Top executives from a wide range of leading apparel and soft goods firms reveal their top investment plans for 2002 in this eye-opening feature. Executives representing a diverse mix of apparel and soft goods enterprises were asked about their plans for information technology, capital expenditures and other outlays in the year ahead. Here is what they had to say.

In a nutshell, almost every executive says his or her firm is planning some form of investment in their enterprises. Many firms are working on various stages of ERP system installation. Store system upgrades also will be prevalent this year, along with a focus on demand planning and supply chain integration.

Here's more on what they had to say.

OshKosh B'Gosh Inc
Doug Hyde
CEO

IT Investment/Implementation Plans: OshKosh B'Gosh expects to go live with an Arthur planning system from JDA Software by the end of the first quarter. The firm began the implementation of this solution in 2001. The system will be used by the firm's 140 store retail division, but OshKosh B'Gosh also will use the tool to better plan its wholesale business in terms of getting the right quantity and flow of goods to its retail customers, Hyde says.

Other Capital Expenditures/Investment Plans: As part of its strategy to become a marketing-oriented company, OshKosh B'Gosh is closing its remaining company-owned production facilities, and does not expect to own any apparel manufacturing operations (beyond sample/prototype making facilities) in the future. As such, the company has no manufacturing capital expenditures planned for 2002. The company will be investing in the launch of 10 new retail stores.

Hollander Home Fashions
Jeff Hollander
President

IT Investment/Implementation Plans: Hollander Home Fashions has a relatively large IT department, which performs a high level of in-house programming to support the company's business needs, Hollander explains. A key focus for 2002 will be on improving the company's systems to better predict sales trends and project overall inventory levels against sales projections, he says.

Other Capital Expenditures/Investment Plans: Hollander Home Fashions is completing a new production facility in Javier Lopez, Mexico. This purpose of this factory will be to supply the Mexican market in response to increasing demand for the firm's products among Mexican retailers, including predominantly domestic retailers but also some US retailers doing business in the country, Hollander says.

In terms of other investment plans, Hollander says the company will accommodate needs as they arise throughout the year. The privately held company embraces a zero-based budgeting process where by it does not start the year with a defined budget but rather identifies and justifies capital expenditures on a case by case basis.

Carole Hochman
Peter Gabbe
Executive vice president and COO

IT Investment/Implementation Plans: Carole Hochman will make a significant investment in IT in 2002, Gabbe says. "The changing marketplace, expanded channels of distribution and need for collaboration require strategic implementation of more powerful and broad-based hardware and software applications," he explains. "We must be prepared to service our trading partners while at the same time, reducing non-value added expenses to the product cost."

Busana Apparel Group
Judith Dirkin
President

IT Investment/Implementation Plans: Busana Apparel Group, which is based in Indonesia and manufactures a wide variety of clothing for customers ranging from Marks & Spencer to Nike to Tommy Hilfiger, plans to invest in software for certain segments of the business, with an emphasis on improving its control of business processes.

The firm is introducing an ERP system initially on a very basic and small scale in early 2002, Dirkin says. This system will be custom designed to gather data from all departments, including the company's factories, buyers and merchandisers, based on prevalent business rules/logic, and then transform this data into intelligent information for middle and senior level management, she explains.

In other IT investment, Busana will be investing in software and training to enable it to electronically accept POs and provide all of its major customers with cut ticket details and advance shipping notices (ASNs).

The firm also plans to invest in Internet communications, which it relies upon largely for business communications, Dirkin notes. Busana will outsource the security and operational control of its Internet communications to IBM. In addition, the company plans to invest in PCs, replacing its older computers with the latest PC technology available in the market.

Other Capital Expenditures/Investment Plans: Busana invests in the continual upgrade and replacement of machinery, Dirkin stresses, with a focus on using state-of-the-art equipment to boost productivity and efficiencies. The company has embarked on a project to establish an independent product design and development centre. "This will help us to work more closely with our customers and their design teams in providing value-added services to them, and at the same time focus on the latest trends and developments of the market in the retail fashion industry," Dirkin says.

Mothers Work Inc
Rebecca Mathias
President and COO

IT Investment/Implementation Plans: This year Mothers Work has two focuses, Mathias says. First, the firm will be installing new POS systems in its stores. The vertical retailer is developing the new Internet-based system internally, and will be purchasing new hardware, CPUs and printers for every store. "The system will give us enormous increases in our database management and in our product control and distribution," she says.

Mathias says she also expects the system to greatly improve Mothers Work's capacity for real-time trickle polling, which involves tracking all retail sales at the home office on a real-time basis instead of compiling POS data once nightly. With the new system, the firm also will be able to track customer shopping history in more detail, with all stores having access to customer data "almost instantaneously," she notes.

