The supply side: Walmart apparel supplier expands apparel production onshore

Jordan-based Classic Fashion has opened its first US manufacturing facility in Santa Ana, California to cut and sew apparel for Walmart. The commitment is part of Walmart’s effort to create US manufacturing jobs by purchasing $350 billion worth of goods made, grown or assembled in America by 2031.

“Classic Fashion is proud to be a supplier to Walmart as we build our manufacturing footprint in the United States,” said Sanal Kumar, Classic Fashion chairman and chief executive officer. “I’m proud to highlight our incredible production staff in the United States and the community of Santa Ana as we continue to build on Classic Fashion’s 20-year track record.”

Kumar and Walmart worked for several years to bring apparel production onshore and participate in the retail giant’s American Lighthouse program, which supports industries in the most challenging sectors onshore, such as clothing. B. Textiles, moves into the limelight.

Deanah Baker, former head of apparel at Walmart US, said textiles are one of the toughest categories for onshore products. But that’s where Walmart started. Looking at Classic Fashion, she was already looking for a partnership and a plan for a reorganization in 2015. Baker made the comments at Walmart’s Open Call event in June. She has since retired from Walmart.

Classic Fashion has 30,000 employees and 22 facilities in Jordan and India. The latest US deal will add another 125 new jobs and plans to grow to 350 jobs over the next three years. The company leased a 12,000 square foot manufacturing facility and 7,200 square foot of warehouse space and invested $4 million in the new facility, which recently opened and is expected to be operational by mid-November.

Kumar said that when Walmart asked him in 2015 to consider starting an apparel line in the US, he knew it would take time since most of the expertise in textiles has been in the 50 years since the US apparel industry is active, gone. Classic Fashion began by opening a design office in the United States, and the new manufacturing facility in Santa Ana is the next phase of that plan. Kumar said it selected the Santa Ana community for the US facility because of the skilled workforce in the area. It is also close to the major Long Beach shipping port.

Baker said in June that bringing textile manufacturing back to the US would be worth fighting for, and she has acknowledged Kumar as a real partner in the process.

Classic Fashion’s U.S. business, The Cut & Sew Co., is working to first source materials from countries near the U.S. and then source materials from within the U.S. to create a closed supply chain for an industry based in This scale has not existed in the US for decades

“Walmart is proud to partner with Classic Fashion, who will soon be manufacturing their amazing products right here in the United States,” said Jason Fremstad, Walmart’s senior vice president of supplier development and sourcing. “Investing in local manufacturing creates American jobs, helps small businesses expand and benefits communities like Santa Ana. We’re thrilled to be able to offer Classic Fashion’s American-made apparel exclusively in our stores.”

Kumar said since he began selling to Walmart in 2005, his business has grown to more than $300 million over the past year. Up to 45% of Classic Fashion’s revenue comes from Walmart sales. Classic Fashion manufactures the majority of retail clothing, including swimwear, sportswear, jackets, casual wear and jeans, which are marketed under its customers’ own brands. While the California facility will produce specifically for Walmart for the first five years, the company also makes apparel for Sam’s Club, Target, JCPenney, Academy Sports + Outdoors, Hollister, Adidas, American Eagle, Hanes, Calvin Klein and Reebok.

The apparel industry has seen its ups and downs amid the pandemic and supply chain disruptions. At the same time, Walmart expanded its apparel offerings by adding more in-house brands such as the activewear line Love & Sports for women and Athletic Works for men. Classic Fashion makes both brands for Walmart.

Marketing firm Statista surveyed fashion executives earlier this year and found that rising commodity costs would affect their supply chain throughout the year, and 85% said they expect inflationary pressures to persist into 2023.

The survey found that 87% of respondents were concerned about higher shipping costs, 79% were concerned about port delays and disruptions, and 78% said temporary vendor closures were affecting them. Other key concerns centered on commodity availability, consumer demand volatility, international trade tensions and changing consumer preferences.

Harry Moser, the founder of the Reshoring Initiative, said supply chain disruptions over the past two years have helped garner more support for restructuring jobs. Moser estimates that 260,000 new manufacturing jobs will come back this year in the US in sectors ranging from microchip makers to diaper makers, steel production to apparel manufacturing.

He said the math makes sense for many manufacturers to backsource at least 20% to 30% of their production to begin with. Given the ongoing challenges in the supply chain over the past two years, Moser said, more manufacturers are now seeing the need to engage in reshoring if they intend to have adequate just-in-time inventory.

The reshoring initiative found that the private and federal push for domestic supply of essential goods resulted in an estimated 230,000 new US manufacturing jobs in 2021. This brings the total number of reshore jobs announced since 2010 to 1.3 million.

Editor’s note: That Supply side section by Talk Business & Politics focuses on companies, organizations, issues and individuals concerned with the provision of products and services to retailers. The Supply Side is managed by Talk Business & Politics and sponsored by Propak logistics.

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