demands a comprehensive understanding not only of the host country’s regulations and laws but also the corporate etiquette and culture. In Mexico, there is no exception because the appropriate sales projection does not correspond with the persuasion needs of sellers performing their business in Mexico (Ferraro and Briody 22). Several cultural insights have been outlined to control the success and sustainability of conducting business in Mexico.

Firstly, it is critical to consider that Mexicans conduct business transaction with the person about whom they have positive perceptions. Considering the demands of positive associations required by the business culture, it is important for new and international businesses to create robust relationships with the people (Ferraro and Briody 21). In order to Construct a professional and friendly bossiness relationship, people requires understanding how to communicate with the people as well as expressing the allowed interaction habits. Some of the behaviors that can foster better business relations with Mexicans include punctuality and keeping promises, emphasis on reasons for delays in meeting the deadline, clarification of delivery time, and the application of words in expression business dates.

Regarding communications and language required for the successful performance of business in Mexico, multiple aspects should be considered. Primarily, communications and language in Mexico involve the need to express politeness and good manners (Pisani and Richardson 109).

For the business person, the urgency of understanding and speaking the English language is supreme. It is important to learn the fundamentals of Mexican language, which include expressions such as disciple (excuse me!), adios (goodbye!), gracias (thank you!), and por favor (please!).

85 Another consideration that should be adopted by every business person entails the need to higher an interpreter who is conversant of the Mexican language and business etiquette (Calderon, Cunha, and Giorgi 15). It also important to understand some elements of formal expression required when addressing strangers, superiors, employers, and elders. Finally, the communications and language culture in Mexico requires addressing individual using words such as Senorita, Senora, and Senor. In this regard, titles should the respected in the formal communication contexts.

Regarding the corporate culture and business relations in Mexico, entities should understand that Mexicans are accustomed to conducting business with their friends (Shenkar, Luo, and Chi 28). Furthermore, Mexican culture advocates developing friendly and warm relationships with their associates. Several of business deals in Mexico are conducted in person without engaging in anonymous and long-distance phone calls (Zikmund et al 32). Generally, instituting a discussion with a Mexican regarding business requires a short and information discussion about the family, weather, and other general themes.

State of the Apparel and Textile Industry Mexico is a major textile producer, with an industry based on competitive labor costs and geographic proximity to the United States. U.S. specialty textile producers can capitalize on the large Mexican sector, but apparel company need to understand a few topics, particularly some technical requirements including rules of origin, verification audits, and reference prices.

According to the Mexican National Institute of Statistics and Geography (INEGI), 63 percent of the Mexican textile industry is concentrated in the central and north-eastern parts of the country, including Puebla, Mexico City, and the states of Mexico, Hidalgo, Tlaxcala, Jalisco, Guanajuato, Nuevo Leon, and San Luis Potosi. The textile and apparel industries account for 7.1% of Mexico's Manufacturing sector GDP (textiles 2.3%, apparel 4.8%) 2018. These sectors account for nearly 20% of all manufacturing employment in Mexico. This equates to employing almost 415,000 workers serving 22,000 apparel companies in 2018.This growth in the number of workers and plants is demonstrating benefits to the US: Textile and apparel exports to Mexico increased from $5.89 billion in 2016 to $6.21 billion in 2018.

95 Most important to Mexico's textile and apparel industry revival is its increasing focus on higher quality and a broader product portfolio. As a result of the of the skill of the maquiladoras in cutting and sewing, apparel manufacturers are benefiting from entering niche fashion markets, and a move away from high-volume production.

Mexican clothing producers are working increasingly closely with brands in the US to help meet specific requirements, and that a growing number of suppliers are offering full package manufacturing, particularly for denim, which is Mexico's leading apparel export, and T-shirts.

Textile firms in Mexico and the Mexican Government realized they needed to increase their competitiveness by investing in expanding production centers and manufacturing high-quality textile products in order to compete in international markets. One of these areas are Technical Textiles. Mexico is the largest market for US technical textiles and plays a special role in trade with the United States textile market. Mexico, therefore, is an ideal starting point for new exporters.

Outlook: According to Inside US Trade, the National Council of Textile Organizations (NCTO) which represents the US textile industry says it is “Encouraged by the information released by USTR, NCTO respects to strengthen the rules of origin for textiles and apparel in the announced agreement with Mexico.” in 2018.

Mexico’s textile and apparel industry are becoming more diversified and expanding with newer investment in technology and infrastructure. The Mexican Government is keen to support and encourage the continued growth of the textile and clothing sector. It has introduced a sector-specific program aimed at strengthening the competitiveness of firms and providing a stable and dynamic environment for investment.

Specific objectives include ongoing modernization through the introduction of hightech solutions and the development of technical skills, the promotion of innovation and encouragement of foreign and domestic investment. Mexico offers security and legal protection for foreign investors through the EU-Mexico FTA, as well as Bilateral Investment Treaties (BITs) negotiated with 20 countries.

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Suppliers Within Mexico Grupo Kaltex After growing steadily for nearly a century, Kaltex now a full-service textile company that produces acrylic fiber, yarn, fabrics, clothing and home textile products. It employs more than 18,000 people in North, Central and South America, and exports its products around the world.Their head office locates at Ingenieros Militares No.2 Empleado Municipal 53380 Naucalpan de Juarez Estado de Mexico. For them, protecting the environment has always been a moral principle that has guided us for over 90 years. All their plants and processes are clean, and their team is committed to preserve the environment natural balance. They are ISO-9001-2009 and ISO 14000 certified, and in compliance with C-TPAT, Levi´s® TOE and Ikea’s IWAY standards. At Kaltex, sustainability is part of taking the long view, set up a complete water saving, energy management, and developing the recycled cotton and PET fibers using a proprietary technology.Their customers are all well-known jeans brands, including: Levi’s, Group M, Coltejer.

Monty Industries Sa De Cv

It is now a full-service textile company, which has facility employs over 2,000 people and is able to produce over 3.6 MM units yearly. Their head office locates at Tehuacán 444, Lomas del Sur, 72470 Puebla, Pue., Mexico. Monty is a sustainable and eco-friendly company. They has highly skilled, creative professionals, washing techniques and 30 years’ experience in the international worldwide delivery. Monty was Certificated in ISO9001:2000 by DNV Veritas. Certificated in C-TPAT Supply Chain Security by U.S Customs and Border Protection. Recognized since 2002 by WQC (World Quality Commitment). Their customers include Polo Ralph Lauren, American Eagle, Eddie Bauer, R13, Karen Kane and Fashionable Moxie and Moss.

Private Label Tehuacan, S. De. R. L. De. C. V.

After growing steadily for nearly a century, Private Label Tehuacan has 23 Years of manufacturing of denim fabric and It employs more than 6700 people in Mexico and exports its products around the world. Private Label Tehuacan locates at Calle 27 No. 400 X 50 Y 52 Parque Industrial Motul, Muxupip, México. They are committed to meeting the need of their clients and provide the full package services. They are Certificated in ISO9001:2000 by DNV and C-TPAT Supply Chain Security by U.S Customs and Border Protection. Their customers are all well-known skate jeans apparels brands, including: Eddie Bauer, Blue Tomato, Tonello, Jatro Bcn.

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Trade Agreements Textile and apparel, along with automotive production, is almost certainly the most important export market for Mexico sector; Mexico has been the key US supplier, ahead of China, Hong Kong and Taiwan. This industry has been helped tremendously

by NAFTA: Since 1993, when the treaty went into place, textile and apparel exports to the United States skyrocketed. The increase in exports also triggered a wave of new investment in Mexico which is now at an all-time high, and many companies are wisely using to upgrade their equipment, factories and infrastructure. Because of NAFTA, Mexican manufacturers enjoy low or zero-percent US import duties for many products, unlike China. The ease in which goods can be brought into the country helps keep supply chains leans, also enhancing Mexico’s competitiveness.

Recently, The US has reached a preliminary agreement regarding a new trade accord with Mexico that could replace the North American Free Trade Agreement (NAFTA), including stronger textile provisions than the original trade pact, and designed to incentivize greater US and Mexican production in textiles and apparel trade. The agreement was announced by President Donald Trump August 27, 2018, which means that the new agreement will create more balanced, reciprocal trade that supports high-paying jobs for Americans and grows the United States and Mexican economies.

It hailed a key achievement as strengthening supply chains to provide new market opportunities for the textile and apparel sector, adding the new provisions on textiles incentivize greater US and Mexican production in textiles and apparel trade, strengthen customs enforcement, and facilitate broader consultation and cooperation among the parties on issues related to textiles and apparel trade.

According to USTR, the provisions will promote greater use of Made-in-the-USA fibers, yarns, and fabrics by limiting rules that allow for some use of non-NAFTA inputs in textile and apparel trade and requiring that sewing thread, pocketing fabric, narrow elastic bands, and coated fabric, when incorporated in apparel and other finished products, be made in the region for those finished products to qualify for trade benefits. They will establish a textiles chapter for United States-Mexico trade, including textile-specific verification and customs cooperation provisions that provide new tools for strengthening customs enforcement and preventing fraud and circumvention in this important sector. “The new textiles chapter provisions are stronger than those in NAFTA 1.0 with respect to both enforcement and incentivizing North American production of textiles," said the USTR statement.

26 So, manufacturing in Mexico is a viable option for companies exploring ways to cut production and labor costs while maintaining a North American manufacturing footprint. Some of the manufacturing benefits include capitalizing on NAFTA (North American Free-Trade Agreement) and the IMMEX Program (formerly known as the Maquiladora Program/Industry), energy cost savings and a highly skilled and productive workforce to name a few.

Product Classification Women’s blue jeans. HTS code: 6204.62.1511, duty rate is free due to the NAFTA. The begin of the HTS code 62 includes articles of apparel and clothing accessories, not knitted or crocheted and the code 6204 is women's or girls' suits, ensembles, suit-type jackets,dresses, skirts, divided skirts, trousers, etc. and the follow code 6204.62 is women's or girls' trousers, bib and brace overalls, breeches and shorts of cotton, not knitted or crocheted.The HTS Code: 6204.62.1511 is Women's Blue Denim Trousers and Breeches of Cotton, not Knitted or Crocheted.

Transportation The major ports in Mexico are Ensenada, Altamira, Manzanillo, Lazaro Cárdenas and Veracruz.

Mediterranean Shipping Company Mediterranean Shipping Company México is the one of biggest freight company in Mexico founded in 1970 and headquartered in Geneva, Switzerland. With a network of 480 offices, MSC is a stable partner for businesses around the world. We have trained, experienced experts available for our full range of services including reefer, out-of-gauge, breakbulk and each of our trade services. Our network of road, rail and sea transport allows us to offer sustainable and reliable door-to-door services worldwide.

MSC is committed to promote sustainable use of the sea and marine resources, while extensively investing in the latest generation green technologies to minimize the environmental impact of its business activities on lands, oceans and populations.

36 The cost of shipping 40ft container from port of Veracruz to Savannah would be 6 days and $3490.

NYK Logistics de Mexico The global network spanning almost 333 cities in 44 countries, and their employees in local situated to manage global logistics are around 24000.

They offer the freight forwarding business, international-multimodal-transport business and its agency business, truck transportation business, marine shipping brokerage / custom house brokerage / warehousing, packaging, leasing of containers, loading equipment, logistics equipment and logistics information systems, casualty insurance agency business,logistics consultancy business, and have own domestic transprotation newworks in place in all major markets.

The cost of shipping 40ft container from port of Altamira to Savannah would be 7 days and $3390.

Risks and Benefits Risks Based on the identified issues associated with logistics or supply of production materials, some risks and benefits emanate (Durรกn-Encalada et al. 78).

