Ugu District
Clothing and Design
Industry Strategy
JUNE 2014
Figure 4.2 - stakeholders in the KZN value chain elements:-
Formal Textile
and Clothing
Firms
(KZN CTC)
Designers
CMT’s
(Proposed KZN
FC)
Retailers
1) Formal firms
2) Designers
3) CMT’s
4) Clothing and related co-operatives
5) Retailers
Clothing Co-ops
Figure 4.3: Nature of Design Houses
Design
Design +
Small Retail
Design +
Small Mfg
Design +
Small Mfg +
Small Retail
Different ways in which designer firms can exist :1) Design house
2) Design house which handles small retail
3) Design house which handles small manufacturing
4) Design house which handles both small retail and small manufacturing
Figure 4.4: Nature of Manufacturing Houses
CMT
CMT
CMT
Big
Medium
Micro
CMT +
Design
CMT +
Small Retail
CMT +
Design +
Small Retail
Different ways in which CMT (manufacturing firms) can exist are:1) Big CMT’s
2) Micro CMT’s
3) Medium CMT’s – can include design and retail activities
Methodology
Questionnaires
Number
Completed
CMT’s
25
Designers
25
Focus Groups and Engagement:
Date
Attendance
Group
14th March 2013
10
CMT’s
18th March 2013
16
Designers
20th March 2013
11 [5 cmts + 6 designers
Combined
25th March 2014
17
Co-operative members from 4 co-ops
31st July 2013
16
Engagement with Stakeholders
15th November 2013
4
Engagement with LED Technical team
Quantitative Analysis
Quantitate Data Presentation
1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
11)
12)
13)
14)
Service provided by respondent
Number of employees
Gender Break-up of employees
Race Break-up of employees
Nature of employment
Monthly Pay
Hours worked per week
Benefits of employees
Skills Proficiency
Current number of employees in each category
Skills required
Machine Handling
Number of staff hired and separated
Qualification of employer
14) Qualification of employer
15) Employer’s years in Business
16) Employer’s years in previous service
17) Employers Business qualification
18) Business acumen rating
19) Model of Machinery
20) Number of Machinery
21) Required number of Machinery
22) Repair bills of Machinery
23) Downtime of Machinery
24) Volume of production
25 ) CMT Rate earned
26 )Percentage of rejects
26) Clients
27) Clients Location
28) Value of Business
29) Items of production
30) Timeframe of production
31) CMT Unit price
32) Percentage of waste
33) Details of finance
34) Costs
35) Costs/ Profit and Turnover
36) Turnover and Profit Trend 2012
37) Compliance
Table 9.1: Snapshot of Clothing Industry Firms in Ugu District, 2014
CMT's on database
34
CCMA member CMT's
20
Surveyed CMT's
25
Focus group CMTs
10
Designers on database
84
Port Shepstone designers
41
Margate designers
17
All other locations
26
Surveyed designers
25
Focus group designers
16
Estimated Universe of designers
300
Co-ops on Database
23
Hibiscus Local Municipality
9
Umdoni Local Municipality
7
Umzumbe Local Municipality
4
Ezinqoleni Local Municpality
1
Umzwabantu Local Municipality
2
Vulamehlo Local Municipality
0
Surveyed co-ops
Focus group with co-ops members from 4 co-ops
-
17
Qualitative Analysis
1) Preliminary verbal inputs – from CMTs
2) Preliminary verbal inputs - from Designers
3) Insights from - CMTs
4) Insights from - Designers
5) Insights from interaction - btw CMT’s & Designers
6) Mini Case
Insights for Strategic Interventions
CMT’s:
1) Compliance
2) Scarcity of skilled labour
3) Cost of Rentals
4) Cost of Utilities
5) Absenteeism of Employees
6) CMT prices
7) Financial assistance
8) Multi-Purpose Centre
9) Working with Designers
10) CCMA and Bargaining Council
Designers:
1)
2)
3)
4)
5)
6)
7)
Geographic Spread
Rentals
Machines
Product range
Access to Fabric
Production and Marketing
Common Vision
STRATEGIC FRAMEWORK
STRATEGIC INTERVENTIONS
Table 11.1: The 8 Step Intervention Process
Step 1 - Forming the Project Steering Forum
Step 2 - Developing the Value Proposition
Step 3 - Developing and Leveraging Core Capabilities [Through training &
incubation
Step 4 - Integrated Manufacturing - Multipurpose Clothing Support Centre
Step 5 - Development of Partnerships and Alliances
Step 6 - Brand Development
Step 7 - Market Access
Step 8 - Industry Development Programmes
Diagram 11.1: Multipurpose Service Centre and Incubator
Various centres can specialise as follows:-
1) Marburg – Main Multi-purpose Production and
Support
2) Port Shepstone – Retail
3) Margate – Incubation
4) Gamalakhe – Training
5) Scottsburg and Harding – Incubation [phase 2]
DIAGRAM 7.2: Community Based Manufacturing
Incubation of micro enterprises involves Access to:1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
11)
12)
Workspace
Machinery
Technical skills
Business skills
Markets
Finance
Warehousing
Coaching and Mentorship
Production Management Techniques e.g. JIT, Lean etc.
