THE ‘STATE’ OF THE INSTITUTE

April 25, 2005

Institute President Dr. W. Gilbert O’Neal, with Administrative Manager Patrice Hill, said the alliance with NC State University is working out well. Photos by Devin Steele

Alliance with NCSU working well
for both parties, benefitting industry

By Devin Steele

RALEIGH, NC — The marriage of two leaders in the world of textile education has been a “good deal” for both parties, according to the head of the Institute of Textile Technology (ITT).

Responding to the challenges of the fast-changing domestic textile industry, the Institute and North Carolina State University’s College of Textiles formed a partnership two years ago in order to better serve the industry.

First-year Fellow Melinda Satcher, a Macon, GA, native, is earning her master’s degree in textile engineering.

Under the arrangement, the Institute moved its headquarters from Charlottesville, VA, to NC State’s Centennial Campus to take full advantage of the alliance. The two now share resources, faculty and students, which has allowed the Institute, in a more cost-effective way, to preserve those programs valued by member companies and the broader textile community, said Dr. W. Gilbert O’Neal, president of the Institute.

“The industry is changing, the need for new products is growing, the need for the integration of applied research is expanding,” O’Neal said. “We knew it was time to change. We were making a lot of changes already to try to address some of the evolving needs in the organization.

“Not only that, but the whole idea of this changing time is to streamline things so that resources are more efficiently used,” he added. “It really didn’t make sense with a contracting U.S. textile industry to maintain all of these separate and in some ways competing resources to service the same industry. So we streamlined things to capitalize on the best resources, we think, in the country if not the world and to deliver those much more efficiently.”

With the alliance, Institute graduate students also have gained access to top-of-the-line equipment and facilities and are in close proximity to North Carolina’s Research Triangle Park, along with a number of textile and apparel organizations.

NCSU has gained nearly a dozen and a half more graduate students and a closer relationship with some of the industry’s companies that support the Institute. NC State staff also has become more involved in applied research projects than they typically would.

From an Institute membership standpoint, the partnership allows them to reap the benefits of applied research programs, at a lower level of funding. To that end, the two entities most recently announced the formation of the Institute of Textile Technology/NC State Textile & Material Research Consortium, created to enhance the ability of industry to access and utilize the research and technical resources of the Institute and NC State.

With the change, the Institute has strengthened its commitment to helping industry meet the arduous tasks associated with maintaining global competitiveness, O’Neal said. As such, the Institute continues to be organized into three functional areas: applied research, education and services.

Change was imminent

The move to Raleigh represented the most dramatic in the now-61-year history of the Institute. But, as O’Neal pointed out, the time for change had come.

“As the industry continued to suffer and realign itself, it was increasingly difficult to support that type of overhead, based on a private, member-supported organization,” he said. “We felt like the things we provided for the industry were extremely important and could be used to help those members of the U.S. textile industry that survived and we wanted to make sure we continued to have an organization and provide that type of support to the U.S. textile industry.”

When Institute leaders began looking at ways to align itself to accomplish its objectives, NC State was an easy choice, he added.

Shawn Hutchinson, a native of Fuquay-Varina, NC, is working on the thesis, ‘Extrusion and Characterization of Amlon Fibers.’ He earned an undergraduate degree in computer science from Duke University.

“We quickly came to the realization that the NC State College of Textiles is the top textile university in the country, if not internationally, and that was our best course,” O’Neal said. “Most of the other programs are struggling and realigning themselves to get away from basic textile manufacturing. NC State still maintains a very strong program in textile technology and textile manufacturing and we thought that was a very important part of our program and we decided that whoever we realign with should really have a strong basic textile technology and manufacturing program.”

In addition, NC State had capabilities in marketing, business management, communications and apparel activities, which would give Institute students the opportunity to expand into new areas and offer better services to the industry, O’Neal said.

Also, the fact that several organizations — Cotton Incorporated; [TC]2 (Textile/Clothing Technology Corporation); INDA, Association of the Nonwovens Fabric Industry; and the American Association of Textile Chemists & Colorists (AATCC) — are located in the Raleigh area is a bonus, he added.

“We have formed a very strong relationship with those groups since we’ve been here and hopefully in the near future will coordinate more activities together,” he said. “We want to make Raleigh really the source of technology and innovation for the U.S. textile industry by bringing all of these resources together.”

Graduate program

The Institute developed a new graduate program for ITT graduate students to capture the same type of applied, hands-on education it traditionally offered, as well as to focus not only in technical areas but also on business and leadership skills in a way that most technical graduate programs don’t, O’Neal said.

The Institute Fellows Program, a joint effort between the Institute and NCSU, offers educational opportunities for U.S. students desiring leadership roles in management, research and manufacturing.

Seneca, SC, native Lisa Hartman (Class of 2006) is earning her master’s degree in Textile, Apparel & Technology Management.

The program, 17 students strong this year, provides full scholarships, competitive stipends and unique opportunities for highly qualified graduate students accepted into the College of Textiles, O’Neal said.

“Our students have to take more contact hours for their master’s degree than the typical NC State master’s student does,” he said. “And they have to do it in a prescribed way so that we can guarantee that they can get the type of background that our members want.”

The program offers three options: traditional textile technology, textile chemistry and textile engineering. Additionally, once a week, fellows are required to attend a seminar, where students hear guest speakers or improve skills, such as those related to communications and business — another plus by being located at NC State, as university faculty conduct these types of workshops. Such skills are beneficial to the students, who twice a year must make presentations of their research results to the Institute’s Technical Advisory Committee (TAC).

Without the overhead of maintaining facilities and a larger staff in Charlottesville, the Institute realizes a huge cost savings at NC State while still funding tuition and fees, stipends and other educational-related expenses, O’Neal said.

“But we think we still get the same quality of student,” he said. “And, in fact, to be realistic, they have many more options now than they did in Charlottesville. Within the college, they’ve got all the resources for marketing and business as well as traditional technical areas.”

