suppliers of parkas and windbreakers are raising
prices by up to 15 percent and taking measures to
enhance efficiency in response to the continuing
increase in raw material costs and the ongoing labor
shortage. A number of makers are also taking steps
to improve product quality.
One of the most pressing challenges in the
industry at present is the soaring cost of raw
materials. The majority of fabric and accessories
used to make the jackets are petroleum-based. With
fluctuating crude oil prices in the world market,
the cost of these materials has increased by as much
as 30 percent in the past year.
The labor shortage affecting industrialized
provinces in China is also a major challenge. The
shortage, which was initially limited to Guangdong
province, is now also widespread in the provinces of
Fujian and Zhejiang, the main production hubs for
In fact, a number of factories in these areas
have only half of their required permanent workforce
at any given time, since most workers prefer to work
on a temporary basis.
The problem is further aggravated by the large
number of suppliers in this industry. Many skilled
workers are enticed by companies that offer higher
salaries and better benefits.
Manufacturers are thus forced to match such job
offers with higher pay, better housing and training
for their employees, consequently raising operating
The lack of skilled workers has also forced many
companies to increase subcontracting up to 30
percent to other jacket-producing makers in their
area to meet delivery schedules. They often
subcontract to factories producing for the domestic
market, and while most companies are able to get
workers when they need them, doing so has pushed up
operating costs even higher.
The situation may also lead to scheduling and
quality problems, since makers have less control
Because of these factors, makers have no choice
but to increase prices in coming months. While most
suppliers will raise quotes by up to 5 percent, a
handful of companies plan increases of as high as 15
To boost competitiveness, a number of companies
are now shifting focus to the production of
value-added models. These jackets have functional
treatments and are designed for increased comfort
and durability. Although these are priced 20 to 50
percent more than regular designs, there is less
competition in the line.
The most significant of improvements is in
water-resistance levels of fabric. The most popular
types have a water-resistance rating of 2,000 to
5,000 mm. But some suppliers now offer designs with
ratings ranging from 8,000 to 20,000 mm.
In addition, many companies are producing parkas
and windbreakers made of high-performance materials
such as Drilon, Entrant, Dermizax, Supplex and
Thinsulate that are imported from the US and the EU.
China produces about 30 percent of global parkas and
windbreakers supply. The country exported more than
475 million parkas and windbreakers worthUS$3.8
billion in the first 10 months of 2005. Export sales
were up 14 percent compared to the corresponding
period in the previous year.
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