Co-operative liaison
Specialist services e.g. NCPC – energy efficiency
Miscellaneous services
Step 7: Market Access:
This can be facilitated by:7.2.1: Supplier Readiness Programmes:
7.2.2: Enterprise Development Programmes with Retailers:
• Supplier Credit
• Early Payment
• Expenses towards modernisation
• Expenses towards Skills Development – Technical as well as Business Skills
7.2.3: Local Market Activation:
• Fashion Shows
• Buyer Fairs
• Retailers
Step 8: Industry Development Programmes:
8.1 Incentives Programme
• Production and export incentives [DTI]
• Awards – Productivity, Labour, Innovation
8.2 Assistance Programme
• Micro credit
• Government procurement
• Garment beneficiation
Weaknesses within perceived strength of China are:1)
2)
3)
4)
5)
6)
Price Weaknesses
Cost Increase
Response Time
Customisation
Market Preference
Linkages with Other sectors
Given the experience from Newcastle, it may be beneficial to bring in Chinese
companies as investors into the Ugu Clothing Manufacturing Value Chain.
Potential Partners include :1)
2)
3)
4)
5)
6)
7)
8)
9)
10)
11)
12)
13)
14)
Ugu District Municipality
KZN DEDT
KZN Fashion Council
KZN Young Designers
DTI help desk
Coastal Clothing Manufacturers’ Association [CCMA]
SETA help desk
Esayidi FET College
Compliance desk [Bargaining Council]
Textiles Support Centre [Clotex, Cape Town]
Ithala
SEDA
Anchor Retailer [Big]
Saris for Good Karma [charity based]
Indicative Business template
No.
Estimated
Budget
ITEM
Step 1 Forming the Project Steering Forum
40,000
Petty Expenses, Registration, Legal Fees,Meeting Expenses
40,000
Workshop, Meeting Expenses, Report Writing Work
750,000
Training Fees, Venue, Refreshments
3,000,000
1 District Hub, 3 Satellite hubs. Equipped with machines,
warehousing
75,000
Workshop, Meeting Expenses, MoU Drafting
250,000
Graphics, Design, Research, Website, Marketing Materials
1,000,000
Advertising, Event Management, Displays,Hospitality
750,000
Awards, incentives, Events, Training, Accreditation
Step 2 Developing the Value Proposition
Step 3
Developing and Leveraging Core Capabilities
[Through training & incubation]
Step 4
Integrated Manufacturing
Clothing Support Centre
-
Scope
Multipurpose
Step 5 Development of Partnerships and Alliances
Step 6 Brand Development
Step 7 Market Access, Supplier development
Step 8 Industry Development Programmes
TOTAL
5,905,000
Notes:
These are only indicative budgets to guide the development of a Business Plan.
This is not a business plan, but guideline to broad cost centres
To be balenced between available resources and Scope of the programme
It is more cost efficient to subsidise or partner with Private Sector players than run own operation
Scope and Time will determine service provider's quotes
Delays would lead to escalations
The approach should be to use this as seed funding to leverage larger private sector resources
An entrepreneurial appraoch needs to be taken
Ugu District Clothing Manufacturing Incubator
District Hub
District Hub Focus Area
Support other hubs
General Mfg
Local Hub
Local Hub
Local Hub
Item
Space
Machinery
Staff
Others
Furniture
Training
Scope
1000 sq mtrs
Shared Key Machines+Basic
Co-ordinators+Hub
Space
Machinery
Staff
Others
Furniture
Training
750 sq mtrs
75,000
Basic Machines for Innerwear 200,000
2
200,000
75,000
Basic Furniture
50,000
Basic Training
100,000
700,000
Sleep wear, Inner wear Space
Fashion wear
Machinery
Procurement
Staff
Others
Furniture
Training
750 sq mtrs
75,000
Basic Machines for Innerwear 200,000
2
200,000
75,000
Basic Furniture
50,000
Basic Training
100,000
700,000
Workwear
Fashion wear
Procurement
750 sq mtrs
75,000
Basic Machines for Innerwear 200,000
2
200,000
75,000
Basic Furniture
50,000
Basic Training
100,000
700,000
Beach wear
Fashion wear
Procurement
Space
Machinery
Staff
Others
Furniture
Training
Storage
Central Trg + Productivity
Total Estimated Budget
Cost
Total
100,000
300,000
250,000
100,000
50,000
100,000 900,000
3,000,000
Next Steps towards the UGU DESIGN AND
CLOTHING CLUSTER:
1. Bankable Business Plan document
2. Project Steering Committee formation
3. Site identifications
4. Investor liaison
5. Funding arrangements
6. Entity registration
QUESTIONS…