The Institute enrolls two types of students: industrial fellows and graduate students. Industrial fellows are sponsored by companies, who send promising employees to the Institute and pay their tuition and fees.

Graduate students are ones who have earned undergraduate degrees from NC State or other universities.The Institute also arranges for summer internships for its fellows, allowing them to obtain valuable work experience. In addition, Institute fellows are obligated to conduct research projects supported by the Technical Advisory Committee for fulfillment of their degree.

Students earn their degree from NCSU, since the Institute no longer functions as an independent graduate school.

Research programs

Institute fellows are expected to choose a thesis research topic from among ideas contributed by the Institute and its research partners. Through the Textile and Material Research Consortium, a network of industry research advisory committees that are organized and administered by Institute leadership helps generate this list of research suggestions. Additional input is sought from NCSU faculty and other industry contacts.

“What we see as the job of Institute staff is interfacing between industry and NC State University to identify what the research needs and objectives are of the industry and then efficiently manage that research through NC State,” O’Neal said. “The way universities are structured is not really conducive to efficiently managing diverse applied research projects. And our job is to reach within NC State, find the resources that are needed to carry out the research program, and then deliver that research both on time and within budget back to our membership. And that makes the job easy on everybody.”

Shiqi Li (L) and Lei Qian monitor an ICP (inductivity coupling plasma), used for element analysis of fabric, wastewater or any kind of sample. Li is a staff member and an Ph.d candidate, while Qian works in faculty research for the Institute of Textile Technology.

Projects are managed by Institute researchers and work is performed by a combination of Institute staff, NCSU faculty, Institute Fellows and, in some cases, subcontractors. Institute Fellows’ thesis research is funded through this process to enhance the student’s exposure to the industry and to provide experience in public speaking and communications. Students must present their research proposals, progress reports and thesis results to the TAC and demonstrate accountability for the results.

The Institute’s Board of Trustees also meets biannually to review budgetary and strategic issues. Implicit in the proposed research efforts between ITT and NCSU is the ability to commercialize research findings through the TAC forum.

Institute members fund this research, so they are able to provide input on applied research projects.

“We’ve negotiated an attractive overhead rate so that we can deliver that research at a much lower cost using the faculty, laboratories and the research facilities at NC State,” O’Neal said. “That’s a deal for NC State because it’s a source of revenue to support their research and it allows their faculty to really get involved with industry at an applied research level in a way that they wouldn’t normally do.”

Membership

Institute membership allows companies to engage in applied research and technical programs designed to enhance their competitiveness, O’Neal said. Institute programs foster product innovation, technological advancement, cost improvements and strategic business insight.

Among benefits are membership in the research consortium, exclusive rights for licensing of consortium intellectual properties, representation on the Board of Trustees and Technical Advisory Committee, access to historical Institute research publications and discounted services and training, among others, he added.

When the Institute moved to Raleigh, it was able to transfer assets to establish a fund that pays for the education program. Membership dues, therefore, go now go primarily toward research and aren’t diluted by having to pay for education.

“And that really helps the research money go a long way, plus it helps isolate the education program with respect to the general membership support of it,” he said. “What I mean is, some of the smaller companies haven’t, in the past, felt that they could really take advantage of the educational program. Now, under this new arrangement, our educational program is funded from our asset account, or our educational fund and membership dues can be used for research.”

ITT Technologies (IT3)

In addition to TAC research, the partnership between the Institute and NCSU allows Institute members to perform proprietary research using ITT Technologies, Inc. (IT3). A for-profit, wholly owned subsidiary of the Institute, IT3 provides companies the opportunity to sponsor advanced research and development projects. Any profits that are generated through IT3 are returned back to the Institute to further its resources, according to O’Neal.

Services include: technical manufacturing performance, textile material analysis, education and training, profitability engineering, energy audits and management and environmental engineering and management.

Also, IT3 is accredited to offer certification to textile companies for Quality (ISO-9000) and in any industry segment for Environmental (ISO-14000) International Standards Organization registration.

“For textile companies that are currently ISO-registered, we’d certainly like to retain their certification, and we think we add additional value to that because of our strong textile experience,” O’Neal said. “We do registration service with a full knowledge of all the textile manufacturing processes and bring a lot of value to that process, as opposed to others who are very competent in ISO registration but may not have the same in-depth knowledge of this industry.”

An important service IT3 offers is energy audits and management, he added. For instance, IT3 staff recently conducted an analysis at a small dyeing and finishing company and found nearly a half million dollars a year in wasted energy that could be corrected with a low capital investment, he said.

“Our strength is not to tell them what they already know. We go in and quantify it,” O’Neal said. “When they know what compressed air leaks mean for them from a dollar standpoint, then all of a sudden it’s justified to focus a maintenance person on fixing air leaks or maintaining steam traps. It’s mainly blocking and tackling. It’s going in and doing things that are straightforward, but quantifying them and helping them make better management decisions and better utilize their resources.”

IT3 representatives also look at newer and more efficient technologies for companies, but always include in their proposals a cost-value analysis.

With its own staff of licensed professional engineers able to design and manage projects, IT3 has a long history of providing environmental services, particularly in water and wastewater treatment areas. IT3 is often contracted to help companies design environmental systems in their offshore operations that meet U.S. standards, O’Neal said.

On the subject of globalization and offshoring, which often comes with negative connotations, O’Neal said the services IT3 provide enable the industry to continue to find ways to be competitive.

“It’s not something we like, it’s not something we’re promoting, but it’s a fact of life and we’re working with companies through ITT Technologies trying to generate revenues that we can bring back to strengthen the U.S. textile industry. None of us like it, but we’ve got to figure out a way to compete with China. Right now we’re faced with no quotas, and the horse is out of the barn, so anything we can do at this point to integrate with other companies and partners in this hemisphere is really one of our best chances to maintain a viable textile industry.”

A need for international partnerships exists, in order to provide more products in a more cost-effective way and help make products at the lowest cost, while at the same time maintaining the quality that the U.S. textile industry is known for, he added.

