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Could you be kind enough to explain what "ori-name" is?
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B:
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Simply put, it's a collective term for the woven label or mark sewn inside your clothes that indicates brand and manufacturer name, material, size and cleaning instructions. More recently, we find them sometimes on the outside of clothing, and some are printed instead of woven. A loop of cloth sewn inside a man's jacket to hang it by (with or without writing) is also called ori-name.
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A:
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I believe the typical ori-name in Japan was cotton-made and approx. 3.6 cm wide, and quality ones were made of still broader satin cloth. Now, a variety of materials ? including man-made fiber, paper, nonwoven cloth, leather and synthetic leather - are used, aren't they?
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B:
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Yes. There're a great variety of materials, in response to the diversification in clothing. As I mentioned earlier, an increasing number use printed names, not ori-name.
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The time has passed when ori-name manufacturers only had to produce ori-name. Now, they are required to supply a whole package of accessory items, such as printed names, tags, paper seals, plastic clasps and bags - when you buy a dress shirt, for example, everything you get other than the shirt itself. I believe this is what is happening.
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That's right. Because of this, the ori-name manufacturer is expected to act as a trading company for accessory items.
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With the added demand for goods beyond ori-name, the volume of their business has grown.
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Yes, that's true, but since they don't manufacture those items in-house, there's a very low margin. Profit depends entirely on volume.
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I understand some of the main Japanese ori-name manufacturers have gone offshore, to China in particular.
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Japanese clothing and apparel manufacturers shifted their production overseas quite a while ago - to Hong Kong, South Korea, China, Vietnam, Thailand, Indonesia, India and the Philippines. Most of their production is shipped to Japan, with a smaller amount exported to other markets. Among those countries, China has been accommodating an increasing share of the production. In the first half of 2000, the country's clothing exports to Japan increased by 26% in volume and 13% in value. China accounts for a surprisingly high 82.8% of total clothing imports to Japan, or 74.3% in terms of value.
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I hear that the three major players in the Japanese ori-name industry, Kobayashi Woven Labels Co., Ltd., Nakamura Labels Co., Ltd., and Ozaki Woven Labels Co., Ltd., are getting more orders than they have the capacity for, because in the second half of 1999 Japanese apparel manufacturers suddenly started procuring accessory items locally.
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That's right. Until the first half (of 1999) they only had inquiries and requests for quotations, but now they have actual orders. To cope with this, they are expanding their factories to increase capacity, doubling machinery and making the most of the Internet.
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They face some tough quality and delivery requirements, don't they?
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Yes. Quality requirements are as strict as any in Japan. Plus, they can easily lose a customer if they fail to meet delivery deadlines. Materials are also procured locally, on the condition that they offer quality equivalent to that in Japan.
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A:
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I wonder how much material Japanese ori name manufacturers purchase locally?
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It varies with the company, but I would say more than 90%. For example, one Japanese manufacturer only produces printed tags at their Shanghai factory. They purchase all the other materials, but they don't just sell them as is. They process them in their factories. They purchase a long roll of ori-name from a local supplier, cut it into pieces and fold in both ends. Or they print numbers on tags they've purchased from another company before shipping them on to their customers.
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A:
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I believe that most of their business is with the Japanese customers located there. What happens after that?
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They do some exporting to Europe and North America, but that only amounts to some 5% of their production. The other 95% is sold to the Japanese customers located there. Almost everything they sell is attached to finished goods and exported to Japan.
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Statistics show that exports of ori-name from Japan totaled \2.33 billion in 1999.
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Yes. They are chiefly produced in Japan. The biggest destination is China, with approx. \1.63 billion (approx. 70%). These are high quality ori-name that cannot be produced in China. They are made in Japan, shipped to China, and then Japanese apparel manufacturers there attach them to clothing which is sent back to Japan. The same happens in other principal destinations, including Hong Kong (\280 million) and Vietnam (\150 million).
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In 1999, Japan imported nearly \200 million worth of ori-name.
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Those came from China, Hong Kong, the U. S. A. and Taiwan, but again, I believe most of them are special ones. I assume the importing from China and Hong Kong was done by Japanese companies there.
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Any ideas about the future of this industry?
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The percentage of overseas production and overseas procurement is already more than 90%, and that figure will only increase. Production in Japan is too costly and thus doesn't make business sense. And exporting materials from Japan, too, is costly. The solution is local procurement of materials, local production and supply to Japanese manufacturers located there. Only those who are agile enough to meet customer needs quickly will survive.
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