Secondly, Mothers Work also is developing a web-based PO application to improve its worldwide sourcing operations. "We need to be able to speak around the world instantaneously and to give direction," Mathias says. The system tracks benchmark dates, and assigns completion dates accordingly for major steps (lab colour approvals etc) that must be completed to meet the benchmark date. "If (vendors) fall behind, we know that instantaneously," she explains. "We don't have to wait until the garment's supposed to be in the warehouse, and it's not here. It's a cooperative venture with our vendors so that they can talk to us. It's two-way communication."

The solution incorporates barcoded carton labelling, so that incoming merchandise can be instantaneously accepted, put onto the shelves and entered into the firm's replenishment system, she adds.

Other Capital Expenditures/Investment Plans: "We are all about stores," Mathias says, pointing to the recent completion of Mothers Work's $50 million acquisition of iMaternity, which included the iMaternity, Dan Howard and Mother Time brands. The firm is in the process of assimilating those stores into its operations. But even so, the company plans to continue to add new stores this year. "We add 60 to 80 stores each year, so that's probably our largest capital expenditure," Mathias concludes.

Columbia Sportswear
Rick Carpenter
Vice president of manufacturing operations

IT Investment/Implementation Plans: Columbia Sportswear is making some very strong investments in technology that will essentially bring its overseas offices "right next door to us," in terms of Columbia's ability to access information on costing, reporting, etc, Carpenter says.

"We're really putting a strong push into making sure that we're prepared to grow going forward as efficiently as we can," he says. "Technology is a fact of our business, whether it's being able to source product by electronic means, whether it's being able to continue to do all your pattern making and send all of your patterns electronically, etc."

Oxford Industries Inc
Ben Blount
Executive vice president and CFO

IT Investment/Implementation Plans: Oxford will continue the implementation of global supply chain and logistics IT projects in 2002. Manugistics and LogNet are the principal suppliers the firm is working with on these projects, along with various suppliers of data warehousing equipment. The firm's supply chain IT initiatives are approximately half-way to completion, being rolled out by division. Its logistics initiatives, with a focus on demand planning (improving forecasting techniques etc), are in earlier stages of implementation, Blount says. When the installations are complete, they will enable Oxford to track most of its supply chain processes on a real-time basis, with links not only to its production resources but also customs brokers and other suppliers and service providers, Blount explains.

Other Capital Expenditures/Investment Plans: Oxford is planning to accommodate "the usual requests" from its offshore factories in terms of production equipment replacement, upgrades and changes, Blount says. The firm is in the process of moving more of its cutting offshore, and as a result, will have an increased emphasis on purchasing cutting equipment this year.

Gerber Childrenswear
Edward Kittredge
Chairman and CEO

IT Investment/Implementation Plans: This year Gerber Childrenswear will finish the final stages of its implementation of an enterprise resource planning (ERP) system from JBA (now GEAC). This installation, which the company began in 2000, represents the single largest capital expenditure in its history at approximately $12 million, Kittredge says. Among other advantages, the new system gives Gerber Childrenswear the ability to accommodate shipments in diverse quantity levels, do business in different currencies and service unique retailer packaging requirements, Kittredge notes. It will also enable the firm to further expand its business without incurring significant selling, general and administrative (SG&A) expense, he adds.

Other Capital Expenditures/Investment Plans: Gerber Childrenswear recently completed a major capital investment project - building a new facility in Mexico. In 2002, it plans to open a new sock production facility in Tralee, Ireland. This plant, located about 30 miles from an older Gerber factory in Cahirciveen in Kerry County, will be equipped with new knitting and finishing (bleaching and dyeing) machinery for the production of athletic hosiery, in particular Wilson brand sports socks. The company's hosiery division is building the new factory in response to anticipated growth in its sock sales to the European market and to improve its finishing efficiency, Kittredge says.

It also will conduct a feasibility study of its distribution set up, evaluating strengths and weaknesses of current and alternative distribution centre locations. Proximity to merchandising personnel as well as customers will weigh heavily in the company's considerations, Kittredge relates.

Quiksilver Inc
Gene Elias
Vice president of information and technology systems

IT Investment/Implementation Plans: Quiksilver's IT budget is driven by two primary elements: strategic alignment to the business and tactical requirements, Elias explains.

In the area of tactical requirements (software maintenance licences, hardware upgrades, network infrastructure etc), the firm will invest about the same to slightly less this year compared with its expenditures in prior years. "Substantial investments were made in 1999 and 2000 in this area, and we continue to reap the benefits of establishing a strong fundamental building block," he says.

As for IT investment that aligns with Quiksilver's business strategy, Elias points to three fundamental initiatives: First, enhancing the ability to execute. Second, reducing time to market. And third, growing the business.

Because Quiksilver's operational business relates to the design/merchandising, production coordination and distribution of product, its "execute" initiative is scheduled for this year, he says. A key focus is the firm's distribution centre. The firm has gone through the selection process for a tier-one warehouse management system, which will be implemented by June. Additionally, the company plans to implement a human resources information system.

