An Analysis of the Disruptions in the U.S Apparel Manufacturing Industry and Identification of Continuity Planning Strategies

Abstract

The purpose of this research is to conduct an exploratory analysis of the disruptions in the United States apparel manufacturing industry. The specific research objective is to identify and determine the nature of disruptions and the continuity strategies in the US apparel manufacturing industry. The research was conducted in two phases. The Phase I research gathered quantitative data using a three page survey questionnaire developed by the researcher. The questionnaire was structured by a designated set of questions that were separated in relation to the disruptions and business continuity planning. The questions were structured to obtain an understanding of the types of business disruptions and the business continuity planning in the US apparel industry. The Phase II research gathered qualitative data from 10-K SEC filings of ten randomly selected US apparel companies. Data was gathered on the risk of disruptions and the response strategies used by companies to handle those risks. Companies were selected based on convenience sampling, as this study explores the current status of continuity planning in the industry to form the basis of future research.

The risk of disruption to companies in apparel industry is significant due to the international nature of the business, large supply base, and the ever changing trade and customs regulations. The movement of the United States apparel manufacturing industry to low wage countries, increased use of independent and contract manufacturers and the trend towards full-package sourcing have increased the industry risk exposure. The business continuity planning culture is not well developed in the industry. Most companies studied have not completed their risk assessment and business impact analysis. The budget is not usually allocated for the development and implementation of continuity plans, and no training programs for employees were identified to effectively handle a disruption.

Results will benefit industry personnel by providing insights into today's dynamic apparel manufacturing environment as well as identifying key disruptions. Future research studies relating to this topic were identified.