Regarding risks, challenges connected with taxation and terrorism can influence the delivery of supplies to the Mexican manufactures. Additionally, political barriers (Trump's rhetoric on trade and immigration) and regulations between Mexico and the United States will control the sustainability and performance of the company.

Transportation conducted between the ports in Mexico and potential supply companies located in the United States will also experience barricades associated with natural occurrences especially in Texas, and the Hijacking trucks events also need to be considered.

46 Several of the naturally occurring disasters have been documented by the Mexican government as well as the supply-side of the business. In addition, the new NAFTA Agreement, negotiators agreed to update labor and environmental standards, included enforcing a minimum wage for workers, stricter environmental standards for Mexican trucks, which means that the labor cost of Mexico would be higher than before and the land transportation would have potential risk, for example, by customs interception or short-term detention.

Benefits Working with Mexico has many benefits. The free trade agreement between the US helps balance out the pricier cost of production. Thought the cost is definitely supported by the unappalled quality. With the Financial support from bilateral and multilateral donors and the Government supported, Mexico's apparel industry has maintained steady growth. The proximity to the US is also a bonus for shorter shipments times and ease of communication. Dynamic textile industry has strong potential, many high-end companies have already begun to move their production to Mexico. Favorable population of Mexico also be the attracting element to the manufacture and investment.

Conclusion Factors influencing business performance in Mexico range for the stability of the country, which relies on political, environmental, economic, and social factors. Since the proposed business requires suppliers for fashion merchandise materials from the overseas, it is arguable that business issues affecting both the United States and Mexico should be considered. The analysis conducted in this research highlights that the reliance on ports located between the U.S. and Mexico will deliver the required materials, although barriers related to politics will emerge both in the short-term and long-term. Nonetheless, the impediments to successful logistics between the United States and Mexico can be overcome by political goodwill.

The clothing and textiles industry in Mexico are a dynamic and growing sector which benefits from supportive and proactive Government policies. Mexico offers an ideal investment location for companies active in the clothing and textile sectors. It has a highly skilled and economically competitive workforce and excellent access to world-class inputs and technologies.

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Vietnam Located in the continent of Asia by the Gulf of Thailand, the South China Sea and the Gulf of Tonkin, Vietnam is the 66th largest nation in the world.

Now there are about 6,000 textile and apparel manufacturing companies working with 2.5 million employees while the population in Vietnam is about 90 million. In 2016, Vietnam has been recognized as the third top garment exporters in the world.

This analysis of the country sees its significant traits, its stability, cultural insights, manufacturing lead times, state of the apparel industry, leading suppliers, trade agreements, transportation, risks and benefits.

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Country Stability Political Vietnam, an ASEAN (Association of South East Asian Nations) member is a one-party state ruled by the Communist Party of Vietnam (CPV) which provides strategic direction and decides all major policy issues. The country is led by the CPV General Secretary, State President, Prime Minister and National Assembly Chair. They are responsible for promoting stability, retaining the political status quo, domestic economic development and international integration.

Even though Vietnam is considered one of the more politically stable countries in South East Asia, its leadership does not welcome dissent. Internal conflict is rare although in 2016 and 2017 there were a small number of high-profile protests including in relation to an environment disaster in Central Vietnam.

There is a lot of red tape in Vietnam. An investment license requires the approval of at least a dozen ministries and committees. There are a multitude of regulations and laws affecting taxation, trade, banking and other activities, often causing delays for foreign countries.

Land rights also continue to be a source of social unrest. There is no private land ownership. Instead there are land-use leases This has often caused havoc and mistrust among the civilians in the country as they felt their deserved share of land was not allocated to them.

However, the re-election of Nguyen Phu Trong andNguyen Xuan Phuc in 2016, maintains a status quo.Their interactions will the US governments of multiple trade agreement negotiations have been heading in the positive direction and it is seen that the Vietnamese government will have a positive attitude to foreign investment while continuing to maintain good relations.

There is a rise in the youth in the country which means the freedom to express opinions, however, the givernment has to tackle evils of red-tapism, corruption, landownership in order to create the most suitable environment for domestic as well as foreign interests.

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Economic

GDP Annual Growth Rate as per Trading Economics 2019.

GDP from Manufacturing as per Trading Economics 2019.

Vietnam's gross domestic product grew by 7.31 percent year-on-year in the fourth quarter of 2018, following a downwardly revised 6.82 percent expansion in the previous quarter. GDP From Manufacturing in Vietnam increased to 640172 VND Billion in the fourth quarter of 2018 from 168156 VND Billion in the third quarter of 2018.

FDI inflows average 8% of GDP annually, the highest among major emerging markets in ASEAN and proportionately larger than China. More than half of total FDI stock is in manufacturing.

The state’s presence in the economy remains large in Vietnam: it maintains full ownership of more than 700 SOEs. Under the light of fiscal deficit, the Government is keen on boosting the participation of non-state sectors in the economy.

Vietnam is ranked 68th (out of 190) in the World Bank’s (WB) “Doing Business 2018” report, increase by 14 places in overall rank in comparison with the previous year. The significant improvement recognizes the efforts of the new leadership elected in early 2016, who have continuously sent a strong commitment to create a favorable condition for the business environment.

With a fast-growing economy like Vietnam where there is scope and support ,it can be seen as a positive climate to allow manufacturing of consumer apparel.

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Social

Growth of wage rate inManufacturing as per Trading Economics 2019.

The Vietnam Second Higher Education Project helped 8,000 students to attend nonpublic upper secondary and professional schools by providing tuition subsidies. In infrastructure, the total number of schools increased from 10,376 in 2004 to 14,863 in 2016. in June 2012 the Vietnamese National Assembly approved a revision of the Labour Code which included extending maternity leave to six months; setting out the requirement for a minimum wage; preventing employees from working more than 50 percent over their official working hours in a day; reducing the maximum term of work permits for foreign nationals working in Vietnam from three years to two years.

In recent years the National Assembly has also passed an amended version of the Law on Trade Unions, which defines the responsibilities of officially recognized trade unions to protect workers’ rights.

Vietnam is one of the most progressive countries in South East Asia for LGBT rights. In 2015 Vietnam abolished regulations that prevented same-sex marriage and Vietnam has also passed a law allowing trans-gender individuals to receive gender reassignment surgery and to register under their preferred gender. Hanoi also hosts an annual Viet Pride event.

Although female participation in the workplace is still rather limited and their retirement age is 55 years as compared to 60 years for men, the country is still seeing employment for a lot of youth, staying at 54 million in 2018.

Freedom to form associations is something that still remains an issue in Vietnam, but the National Assembly is identifying the needs of the labour and implementing agreeable provisions in order to keep them happy. The country is definitely heading towards social progress.

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Lead Times in Vietnam Garment manufacturing lead time includes many small steps. The whole process of garment manufacturing lead time in Vietnam takes anywhere from 60 to 120 days depending on the complexity of the garment and other orders the factory is doing.

The total time it takes to get the garments to the warehouse is production lead-time plus shipping time. Best-case scenario is 60 days production time and 30 days shipping. For 5,000 pieces, approximately 6,000 meters of fabric is required, which would take 16 days to produce.

Once the fabric is in house, the factory can make a pre-production sample. The sample is usually size medium. This should take a maximum of three days, allocating room for client approval, stretching it to a week. Generally speaking, one sewing line can produce 900 garments per day. Quality control is done in line and there is a separate quality control section between the lines and ironing. Any defective garments are either fixed or removed from production.

Producing in Vietnam means that you won’t see your garments for at least 90 days.

That is the nuts and bolts of garment manufacturing lead time in Vietnam.

Working conditions and schedules also affect the lead times in Vietnam. Although Vietnam officially recognizes 17 public holidays and 10 local or regional observances, workers are only entitled to nine paid holidays per year.

According to the labour laws, if a recognized public holiday falls on a Saturday or Sunday, the following Monday is observed as a paid holiday. The majority of the Tet holidays are observed in February, many of which fall on weekends.

The World Bank has ranked Vietnam as one of five countries most likely to be affected by climate change. Lying in the tropical monsoon area of the North West Pacific, Vietnam is one of the most disaster-prone countries in the world. It is affected by many kinds of natural disasters such as floods, storms, whirlwinds, flash floods, coastline erosion, droughts and landslides. Typhoons and floods are the most frequent and devastating events, causing fatalities and wreaking havoc on infrastructure and livelihoods. It is estimated the country faces an average estimate of 6-8 typhoons every year. An estimated 70 percent of the population live in coastal areas and low-lying deltas, and therefore have increased exposure to flooding risk.

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Cultural Insights Vietnamese business relationship inevitably becomes a social relationship after a while.The more you share your personal life, including family, hobbies, political views, aspirations, the closer you are in your business relationship.

Seniority is very important to the Vietnam especially if you are dealing with a State owned or government body. Similarly, sitting positions in a meeting room or a dining table is accorded accordingly to rank, importance and seniority. For example, the most senior person should always enter the room first.

Most business luncheons and dinners are held in hotels, restaurants, or government facilities. Usually, the host will arrange for a dinner during the early part of the visit. One is expected to reciprocate by arranging for a return dinner. Business gift giving is fairly common at the end of a meeting or during a meal in honor of business associates. Gifts should be small but not expensive. Something with the company logo or something typical from the visitor's country both make excellent gifts Negotiations can be slow so it is important to bear in mind that decisions have to go through a lot of red tape and also group consultation. Consensus is important in Vietnam. Any and every person holds veto power. Everyone must be in agreement about a decision, or the decision will not go through.

Documents must be presented in Vietnamese and it is ideal to hire a Vietnamese translator. The best means of doing business is through a local representative who can act as a reference.

37 Traditionally, Vietnamese people prefer to hold meetings in their own territories, which can be their offices or familiar locations. An office is usually set up strategically to facilitate the negotiation process. Vietnamese people utilize feng shui in their room settings, and/or place significance in negotiating in the “home turf.” Vietnamese people tend to arrange meetings in an intimate area, where visitors are treated as welcome guests. However, the room is usually set up so that there are distinctive differences between the host’s seat and the guests’, which allow the host to seem more in control of the situation than the guests.

Overall, the mindset of the people is very accepting of different cultures, traditions and lifestyles. They provide an enriching experience, not just for the visit but also for the business holdings. They demand and give respect, making sure that the relationship is always nurturing.

State of Apparel and Textile Industry Vietnam’s textile and apparel industry is fully geared up to achieve this goal and denim can play an important role in supporting the growth of the country’s apparel export.

A Country which holds 10 bilateral and multilateral trade agreements (including ASEAN Free Trade Area, five ASEAN and expected to execute CPTPP & EVFTA by the end of this year), Vietnam has evolved as a major denim player in past few years and expected to grow faster in coming years due to its geography and advantages due to its demographics and policies.

Statistics shows that by the end of 2017, Vietnam had attracted 2,079 projects in the garment-textile sector with total capital of 15.75 billion USD, up 10 percent year-onyear.

Investors come from 57 countries and territories nationwide.Growth of exports of denim from Vietnam was over 25% in 2017. Vietnam is on the rise in denim exports to its biggest market, the USA. During January to May 2018 period, Vietnam exported denim apparels to USA worth US $ 78.16 million, marking growth of 42.81 per cent over the last year.

47 According to the latest figures released by OTEXA and analysed by Apparel Resources, Vietnam posted surge in all 4 categories; skirts, jackets, Men & Boys (MB) jeans and Women & Girls (WG) jeans, of denim apparels. WG jeans captured the larger chunk in the total export value with US $ 54.51 million (up 39.57 per cent) worth of exports, while MB jeans export fetched US $ 21.09 million (up 41.75 per cent).

