aafa sclc fall meeting. walter meck past 12 years ceo

AAFASCLCFall

Meeting

AAFASCLCFall

Meeting

Walter Meck

Past

12

Years CEO

CPA

Partner

Troubled CompanyWorkoutSpecialist

Investment Banker

Bought, fixed and sold

troubled companies

Before FesslerUSABefore FesslerUSA

• Pennsylvania-based

• 100% made-in-the-USA

• Private label knitwear

– Design support services

– Vertical manufacturing

Fashion

Tees

• Best customers in the whole world

• Fashion driven

• Technology based

• Last year – 4 million fashion tees

Fashion

Tees

Meckville, Pennsylvania

FarmGeneral StoreCigarsLiquorLumber

Meck Knitting

1900

Grandpa Walter

The Sewing Floor

1900

• Since 1900

• Underwear Manufacturer

• We survived:– 2 World Wars– 1 Great

Depression– Couple Recessions

• But “not exactly” the Korean War

Dri-JeansPlastic Leggings with Boots

Little Wally

1960

1960

Dad SoldDad SoldMr. Fessler BoughtMr. Fessler Bought

“Mr Fessler, we want

our company back.”“Mr Fessler, w

e want

our company back.”

• Artificially Sustained

• Weak Management Practices

• Technology Deprived

• Retailer-controlled Business Practices

• Virtually No Collaboration

• Volume Chasers, not Profit ChasersOpportunity

OpportunityNAFTA

NAFTA

1994 1995 1996

Sales

1994

to

1996

1994

to

1996

“Those jobs will be back soon, won’t

they?

“Those jobs will be back soon, won’t they?

SALESSALES

“Never quit.Never. Never. Never.”

Sir Winston

Churchill

“Human Resources.”“Human Resources.”

Old

Technology

“Sales are up 9% since we cut prices in half.”

“Sales are up 9% since we cut prices in half.”

Price

1996 1997 1998 1999 2000

Sales

1996

To

2000

1996

To

2000

Compete on PriceCompete on Price

Using Old TechnologyUsing Old Technology

When it rains,

it pours.

When it rains,

it pours.

When it

rains,

it pours.

When it

rains,

it pours.

September 11, 2001September 11, 2001

September 17, 2001

When it rains,it pours.

Paul:

“… takeit away

from me.”

Paul:

“… takeit away

from me.”

The Lord:

“My graceis sufficient

for you.”

The Lord:

“My graceis sufficient

for you.”

2 Corinthians 12:9

2 Corinthians 12:9

Paul’s ThornPaul’s Thorn

“History willbe kind

to me for Iintend towrite it.”

Sir Winston

Churchill

ToolsTools

Tools

+ (early)Technology

Tools

+ (early)Technology

“The best thing sin

ce

sliced bread.”

“The best thing sin

ce

sliced bread.”

2001 2002 2003 2004 2005 2006

Sales

2001

To

2006

2001

To

2006

To the priests:

Take up the ark of the covenant and pass on ahead of the

people.

When you reach the edge of

Jordan’s waters, go and stand in

the river.

Have faith.

Lead, don’t follow.

The Road Less

Traveled

Strategy

Niche

TheSecret

Fabrics

FashionTees

Small Lot

Quick

Turn

GarmentDye

Niche

Fabricsdictatethe“Look”

Fabricsdictatethe“Look”

Yarns

dicatethe

Fabric

Yarns

dicatethe

Fabric

DifferentDifferentDifferentDifferent

WhyWhy

Trendier Better

New

•70 orders

•70 different styles

•1,000 units each order

•70,000 units

•Each and every week

•2300 styles so far this year

What isWhat is

SpeedSourcing

FastFashionSpeed toMarket

CreativeThought

ShelfFrom

2 the

What isWhat is

•Flexible & Fast

•Right Goods on Shelf

•Higher Sell Throughs

•Fewer Mark Downs

WhyWhy

Strategy

How to best serve our niche.

Part

ners

hip

s

Customers

SuppliersAlli

an

ces

Consumer

Vir

tual V

ert

ical

Design Concept

Design Support

Production

Strategy

“Every gatewayto the futureis guarded by

a thousand soulsanointed to

protect the past.”

Strategic PartnershipsWith Customers

Strategic PartnershipsWith Customers

SPEEDTO

MARKETOur

Fabrics

YourDesigner

StrategicPurchasing

Design Support

=

Back Room

+

++

=

Roselon

Roselon

Cotton IncorporatedCotton Incorporated

Management

Technology

Niche Strategy

Link

EquipmentEquipment

ComputerSystems

ComputerSystems

SilhouetteDesign

SilhouetteDesign

PatternMakingPatternMaking

GERBERGERBER

Helps us manage:• 200 customers

• 500 fabrics

• 3,000 styles

• 4,000 orders

•a few good vendors

Warehouse

Bin & LotControl

ApparelManufacturi

ng

Distribution

OrderManageme

nt

Yarn &Knitting

PDM

Web AccessCustomersVendors

Sales ForceSupply Chain

Partners

Business Intelligence

MRPOrder to Yarn

“The future belongs to those who

dareto transform rapid change into competitive advantage.”

“The future belongs to those who

dareto transform rapid change into competitive advantage.”

Skills

Tools

Resources

Responsibility

Authority

Challenge

Skills

Tools

Resources

Responsibility

Authority

Challenge

LeadershipTraining

ForManagers

More Technology

“Technology that

facilitates collaboration”

“Alliance Technologies”

More Technology

“Technology that

facilitates collaboration”

“Alliance Technologies”

Luxury - the “new”

Fashion - fresh & creative

Luxury - the “new”

Fashion - fresh & creative

Speed to Market

“from creative thought

to the shelf”

“minutes”

Speed to Market

“from creative thought

to the shelf”

“minutes”

Collaboration - Design

- Supply Chain

- Country - Competitors

Collaboration - Design

- Supply Chain

- Country - CompetitorsBrandingBranding

The Future

Every morning, in the jungle,the gazelle awakes at dawn.

Every morning, in the jungle,the gazelle awakes at dawn.

The Future

The gazelle knows it must run faster than the fastest lion or it

will die.

The gazelle knows it must run faster than the fastest lion or it

will die.

Everymorning, in the jungle, the lion awakes at dawn.

Everymorning, in the jungle, the lion awakes at dawn.

TheFuture

The lion knowsit must run fasterthan the slowestgazelle or it will starve.

The lion knowsit must run fasterthan the slowestgazelle or it will starve.

TheFuture