Garment Sourcing & Buying UpdateThe Netherlandsby DH International Fashion Group

edition November 2010

Best Kept Secret for Knitted Garments: BulgariaMany buying parties are concerned nowadays that they depend too much on a few suppliers in the Far East, mostly China. It makes them vulnerable, in particular regarding long delivery times, Chinese New Year hassle, repeat order lead time, dollar rate issues, capital demands and import duties.

There is a strong demand in the market for EU sources nearby, which enable retailers to respond to the market more adequately and with less financial risk.

DH International Fashion Group with a broad experience in China experienced the same challenges as many others. Picking up this challenge became a company goal. Targets were set to find alternative sources: quick initial delivery, even faster delivery of repeats, much less transportation time, no import duties and ‘China competitive price level’.

DH’s mission ended up in Bulgaria. In this country they find an unexpected potential for knitted garments that fully meet the set requirements. In this GS&B Update, DHIFG would like to share their very positive experiences and the potential of Bulgaria. They are right to call it one of their best secrets for sourcing and buying.

FOTO LOW RES!

Frank Bakker, managing director of DH International Fashion Group is excited about DH’s experiences in Bulgaria.

“The fact that Bulgaria became member of the EU has been pivotal for their current performance which is light years ahead from their efforts in the communist era. In our opinion they can strongly compete now with all major producing countries. In particular on knitted garments.”

“Bulgaria’s capacity came as the biggest surprise in our history”

Speed up by 55 days!The ‘Factory to Store’ lead time table is build upon DH’s experiences of over 10 years deliveries from China and 2 years from Bulgaria. The trend in China is that production lead-time is even increasing to 90 days for large quantities. Transport is sea shipments from China versus truck transport from Bulgaria. Of course, airfreight from China will shorten with 22 days but that has a strong negative effect on the base price and profit margin. As Bulgaria is member of the EU, there is no custom clearance, which gives another gain of a few days.

Exploring Bulgarian knitwear opportunities starts simply.Call us atOffice: +31(0)35-6944524Frank Bakker : mobile: +31(0)6-11350391 fbakker@fashiongroup.netDorette Hibbert: mobile: +31(0)6-24780410 dhibbert@fashiongroup.net

Bestsellers is our businessDH International Fashion Group is an international Fashion Design, Sourcing and Production firm. Based on our experience and creativity we focus on design and/or souring and production of retail items with the potential of a bestseller.

Retailers often use our items to complete their store collections. Being active over 10 years within the European and American markets, DH International Fashion Group has great experience in serving a broad customer base, containing world famous a-brands, established retail chains and leading catalogue houses. Companies that are being served over the last years include: IC Companys, H&M, Tommy Hilfiger Europe, Dunnes Stores, Varner Gruppen, M&S Mode, Wehkamp and Coltex

AdressDH International Fashion Group BV Energiestraat 5E 1411 AN Naarden The Netherlands Phone +31 (0)35-6944524 Fax +31 (0)35-6940364

Email: info@fashiongroup.net

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The goal was ‘China

competitive price level’

DH INTERNATIONAL

FASHIONGROUP

Bulgaria: a strong background in textile

The textile and clothing sector has become one of the Bulgaria’s most competitive industries in recent years with considerable foreign investment. 22% of Bulgaria’s labor force is employed in the textile industry! Bulgaria is number 1 in Eastern Europe in textile exports to the United States.

• Long lasting traditions in textile and clothing manufacturing

• Highly skilled labor force• A forte in knitwexar• World class modernized technology base:

STOLL and SHIMA SEIKI installed on a large scale.

• Average monthly wage in textile and clothing is in the range of 150-200 Euros per month.

• Annual growth in the Bulgarian Textile market has been 15-20 percent mainly driven by foreign investment, with Greece, Italy and Germany being by far the most active investors.

Last but not least• Buying from Bulgaria means elimination

of import duties, creating cost advantage.

Price comparison Bulgaria – China

If you want to make a fair price comparison between Bulgaria and China you should calculate all aspects that matter. At the source you probably will find prices that are up to 10% lower in China than Bulgaria. However ‘price at source’ is not your ‘base price’. If you buy from Bulgaria you must calculate with less capital demands (57 days quicker delivery), no dollar rate issues and no import duties. DH’s experience shows that taken the latter points into account the Bulgarian base price ends up more or less the same as the price from China. On top are the short delivery times that make buying from Bulgaria really attractive.

Made in Bulgariaby DH International Fashion Group

When asking Dorette Hibbert, creative director, about her experiences in Bulgaria she is quite honest.

“At start I was quite skeptical as I know how often a nice design is screwed during sampling. I have met in Bulgaria at manufacturers all sorts of people and am impressed by their skills to get things out of production as they are meant to be. Remarkable how easy we can communicate, whilst English is not their mother tongue. You can rate their machinery to top of the class. In Bulgaria we have access to the same yarns and machinery as China. Next to this we visit our production plants on a regular basis, a flight of two hours instead of eleven is also a relieve sometimes!”

“They know how to produce fashion”

Joint venture with specialists

DH has set up a joint venture with a group of 16 knitwear manufacturers; each of them specialized in one or more aspects of knitwear production. Our network has created a combined yarn stock service, keeping permanently a wide variety of yarns and colors in stock. This is very helpful to cut repeat order delivery time. All members of the joint venture are equipped with newest production technology and have skilled labor force on all areas. Whether your own design or any other, they make it fast and at a very competitive price.