“And in most cases, they’re also being done in a way to utilize U.S. raw materials,” O’Neal noted. “So it’s not completely going offshore, but it’s really aligning with where the apparel industry already is. That’s what’s driving it.”

There’s some good in it for the U.S., but there’s also a downside in terms of jobs being displaced here, he added. But most companies are trying to find that right mix from an economic standpoint to manufacture as much as possible in the U.S. while being more responsive to the cut-and-sew operations and integrating the supply chain, he added.

“Along that same line, one of the things we want to do in our research program and working with NC State faculty is to focus on supply-chain management in ways in which the U.S. textile industry can be more integrated and more responsive to consumer demands,” he said. “And I think that’s a big factor in terms of what survives and what doesn’t. The only chance we have of surviving is through added value through enhanced services and responsiveness to the consumer.”

Alumni association

With more than 500 Institute graduates, an effort has been made to reorganize the Institute’s alumni association. Dr. Robert Barnhardt, former president of the Institute and former dean of NC State’s College of Textiles, David McAlister of the U.S. Department of Agriculture and Barry Leonard of Excel Manufacturing have helped organize this effort.

An Alumni Event, postponed in January due to inclement weather, has been rescheduled for June 11 in Charlotte.

“Many of our graduates are well placed within the industry and still are working in the industry,” O’Neal said. “We really would like to get them more involved in our activities and help the tradition carry on and perhaps give back a little in terms of what the Institute education has meant to them.”

Move shows vision

Creating the alliance with NC State and pulling up stakes has been a challenge, as expected, but making the move speaks volumes about the vision leaders have for the Institute, O’Neal said.

Barnhardt and current College of Textiles Dean Dr. Blanton Godfrey were both instrumental in making the proposed move a reality, he said.

“They’ve been very cooperative and supportive in embracing the Institute’s coming here,” O’Neal said. “That speaks not only of those individuals but also of the vision that they have for making the industry better and the faith that they have in this relationship — that it’s going to be strong and a good ones for both institutions. And of course our board has been very supportive of it and we’re very anxious to expand our membership and get broader participation.”

O’Neal also thanked Patrice Hill, the Institute ’s administrative manager, who previously worked in the provost’s office at NC State.

“She knows all of the ins and outs, the politics of State and how to get things done and she’s taken some very strong leadership roles in the educational program and in managing the membership,” he said.

“We feel like the kinds of things that we offer are essential to companies that are going to succeed in this competitive environment that we’re facing,” O’Neal said. “And we really are anxious to work with companies and give them the benefit of every opportunity that we can.”


ITT Fellows tackling global competitiveness issue

By Devin SteeleBy Devin Steele

RALEIGH, NC — Each year, student Fellows at the Institute of Textile Technology conduct master thesis research not only in technical areas, but also in non-traditional areas as well.

(L-R) Reece Allen, Hope Nowell, ITT President Gilbert O’Neal, Linsey Cesca and Michael Jones meet to discuss the theses on global competitiveness being researched and written by Nowell, Cesca and Jones. Allen, a first-year ITT student, plans to expand the topic in his thesis next year.

This year, three students of the Class of 2005 are heavily involved in theses specifically focused on economic competitiveness. These students — Lynsey Cesca, Hope Nowell and Michael Jones — are working diligently to research and write their theses and are working closely together to integrate their findings into an industry report and present them, as a group, to the Institute’s Technical Advisory Committee (TAC).

With the Institute now being aligned with NC State University and being located on the Centennial Campus with NCSU’s College of Textiles, the three have been able to pull together perhaps more in-depth research than would have been possible at the Institute alone, according to Dr. W. Gilbert O’Neal, the Institute’s president.

“Economic competitiveness is an area where we had limited resources in Charlottesville,” he said. “By coming to Raleigh it’s opened up all kinds of possibilities, both within the College of Textiles, in their management department, as well as being able to go to other areas on the campus — business and economics and so on.”

Institute students also are able to tap into a wealth of other resources at NC State, from state-of-the-art facilities to professors, he added.

“Because of NC State and the Institute working together we were able to have a much better experience than I think the average graduate student does because the Institute has its resources and NC State has even more resources,” Cesca said.

The requirements for Institute Fellows also are steeper than those of typical NC State graduate students, Jones added, pointing out that first-year Institute students are obligated to take five classes per semester as opposed to the typical three.

“Being a part of NC State has helped tremendously,” Nowell added. “The professors here have such a large network of contacts. I feel more prepared going into the work force with the diversity of classes that we’ve had to take.”

With cost savings being realized by moving to Raleigh and sharing resources and facilities, the Institute has more money to support its research programs, O’Neal added.

Such support has given the three Fellows opportunities they may not have had previously, he said. For instance, their research has taken them not only throughout the South’s textile and apparel manufacturing regions, but to Miami and New York — not to mention Hong Kong and China, where they spent seven days in January. In mainland China, they toured a manufacturing facility owned by an Institute graduate.

“One of our committee chairs, Nancy Cassill, felt like we really needed to see the pulse of what was going on in Hong Kong and China,” Cesca said. “Seeing the manufacturing facility definitely put a different perspective on what we had heard about them.”

Research objectives

The three students, who will defend their theses to the TAC this week, interviewed 33 executives from 18 companies for their theses. They talked with U.S. manufacturers with production facilities here and abroad, as well as U.S. retailers and sourcing agents.

With a focus on the bed/bath and bottomweights market, their goals included trying to better understand the competitive environment for U.S. textile manufacturers and better grasp retailers’ sourcing strategies, in hopes of helping U.S. companies compete in a global market.

Some of their work evolved around “playing field issues,” such as trade policy, environmental regulations, federal subsidies, employment benefits plans, etc., according to Jones.

“We looked at the difference in using a Western Hemisphere strategy versus going to Asia and how U.S. companies can best use the close proximity of the Latin American and Central American countries to improve their competitiveness to take advantage of those proximities,” said Jones, whose thesis is “Factors Affecting Government/Trade Disparities Among Nations.”