As far as quantity of jeans are concerned, Vietnam exported 8.023 million units of jeans in the USA during the period under review noting a stellar surge of 20.30 per cent. MB jeans export was 2.076 million units, while 5.947 million units of jeans were exported to the USA market in WG category by Vietnam.

The Chief of Vietnam Textile And Apparel Association (VITAS) asserted that Vietnam’s garment-textile export revenue is going to hit 200 billion USD by 2035. Denim is also major part in the entire periphery of Textile & Garment and is expected to achieve an annual growth rate of 30% so far as US export is concerned .After the tariff war between US and China , a substantial production shift in Vietnam is expected and if the trade war remains for longer time , China’s loss will be Vietnam’s gain. In this report , we’ve analysed the denim exports of Vietnam to US from 2014 to June 2018 and it gives an idea how the country is growing rapidly.

Some of the challenges in the industry are: Growing prices of electricity and transportation.

Increase in minimum wages are now becoming a cause of concern to the industry players.

On the other hand, Vietnam’s garment industry is highly dependent on imports for its machinery equipment, raw materials, and accessories, which not only decreases its profit margins but also keeps it in harms reach against foreign cost fluctuations.

Competition from Cambodia and Bangladesh, as the wages there are lower than that of Vietnam.

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Suppliers Within Vietnam Nien Hsing Ninh Binh garment Nien Hsing Ninh Binh Garment, incorporated in 2008, is headquartered in the Ninh Bin Province in Ho Chi Minh City. The company has undertaken 245 shipments in 2018 to United States, Mexico and Canada. Their annual revenue is $1,697,640 for the last financial year. Their top shipping carriers are Hapang Lyold A G, Maersk Line and China International Freight Co. Ltd. The top ports of departure are Hong Kong, Yantian in Mainland China and Kao Hsiung in Taiwan.

Their clients include Levis's, GAP and American Eagle Outfitters of the many.

Vina Korea Co. Ltd Vina Korea Co. Ltd., is headquartered in the Vinh Phuc province of Vietnam. It was founded in the year 2001 and has grown exponentially since then with an employee count of 5000 as of today. The company has undertaken 263 shipments in 2018, mostly to United States and Canada. Their annual revenue is $29,867,710 for the last financial year. Their top shipping carriers include Mitsui OSK Lines Ltd., China International Freight Co. Ltd and Expeditors International of Washington Inc. The top ports of departure are Hong Kong, Singapore and Kao Hsiung in Taiwan.

Their clients include Banana Republic, GAP and Old Navy are some of their best customers.

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Nobland Vietnam Co. Ltd. Nobland Vietnam Co. Ltd. has a reputation for being an excellent choice of manufacturer for companies such as GAP, H&M, Madewell, Banana Republic, Rag and Bone, Old Navy and Everlane. It's annual revenue last financial year stood at $3,422,400. The company has three mills in South East Asia with an R&D centre in New York. Manufacturing at Roland is always efficient and effective because of its 73 lines at the center. The company is Beaureau Veritas certified Its current employee count is 200. The top carriers are Dynamic Network Container Line Ltd., Expeditors International of Washington INC and Apl CO Pte Ltd departing from ports of Vung Tau, Vietnam, Port Redon, Vietnam and Hong Kong.

Trade Agreements Vietnam is the 21st largest export economy in the world. In 2016, Vietnam exported $207B and imported $196B, resulting in a positive trade balance of $11B. The top export destinations of Vietnam are the United States ($43.3B) Initially, when the BTA (Bilateral Trade Agreement) went into effect on December 10, 2001, the U.S. immediately provided Vietnam’s goods and companies access to the U.S. market — a market that represents nearly a third of world GDP — on the same basis it grants to other countries with which it has normal trade relations.

Among other things, this meant Vietnam’s products were now assessed much lower tariffs — dropping from an average of 40 percent to an average of three percent — when they enter the U.S. For Vietnam’s part, Vietnam has committed to reform its trade and investment regime to provide a much more level and fair “playing field” for U.S. companies and products in Vietnam.

77 Years later, the $32 billion bilateral merchandise trade deficit with Vietnam in 2016 was reportedly a major issue during President Trump's May 2017 meeting at the White House with Vietnam's Prime Minister Nguyen Xuan Phuc.

The two leaders pledged to deepen and expand the bilateral trade and investment relationship through formal mechanisms, including the Trade and Investment Framework Agreement (TIFA).

Contrasting the above, according to the USITC, U.S. imports from Vietnam were up 5.2% year-on-year for the first two months of 2018, while U.S. exports to Vietnam were down 2.4%, possibly indicating that the U.S. bilateral merchandise trade deficit with Vietnam will continue to grow. This is something that the country will have to keep a close watch on as the counter effects of this will affect the negotiation powers of the country.

PRODUCT CLASSIFICATION The HTS (Harmonized Tariff Schedule) for blue denim(348) is code 6204.62.15.11. This can be found under the article description named "Other". The general rate of duty is 16.60%.

TRANSPORTATION Along her 3,200km-long coastline, Vietnam has a total of 114 seaports, 14 of which are relatively large and named as the keys to economic development. However, most ports are relatively small with obsolete facilities and poor supporting services. The three largest ports of Vietnam are – Saigon port (south), Hai Phong port (north), and Da Nang port (central).

87 The limited size of Vietnamese ports entails transportation of goods from Vietnam to major international market such as USA and the European Union to be transshipped at larger ports, including Hong Kong and Singapore.

Similar to many investment projects in Vietnam, seaport projects face a common problem of local authorities fighting for State funds and attention. Vietnam still lacks an international-standard port with large capacities that could enhance the country’s rising exports and economy. Apart from the inadequate infrastructure, Vietnam ports are facing another setback due to backward pricing.

But the government is definitely making improvements in Southern Vietnam; undertakings are under way for further development of the container section of Ho Chi Minh City’s port. Also, there are plans are to improve connections of the Mekong Delta to international ocean freight shipping routes.

The cost of transportation including insurance is $10,986 from the port of Ho Chi Minh City, Vietnam to the port of Savannah, Georgia; for a full container load of 40 feet. The transit time is anything between 30-40 days. The tax rate applicable is 16.60%.

Port of Ho Chi Minh City The port of Ho Chi Minh cCity is a river port that is located on the Saigon River.

It is a network of ports functioning as a hub for the import and export of goods in south Vietnam. It’s the country’s most important economic center, contributing to more than two-thirds of its economy. It caters to a host of industries, including mining, processing seafood and agriculture and consumer goods like textiles and apparel. The port and harbor size is medium and the maximum vessel size is over 500 feet in length.

Some of the port services offered are Longshore, Electrical Repair, Steam, Navigation Equipment and Medical. Supplies like Provisions, Fuel Oil, Deck, Water, Diesel Oil and Engines are also provided. Communications are mostly through telephone, radio, air, telegraph, radio and tel rail.

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RISK AND BENEFITS Vietnam is an ideal place for manufacturing due to its cheap and hardworking labour, its openness to foreign investment and its flexibility to develop business relations. It is a country that has a positive growth projection in every sense and is one to watch out for. Its ability to compete with China in terms of a production destination speaks volumes for all the efforts it is making in its political, economic and social scenarios.

However, corruption and red tapism continue to be a matter of concern. The government's rigidity up to a certain level might cause hindrances to the workforce and civilians at large. Natural disaster will also affect the lead times causing a threat to loss of business.

CONCLUSION

Vietnam is a destination for many multinationals looking to outsource the manufacturing and production of their apparel. The economy is open to more FDI and is willing to cooperate with any conditions and demands put forward, to the best of their abilities. Their goal is to constantly improve with increased employment rates, steady GDP growth and modernize technology as required by other countries that want to set foot in Vietnam. Even though the garment industry is heavily dependent on China, Taiwan, South Korea, India and Bangladesh for its yarn, its ability to take the manufacturing process further along is commendable as it is able to do it in a shorter lead time. The trade agreements signed with many countries is sure to bring in investment for the development of industries. By means of trade agreements, tax concessions can be taken complete advantage of so as to concentrate on profits, and by extension a surplus of trade.

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Country Rankings After researching each of the countries, it is important to see how they compare to one another. This is the best strategy to determine which will be the best fit for manufacturing our products.

By ranking each country in thirteen categories on a scale of 1-10, we were able to get a better understanding of where the countries fell short by quantifying qualitative topics. The thirteen categories are: Business climate Costs Government Location Risks Social stability Sourcing guidelines Textile industry Trade agreements Trained workforce Socio-eco-political factors

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China Ranking Rationale The business climate in China is very established and stable as it is the second largest economy in the world. Costs in the country related to manufacturing are attractive for companies in the U.S. nevertheless they have been increasing and are expected to continue to rise. The government in China is stable, but it is a communist country and it currently has a very bad relationship with the U.S. because of their ongoing “trade war.” China is located very far in comparison the U.S. as well, and it takes no less than 25 for cargo to arrive by sea to the closest U.S. port. There is also risk associated to doing business in China because it is the most susceptible country to natural disasters world-wide as it affects approximately 200,000,000 Chinese annually. Another risk that could affect our business is the ongoing “trade war” because if there is no agreement soon, the U.S. could impose higher tariffs on imported Chinese goods. "

38 Our sourcing guidelines in China are adhered to by many suppliers, but as a company we should be careful to know who we do business with since a lot of manufacturers don’t follow our core values to the full extent. The social stability in China is stable as well but the country has a problem with a large aging population which could affect us because of a shrinking workforce and therefore, lead to increased labor costs. There is currently no trade agreement between the U.S. and China. The country has a large trained workforce, however it is not all high-skilled. Overall, the socio, economic and political climate of China is stable but the ongoing “trade war” with the U.S. is worrisome.ces."

Egypt Ranking Rationale Based on research and analysis, Egypt was given an overall ranking of 77 out of 100, which placed it in third out of the four countries. When it comes to the business climate, Egypt was rated a 7. This was based on their import/exports, foreign relations, foreign investment, and their business freedom. Egypt has a way to go compared to the other three countries, but they have been aiming to attract foreign investments by amending some of their laws, which in turn has attracted companies like Nissan and Toyota.

While Egypt doesn’t have a trade agreement with the US, they do have the Qualified Industrial Zones (QIZ). This allows for duty free entry into the US for products manufactured by Egypt and Israel, as long as the country input shares total 35% of the appraised value of the product at the time it enters the US. The QIZ along with the low manufacturing costs, are the best assets Egypt has to offer. Egypt was rated a 7 in the textile industry as it employs 30% of their industrial workers and supplies an extremely high-quality material, but the industry overall isn’t as significant or developed as the other countries.

The Egyptian government is deemed very unstable, which is why it was rated a 6. In 2011, there was a huge riot that disrupted and greatly affected the country as a whole.

This has led to economic and social instability. For example, a high unemployment rate and a decrease in growth rates, tourism, and the value of the Egyptian pound. The country is also dealing with the ongoing war between the Islamic state, which contributes to the overall score of a 7 for the socio-eco-political category and a 5 for the risk category. Even though Egypt is far away from the US it still placed second when it came to location, as lead times were 20-25 days, where its competitors were 25-30 days.

48 Egypt’s social stability and trained workforce both received a 7. Their current population is at 99,413,317 million and the country will add another 24.5 million citizens between 2019 – 2030. However, there is a scarcity of skilled workers due to the fact that 2/3 is under the age of 29 and lacks experience and training. This in turn puts a strain on public finances and increases the job demand. Overall there is a high risk when it comes to Egypt, but the country also brings many opportunities within the textile industry.

Mexico Ranking Rationale Considering the factors of business climate in Mexico, the recent reports conclude that foreign companies are becoming more welcome in Mexico would be not ignored. The internet censorship and free trade agreement should be focused. The labor Costs is $.17 per minute, the price is quite higher than other countries, but the labor is leveled and skilled which still has a good value for apparels manufacturers. There are no apparel duties and lower transportation costs and less time of transport to the United States.

