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By Sourcing Journal
This article was published in Sourcing Journal August 30, 2021. We're sharing because it recaps SPESA's recent Advancements in Manufacturing Technologies Conference from August 24, 2021. Notably it offers insight from panelists on how the industry fared during the Covid-19 pandemic and what must be accomplished to operate successfully in a post-pandemic world.
The home goods market was not immune to the upheaval brought about by the pandemic. While many in the sector have enjoyed robust growth with the shift away from the office, how firms respond to both current challenges and future crises will determine their long-term success. That truth punctuated discussions at the recent Sewn Products Equipment and Suppliers of the Americas (SPESA) Advancements in Manufacturing Technologies Conference, held during Techtextil North America in North Carolina last week.
During the event, representatives from the sewn products industry, as well as academics and other thought leaders, examined not only how COVID has impacted the home business in the short-term, but the pandemic’s lasting effects on how companies operate.
“The pandemic was really an acceleration event,” said Paul Magel, president, business applications and technology outsourcing division, Computer Generated Solutions. “It took 10-year business plans and ramped them into 10-month business plans.”
And for the home furnishings industry, the pandemic hasn’t been the only challenge to business over the past year.
“Everyone was sitting on their couch for 60 days and decided to get a new one,” said Leonard Marano, president, Americas, Lectra. “Then petroleum factories shut down, which reduced foam, and you had the shutdown of production because of COVID and then shortages, and it was the perfect storm for the furniture industry. You cut the supply, demand went up, and now you’re just trying to catch up.”
But simply playing catch-up is not enough. Home goods manufacturers must look beyond the current crisis to find solutions that will not only allow them to weather this storm, but future challenges, as well.
Rethinking Sourcing
One of the most glaring truths revealed by the pandemic has been the vulnerability of the supply chain. With shutdowns in China, Vietnam and other countries that produce much of the home industry’s product, along with shipping logjams that have left container ships sitting on the water sometimes for weeks at a time, relying solely on imports has proved problematic for many companies.
At the same time, domestic production has suffered due to COVID lockdowns in the U.S., as well as worker shortages. So what’s the solution? Magel said diversifying suppliers may be the best option going forward.
“One of the things that was exposed around the supply chain was those relationships vendors had with their suppliers,” he said. “I think all those relationships are being reevaluated, and the network of relationships will have to expand to meet the demand. It’s not onshore or offshore—it’s going to be a mix.”
Another important factor? Digitizing the supply chain so that when there is a disruption, information can be communicated immediately to increase response time. Magel said companies should consider that capability when choosing vendor partners.
“You’ve got to have that entire supply chain digitized,” he said. “When you make those partnerships with suppliers, that needs to be in the discussion—it can’t just be about price anymore. It’s what data can you share with me as quickly as you can? And then looking at your data integrity throughout your organization and how are you turning that data into meaningful information.”
Flexing the Factory
Digitization of the supply chain plays into the concept of the flexible factory model. And with the workforce issues created by the pandemic, the idea of a flexible factory floor that can more easily respond to disruptions has become more attractive than ever.
“A flexible factory is a smart manufacturing plant, digitally connected with control through a centralized network,” said Frank Henderson, CEO, Henderson Sewing Machine Company. “It’s not only automated—it’s got lean processes, but it’s also independent and adaptive to change.”
The flexible factory model depends on digitized, automated machinery paired with highly trained workers who have the ability to not only operate the machinery, but adapt as needed to meet the needs of customers or changes in production.
“An integrated smart factory is highly flexible with cross-trained work teams that are producing for a brand, and a brand is committed to the capacity of that line,” said Will Duncan, executive director, SEAMS. “We’re going to engineer that line for that brand, and no matter what style you give me, we can run it through that line.”
Duncan said that factories he has observed who’ve made the move to this flexible model are not only more nimble, they’re also better places to work for their employees.
“You have workers who can read the tech packs and can be flexible and change on demand,” he said. “When introducing the technology to the cutting room floor, we found the workers were more excited about doing their work.”
Workforce Woes
While a highly skilled workforce is integral to creating a flexible factory environment, many home goods companies are struggling to simply fill open positions at this point. And with the delta variant making some leery of returning to work in person while demand continues to soar, labor shortages have become a huge problem.
“March 2020 hits, and you’ve got big factories in North Carolina and other parts of the world saying, ‘we have a huge crisis on our hands—nobody’s going to spend money, we’re going to furlough everyone,’” Marano said. “And now you drive to Hickory (North Carolina), and they have $5,000 signing bonuses—they can’t get enough people.”
For companies struggling to fill worker vacancies, competitive pay and benefits certainly help with recruiting, but businesses also have to invest in training for current employees to make the most of the resources they already have.
“If you look internally, you’re going to see the skill gaps,” said Jill Coleman, vice president of global sales and business development, Motif. “It’s really sitting down and mapping out what is that person’s passion when they come in, and it’s management being open and saying, ‘we’re willing to invest in a training program.’”
And when appealing to the next generation of workers, pay isn’t the only benefit factories can use to entice new hires. For Generation Z, highlighting the social impact of their work—be it contributing to a local supply chain or using sustainable materials—can be just as important as how much they’ll be paid.
“Gen Z is really passionate about contributing to the world at large, and that doesn’t always translate to a high wage,” said Melissa Sharp, associate director, Zeis Textiles Extension, North Carolina State University Wilson College of Textiles. “And they’re OK with that.”
Above all, the panelists agreed that manufacturers must rethink the status quo and evolve their businesses not only overcome this pandemic, but other crises to come.
“It’s a matter of survival,” Magel said. “It’s a strategic advantage and requirement to survive and move forward.”