Other Capital Expenditures/Investment Plans: In concert with its IT expenditures in its distribution centre, Quiksilver will continue to invest in facility improvements and infrastructure improvements in the distribution centre, Elias says. Additionally, Quiksilver will continue its investment in its in-store merchandising, and particularly in its retail initiatives through company-owned concept stores. This includes the Quiksilver Boardriders Clubs, Roxy and Hawk Skate stores.

Kurt Salmon Associates (KSA)
Clay Parnell
Principal

IT Investment/Implementation Plans: Based on his interaction with KSA's clients, Parnell says he believes likely IT priorities for 2002 will focus on the following: sourcing, including production and purchase order (PO) tracking; and planning, including merchandise planning, forecasting and production planning. Overall integration of systems also will be a priority, he predicts, along with analysis and reporting, including data warehousing, use of performance scorecards, etc.

Other Capital Expenditures/Investment Plans: The relative scale of capital spending this year remains to be seen, Parnell notes. Given the current economic environment, and continued softness in apparel in general, "budgets have been slashed everywhere," he observes. Still, spending will continue for manufacturing, joint ventures and the set-up of operations in newer, lower-cost markets, he predicts.

Atlas Headwear
Michele Goodman
President

IT Investment/Implementation Plans: Atlas Headwear does not have any 2002 plans for IT/software investment.

Other Capital Expenditures/Investment Plans: The company is anticipating expenditures for specialised machinery as it expands into new areas of headwear manufacturing, Goodman says.

The Children's Place
Mark Rose
Vice president of manufacturing

IT Investment/Implementation Plans: The Children's Place is about two-thirds of the way to completion in the in-house development of a web-friendly technology for supply chain visibility. The project encompasses a range of processes, from the initial product inquiry to production tracking to customs clearance to the receipt of goods at the warehouse. "The backbone of the systems is done and up and running," Rose says. "We're adding some of the fingers that reach out and touch key elements of the supply chain - key suppliers and representatives and logistics providers."

The proprietary system - called the Style Data Management System (SDMS) - has been programmed in Java, and runs on a WebSphere server. "The flexibility of the system will allow it to evolve and grow with the business," Rose explains, noting: "That's one of the reasons we developed it ourselves - so that we would really own the code and the ability to understand how it's built and how we can develop with it and it can grow with us."

Other Capital Expenditures/Investment Plans: In the past year, The Children's Place opened a warehouse in Ontario, Canada. This facility is a key part of the firm's investment plans, in terms of its US logistics chain. "It is a real important step for the company to be able to allocate to stores from both coasts," Rose concludes.

Lucky Star de Mexico
Brad Gibens
President

IT Investment/Implementation Plans: Lucky Star de Mexico does not have any plans to invest in any additional IT/software in 2002.

Other Capital Expenditures/Investment Plans: The Aguascalientes, Mexico-based firm's 2002 plans for capital expenditures include updating its pressing equipment in the laundry, buying more sample washers and dryers and investing in an oven for the laundry.

Slimline (Pvt) Ltd
Dian Gomes
Managing director

IT Investment/Implementation Plans: Investment in information technology in 2002 will be targeted toward the Internet at Slimline, which is based in Pannala, Sri Lanka, and is a joint venture of Mast Industries, Sara Lee Courtaulds and MAS Holding (Pvt) Ltd. At present, the Slimline website is a static site, and as such, the firm does not derive a business advantage from the Internet, Gomes says. The site will be converted into a dynamic site with functionality for customers, suppliers, Slimline users and other visitors. The implementation will be done in stages, with customer functionality being implemented first. "We expect to leverage on our strong back-end SAP implementation to provide inputs to our website," Gomes concludes.

Other Capital Expenditures/Investment Plans: In order to compete against plants located in lower-labour-cost regions, Slimline plans to mechanise more labour-intensive operations. Production efficiencies also will be addressed in order to achieve the desired number of standard hours, which would enable the firm to reduce the cost per unit, Gomes relates. Another focus will be on reducing material wastage.

Haggar Clothing Co
David Specht
Senior vice president and CIO

David Roy
Executive vice president of operations at Haggar Clothing Co

IT Investment/Implementation Plans: Haggar plans to invest in web-based software that will help it improve its visibility into its eastern hemisphere supply chain. Roy explains that the firm has good visibility into its western hemisphere supplier base, which is more established than its eastern hemisphere network. Still, the firm will be investigating ways to improve the level of communication with western hemisphere suppliers using systems already in place, Roy notes.

Looking at the big picture for Haggar's overall IT investment strategy, Specht says the company is "rethinking the type of information, functionality and IT support managers need to go to market a little quicker and a little smarter".