New government is friendly to the US, promised to fix poverty, corruption, and crime on behalf of ordinary Mexicans. In addition, the location of Mexico couldn't get any closer to US. Lower transport costs. Containers can reach Miami in 5 days, NYC in 9 days. Trucks can reach Atlanta in 2-3 days. But the risks in Mexico like natural disasters, high crime, hijack trucks, dependence on the USA, lack a suitable infrastructure, educational shortcomings, and low productivity should be considered. High crime is still a major concern for citizens. Some of the most affected areas are relatively lawless.

Mexico’s sourcing guidelines are good, child labor is decreasing but can still be an issue. Some of the worst water pollutants can be found in the textile industry. Good guidelines in place but still need to monitor for violations.

Mexico Textile Industry is master of the world apparels industry, as the #5 global apparel exporter. Apparel industry is one of the largest manufacturing sectors in Mexico. Many are small companies. Several large mills. Good resource for high-value denim apparel. Mexico also has a free trade agreement with the United States. Socioeco-political in Mexico is stable, the country has relatively open economy but overdependence on US exports. austerity measures led to poor GDP growth last year. 1 currency = 0.052 dollar.

58

Vietnam Ranking Rationale The business climate is increasing in Vietnam with around 6000 textile and apparel manufacturing companies today. Manufacturing has been the primary contributor to GDP. Vietnam is also benefiting from the US-China tariff war, along with the increase in costs of labour and apparel manufacture in China.

The cost of manufacturing is cheap, the currency exchange is also favorable for the U.S where 1$=23,200 dong. The government in Vietnam is stable with the election of its new Prime Minister in 2016. However, there are some regimes that the current government is still struggling with. Land rights issues with civilians protesting for their rights are a major cause for disarray. Red tapism and corruption are putting the authorities in question as well. Overall, the election of Nguyen Phu Trong is leading interaction with US in a positive direction. The country also has an extremely positive attitude towards receiving foreign investment. Great initiatives by the government to improve primary education, freedom for LGBTQ community, women's and worker's rights are appreciated by the citizens. The downside to the working conditions is that there is no freedom to form associations because of its socialist nature. A large percentage, 2.5 million of the 90% population are employed into workforce, thereby opening more opportunities. The socio-political-economic conditions are stable and even though the country is communist, they recognize the potential in its labour force and are slowly working towards creating better working conditions and welcoming investment. It has friendly ties with all its neighbours.

In terms of lead times, Vietnam is 8,568 miles away from the United States which takes 25-30 days minimum to ship by sea. The biggest market for Vietnam is the USA, the textile industry is growing at an exponential rate which is now being compared to China (on a labor cost level). A flourishing denim manufacturing sector has exported over 8 million units of jeans last year to the US. There are 10 bilateral and multi-trade agreements between Vietnam and the United States currently. Leaders, Trump and Phuc have agreed to work together to deepen investment relationship for both countries.

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Supplier Rankings After determining our top potential countries in which we will manufacture, we looked into their top denim manufacturing companies. We chose three manufacturers from each country to research more in-depth. The best in Egypt are Lotus Garment Group, T&C Garments and Vertical Jean Company.

China’s top manufacturing companies include Crystal Apparel International Group, Springdale Group and J.D. United Manufacturing Ltd. The best in Vietnam are Vina Korea Company Ltd., Nobland Vietnam and Nien Hsing Ninh Binh Garment. Mexico’s are Monty Industries Sa De C.V., Manufacturas Kaltex S.A. De C.V. and Private Label Tehuacan S. De R. L. De C.V. By ranking each supplier using twelve different categories on a scale of 1-10 (ten being the best), we were able to get a better understanding of how each supplier compares to one another and find the best fit for our company. The twelve categories are: Abilities Capacity Costs Customer service Customers Flexibility Lead-time Management Quality Services offered Strategic outlook Sourcing guidelines

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China Supplier Ranking Rationale There are endless numbers of manufacturers in China therefore the challenge was narrowing the list just include three. What Adamo considered the most when investigating three manufacturers was that they adhered fully to our company’s sourcing guidelines, their customers, flexibility, lead-times and ultimately capacity among other criteria. As a result, some of the strongest manufacturers in China for Adamo specifically are Crystal International Group Ltd, Springdale Group and J.D. United Manufacturing Corporation Ltd. Some of the strongest points about Crystal International Group include their strong adherence to our sourcing guidelines, that they only work with denim and large capacity built of a network of 20 factories.

88 While some of the strongest points about Springdale Group include their large output capacity of over 1 million units a year, strong adherence to our company’s sourcing guidelines, strategic outward look towards innovating and history of working with important company’s like Everlane, H&M and J. Crew. Nevertheless, when comparing J.D. United with Crystal Group and Springdale Group, it was J.D. United that had the strongest competitive advantage.

J.D. United Manufacturing Corporation Ltd is the strongest manufacturing company for Adamo in China because it goes beyond adhering to our company’s guidelines. It is the largest denim manufacturer in the world, and it specializes in working with denim only. The company also has the strongest customers it works with like Levi’s, Uniqlo and Gap, among others. As well as the fact that the most technologically advanced in that they the only ones manufacturing kinetic energy. Finally, J.D. United is also the supplier that would produce the best quality of jeans for Adamo.

Egypt Supplier Ranking Rationale After reviewing the companies in depth, the decision was made to go with Lotus as the top supplier. They are vertically integrated and have a production volume of 16 million pieces annually. This makes it easy for them to handle large orders and guarantee the flexibility, scalability, and needs any client and production order may have. Lotus is also committed to improving energy performance, reducing the emissions of greenhouse gases, water usage, the dependence on finite fossil fuels, noise pollution, and minimizing waste by evaluating operations.

They have taken numerous steps to show their commitment to sustainability which is something that falls in line with our core values as a company. Lotus meets all of our sourcing guidelines and goes above and beyond in the sustainability aspect, so we feel they would be a great match for our company.

Mexico Supplier Ranking Rationale Mexico has a lot of manufacturers therefore, the challenge was narrowing the list just include three. What Adamo considered the most when investigating three manufacturers was that they adhered fully to our company’s sourcing guidelines, their customers, flexibility, lead-times and ultimately capacity among other criteria.

98 As a result, some of the strongest manufacturers in Mexico for Adamo specifically are Manufacturas Kaltex S.A. De C.V.,Monty Industries Sa De C.V., and Private Label Tehuacan S. De R. L. De C.V.. Some of the strongest points about Private Label Tehuacan include their strong adherence to our sourcing guidelines, that they only work with denim and large capacity built of a network of 12 factories. While some of the strongest points about Manufacturas Kaltex their large output capacity of over 20 million units a year, strong adherence to our company’s sourcing guidelines, strategic outward look towards innovating and history of working with important company’s like Levi’s, Group M, Clottier, more higher-end customers, when comparing Monty Industries with Manufacturas Kaltex and Private Label Tehuacan, it was Monty Industries that had the strongest competitive advantage.

Monty Industries is the strongest manufacturing company for Adamo in Mexico. Firstly, the company has the expertise to make men’s, women & children jeans pants shorts & skirts jackets dresses shirts, and the capacity of Monty (over 3.6 MM annual) meets the demand of our line plan. The cost is competitive with others. Additionally, they provide excellent website, phone, email and US agents available with bi-lingual team, which helps a foreign company easier to contact them and check the production. Monty also works with some smaller brands, especially suitable for our start-up company. The company holds the defect-free and high-quality standards, recognized since 2002 by WQC (World Quality Commitment), and their sourcing guideline is beyond our expectation, which include exceeds air & water quality restrictions, water treatment plant, certificated in ISO9001:2000 by DNV Veritas and certificated in C-TPAT Supply Chain Security by U.S Customs and Border Protection. Moreover, they provide the full package, CMT, dedicated merchandisers, vertical-weaves, fabric, design, pre-production, cutting, laundry, dry process, finishing, sewing, warehousing and logistics. We choose this supplier, because considering the geographical advantages of the United States and Mexico, Monty has 30 years of transportation experience, including sea transportation and land transportation, which helps the company to avoid potential risks. For example, during the period of high hurricane, the risk can be managed by land transportation. Or in the event of an intercept, it can be immediately shipped to cover the loss.

09

Vietnam Supplier Ranking Rationale Nobland international was incorporated in year 1994 starting to manufacture cut & sewn knit and woven wear products for New York based Designer Brand. The organization has achieved remarkable growth and we are now a leading apparel Manufacturer with headquarter located in Seoul, Korea along with offices in Vietnam , Indonesia, New York and factories in Vietnam and Indonesia with over 15,000 direct employees globally.

They provide customers with greatest satisfaction with the motto “ Innovation and advances “ not only by setting trend with having Design Center in the heart of fashion avenue in New York, but also by collaborating with the customers' design team to be tailored to their specific needs by categories.

They have adopted being an advanced “ Full Service Vendor Model “ with operating exclusive development center and dedicated production lines fit for some brands of our major customers and we are trying to step up to the most efficient and challenging company.

Their proximity to the ports and ability to handle vast loads of orders makes them a supply worth manufacturing luxury garments with. Their future outlook is hand in hand with Adamo's where they providing high quality products to the customer to become a leading global apparel manufacturer.

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Costing

Determining the cost of producing each our products is important for our business, as well as for helping us further determine which countries would be the top choices for manufacturing.

Using our tech packs, we found the cost of our fabric and components for each of our denim styles. We also sourced vendors for packaging, packing, labor and other cost factors. Finally, we compared the cost of producing each style in our four potential countries to see the difference in prices for each location.

29

Ash

39

49

Maggie

59

69

Lin

79

89

Shay

99

001

Line Plan After determining the countries in which we want to manufacture and breaking down the costs of production, we developed our line plan margins for the company. The line plan margin will help us understand our profit margins for each of our denim styles and ultimately decide how much of each product we will produce for each month. Overall, we plan to produce one million units total for the year.

101 Our line plan exercise concluded that Adamo will achieve excellent overhead figures with products averaging at a 95% profit margin. While Ash, Maggie and Lin will be sold to retailers year-round, Shay will only be available in the market from January to September since it is a cropped style that is more applicable to the warmer months of the year.

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Placement After weighing the possibilities of conducting business in China, Egypt, Mexico and Vietnam, researching their top suppliers and calculating how many units we plan to manufacture per month, we now will decide how many units we will manufacture in each country specifically. After carrying out numerous placement exercises, we have decided to not conduct business in China at this moment. This is because we feel that due to China’s quality of suppliers, manufacturing costs, lack of a free trade agreement and distance with the U.S., it is better not manufacture in this country. We will only be manufacturing in Mexico, Egypt and Vietnam for the moment. China will be kept as a future possibility only.

When carrying out our placement exercises we also kept in mind Adamo’s mission and vision, sourcing guidelines, values, risks in each country, distance from the U.S., duties, lead-times, PEST environment, costs, flexibility and future growth plans for each manufacturer. In the end, we decided to go with the following placement analysis for our product because we feel it will help us replenish our styles according to our line plan.

301 The minimum order requirement for each supplier was 240,000 units. We fulfilled this by allocating 300,000 units to Vietnam's supplier, Nobland; 450,000 to Mexico's supplier, Monty and 250,000 to Egypt's supplier, Lotus.

Mexico has the highest quantity as compared to the Vietnam and Egypt because of its proximity to the U.S. The lead times are shorter, ranging between 3 days to 6 days which is three times lesser than it would take to ship from Egypt or Vietnam. This will allow us to replenish our stock as soon as we require it, thereby eliminating time lags.

Mexico's free trade agreement with the U.S. also allows us to operate duty free, which causes lesser time going towards compliance procedures.