Nowell, meanwhile, has three research objectives with her thesis, “Economic Competitiveness in the Global Supply Chain: Examination of Supply Chain Configurations.”

“The first one being determining why U.S. manufacturers are losing market share in the areas being sourced by U.S. retailers,” she said. “I’m trying to get a perspective from U.S. retailers as to why they’re leaving U.S. manufacturers out of the loop and what they’re lacking in comparison to offshore manufacturers.”

Her second objective is to determine the supply-chain structures of each company examined, with the third being exploring performance measures, mainly the vendor selection criteria that U.S. retailers are using when choosing a supplier.

“Who’s doing a better job in terms of measuring their own performance and the performance of their vendors in comparison to what U.S. retailers are using,” she explained, “and to see if that communication is being streamlined across the entire supply chain, to determine who is working together better to meet the needs of the U.S. retailer.”

Cesca’s thesis, “Economic Competitiveness in the Global Textile Supply Chain: Examination of Logistical Cost Structures,” delves of course into logistics costs across the supply chain and how the different types of companies are utilizing these logistics costs to create competitive advantage.

“So, partially, it was determining all the different types of logistics chains that are used by different manufacturers, the retailers, the sourcing agents and on top of that looking at where the U.S. manufacturer can fit in,” she said. “And then determining what competitive advantages can be a result of these optimizations.”

Findings

One of the most eye-opening revelations coming out of the research is that U.S. retailers do desire to use U.S. manufacturers, Jones said.

They believe that U.S. manufacturers have an important role that they do fill, because of quickness to market, with their location being so close to their distribution centers and market, as far as replenishments and things like that go.

“But there just seems to be a communications barrier between the two.”

Nowell found that, generally, fashion goods are being produced in Asia and basic goods are being made in the Western Hemisphere.

“A lot of people say that one way to keep U.S. manufacturers in business is to partner maybe with companies, the apparel manufacturers, in say, Central America, to offer full-package sourcing,” she said. “Most retailers want to source full package, but most of your full-package providers are in Asia and there aren’t many full-package options in the Western Hemisphere right now.”

Adding to that, Cesca pointed out that Asian manufacturers have a better fabric supply chain than those in this hemisphere.

“They have the ability to create fabric, whereas companies in the Western Hemisphere rely heavily on the U.S. to ship their fabric for cut-and-sew operations,” she said. “And that’s hindering the Western Hemisphere from succeeding because it adds on so much more cost in transport back and forth.

“Proximity does not remain an issue because (Asian companies) have the ability for one shipment of goods coming over to the U.S.”

“Notwithstanding the shipping issue, though,” O’Neal interjected, “all of this falls back to what Michael was saying in terms of communication and responsiveness to the market. And those communication lines just haven’t been established very well between the suppliers and the apparel manufacturers and the retailers. And that’s where much of the focus has to be going forward for the industry.”

Next year, now-first-year Fellow Reece Allen will follow up on the upperclassmen’s research, focusing on niche market strategies with his thesis.

Expanded education

To enhance their education, Institute Fellows also are required to attend a seminar a week. This may be a presentation from a guest speaker, or it may be a workshop on communications given by an NC State professor from the Dept. of Humanities and Social Sciences.

“The fact that we have meetings and sit down with people like Roger Milliken or Allen Gant comes and speaks to a class gives you a lot of valuable face time with executives,” Cesca said.

Because Fellows are required to give four presentations to the TAC during their graduate school careers makes communications seminars particularly useful, Jones added.
Other members of the Class of 2005 are Shawn Hutchinson, Kevin Hyde, Jaime Pisczek and Rebecca Berger.

First-year students, in addition to Reece, include Stephannia Williams, Lisa Hartman, Belen Perez, Chris Lauer, David Eskew, Beth Anderson, Paige Kennerly, Riley Jo Carrigg and Melinda Satcher.

Textile News Index


GTMA Annual Meeting

April 25, 2005

Don Henderson, chairman of the GTMA: The Association of Georgia’s Textile, Carpet and Consumer Products Manufacturers, will hold the gavel when the group holds its 105th annual meeting May 7-10 at The Ritz-Carlton, Amelia Island, FL.

Association stays strong, relevant under Henderson

Editor’s note: Following is a Q&A with Don Henderson, chairman of the GTMA: The Association of Georgia’s Textile, Carpet and Consumer Products Manufacturers, and vice president of manufacturing for Mount Vernon Mills, Inc., Trion, GA, and Roy Bowen, president of the association. GTMA will hold its 105th annual meeting May 7-10 at The Ritz-Carlton, Amelia Island, FL. Their responses come in questions posed to them in written form by Devin Steele, STN editor.

STN: Don, you are completing a year as chairman after having previously served as chairman of the Textile Education Foundation. Please comment on the experience of serving as an officer and chairman in these affiliate organizations.

Henderson: While Roy Bowen, Liz Hopkins and Sharon Ferguson do most of the “real work,” the chairmanship of TEF or GTMA is, by no means, a figurehead position. With the TEF, I served on the scholarship selection committee at Georgia Tech and was amazed at the quality of the young people interested in coming into our industry. I participated in the installation process of the Executive in Residence position at Tech and I am truly proud of the benefit this program has been in communications with our industry as well as keeping our students in touch with real industry people.

As GTMA chairman, I have been to Washington on several occasions to meet with congressmen, senators and trade representatives to bring our points of view to the people who must know what our needs are. I have met with state legislators, Georgia Power and the broad-reaching committees of GTMA, with the purpose of advancing the interests of our membership on many fronts. Finally, and perhaps the greatest benefit of all, I was able to work with a large group of people who are allowed to volunteer their time by their respective companies for the benefit of our GTMA companies. I count them all as friends and I have gained immeasurably from my association with them all.

STN: Don, what were your goals when you became chairman and how did you, your administration and the GTMA staff go about advancing the association’s mission?

