October 15, 2008
Issue #227
The McPete Sez
Lingerie Newsletter & Women's Wear Journal
6/24
Intimate Apparel
Sleepwear-Daywear-Foundations-Loungewear-Hosiery-
Lingerie-Swimwear-Dancewear-Clubwear
Ready-to-Wear
Goody's To Emerge From
Bankruptcy
Apparel retailer Goody’s Family Clothing Inc is expected to emerge from Chapter 11 bankruptcy
protection, after a US bankruptcy court approved the company's reorganization
plan.
Paul White, Goody's chief executive officer, said October 8,: "Our company has made great progress over
the past few months...in particular, we have created a stronger and more nimble
organization."
Goody's, which operates 287 stores, filed for bankruptcy on June 9, blaming slowing apparel sales.
As part of its reorganization plan, it is closing 69 stores.
It also secured a commitment for $210m in debtor-in-possession (DIP) financing to supplement its
working capital and provide adequate liquidity while it works to clear its debts.
A model wears Spoylt during Lingerie Americas
Fashion Show on August 4 at Cipriani in New York.
2/24
Noyon in Administration
Calais-based Noyon, which manufactures lace for lingerie and dresses, has gone into administration for
an initial period of six months.
The French family firm, founded in 1919, put its difficulties down to a constant reduction in turnover -
itself a result of the slide in consumer purchasing power in Europe and the US which has hit demand for
textiles goods.
In the past few years, Noyon has implemented a series of restructuring programs in the light of fierce
competition in Asia, reduced its workforce from 800 to 450 and transferred
a good part of its production to Sri Lanka.
Noyon made losses of EUR2.8m in 2007 on a turnover of EUR42m compared to losses of EUR1.4m on turnover of
EUR53m in 2006.
As recently as four years ago, Noyon's turnover had totaled EUR70m.
23/24
Photographed by
Lawrence O. Brown
Sri Lanka Applies for
GSP+ Extension
Sri Lanka is due to submit its application for an extension of the GSP+ trade concession to the European
Commission at the end of this month. But uncertainties about whether or not the scheme will be renewed are
already affecting garment factories, with buyers seeking assurances that they will not have to pay new
duties.
Sri Lanka's garment industry is the main beneficiary of the GSP+ (Generalized System of Preferences) unilateral
trade concession which allows the country to export around 7,200 items to the European Union (EU), duty
free.
In particular, the scheme allows Sri Lankan garment manufacturers to remain cost competitive in European
markets because of the zero duty export facility.
But concerns over whether the GSP+ will be renewed are leading international buyers to ask garment factories
to absorb the duty component partially or in total.
Given that the duties could be as high as 8% - 10% without the GSP+, local factories say absorbing the
duties is not possible because higher manufacturing costs in Sri Lanka have already made profit margins
"wafer thin".
To cut costs, many garment factories have already upgraded technologies and moved into lean
manufacturing.
But if the GSP+ is not renewed at the end of the year, factories say they will have no choice but to cut down
on workers and many smaller factories may even have to close down.
Women from poor, rural backgrounds would be hit the hardest by the loss of the GSP+ because the island has
no other jobs available to replace garment sector employment.
Over 80% of the garment industry workforce is made up of young girls from rural areas. The loss of factory
jobs therefore, could increase exploitation of women by forcing them to find unprotected, Middle Eastern 'house
maid' jobs.
A sudden termination of the GSP+ would also impact beyond the garment sector.
"Originally, it was the garment factories that used the GSP+. But by now, a few other industries are also
slowly starting to use it," said the secretary to the Ministry of Export Development and International Trade,
Mr. S Ranugge.
"This is because it takes some time for a country to build internal capacities to make use of a trade
scheme."
At this point, it is estimated that about 35% of the exports from Sri Lanka that use the GSP+ are
non-garment exports.
Add their workers to the 270,000 people employed directly by the garment sector, as well as its indirect
employees, and the number of people dependent on GSP+ is considerable.
The footwear industry and exporters of agricultural produce are some of these new users of the GSP+. They
point out that their exports directly benefit factory workers and rural farming families.
The three-year GSP+ scheme finishes at the end of 2008, and Sri Lanka has until
October 31, to re-apply and re-qualify for another three-year term to run from 2009
- 2011.
The EC is expected to announce its decision on whether or not this application has been successful, on
December 15.
GSP+ status is awarded to countries that have ratified 27 international conventions on environmental
standards, labor rights and human rights.
But now Sri Lanka - and the GSP+ - is in the line of fire over allegations of human rights violations.
The government maintains that it is doing all it can to safeguard human rights while fighting a war against the
LTTE (Liberation Tigers of Tamil Eelam) terrorists in the north of the country.
However, reports of disappearances, abductions, intimidation of media and allegations of corruption in
government are pointing to poor governance - apart from the casualties of war.
These reports have raised strong concerns that the EU may not extend the GSP+ for Sri Lanka.
The EU has already banned the LTTE as a terrorist organization and awarded the GSP+ to Sri Lanka in
mid-2005 to help its economic development.
Removing it suddenly, say industrialists, will hurt the island's most vulnerable populations - not corrupt
politicians.
Moisturizing
Undies
A new line of underwear which incorporates a hi-tech moisturizing
ingredient into its fabric is being test-marketed.
The unnamed product line of intimate apparel, currently being test-marketed by a global company, uses Applied
DNA Sciences' (APDN) proprietary DermalRx HydroSeal ingredient.
Part of APDN's BioActive Ingredients portfolio, DermalRx HydroSeal uses "structural
moisturization" to treat dry skin, based on the biofermentation expertise
developed from the company's SigNature DNA and BioMaterial Genotyping.
"Topical delivery systems enhance the performance of active ingredients on the skin," said Dr James Hayward,
CEO of APDN.
"All garments contact the skin. What better way to deploy a skin treatment than through a textile?"
APDN said DermalRx HydroSeal, a complex of a yeast ferment, soy proteins and soy peptides, helped to
enhance cohesion between the cells in the upper layers of the skin, restoring elasticity and the skin's
natural capacity to retain moisture.
APDN believes that its BioActive Ingredients products are set to generate a growing future revenue stream for
the company.
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