Vietnam has a slightly higher quantity than Egypt, because of its country stability factors. Manufacturing in Egypt comes with a lot of risks because of the turmoil in the country, its relations with Israel and its distance from the U.S. Even though, Egypt is known to grow the finest quality of cotton, there is still a substantial amount of risk involved with the political and social standing in the country - and its effects on its people and world at large.

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501

Managing Risk in China Although at the moment Adamo will not be conducting any of its business with China, it is still important to know about the risks involved in carrying-out our trade in this country since it could be a possibility for our company in the future. Since China is the most impacted country by natural-disasters world-wide, it is imperative that we insure our product. Nevertheless, we must also leverage the production and produce at least some quantity of everything that is being produced in China elsewhere in case our products are affected by a natural disaster, we will still be able to deliver in time.

Natural disasters in China must also be closely monitored all the time since being informed could help us to not expand our lead times by rerouting our product, if necessary. Another way to minimize risk for Adamo would be to closely monitor news in order to be up to date with the most current information on the ongoing “trade war” with the U.S. so that if we were to manufacture in China, we would not be affected if higher tariffs are imposed and we can make arrangements to leverage production somewhere else.

Managing Risk in Egypt Egypt was one of the countries we choose to conduct business in. However, due to many riots, terrorist attacks, and conflicts the country is very unstable in the political, social, and economic aspect. There is a lot of risk to take into consideration and how we are going to handle it. Our goal overall is to minimize risk and maximize opportunity.

One way we are going to offset risk is by producing the same style of denim in different countries, not solely in Egypt. The Egyptian government is also protecting manufacturers in the country and the QIZ has been very beneficial towards them. As long as the products have at least 35% of their value added by QIZ factories by Egypt contributing 11.7% of this value and Israel contributing 10.5%, then the products are allowed entry into the US duty free.

601 Staying up to date on the current situation with Egypt and Israel is going to be crucial moving forward, as there is a lot of instability within both countries. With Israel, there is a lot of controversy surrounding the Israeli-Palestinian conflict, the Gaza War, and dealing with terrorist attacks. This has the potential to affect our production in Egypt, so we will be having a discussion with our manufacturer Lotus about the options and how we will move forward if we to not be able to get our material from Israel.

Managing Risk in Mexico One of the potential risks that our company could face while trying to bring our product into the U.S. is the caravans of people trying to get into the country. This can affect our ability to get our products through the border in a timely manner. At this point, we may choose to ship most of the goods by sea. According to the line plan, we can predict that a large number of transportation and manufacturing quantities will be needed in some months, therefore we can communicate with suppliers and freight companies in advance to deliver part of the goods beforehand.

In addition, in case of a bad weather prediction, we are also able to reroute our products to cross the border at a different location, either through Laredo or El Paso.

This is something that we will heavily be monitoring, specially during hurricane season.

On the other hand, hijacking is an unpredictable potential risk but we can minimize the loss of product through insurance. Furthermore, we will still be able to deliver our products in time because we would have the same styles being produced in Mexico in at least one other location. Overall, given the closeness of Mexico to the U.S. the flexibility of our suppliers can also help us to make up for the lost quantity of goods in a short time.

Moreover, Mexico is surrounded by sea and has enough cargo ports. Therefore, even if President Trump’s plans to build a wall in the U.S. - Mexican border succeed, and we find that at some point our trucks are stranded at the time of crossing the border. In this case, we would reroute our freight and move our shipment to the nearest cargo port of Ensennadaz to transfer to sea transportation instead.

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Managing Risk in Vietnam Although Vietnam's political, social and economic environments seem rather favorable for Adamo to manufacture in, certain risks involved will need to be mitigated in order to conduct business smoothly.

Natural disasters such as hurricanes and typhoons are most common in Vietnam. Over the last few years, thousands have died and have lost their livelihood. The typical tropical monsoon season in Vietnam is anytime between April and September, with June, July and August being the most fierce.

Roads have often been blocked for days, which will make it challenging for our suppliers to transport the required quantities declared by Adamo. Our approximate inventory level planned is anything between 66,000 and 90,000 between this period.

We plan on managing our inventory most efficiently with safety stock that will allow us to distribute and sell in the United States.

The supplier in Vietnam, Nobland, has a stellar reputation for its capacity and fulfillment of orders. A conversation with them on how they have managed the risk of the monsoons will provide a good case study for us to follow.

801

Supply Chain Solution Providers Now that we have outlined specific quantities and locations in which will we manufacture each of our styles, we will now research four different supply chain solutions company in order to figure out which company best fits our needs.

901

A P L Logistics APL Logistics is a supply chain company that we researched in order to compare it to other similar companies and find the right one for Adamo to work with. Some of the most appealing aspects of APL Logistics is that the company is among the top 50 supply chain providers in the world and they operate globally in 110 offices in 60 countries.

Their value-added services are also very strong because they offer total customization to fulfill unique company requirements. Other value added services include Vendor Managed Inventory (VMI) strategies, inventory control solutions and systems integration with latest Information Technology (IT) techniques and Electronic Data Interchange (EDI), among others. They also have the ability tp pick and pack and deliver products within a 24 to 48 hour time window. Nevertheless, we don’t believe that APL is the correct supply chain provider for us because even though they have the knowledge and the capacity, their area of expertise is not in working with retail companies. Therefore, Adamo would like to use a provider which has more experience with other retail companies like ours.

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Radial Radial services luxury apparel brands such as Levis, Guess, Kate Spade, Adidas, Aeropostale, Club Monaco, Huda Beauty, Marc Jacobs, Nine West, Spanx, Zara and Urban Outfitters. They use dynamic supply with demand function and forecasting and an inventory tracker. They take control with precision based forecasting that helps with informations such as product availability, time in transit, customer's shopping behaviour, eliminating excess inventory and supply chain planning, inventory remarketing and digitized handwriting. Their order turn around is 2.4 average days in transit. 90% of North America has has deliveries in 3 days. They offer pick and pack services for customers based on their personal requirements. Some of their value added services are: customized packaging and gift wrap, personalization, marketing inserts, custom blending, embroidery, and kitting. The cost per outbound carton for pick and pack is $2. Radial has warehouses typically in 11.7 mil sq feet in area, shipping to 85 plus countries from US fulfillment centers. Radial operates 26 fulfillment centers globally in 4 countries - USA, Canada, Germany, UK. Within US, it has 21 centers in the states of Kentucky, Nevada, California, Atlanta, Ohio, Illinois, New Jersey, Virginia.

U P S Supply Chain UPS Covers 35 million square feet of per distribution and warehousing facilities, it has more than 1000 facilities including more than 9,000 alternative fuel and advanced technology vehicles, 1,000 UPS service centers and 427,700 global employees. UPS Supply Chain’s nearest office to our company is in Atlanta, GA, while the closest warehouses are in Massachusetts, Missouri and California.

UPS ready warehouse management systems help businesses of any size support and optimize their distribution and sourcing network by integrating UPS tools of valueadded technology solutions. UPS collaborates with Manhattan Associates which provides a global supply chain solutions to organizations which consider supply chain software, processes and strategic technology.

111 Additionally, the time of order turnaround is expedited in 12 to 24 hours on average in UPS, with time-in-transit speeds that average one to four days faster than other postal service providers. They offer the pick and pack services at a price of $1.95 per outbound carton. UPS has a science system to promise shipments arrive safely and instantly. Their certified engineers use leading-edge technologies to simulate real-word package transport scenarios at the UPS Package Design and Test Lab. UPS also provides customers with spare parts logistics, technical maintenance and configuration, supply chain design and planning, return management and emergency spare parts delivery services. Most of their customers are well-known clothing retailers: Adidas, Deer stags, G3 Genuine Guide Gear, Kingsdown, Skirt plus, Land's End Inc and J.C. Penney Co. Some of the disadvantages to working with UPS include the cost which is relatively higher than other companies, nevertheless they offer a discount which may be applied if we ship over 25-35 times per week.

XPO XPO Logistics is one of the top ten global providers of transportation and logistics services, with a highly integrated network of people, technology, and physical assets.

The company was founded in May 1989 “Express -1 Expedited Solutions� by Michael Welch and Keith Avery.  In 2011, Bradley Jacobs purchased the company and changed the name to XPO. Just one year later, XPO opened an operation center in Charlotte North Carolina and made their first acquisition.

The company has done extremely well since then being ranked 3186 on the Fortune 500 list in 2018. Today, the top of their value proposition is an intense customer service culture that connects their team worldwide. Their people are focused on finding new ways to help their customers succeed, while becoming continuously more efficient themselves. Their values are: being respectful, entrepreneurial, innovative, inclusive, and safe. They operate over 800 warehouses (contract logistics facilities), employee 100,000 people, manage 7 billion inventory units, handle 1,535 locations and arrange 40,000 deliveries a day.

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Supply Chain Solution Conclusion After having closely researched several supply chain companies we want to go ahead and work with UPS because we feel that given their expertise and size; they are the better company. As well as the fact that they are recently starting to work with small to medium-sized companies and therefore tailoring their business specifically to them as well.

We also want to work with UPS because when our cargo ships from Mexico to the Port of Savannah, UPS can directly handle the products to our warehouse and our retailers local distribution centers. UPS’s advanced IT systems also provide reports to help optimize business planning and decisions. UPS also has e-commerce solutions for new and small business like ours. Whether a customer needs to be able to manage multiple online marketplaces or integrate shipping and order processing, UPS small business solutions gives the customer the control to run the business smoothly. Moreover, UPS returns can give customer greater efficiency, reduce costs, and make it easier for our customers to get their return labels, while providing multiple pick-up and drop-off options. With advanced inventory management backed by the latest technological advances, UPS logistics is the best choice for Adamo’s distribution strategy.

Distribution Strategy Our distribution strategy involves retailing in two formats: through our own e-commerce platform and through other retailers. We plan on selling 70% of our inventory through retailers like Saks and Neiman Marcus and 30% through our website.

The 700,000 units out of a million have been divided equally between Saks and Neiman Marcus.

We also chose these department stores because of their extensive and impressive reach throughout the U.S. We are interested in selling in the following Saks doors: New York City, Greenwich, Boston, Philadelphia, Long Island, Atlanta, Palm Beach, Miami, Richmond, Houston, Boca Raton, San Antonio, Las Vegas, Costa Mesa and San Francisco.

Neiman Marcus' doors will be Chicago, Washington D.C, Orlando, Tampa, New Jersey, Brooklyn, Charlotte, Denver, Seattle, Austin, Beverley Hills, Dallas, New Port Beach and San Diego.

Saks distribution centers in California and Tennessee and Neiman Marcus' in Texas and Pennsylvania are easily accessible to and from Adamo's warehouses in Atlanta, Georgia and Henderson, Nevada.

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Sourcing Stratgy Conclusion Adamo’s final distribution strategy was carried out and defined based on extensive research and comparisons between China, Egypt, Mexico and Vietnam. Furthemore, we also compared and weighed advantages and disadvantages based on the the top suppliers of each country and compared costs to manufacturing in each country as well. Finally, we carried out a line plan analysis in order to figure out where would manufacture one million units over the course of one year and placement exercise to define how much of each style we would manufacture in each country.

With all the above research and exercises, Adamo came to the conclusion that in order to reach the most efficient supply chain strategy we will manufacture only in Vietnam, Mexico and China. We have also identified that because of Mexico’s strategic location of being closest to the U.S. compared to any of the other three countries, we will manufacture the most units in that country with Monty as our supplier. Nevertheless, because of quality and cost we will also use Nobland Vietnam to manufacture in Vietnam and Lotus to manufacture in Egypt. The styles that will be available year round are Ash, Maggie and Lin, while Shay will only be available in the market from January to September. Adamo will also use UPS Supply Chain as our supply chain solutions provider because of their expertise working with retail companies and their recent shift towards tailoring their services to smaller companies as well. With the help of UPS, Adamo will then be able to distribute our products to Neiman Marcus and Saks distribution centers and stores all over the U.S. and Adamo’s warehouses for ecommerce customers.