Henderson: My goals were to continue to maintain the high integrity that GTMA embodied and to work closely with our permanent staff to work through some tough times. The GTMA staff kept me informed on the many issues that our association must participate in and I was allowed to have input on the directions we would take.

STN: Don, how long have you been a member of GTMA and how has the association helped you grow professionally? Also, why is serving in a leadership capacity important to you?

Henderson: I have been a member of GTMA for over 25 years and my association with the people who make up the membership has been invaluable to me and my company. Being able to pick up the phone, or nowadays send an e-mail, to a colleague and get some immediate help in addressing everyday problems is a benefit beyond measure.

STN: Roy, how did the association benefit from Don’s service?

Bowen: Don Henderson has been a voice of calm and perspective throughout his tenure as chairman of GTMA. The theme he chose for his leadership year — “Service with Integrity Through Times of Change” — is a reflection of his approach. With the lifting of quotas in January and the associated contraction in the textile industry, many analysts and industry spokespeople have been foretelling disaster.

Don has brought the principles he has relied on throughout his career to the helm of our association with his emphasis on integrity in product, integrity as employers and integrity with suppliers and even competitors as the key to maintaining and expanding market position, despite “times of change.”

STN: How has continued manufacturing contraction affected membership numbers this year?

Henderson: The steep decline and slow recovery of the manufacturing sector from the recent recession, coupled with the extraordinary global pressure on textile production and pricing, have had the effect of banding our association more closely together. Our members have found that GTMA serves to amplify their voices and sharpen their influence in matters of importance such as cost saving, legislation and achieving safe working conditions for our employees.

Members have solid proof that they are receiving far more in value than they expend in dues, and therefore they maintain membership in GTMA despite the current challenging economic environment.

STN: How do employment numbers in your sectors changed during the past year?

Bowen: Some of our members are hiring, some have reduced their work force through attrition and some, regretfully, have had to institute layoffs. We are estimating that overall employment in the carpet and textile industry has fallen by about 3,500 jobs since last year.

STN: How would you describe the general health of textile, carpet and consumer products in the state?

Bowen: Our member companies continue to provide a critical element of Georgia’s economic base. Manufacturing compensation is well above average in terms of salary and benefits offered, and that is particularly true in the more rural areas of the state, where our members are typically located.

The carpet companies, with their close association with housing starts, have rebounded from the recession more quickly than some of our textile members, many of whom have added niche or specialty products in order to expand.

Textile employees are going above and beyond the norm in terms of quality assurance and customer service in order to add value, and that has had a positive effect on the bottom line as well.

STN: GTMA recently reported that its most ambitious and involved effort during 2004 was its intervention in Georgia Power Company’s $328 million rate case, which ended in a settlement. Specifically, how was this favorable to GTMA membership?

Bowen: The final version of the Decision and Order by the Public Service Commission resulted in very significant savings over what Georgia Power Company had originally proposed across our membership, and is in fact one of the concrete, tangible values that our members reap from the association.

The testimony and negotiations that GTMA offered on behalf of our membership covered a great many areas, with the two most substantial being a reduction in the return on equity target requested by the company and the continuation of the Interruptible service credit. These two areas accounted for the bulk of the savings.

STN: What other matters related to legislation or regulation does GTMA count among its “victories?”

Bowen: The association’s primary legislative priority in the most recent session of the Georgia General Assembly was passage of legislation authorizing a change in the apportionment formula for computing state corporate income tax. This was an important change for companies with large investments in property and payroll in Georgia, a description which certainly fits our industry profile.

We were very pleased that this legislation was enacted in the 2005 session, and feel that it will provide an incentive to both existing and relocating companies to increase their stake in Georgia jobs and property.

We also worked hard to obtain passage of Georgia’s landmark civil justice reform bill, clarification of environmental regulations and compliance procedures and several matters dealing with health care and workers’ compensation.

STN: What are some of the key pending legislative issues GTMA is working on?

Bowen: GTMA will be working with the Environmental Protection Division on water issues, with House and Senate conferees on long-range planning for a distribution system for natural gas and with the Commissioner of Labor and the Governor’s office on a financing plan to ensure the solvency of the Unemployment Insurance Trust Fund.

STN: Roy, you were recently quoted in this newspaper that, “Our members are constantly seeking innovation in product, in supply chain management and in market niches in order to compete effectively in the global environment. GTMA must do the same. We don’t wait for opportunities to come knocking. We go out and find them.” How is the group doing that?

Don Henderson, chairman of GTMA: The Association of Georgia's Textile, Carpet and Consumer Products Manufacturers, serves as vice president of manufacturing for Mount Vernon Mills, Trion, GA.

Bowen: Our association is so very lucky to have the active involvement of some of Georgia’s most experienced and sophisticated executives on our standing committees. These are truly remarkable gatherings of individuals with deep knowledge and connections in their fields of expertise, which allow them to identify areas of importance proactively.

They bring up issues and suggestions for the rest of the group to consider, formulate policy and then we can take action. In addition, the GTMA staff tries to stay one step ahead of need. For example, for the Georgia Power company Fuel Case that was just concluded, we performed an exhaustive analysis of coal purchase data by power companies throughout the Southeast and invested in an expert consultant in order to determine if there were savings that could be realized by the company and passed along to our members.

STN: Obviously, the effects of the removal of global textile quotas on Jan. 1 has begun to be realized in several product categories and felt by various U.S. textile producers. How is the association working with its membership to deal with this issue?

Bowen: GTMA is closely associated with the National Council of Textile Organizations and the American Manufacturing Trade Action Council, two groups which are spearheading the political response on this issue. In addition, we were the only state organization to draft and successfully lobby for passage of a resolution from the Georgia House and Senate in support of the textile industry’s position on fair trading practices.

We personally briefed legislators throughout the state prior to the lifting of quotas and then followed up with updated information once the new system was in place. That level of understanding was a primary reason that the resolutions passed unanimously in both chambers of the General Assembly, and why many of our legislators and top state executives have written directly to the Bush Administration in support of the industry.

