AAFA Summit Drills Down on China, Global Trade

Navigating the rapidly evolving international trade environment and sourcing issues in China were hot topics on the agenda at the American Apparel & Footwear Association’s annual executive summit, held this week in Washington, D.C.

The three-day event featured panel discussions focused on the major factors impacting companies’ supply-chain decisions. The summit also focused on how the current gridlock in Washington is hurting the U.S. economy.

A standout was the presentation by former Utah Governor and U.S. Ambassador to China Jon Huntsman Jr., who discussed the relationship between the U.S. and Asia as China’s prominence on the world stage grows.

While China presents many opportunities for companies operating in the region, Huntsman said companies should also be aware of the risks, which include the negative impact of urbanization, state-owned enterprise reform and growing debt. 

“We’ve seen China rise but not ready to perform. But that will no doubt change over the next five to eight years,” he said.

Rob DeMartini, president and CEO of New Balance Athletic Shoe Inc., asked Huntsman to weigh in on the current political deadlock in Washington.

Said Huntsman, “We need to change the operating culture in Washington from that of finger-pointing, acrimony and anger. … We need to have a critical mass of people on Capitol Hill [willing to act in unison].”

Also related to sourcing in China was the panel discussion with Payless ShoeSource’s division SVP of global sourcing and product development, Michael McBreen, and other executives in the supply-chain management field.

On the pressures impacting global sourcing decisions today, McBreen said, “We’re seeing unprecedented pricing inflation after 20 years in China, [which means] you have to think differently about sourcing.” He further noted that differing trade regulations across the globe have changed the way companies manage their supply chains.

Following the presentation was a conversation with Stephen Kolb, CEO of the Council of Fashion Designers of America, who spoke with Diane von Furstenberg about the evolution of her label and her future ambitions to expand in the accessories space, in addition to opening retail stores.

Coinciding with the trade-focused event was the AAFA’s announcement of a refresh of its international trade policy, designed to support its legislative agenda and daily advocacy efforts in Washington.

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