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Conclusion As a luxury women's denim brand, Adamo needs to have a supply chain strategy that will not only be cost effective but will also give enough importance to quality of the product. The strategy we have chosen is in sync with our company vision, mission, values and sourcing guidelines.

Egypt, Mexico and Vietnam will be the countries of make for selling and distribution in the United States. We have leveraged free-trade zones, ideal political and economic scenarios and economic costs in order to meet our desired margins of profit. The suppliers have a clientele portfolio with the largest apparel companies in the world and this gives us confidence in their capabilities and services offered. Once our denim styles are produced - they will be shipped with Maersk to the Savannah seaport. UPS will warehouse and fulfill our orders due to their locations, customer satisfaction and experience for working with luxury clientele.

We feel very strongly about this strategy that we have devised because it will support our efforts to successfully launch Adamo's first collection.

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Appendix

911

TECH PACKS

ASH

DESIGN SHEET COMPANY NAME: ADAMO

PAGE #01 STYLE #1901002 SKETCH

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: ASH@ADAMO.COM GARMENT INFORMATION GROUP NAME: REGULAR FIT JEANS

CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

FABRIC CONTENT: 100% COTTON

COLORWAY: INDIGO

DESCRIPTION: 100% COTTON, REGULAR FIT, 4 POCKET, MID-RISE WOMEN'S DENIM

DATE CREATED: JANUARY 19. 2019

DESIGNER INITIALS: MA

DATE MODIFIED

DATE RELEASED

ILLUSTRATION SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #02 STYLE #1901002 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: REGULAR FIT JEANS COLORWAY:

EMAIL: ASH@ADAMO.COM

INDIGO

WHITE

BLACK

SKETCH

FABRIC INFORMATION

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

100% COTTON #129 Nick of Time Textiles

64”

24-25-26-27-2829-30

TBD

DATE CREATED: JANUARY 19. 2019

DATE MODIFIED:

COMMENTS

DESIGNER INITIALS: MA

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #03 STYLE #1901002 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: REGULAR FIT JEANS COLORWAY

EMAIL: ASH@ADAMO.COM

INDIGO

WHITE

SKETCH

BLACK

FABRIC 100% COTTON Indigo #129 Nick of Time Textiles Width: 64/66" wide Weight: 11oz per square yard -

Warp threads Utilized a traditional basket weave with indigo and white yarns

DESIGNER INITIALS: MA FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO

PAGE #03

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

STYLE #1901002 CLASSIFICATION: WOMENS DENIM

PHONE: 917-703-3197

GROUP NAME: REGULAR FIT JEANS

SEASON: F/W 2019

COLORWAY

EMAIL: ASH@ADAMO.COM

INDIGO

WHITE

BLACK

FABRIC SKETCH 100% COTTON T/C90/10 Shenze County Xingye Textile Co., Width: 45x45 Density: 96x72 -

Texture is plain herringbone twill Air-jet loom

DESIGNER INITIALS: MA

FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

COMPONENT SHEET

PAGE #04

COMPANY NAME: ADAMO

STYLE #1901002 GROUP NAME: REGULAR FIT JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

COLORWAY

PHONE: 917-703-3197

EMAIL: ASH@ADAMO.COM INDIGO

ITEM-VENDORCODE-ORIGIN Copper Button, Xiamen QX Tarde Co., Ltd, MP-JB-B017-4, China

CONTENT

SIZEQUANTITYUNIT OF MEASURE

#65 Brass

17 mm, 1 per denim

Yellow PermaCore Thread, American & Efird, #44105, USA

Polyester and cotton

Zipper, YKK, 5RMN, Japan

100% cotton and silver metal

DATE CREATED: JANUARY, 19, 2019

WHITE

LOCATION

BLACK

COLOR

Front top corner, above zipper

Copper

12 Mic, 220 yards per denim

Stitching all over

Yellow

6 inches, 1 per denim

Front, above crotch opening

White and silver

DATE MODIFIED:

COMMENTS

DATE RELEASED:

LABEL/PACKAGING SHEET

PAGE #05

COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: ASH@ADAMO.COM

PACKAGING

Fold left over right Fold bottom edge to knee Fold bottom to top waistband

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL/PACKAGING SHEET COMPANY NAME: ADAMO

PAGE #06 STYLE #1901002 GROUP NAME: REGULAR FIT JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFICATION: WOMENS DENIM COLORWAY

PHONE: 917-703-3197

SEASON: F/W 2019

EMAIL: ASH@ADAMO.COM INDIGO ITEM-VENDOR-CODE-ORIGIN Outer waistband label, Xiamen Xinlonggiao, #DK851, China Inner waistband label, WeSource, #WL-007, China Hang tag, Xiamen Xinlongqiao, #DK040, China Care label, Whenzou Dongmao, #DM0051, China

CONTENT Print 100% Cotton Print 100% Cotton

SIZEQUANTITYUNIT OF MEASURE

WHITE

LOCATION

1 per denim, 3.5” x 2” 1 per denim, 0.5” x 2” 1 per denim, 3.5” x 2” 1 per denim, 1” x 2”

BLACK

COLOR

Back top waistband Inner top of waistband Top waistband, attached to belt loop Front inner waistband

COMMENTS

White and black White and black Black White

2” 0.5” FRONT 1”

3.5” 2”

BACK

2”

2” 100% COTTON

3.5” 1ST PAGE

FRONT

2ND PAGE

BACK

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: ASH@ADAMO.COM

PAGE #07 STYLE: #1901002 GROUP NAME: REGULAR FIT JEANS CLASSIFICATION: WOMENS DENIM SEASON: F/W 2019 COLORWAY:

PHONE: 917-703-3197

INDIGO DETAIL

WHITE

BLACK

CARE LABEL

Left inner bottom waistband

INNER LABEL

A: 0.8” top of waistband to top of label B: 0.5” width of label

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

DATE RELEASED:

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: ASH@ADAMO.COM

PAGE #08 STYLE #1901002 GROUP NAME: REGULAR FIT JEANS CLASSIFICATION: WOMENS SEASON: F/W 2019 DENIM COLORWAY:

PHONE: 917-703-3197

INDIGO DETAIL

WHITE

BLACK

OUTER LABEL

Place on back waistband, 2” from belt loop

Place on front right belt loop with 6.5” black woven string HANG TAG

AD

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

O AM

DATE RELEASED:

DETAIL CONSTRUCTION

PAGE #09

COMPANY NAME: ADAMO

STYLE #1901002

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

GROUP NAME: REGULAR FIT JEANS

PHONE: 917-703-3197

CLASSIFICATION: WOMENS DENIM COLORWAY:

SEASON: F/W 2019

EMAIL: ASH@ADAMO.COM

INDIGO

WHITE

BLACK

DETAIL

POCKET PLACEMENT POCKET DIMENSIONS

DATA CREATED: JANUARY 19, 2019

DATA MODIFIED

DATA RELEASED

DETAIL CONSTRUCTION

PAGE #10

COMPANY NAME: ADAMO

STYLE #1901002

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

GROUP NAME: REGULAR FIT JEANS

PHONE: 917-703-3197

CLASSIFICATION: WOMENS DENIM COLORWAY:

SEASON: F/W 2019

EMAIL: ASH@ADAMO.COM

INDIGO

WHITE

BLACK FLY STITCHING

POCKET STITCHING

FLY STITCHING

BELT LOOP DETAILS

FIVE THREAD OVERLOCK

SINGLE STITCH

DATA CREATED: JANUARY 19, 2019

DATA MODIFIED

DATA RELEASED

SPEC SHEET COMPANY NAME: ADAMO

PAGE #11 STYLE #140088 GROUP NAME: REGULAR FIT JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFIATION: WOMENS DENIM

SEASON: F/W 2019

COLORWAY:

PHONE: 917-703-3197

EMAIL: ASH@ADAMO.COM INDIGO TECHNICAL SKETCH

COMMENTS: COD POINT OF E MEASURE

BLACK

SKETCH/PHOTO:

TOL.+ less - 1/4 more + 1/2

A

WAIST

B

RISE

C

HIPLINE HIGH

D

HIPLINE LOW

E

THIGH

F

LEG OPENING

less - 1/4 more + 1/6 less - 1/4 more + 1/8

G

INSEAM

less - 1/4 more + 1/9

DATE CREATED: JANUARY 19, 2019

WHITE

less - 1/4 more + 1/3 less - 1/4 more + 1/4 less - 1/4 more + 1/5

XS 28 1/2 "

S

M 30 1/2 "

L 31 1/2 "

XL 32 1/2 "

8 3/4 "

20 1/2"

9" 19 1/2" 20 1/2"

9 1/4 "

9 1/2 "

10 "

21"

21"

22"

22"

22"

23"

19 "

19 "

20 1/2 "

20 1/2 "

16 "

16 "

16 "

30 "

30 "

31 "

19 1/2"

DATE MODIFIED:

29 "

XXL

XXXL 35 "

21 "

34 " 10 1/4 " 22 1/2" 23 1/2" 22 1/2 "

16 "

17 "

17 "

18"

31 "

32 "

32 "

33 "

DATE RELEASED:

10 1/2 " 23 1"2 24 1/2" 23 "

MAGGIE

DESIGN SHEET COMPANY NAME: ADAMO

PAGE #01 STYLE #140088 SKETCH

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: MATENC@ADAMO.COM GARMENT INFORMATION GROUP NAME: SKINNY JEANS

CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

FABRIC CONTENT: 100% COTTON

COLORWAY: INDIGO

DESCRIPTION: 100% COTTON, MIDRISE, 4 POCKET, 1 BUTTON, LIGHT STONE WASH, SUPER SKINNY JEANS

DATE CREATED: JANUARY 19. 2019

DESIGNER INITIALS: MA

DATE MODIFIED

DATE RELEASED

ILLUSTRATION SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #02 STYLE #140088 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: SKINNY JEANS COLORWAY:

EMAIL: MATENC@ADAMO.COM

INDIGO

WHITE

BLACK

SKETCH FRONT

BACK

FABRIC INFORMATION

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

100% COTTON #129 Nick of Time Textiles

64”

24-25-26-27-2829-30

TBD

DATE CREATED: JANUARY 19. 2019

DATE MODIFIED:

COMMENTS

DESIGNER INITIALS: MA

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #03 STYLE #140088 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: SKINNY JEANS COLORWAY

EMAIL: MATENC@ADAMO.COM

INDIGO

WHITE

SKETCH

BLACK

FABRIC 100% COTTON Indigo #129 Nick of Time Textiles Width: 64/66" wide Weight: 11oz per square yard -

Warp threads Utilized a traditional basket weave with indigo and white yarns

DESIGNER INITIALS: MA FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #03 STYLE #140088 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: SKINNY JEANS COLORWAY

EMAIL: MATENC@ADAMO.COM

INDIGO

WHITE

SKETCH

BLACK

FABRIC

100% COTTON T/C90/10 Shenze County Xingye Textile Co., Width: 45x45 Density: 96x72 -

Texture is plain herringbone twill Air-jet loom

DESIGNER INITIALS: MA FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

COMPONENT SHEET

PAGE #04

COMPANY NAME: ADAMO

STYLE #140088 GROUP NAME: SKINNY JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

