The benefits of manufacturing apparel closer to home are well known—convenience, speed to market, lower costs, better sustainability, easier communication, less geopolitical risk, to name a few. For U.S.-based apparel companies building out their nearshoring operations, the United States-Mexico-Canada Agreement (USMCA) as well as CAFTA-DR (Costa Rica, El Salvador, Guatemala, Honduras, Nicaragua, and the Dominican Republic), offer added benefits in the form of duty-free status on goods.
Even so, there is fine print. Yarn forwarding laws stipulate that garments made with inputs produced outside corresponding trade pact countries cannot receive duty-free status. That means more partnership and investment is needed to boost local supply chains and develop skills so nearshoring output can be scaled.
“The three main things you need to have for a successful nearshoring operation are technology, machinery and workforce,” said Ryan Zimmerman, founder and head of business development for Arzee International, a Los Angeles-based private label manufacturer that produces its garments exclusively in Mexico. To create its jersey, French terry and fleece garments, Arzee imports much of its cut goods from LA to be sewn and embellished in Mexico.
Arzee has a strong interest in sustainability and has found various opportunities within its operations. To boost sustainability of its printed Ts and sweatshirts, Arzee invested in a “state of the art” machine that repurposes water to clean its screen-printing machines. The company also imports recycled yarns from a Mexican yarn recycler that falls within the yarn-forwarding parameters.
Because Mexico’s high-end embroidery capabilities weren’t up to the standards Arzee was seeking, the company invested in new embroidery machinery amd more upscale threads, as well as training programs for those working in the facility. “Today, we’re heavily invested in training and getting the local workforce to really understand the brand’s needs and expectations, and most importantly, brand identity,” he said.
In the fireside chat with Lauren Parker, director of SJ and FMG Studios, Zimmerman also discussed how trust is the main ingredient to a successful nearshoring operation, especially as building partnerships can take a long time to come to fruition.
“It doesn’t take just three to six months. I’ve been building a partnership for two years with a massive company, and we’re now just getting into production,” he said, adding that nearshoring proximity isn’t just great for the multiple site visits that come with the territory, but it also eases communication, back-and-forth sample shipping, and the ability to put goods on a truck versus a ship—the latter which also reduces carbon footprint.
Mexico’s two-hour time difference also means no more 10 p.m. calls to China to check on samples. “These are some of the things that definitely pleasantly surprise people when they start doing business in Mexico,” said Zimmerman. “
To watch the fireside chat, click the video above. To learn more about Arzee International, click here.