In terms of specific focus areas, Haggar is looking to streamline the process of enabling contractors to ship more merchandise directly to retail customers while billing Haggar for the product. With increased direct shipment capability, the firm's cycle times and product handling costs can be greatly reduced, Specht observes.

Haggar also is updating the systems in its Direct-to-Consumer division, which manages its network of retail stores. In particular, the firm is putting together a software strategy for its point-of-sale (POS) data collection processes as well as its back office, merchandising and allocation activities. In 2001, the firm installed a new frame relay system as the telecommunications backbone of its Direct -to-Consumer retail operations, improving communication by connecting all stores via a wide area network (WAN). The next step, on schedule to be executed in 2003, will be to optimise its retail operations with a more state-of-the-art POS system, Specht says.

In 2002, Haggar will also be working to identify ways to reduce costs through the use of information technology. For example, the firm is exploring ways it can use the Internet to reduce EDI expenses, Specht relates. Will these new methods for EDI hinge on the use of XML? Not likely. "We believe XML is more hype than reality at this point," he says.

Other Capital Expenditures/Investment Plans: Haggar is dedicating much "human capital" toward its strategic sourcing operations as it explores different production locales globally, Roy says.

In general, the firm will continue to be cautious about spending in 2002, and will continue to run "tight and lean," he adds, noting that Haggar's business remained strong during the economic downturn of 2001 and looked promising for early 2002 in terms of increasing order volume.

Roy relates that many of Haggar's current business initiatives "do not require a lot of capital," pointing to the firm's ongoing focus on new acquisition and licensing opportunities, such as the Claiborne for Men deal it sealed in 2001. As he sums up the key to competitiveness in today's apparel business environment: "It's about being in the right place at the right time, and managing information."

American Apparel Producers' Network (AAPN)
Mike Todaro
Managing director

Other Capital Expenditures/Investment Plans: Based on his perspective from dealings with primarily western hemisphere producers, Todaro says he foresees little to no capital investment in the works for 2002. "What little new growth in production capacity there is in this hemisphere seems to be funded by firms expanding into the region from Korea, China, Taiwan and elsewhere in the Far East," he says.

While expansion by US manufacturers in terms of owned, offshore facilities is declining, he notes, there is some growth in investment among a few, very large, sophisticated apparel enterprises in the Latin American region.


American Textile Manufacturers Institute (ATMI)
Carlos Moore
Executive vice president

Hardy Poole
Director, product services division at ATMI

IT Investment/Implementation Plans: Drawing on discussions with apparel importers and retailers he has had during the past eight months, Moore says he has found that their interest in sourcing garments from the Caribbean and Mexico will depend on the delivery speed of firms in those areas. "That is why IT investment is so important, as well as other investment," he emphasises. "Our one major advantage is being able to turn around and replenish goods more quickly than can be done from Asia."

Likewise, Poole observes that some of ATMI's members have found IT investment to be essential in responding to retail sales trends and ultimately, consumer demand. "Some members that make finished products like top-of-the-bed products and bath products have equated the flow of information as the lifeblood of the business world," he relates.

In terms of the nature of IT investment by ATMI members, Poole says: "To the extent that they're able to invest in IT, it's going primarily toward upgrades and refinements and debugging of existing systems - helping the existing systems perform at a higher level, and putting in additions that their customers want."

Other Capital Expenditures/Investment Plans: ATMI members are besieged by competition from low-cost imports, Moore says, and that certainly will affect investment decisions. "That is especially troubling because we have been able to maintain our competitiveness as producers of yarns and fabrics and home furnishings by investing substantial amounts year after year in the latest, most productive equipment," Moore says.

North Carolina State University
College of Textiles
Trevor Little
Professor and department head
at Department of Textile and Apparel Technology Management

IT Investment/Implementation Plans: The College of Textiles is interested in participating in an initiative with SAP to develop and teach one or more courses on ERP and the related business functions. This would mean installing SAP and working to include this new course in the curricula, Little explains. Other IT investment will include the introduction of Pointcarré software in the textile design curriculum. "We hope to have additional CAD for knitted textile design," Little says, adding: "We are also interested in installing more stations of ARENA for operations research and process simulation. This will involve additional site licenses for the university."

The college is completing its change from Windows NT to Windows 2000, and is evaluating Windows XP. It also now has the ability to operate in a wireless environment.

Other Capital Expenditures/Investment Plans: The college will be adding electronic knitting capability, sample sewing equipment and machinery for multi-needle embroidery and dynamic tensile and compression testing. A new spunbond/meltblown non-woven line will become operational in March, representing a multi-million dollar investment for the college. The college also will add a new studio for Anni Albers' design program.

This staff report was compiled by Bobbin editor in chief Kathleen DesMarteau, with contributions from senior editor Jordan Speer and assistant editor Tracy Haisley.