COLORWAY PHONE: 917-703-3197

EMAIL: MATENC@ADAMO.COM INDIGO

ITEM-VENDORCODE-ORIGIN Copper Button, Xiamen QX Tarde Co., Ltd, MP-JB-B017-4, China Yellow PermaCore Thread, American & Efird, #44105, USA Zipper, YKK, 5RMN, Japan

CONTENT

SIZEQUANTITYUNIT OF MEASURE

#65 Brass

17 mm, 1 per denim

Polyester and cotton 100% cotton and silver metal

12 Mic, 200 yards per denim 6 inches, 1 per denim

DATE CREATED: JANUARY, 19, 2019

WHITE

LOCATION

BLACK

COLOR

Front top corner, above zipper

Copper

Stitching all over Front, above crotch opening

Yellow White and silver

DATE MODIFIED:

COMMENTS

DATE RELEASED:

LABEL/PACKAGING SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: MATENC@ADAMO.COM

PAGE #05

PACKAGING

Fold left over right Fold bottom edge to knee Fold bottom to top waistband

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL/PACKAGING SHEET COMPANY NAME: ADAMO

PAGE #06 STYLE #140088 GROUP NAME: SKINNY JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFICATION: WOMENS DENIM COLORWAY

PHONE: 917-703-3197

SEASON: F/W 2019

EMAIL: MATENC@ADAMO.COM INDIGO ITEM-VENDOR-CODE-ORIGIN Outer waistband label, Xiamen Xinlonggiao, #DK851, China Inner waistband label, WeSource, #WL-007, China Hang tag, Xiamen Xinlongqiao, #DK040, China Care label, Whenzou Dongmao, #DM0051, China

CONTENT Print 100% Cotton Print 100% Cotton

SIZEQUANTITYUNIT OF MEASURE

WHITE

LOCATION

1 per denim, 3.5” x 2” 1 per denim, 0.5” x 2” 1 per denim, 3.5” x 2” 1 per denim, 1” x 2”

BLACK COLOR

Back top waistband Inner top of waistband Top waistband, attached to belt loop Front inner waistband

COMMENTS

White and black White and black Black White

2” 0.5” FRONT 3.5” 2”

1”

BACK

2”

2” 100% COTTON

3.5”

1ST PAGE

FRONT

2ND PAGE

BACK

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: MATENC@ADAMO.COM

PAGE #07 STYLE: #140088 GROUP NAME: SKINNY JEANS CLASSIFICATION: WOMENS SEASON: F/W 2019 DENIM COLORWAY:

PHONE: 917-703-3197

INDIGO DETAIL

WHITE

BLACK

CARE LABEL

Left inner bottom waistband

INNER LABEL

A: 0.8” top of waistband to top of label B: 0.5” width of label

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

DATE RELEASED:

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: MATENC@ADAMO.COM

PAGE #08 STYLE #140088 GROUP NAME: SKINNY JEANS CLASSIFICATION: WOMENS DENIM SEASON: F/W 2019 COLORWAY:

PHONE: 917-703-3197

INDIGO DETAIL

WHITE

BLACK

OUTER LABEL

Place on back waistband, 2” from belt loop

Place on front right belt loop with 6.5” black woven string HANG TAG

AD

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

O AM

DATE RELEASED:

DETAIL CONSTRUCTION

PAGE #09

COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

STYLE #140088

PHONE: 917-703-3197

CLASSIFICATION: WOMENS DENIM COLORWAY:

GROUP NAME: SKINNY JEANS SEASON: F/W 2019

EMAIL: MATENC@ADAMO.COM

INDIGO

WHITE

BLACK

DETAIL POCKET PLACEMENT POCKET DIMENSIONS

DATA CREATED: JANUARY 19, 2019

DATA MODIFIED

DATA RELEASED

DETAIL CONSTRUCTION COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #10 STYLE #140088 GROUP NAME: SKINNY JEANS CLASSIFICATION: WOMENS DENIM COLORWAY:

SEASON: F/W 2019

EMAIL: MATENC@ADAMO.COM

INDIGO

WHITE

BLACK

FLY STITCHING

POCKET STITCHING

FLY STITCHING

BELT LOOP DETAILS

FIVE THREAD OVERLOCK

SINGLE STITCH

DATA CREATED: JANUARY 19, 2019

DATA MODIFIED

DATA RELEASED

SPEC SHEET COMPANY NAME: ADAMO

PAGE #11

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

STYLE #140088 GROUP NAME: SKINNY JEANS CLASSIFIATION: WOMENS SEASON: F/W DENIM 2019 COLORWAY:

EMAIL: MATENC@ADAMO.COM INDIGO SKETCH/PHOTO:

TECHNICAL SKETCH

POSITION FRONT FRONT FRONT FRONT FRONT FRONT FRONT FRONT FRONT BACK BACK BACK BACK BACK BACK

POINT OF MEASURE A B C D E F G H I A B C D E F

TOL.+ +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.4” +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.25” +/- 0.2” +/- 0.2” +/- 0.2”

24 42” 13.5” 32” 5.5” 8.5” 3.5” 13.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 15”

25 42” 14.5” 32” 5.5” 8.5” 3.5” 14.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 15.5”

26 42” 15.5” 32” 6” 8.5” 3.5” 15.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 16”

27 42” 16.5” 32” 6” 8.5” 3.5” 16.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 16.5”

WHITE

28 42” 17.5” 32” 6.5” 8.5” 3.5” 17.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 17”

BLACK

29 42” 18.5” 32” 6.5” 8.5” 3.5” 18.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 17.5”

COMMENTS: DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

DATE RELEASED:

30 42” 19.5” 32” 7” 8.5” 3.5” 19.5” 2.5” 2” 5.5” 4.5” 5.5” 2” 12” 18”

LIN

DESIGN SHEET COMPANY NAME: ADAMO

PAGE #01 STYLE #140011 SKETCH

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: LINZZIE@ADAMO.COM GARMENT INFORMATION GROUP NAME: WIDE-LEG JEAN

CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

FABRIC CONTENT: 100% COTTON

COLORWAY: INDIGO

DESCRIPTION: 100% COTTON, SLIM FIT, DARK WASH DENIM, WIDE-LEG JEAN

DATE CREATED: JANUARY 19. 2019

DESIGNER INITIALS: MA

DATE MODIFIED

DATE RELEASED

ILLUSTRATION SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #02 STYLE #140011 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: WIDE-LEG JEAN COLORWAY:

EMAIL: LINZZIE@ADAMO.COM

SKETCH

FABRIC INFORMATION

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

100% COTTON #129 Nick of Time Textiles

64”

24-25-26-27-2829-30

TBD

DATE CREATED: JANUARY 19. 2019

DATE MODIFIED:

COMMENTS

DESIGNER INITIALS: MA

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #03 STYLE #140011 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: WIDE-LEG JEAN COLORWAY

EMAIL: LINZZIE@ADAMO.COM

SK ETCH

FABRIC 100% COTTON Indigo #129 Nick of Time Textiles Width: 64/66" wide Weight: 11oz per square yard -

Warp threads Utilized a traditional basket weave with indigo and white yarns

DESIGNER INITIALS: MA FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

COMPONENT SHEET

PAGE #04

COMPANY NAME: ADAMO

STYLE #140011 GROUP NAME: WIDE-LEG JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

COLORWAY PHONE: 917-703-3197

EMAIL: LINNZIE@ADAMO.COM

ITEM-VENDORCODE-ORIGIN Copper Button, Xiamen QX Tarde Co., Ltd, MP-JB-B017-4, China Yellow PermaCore Thread, American & Efird, #44105, USA Zipper, YKK, 5RMN, Japan

CONTENT

#65 Brass Polyester and cotton 100% cotton and silver metal

DATE CREATED: JANUARY, 19, 2019

SIZEQUANTITYUNIT OF MEASURE 17mm diameter 1.65 g 1 per pair of jeans 12 Mic, 286 yards per denim 6 inches, 1 per denim

LOCATION

COLOR

Front top corner, above zipper

Copper

Stitching all over Front, above crotch opening

Yellow White and silver

DATE MODIFIED:

COMMENTS

DATE RELEASED:

LABEL/PACKAGING SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: LINZZIE@ADAMO.COM

PAGE #05

PACKAGING

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL/PACKAGING SHEET COMPANY NAME: ADAMO

PAGE #06 STYLE #140011 GROUP NAME: WIDE-LEG JEAN

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFICATION: WOMENS DENIM COLORWAY

PHONE: 917-703-3197

SEASON: F/W 2019

EMAIL: LINZZIE@ADAMO.COM

ITEM-VENDOR-CODE-ORIGIN Outer waistband label, Xiamen Xinlonggiao, #DK851, China Inner waistband label, WeSource, #WL-007, China Hang tag, Xiamen Xinlongqiao, #DK040, China Care label, Whenzou Dongmao, #DM0051, China

CONTENT Print 100% Cotton Print 100% Cotton

SIZEQUANTITYUNIT OF MEASURE

LOCATION

1 per denim, 3.5” x 2” 1 per denim, 0.5” x 2” 1 per denim, 3.5” x 2” 1 per denim, 1” x 2”

COLOR

Back top waistband Inner top of waistband Top waistband, attached to belt loop Front inner waistband

COMMENTS

White and black White and black Black White

2” 0.5” FRONT 3.5” 2”

1”

BACK

2”

2” 100% COTTON

3.5”

1ST PAGE

FRONT

2ND PAGE

BACK

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: LINZZIE@ADAMO.COM

PAGE #07 STYLE: #140011 GROUP NAME: WIDE-LEG JEANS CLASSIFICATION: WOMENS SEASON: F/W 2019 DENIM COLORWAY:

PHONE: 917-703-3197

DETAIL

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

DATE RELEASED:

DETAIL CONSTRUCTION

PAGE #09

COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

STYLE #140011

PHONE: 917-703-3197

CLASSIFICATION: WOMENS DENIM COLORWAY:

GROUP NAME: WIDE-LEG JEANS SEASON: F/W 2019

EMAIL: LINZZIE@ADAMO.COM

DATA CREATED: JANUARY 19, 2019

DATA MODIFIED

DATA RELEASED

SPEC SHEET COMPANY NAME: ADAMO

PAGE #11 STYLE #140011 GROUP NAME: WIDE-LEG JEANS CLASSIFIATION: WOMENS SEASON: F/W DENIM 2019 COLORWAY:

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

EMAIL: LINZZIE@ADAMO.COM

TECHNICAL SKETCH

WAIST

- 1/4 more + 1/2

28 1/2"

29"

30 1/2"

31 1/2"

32 1/2"

34"

35"

HIPELINE HIGH HIPLINE LOW FRONT RISE

- 1/4 more + 1/2 - 1/4 more + 1/2 - 1/4 more + 1/2

19 1/2" 20 1/2"

19 1/2" 20 1/2"

21"

21"

22"

22 1/2"

23 1"2

22"

22"

23"

23 1/2"

24 1/2"

8 3/4"

9"

9 1/4"

9 1/2"

10"

10 1/4"

10 1/2"

BACK RISE

- 1/4 more + 1/2

11 1/4"

11 1/2"

12"

12 1/4"

12 1/2"

13"

13 1/4"

INSEAM

- 1/4 more + 1/2

26‘’

27‘’

27 1/2‘’

28 1/2‘’

29‘’

30‘’

30 1/2‘’

LEG OPENING

- 1/4 more + 1/2

22''

22 1/2''

23"

23 1/2''

24''

24 1/2''

25''

THIGH

- 1/4 more + 1/2

20''

20 1/2"

21"

21 1/2''

22"

22 1/2"

23''

A B C D E F G

SKETCH/PHOTO:

H COMMENTS:

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

DATE RELEASED:

SHAY

DESIGN SHEET COMPANY NAME: ADAMO

PAGE #01 STYLE #140013 SKETCH

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: SHAN@ADAMO.COM GARMENT INFORMATION GROUP NAME: CROPPED JEANS

CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

FABRIC CONTENT: 100% COTTON

COLORWAY: INDIGO

DESCRIPTION: 100% COTTON, CROPPED JEAN, 5 POCKET, MID-RISE WOMEN'S DENIM

DATE CREATED: JANUARY 19. 2019

DESIGNER INITIALS: MA

DATE MODIFIED

DATE RELEASED

ILLUSTRATION SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #02 STYLE #140013 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: CROPPED JEANS COLORWAY:

EMAIL: SHAN@ADAMO.COM

INDIGO

WHITE

BLACK

SKETCH

FABRIC INFORMATION

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

100% COTTON #129 Nick of Time Textiles

64”

24-25-26-27-2829-30

TBD

DATE CREATED: JANUARY 19. 2019

DATE MODIFIED:

COMMENTS

DESIGNER INITIALS: MA

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197

PAGE #03 STYLE #140013 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

GROUP NAME: CROPPED JEANS COLORWAY

EMAIL: SHAN@ADAMO.COM

INDIGO

WHITE

SKETCH

BLACK

FABRIC 100% COTTON Indigo #129 Nick of Time Textiles Width: 64/66" wide Weight: 11oz per square yard -

Warp threads Utilized a traditional basket weave with indigo and white yarns

DESIGNER INITIALS: MA FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

FABRIC SHEET COMPANY NAME: ADAMO

PAGE #03

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

STYLE #140013 CLASSIFICATION: WOMENS DENIM

PHONE: 917-703-3197

GROUP NAME: CROPPED JEANS

SEASON: F/W 2019

COLORWAY

EMAIL: SHAN@ADAMO.COM

INDIGO

WHITE

BLACK

FABRIC SKETCH 100% COTTON T/C90/10 Shenze County Xingye Textile Co., Width: 45x45 Density: 96x72 -

Texture is plain herringbone twill Air-jet loom

DESIGNER INITIALS: MA

FABRIC INFORMATION 100% COTTON #129 Nick of Time Textiles DATE CREATED: JANUARY 19. 2019

STYLE WIDTH

SIZE RANGES

DELIVERY DATE

24-25-2627-28-29-30

TBD

64”

DATE MODIFIED:

COMMENTS

DATE RELEASED:

COMPONENT SHEET

PAGE #04

COMPANY NAME: ADAMO

STYLE #140013 GROUP NAME: CROPPED JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 CLASSIFICATION: WOMENS DENIM

SEASON: F/W 2019

COLORWAY

PHONE: 917-703-3197

EMAIL: SHAN@ADAMO.COM INDIGO

ITEM-VENDORCODE-ORIGIN Copper Button, Xiamen QX Tarde Co., Ltd, MP-JB-B017-4, China

CONTENT

SIZEQUANTITYUNIT OF MEASURE

#65 Brass

17 mm, 1 per denim

Yellow PermaCore Thread, American & Efird, #44105, USA

Polyester and cotton

Zipper, YKK, 5RMN, Japan

100% cotton and silver metal

DATE CREATED: JANUARY, 19, 2019

WHITE

LOCATION

BLACK

COLOR

Front top corner, above zipper

Copper

12 Mic, 180 yards per denim

Stitching all over

Yellow

6 inches, 1 per denim

Front, above crotch opening

White and silver

DATE MODIFIED:

COMMENTS

DATE RELEASED:

LABEL/PACKAGING SHEET

PAGE #05

COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401 PHONE: 917-703-3197 EMAIL: SHAN@ADAMO.COM

PACKAGING

Fold left over right Fold bottom edge to knee Fold bottom to top waistband

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL/PACKAGING SHEET COMPANY NAME: ADAMO

PAGE #06 STYLE #140013 GROUP NAME: CROPPED JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFICATION: WOMENS DENIM COLORWAY

PHONE: 917-703-3197

SEASON: F/W 2019

EMAIL: SHAN@ADAMO.COM INDIGO ITEM-VENDOR-CODE-ORIGIN Outer waistband label, Xiamen Xinlonggiao, #DK851, China Inner waistband label, WeSource, #WL-007, China Hang tag, Xiamen Xinlongqiao, #DK040, China Care label, Whenzou Dongmao, #DM0051, China

CONTENT Print 100% Cotton Print 100% Cotton

SIZEQUANTITYUNIT OF MEASURE

WHITE

LOCATION

1 per denim, 3.5” x 2” 1 per denim, 0.5” x 2” 1 per denim, 3.5” x 2” 1 per denim, 1” x 2”

BLACK

COLOR

Back top waistband Inner top of waistband Top waistband, attached to belt loop Front inner waistband

COMMENTS

White and black White and black Black White

2” 0.5” FRONT 1”

3.5”

2”

2”

BACK

2” 100% COTTON

3.5” 1ST PAGE

FRONT

2ND PAGE

BACK

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED

DATE RELEASED

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: SHAN@ADAMO.COM

PAGE #07 STYLE: #140013 GROUP NAME: CROPPED JEANS CLASSIFICATION: WOMENS DENIM SEASON: F/W 2019 COLORWAY:

PHONE: 917-703-3197

INDIGO DETAIL

WHITE

BLACK

CARE LABEL

Left inner bottom waistband

INNER LABEL

A: 0.8” top of waistband to top of label B: 0.5” width of label

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

DATE RELEASED:

LABEL PLACEMENT SHEET COMPANY NAME: ADAMO ADDRESS: 102 E LIBERTY, SAVANNAH, GA 31401 EMAIL: SHAN@ADAMO.COM

PAGE #08 STYLE #140013 GROUP NAME: CROPPED JEANS CLASSIFICATION: WOMENS DENIM SEASON: F/W 2019 COLORWAY:

PHONE: 917-703-3197

INDIGO DETAIL

WHITE

BLACK

OUTER LABEL

Place on back waistband, 2” from belt loop

Place on front right belt loop with 6.5” black woven string HANG TAG

AD

DATE CREATED: JANUARY 19, 2019

DATE MODIFIED:

O AM

DATE RELEASED:

DETAIL CONSTRUCTION

PAGE #10

COMPANY NAME: ADAMO

STYLE #140013

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

GROUP NAME: CROPPED JEANS

PHONE: 917-703-3197

CLASSIFICATION: WOMENS DENIM COLORWAY:

SEASON: F/W 2019

EMAIL: SHAN@ADAMO.COM

INDIGO

DATA CREATED: JANUARY 19, 2019

DATA MODIFIED

WHITE

BLACK

DATA RELEASED

SPEC SHEET COMPANY NAME: ADAMO

PAGE #11 STYLE #140013 GROUP NAME: CROPPED JEANS

ADDRESS: 102 E LIBERTY, SAVANNAH, GA, 31401

CLASSIFIATION: WOMENS DENIM

SEASON: F/W 2019

COLORWAY:

PHONE: 917-703-3197

EMAIL: SHAN@ADAMO.COM INDIGO TECHNICAL SKETCH

WHITE

BLACK

SKETCH/PHOTO:

COMMENTS: CODE

POINT OF MEASURE

B

WAIST HIPELINE HIGH

C

HIPLINE LOW

D

FRONT RISE

E

BACK RISE

F

INSEAM

TOL.+ less - 1/4 more + 1/2 less - 1/4 more + 1/2 less - 1/4 more + 1/2 less - 1/4 more + 1/2 less - 1/4 more + 1/2 less - 1/4 more + 1/2

G

LEG OPENING

less - 1/4 more + 1/2

A

DATE CREATED: JANUARY 19, 2019

24 28 1/2" 19 1/2" 20 1/2"

25 29"

26 30 1/2"

27 31 1/2"

28 32 1/2"

19 1/2"

21"

21"

22"

20 1/2"

22"

22"

23" 10" 12 1/2"

8 3/4" 11 1/4"

9"

9 1/4"

11 1/2"

12"

9 1/2" 12 1/4"

21"

22"

23"

24"

9"

9"

10"

10"

DATE MODIFIED:

29

30

34" 22 1/2"

35"

23 1/2" 10 1/4"

23 1"2 24 1/2" 10 1/2"

13"

13 1/4"

25"

26"

27"

11"

11 1/2"

12"

DATE RELEASED:

ADAMO

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Irun, Beatriz. “Business Opportunities and Challenges in The Textile and Apparel Market in China.” EUSME Centre, Suoyou Consulting Company, 2017, ccilc.pt/wpcontent/uploads/2017/07/eu_sme_centre_report_tamarket_in_china_2017.pdf.

Kader, Shahidul, and Khairul Akter. “ANALYSIS OF THE FACTORS AFFECTING THE LEAD TIME FOR EXPORT OF READYMADE APPARELS FROM BANGLADESH; PROPOSALS FOR STRATEGIC REDUCTION OF LEAD TIME.” European Scientific Journal, Nov. 2014, citeseerx.ist.psu.edu/viewdoc/download? doi=10.1.1.826.9649&rep=rep1&type=pdf.

Leng, Sidney. “China's Once-Booming Textile and Clothing Industry Faces Tough Times.” CNBC, CNBC, 30 Apr. 2018, www.cnbc.com/2018/04/30/chinas-once-boomingtextile-and-clothing-industry-faces-tough-times.html.

Leslie, Chris. “The Port of Shanghai: The World's Largest Port.” Port of Baltimore Ready for Large Ships, www.portvision.com/news-events/press-releases-news/the-port-ofshanghai-the-worlds-largest-port.

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McKay, Zoe. “The Ten Principles For Doing Business In China.” Forbes, Forbes Magazine, 14 Mar. 2012, www.forbes.com/sites/insead/2012/03/06/the-ten-principles-fordoing-business-in-china/#69db24401d82.

Mirzayev, Elvin. “Impact of the Chinese Economy on the U.S. Economy.” Investopedia, Investopedia, 25 Oct. 2018, www.investopedia.com/articles/investing/072915/impactchinese-economy-us-economy.asp.

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（⾯⼦

）

“Timeline: U.S. Relations With China 1949-2018.” Council on Foreign Relations, Council on Foreign Relations, www.cfr.org/timeline/us-relations-china.

“Trump Agrees to Honour 'One China' Policy despite Threats.” BBC News, BBC, 10 Feb. 2017, www.bbc.com/news/world-asia-china-38927891.

Wibawa, Tasha. “'Cold War Confrontation': What to Expect in US-China Relations This Year.” ABC News, Australian Broadcasting Corporation, 5 Jan. 2019, www.abc.net.au/news/2019-01-05/what-to-expect-in-us-china-relations-in2019/10671434.

Yu, Katrina. “China Economy: A Gloomy Start to 2019.” GCC News | Al Jazeera, Al Jazeera, 14 Jan. 2019, www.aljazeera.com/news/2019/01/china-economy-gloomy-start2019-190114151624533.html.

EGYPT Abdel Ghafar, Adel, and Firas Masri. “A Stable Egypt for a Stable Region: SocioEconomic Challenges and Prospects.” Edited by Györgyi Macsai, European Parliament , 19 Jan. 2018, www.europarl.europa.eu/RegData/etudes/STUD/2018/603858/EXPO_STU(2018)603858 _EN.pdf.

Al-Youm, Al-Masry. “Suez Canal Records Highest Ever Revenues for 2017-18, Official.” Egypt Independent, 30 June 2018, ww.egyptindependent.com/suez-canalrecords-highest-ever-revenues-2017-18-official/.

Amin, Shady. “Egypt’ Textiles Development Strategy ‘Vision 2025.’” Egypt Supplying the World, Dec. 2015, file:///Users/shaniyashabrach ortiz%201/Downloads/Textiles_Development_Strategy_Vision_2025Egyptian_Ministry_of_Trade_and_Industry.pdf.

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