STN: Please comment on Textile Education Foundation activities over the last year and provide an update on the Executive in Residence program at Georgia Tech and the Consortium on Competitiveness in the Apparel, Carpet and Textile Industries.

Henderson: The Textile Education Foundation continues to gain great advantage from the involvement of Max Corner, former chairman of GTMA and a longtime executive for Coats & Clark. Max has brought a business perspective to the outstanding academic and research credentials of the School of Polymer, Textile and Fiber Engineering at Georgia Tech, as well as doing some teaching himself and mentoring students.

He has instituted cooperative programs with the College of Industrial Management and others at Tech to round out the degree program, and has been instrumental in fine-tuning the recruitment strategy. We managed to talk him into prolonging his tenure as GTMA Executive In Residence at least until next June, so we are confident that these changes will be continued. We were successful in maintaining funding for the CCACTI program in the 2006 state budget, and the research evaluation groups just recently reviewed grant applications for research in product and marketing areas.

STN: Don, please describe the working relationship you have with your officers and board and the GTMA staff?

Henderson: I have a very cordial relationship with all of these people. They have quickly become friends, as well as associates, and I know I can depend on them for support in both my business and private life.

STN: Also, please comment on the leadership skills of Tom Watters, your expected successor.

Henderson: Tom is extremely smart, dynamic and industrious — the type of guy who would intimidate everyone around him except for his ability to be flexible, to listen and to present himself in a down-home way. His experience in starting his own companies and in finding niche markets will bring energy, new ideas and a bottom-line practicality to his year at GTMA’s helm. If Tom is excited about something, he has the ability to draw others in and make them believe in the viability of his vision. He’s a wonderful person to lead the organization.

STN: With the retirement last year of longtime GTMA corporate secretary Suzanne Wilkes, GTMA has added a new staff member, Sharon Ferguson, as director of public affairs. Please provide a little background on her and the value she brings to the organization.

Bowen: Sharon has come to GTMA with an extensive background in communications. She is a magna cum laude graduate of Duke University and spent much of her career in advertising and marketing, working for Pepsi-Cola, Madison Avenue advertising agencies Doyle Dane Bernbach and J. Walter Thompson, as well as an HVAC trade association and an Internet consulting firm.

She brings a wealth of experience in strategic marketing thinking, excellent writing skills and a strong commitment to member service. Suzanne will always be missed, but Sharon has made a substantial contribution and her talents, coupled with those of our long-time staff member and new Corporate Secretary Liz Hopkins, give our members a range of new services. We are delighted, and very fortunate, to have them both.

STN: The theme of your annual meeting is “GTMA — Service with Integrity Through Times of Change.” How does your program reflect that theme?

Bowen: We have approached Chairman Henderson’s theme as a three-part challenge: service, integrity and change. In the meetings of the Board of Directors and The Textile Education Foundation, we will review the service that our committees and Foundation initiatives have returned to the association, the industry and their communities in the year past and discuss plans for the coming 12 months.

Speakers Herman Cain and Roger Chastain will address integrity through their presentations on employee motivation and commitment and on product quality and customer responsiveness. Finally, author Stephen Yafa, Congressman Phil Gingrey and Council on Competitiveness Vice President Chad Evans will talk about change.

Getting to know ...

Don Henderson, Chairman, GTMA: The Association of Georgia’s Textile, Carpet and Consumer Products Manufacturers

* Title: Vice president, manufacturing, Mount Vernon Mills, Inc., Trion, GA

* Hometown: Trion, GA

* Education: B.A., history, Jacksonville State University. Took textile classes at Southern Tech and Georgia Tech and did graduate work at North Carolina State University

* Military: U.S. Army, Vietnam veteran

* Years in industry: 36

* Career: Worked at Trion Division of Riegel Textile Corporation throughout high school and college; rejoined Riegel (now a part of Mount Vernon Mills) in 1969 and have been there ever since, moving to LaFrance, SC, as product development manager and to Alto, GA, as plant manager; returned to Trio in 1986 as vice president of Technical Service before becoming vice president of Manufacturing in 1992

* Childhood: “I was born in the ‘company hospital’” and my folks paid my delivery off for $2 a week until the $75 was paid in full. I was raised in the mill village and went to school at Trion Schools, which was also paid for by the company. My father worked in the spinning department for 39 years and my mother was a housewife. My ties to the textile industry go back into the early 1900s, with my grandparents working in mills in Cedartown, GA, and Piedmont, AL. I planned to never work in a mill again after I graduated from college, but situations presented an opportunity after leaving the military and I can honestly say I do not regret the events that brought me back ‘home.’ ”

* Biggest influences: “Our company president, Mr. Roger Chastain, has put his trust in me for 20 years by allowing me to work at responsible jobs with a degree of freedom that few of us ever realize in our working lives. I know when to ask for approval but I also know that the decisions I make will be supported by those above me in the company. Also, Mr. Harold Peek, who was my predecessor in my current job, was a mentor and professional model from the first day on the job. He hired me in 1969 and allowed me to work in a variety of jobs to prepare myself for broader responsibility.”

* Civic, other: Member, Trion United Methodist, having served as chairman of the Administrative Council, Sunday School teacher and in various other roles; past chairman, Chattooga County Chamber of Commerce; president, Chamber Foundation; member, Board of Trustees, Northwestern Technical College Foundation; past chairman, Georgia Textile Operating Executives (GTOE) and The Textile Education Foundation (TEF) of GTMA

* Honors/awards: “My most notable award was being named ‘World’s Greatest Father’ by my three grown children. Being trusted to be of service to my church, my friends and my community are honors that are I will always cherish.”

