Sri Lanka Apparel Group Comes to L.A.

Sri Lanka makes clothes for some of the biggest U.S. apparel labels.

But that business comes from entities such as Columbus, Ohio–based Limited Brands Inc. and St. Louis–based Kellwood Co. Few West Coast manufacturers have chosen the nation of 20 million people as a sourcing destination.

Sri Lanka apparel manufacturers hope to change that. A business development group led by Sri Lankan Foreign Minister Tyronne Fernando visited Los Angeles recently to convince clothing companies that the island country just south of India is a great place to do business.

“Some of the best brands in the world are manufactured in Sri Lanka, such as the Gap, Liz Claiborne, Polo Ralph Lauren and Nike,” said Ajith Dias, director of Brandix Lanka Ltd., a Sri Lanka company that was formed recently by the merger of apparel giants Phoenix Ventures Ltd. and the Jewelknit Group. The new venture, with 20 plants and 14,500 employees, hopes to compete with countries such as China in the post- 2005 quota-free market.

“We [in Sri Lanka] export $2.2 billion in apparel and 65 percent of that goes to the U.S.,” Dias told a small group of people gathered on Oct. 2 at the California Market Center for a breakfast talk organized by the World Trade Center Association in Los Angeles and the Sri Lanka America Business Council.

With its government tr ying to boost business at its 835 apparel factories, Sri Lanka is finding that the West Coast is the logical place to look for new business. “We have plans to double our apparel exports from $2 billion to $4 billion in the next five years,” said Dias, noting that a cease-fire agreement with the Tamil separatist guerrillas in the north of the country has been in effect since last year.

Sri Lanka is also worried about losing market share to China, which stands to benefit from the elimination of apparel and textile quotas for World Trade Organization members in 2005.

But Bruce Berton, director of international business consulting for accounting firm Stonefield Josephson Inc. in Santa Monica, Calif., noted that if Sri Lanka were serious about getting West Coast business, it would open a Los Angeles office or have a representative who would help smooth operations between the two countries.

He also noted shipping routes from Sri Lanka to the United States traditionally go to the East Coast, passing through the Suez Canal. Ocean carriers take up to one week longer to reach Los Angeles. Apparel from Sri Lanka often must be shuttled to another shipping hub, such as Singapore, Hong Kong or Kobe, Japan, and then put on a cargo ship that has a more direct route.

Sri Lanka also does not have a large textile industry. The fact that most of the industry’s fabric comes from India adds another 30 to 60 days to the manufacturing process. “To get an order from Sri Lanka, you need a minimum of five months,” Berton said. —Deborah Belgum