* Hobbies/interests: “I’m a guitar strummer and love to sing ’60s music and country music with my friends. Notice that I’m a ‘strummer,’ not a ‘picker’ (a ‘picker’ is better than me). Our Sunday School class takes a trip to the mountains every winter and we sing to all hours starting with the ’60s music and ending up with gospel. I also enjoy gardening on a small scale. I’m currently anxiously awaiting the man to come and plow my garden. Mostly I just plant tomatoes and I enjoy passing them out to my friends. Roy Bowen and Liz Hopkins will attest to the quality of my tomato crop. A tomato sandwich is right up there with ‘Death By Chocolate’ to Roy.”

* Reading: The Glorious Cause by Jeff Shaara, a novel about the American Revolution. “I enjoy reading just about anything and I always have a partially read book lying around when I get a few minutes to relax.”

* Biggest professional success: “It may sound self-serving, but I am proud to be the ‘only hometown boy’ to manage our Trion Mill, which has been here since 1845

* Best advice received: “Being a native of Trion, I was reluctant to move when job opportunities became available, but my wife, whose entire family lives here, encouraged me by saying, ‘We can be at home wherever we live as long as we are together.’ Without her, I’d still be on the third shift in the card room — a pretty good job nowadays.”

* Wife: Juanita

* Children: Jonathan, a graduate of DeVry University in computer and electrical technology who now works in the instrumentation department at Mount Vernon; Mark, a graduate of Florida State University, who is currently working in St. Louis, MO, for Stages St. Louis, a theater production company and in the fall will be attending graduate school at the University of North Carolina at Chapel Hill; Beth, a senior at Shorter College in Rome, GA, who is planning to attend law school at the University of Georgia or Mercer University

* Little-known fact: “I worked my way through college calling square dances and singing with a country band at a dance hall on the Georgia-Alabama line. When the group Alabama sings about ‘I heard about the barrooms right across the Georgia line where a boy could make a living playing guitar late at night’ in ‘My Home’s in Alabama,’ that was my dance hall.”

Textile News Index


Fabric manufacturer

April 25, 2005

Guilford's Emrich resigns;
Firm also to close plant, cut more jobs

GREENSBORO, NC — John Emrich, an unabashed voice for U.S. textile industry interests on various trade and other matters, has resigned as president and CEO of Guilford Mills, Inc.

Emrich

Cerberus Capital Management, a private equity firm that bought Guilford last year, announced on April 15 his departure. The arrangement came “by mutual agreement,” Emrich said, according to reports.

Several days later, on April 20, the firm announced the closing of a polyester yarn plant here and said it is cutting its work force in half at a plant in Fuquay-Varina, NC, where polyester yarn for automotive products also is produced.

About 100 employees here will be out of a job by June 18, leaving only one Guilford plant in Greensboro. About 130 employees will lose their jobs by that date at the Wake County site.

Emrich, a New York native who had been with the company 20 years, guided Guilford through bankruptcy in 2002.

A member of the National Council of Textile Organizations and the National Textile Association, he often participated in press conferences on behalf of those trade groups.

Textile News Index


Trade pact

April 25, 2005

Bipartisan coalition speaks out against Dr-CAFTA

WASHINGTON, DC — A bipartisan coalition of members of Congress, trade associations and activist groups, including the American Manufacturing Trade Action Coalition (AMTAC), reiterated their opposition to the proposed Dominican Republic-Central American Free Trade Agreement (CAFTA) at a press conference here April 20.

“If CAFTA was the silver bullet its supporters say it is, why hasn’t it been brought up on the Senate and House floor for a vote?” Rep. Sherrod Brown, D-Ohio, said during the event.

Members of Congress participating in the media event were: Sen. Byron Dorgan (D-ND), Sen. Larry Craig (R-ID), Sen. Mark Dayton (D-MN), Rep. Sherrod Brown (D-OH), Rep. Virgil Goode (R-VA), Rep. Walter B. Jones (R-NC), Rep. Hilda Solis (D-CA), Rep. Charles Melancon (D-LA), Rep. Ted Strickland (D-OH), Rep. Marcy Kaptur (D-OH), Rep. Tim Ryan (D-OH), Rep. Mike Michaud (D-ME), Rep. Jan Schakowsky (D-IL), Rep. Peter DeFazio (D-OR), Rep. Raul Grijalva (D-AZ), Rep. Joe Crowley (D-NY), Rep. Dale Kildee (D-MI), Rep. Barbara Lee (D-CA), Rep. Gene Green (D-TX) and Rep. Bart Stupak (D-MI).

Congressmen Charlie Norwood (R-GA) and Dennis Rehberg (R-MT) did not participate in the press conference, but did issue press statements.

Proponents of DR-CAFTA argue that the only way to protect the American textile industry against the onslaught of Chinese textile imports is to marry it up to low-wage production platforms like those in the CAFTA countries. This will provide a “regional bulwark” against the Chinese, they say.

They argue that since apparel production in DR-CAFTA countries already uses large amounts of American yarn, fabric and components that all that is needed to do to lock in that relationship is to pass the DR-CAFTA. As such, a “win-win” situation would result, where American yarn, fabric and components will be used in the production of apparel in the CAFTA countries, supporters say.

AMTAC, in a statement, refuted those claims. The group said that DR-CAFTA destroys the existing incentives that have created the system where large amounts of American yarn, fabric and components are used in the production of apparel in CAFTA countries.

“The existing Caribbean Basin Trade Partnership Act (CBTPA) requires, with one exception, the use of U.S. yarn, fabric and components in order for apparel from CBPTA countries to be imported into the U.S. tax-free,” AMTAC stated. “The CAFTA eliminates the American requirement in favor of a ‘regional’ requirement.

In addition, the DR-CAFTA contains several loopholes that allow for massive quantities of Chinese yarn, fabric and other components to be used instead of American yarn, fabric and components, AMTAC argued.

And finally, the DR-CAFTA “will not help the U.S. textile industry compete against unfair Chinese trade practices, just as NAFTA did not help Mexico or the American industry compete against unfair Chinese trade practices,” AMTAC said. “Nor will it be the salvation of the textile and apparel industries of the Central Americans.”

Textile News Index


Trade association

April 25, 2005

AMTAC holds annual meeting

WASHINGTON, DC — The American Manufacturing Trade Action Coalition held its third annual meeting here April 5.

The day began with briefings on current legislative agenda items, as well as membership recruitment efforts.

A lunch presentation by David Hartman, chairman of the Rockford Institute, followed on the need to replace the U.S. income tax with a border-adjustable, business-transfer or value-added tax (VAT). Currently the U.S. is the only developed country without a VAT-like arrangement and thus is at an inherent disadvantage, he said.

The afternoon included further discussion of current issues and a presentation on AMTAC’s media efforts. Participants then went to Capitol Hill to meet with senators and representatives.

Congressman Virgil Goode of Virginia served as the honorary dinner speaker and addressed the group about the demise of Martinsville, VA, once one of the largest industrial communities in the United States. Goode spoke of the need for trade policy measures to keep remaining domestic producers viable.

Textile News Index


Congress

April 25, 2005

Bill targets China yuan

WASHINGTON, DC — Sen. Lindsay Graham (R-SC) and Sen. Chuck Schumer (D-NY) have co-authored a bill that would place a 27.5 percent tariff on all China-made products if China does not revalue its currency.

The senators said China’s undervaluation of its yuan has played a major role in the loss of 3 million U.S. manufacturing jobs over the last five years and is contributing to the migration of service and engineering jobs to China.

The amendment will be offered to the Foreign Affairs Authorization Act. The amendment is identical to the text of S. 295, which Schumer and Graham introduced in February.

In April 7, the Senate voted 67-33 to consider the Schumer-Graham bill. For procedural purposes, the senators have agreed to allow the Senate to revote on the package as a separate bill this summer.

The bill calls for a 180-day negotiation period between the U.S. and China on currency revaluation. Without a resolution, a temporary, across-the-board tariff of 27.5 percent would be levied on all Chinese products entering the U.S., according to the bill.

Textile News Index


Pickin' Cotton

April 25, 2005

China's cotton buying, shipments under scrutiny

By Odyll Santos

Cotton market participants and observers continue to watch China’s actions within the textile business. China can both help and hurt the U.S. cotton and textile industry. Its purchases of U.S. cotton are expected to provide substantial support to the U.S. market. But at the same time, the amount of cotton products China ships to the U.S. is under scrutiny, as U.S. mills have suffered financially over the years amid stiff foreign competition.

For the U.S. cotton market, China’s purchases are key. In market comments for the week ended April 15, Mississippi cotton marketing specialist O.A. Cleveland said cotton traders are waiting for the last two weeks of April and the first two weeks of May to see if buying by China will increase as import licenses are granted.

Cleveland noted that cotton export business is “solid” below the futures price of 52 cents per pound, and he believes that a sell-off down to that price level will be supported into May and June. In addition, the weekly export sales report, released on April 14, was supportive to the market. The report, which showed sales for the week ended April 7, showed net upland cotton sales of 253,800 running bales, with China and Turkey the top buyers. China bought 138,100 running bales of U.S. cotton, while Turkey bought 49,700 running bales.

“As long as sales to China average at least 100,000 bales weekly, New York (cotton futures) will be well supported. Turkey and the Asian countries will remain consistent buyers,” Cleveland said.

Cleveland also noted that many international mills are operating “hand-to-mouth, buying in the ‘just-in-time’ method.” This situation has caused a slight pullback in expectations for total U.S. cotton exports. Still, he believes that U.S. exports can easily reach USDA’s projection of 13.2 million 480-pound bales for the current season. China’s intent to purchase cotton will only help U.S. exports further, likely raising the USDA forecast for the year.

However, the debate over limiting cotton textile imports to the U.S. may have an effect on China’s cotton purchases. “I am convinced we will sell more cotton to China in the years ahead,” said National Cotton Council Vice President Robert Weil II in testimony on April 14 before the House Ways and Means Committee regarding China’s role in the U.S. cotton and textile world. “At the same time, our long-standing customer, the U.S. textile industry, continues to erode financially in the face of competition from textile imports — and there is no more competitive textile and apparel manufacturer in the world than China. With its rate of increase in cotton production, cotton mill use and cotton purchasing, China is the dominant force in world cotton.”

Weil noted in his testimony that so far in the 2004-05 marketing season, China has about 2.0 million 480-pound bales in commitments from the U.S. and is expected to import up to 8.0 million 480-pound bales from all sources. China also produced a record 29 million 480-pound bales of cotton in calendar year 2004 and exported almost $55 billion dollars of total textile and apparel products, a 50 percent increase since 2002, he said.

Projections for the 2005 USDA Ag Outlook show China importing 14.5 million (480-pound) bales for the 2005 marketing year, up more than 6.0 million bales over 2004, Weil said. “This growth should be taken in context with the demise of the U.S. textile industry,” he said, noting that China now is estimated to be using about 41 million 480-pound bales while U.S. cotton consumption has fallen to around 6.0 million 480-pound bales a year, 40 percent below rates seen in the 1990s.

Several committee members were concerned about recent surges in textile and apparel shipments from China. They expressed support for legislation to impose duties on Chinese products and also commented that regional trade agreements, such as the Central American Free Trade Agreement (CAFTA), can assist U.S. industries in remaining competitive with China.

Cleveland, the marketing specialist, said the situation likely would be resolved in favor of the Chinese. “Limiting their imports to the U.S. would only increase those coming from other countries, especially India, but other countries as well,” he said. “U.S. policy could best focus on assisting U.S. mills in exporting cotton yarn rather than attempting to limit imports.”

Textile News Index


April 25, 2005

Southern Textile Association
Piedmont Division Spring Meeting
Belmont, NC

Steve Dobbins, president and CEO of Carolina Mills, Inc., addresses STA members on the topic, ‘What You Always Wanted To Know About Textile Trade Terminology — But Were Afraid To Ask.’ Photos by Devin Steele

Khal Shreitah of Carolina Mills introduces Steve Dobbins.

Textile News Index