Ugu District Clothing and Design Industry Strategy

1. Ugu District Clothing and Design Industry Strategy JUNE 2014

2. Clothing and Textiles Sector Formal Textile and Clothing Firms (KZN CTC) Designers (Proposed KZN FC) CMT’s Clothing Co-ops Retailers 1) Formal firms 2) Designers 3) CMT’s 4) Clothing and related co-operatives 5) Retailers

3. 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

4. Figure 4.4: Nature of Manufacturing Houses CMT Medium CMT Micro CMT Big 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

5. Methodology Focus Groups and Engagement:

6. Quantitative Analysis

7. Quantitate Data Presentation • 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

8. 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

9. 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

10. Table 9.1: Snapshot of Clothing Industry Firms in Ugu District, 2014

11. Qualitative Analysis • Preliminary verbal inputs – from CMTs • Preliminary verbal inputs - from Designers • Insights from - CMTs • Insights from - Designers • Insights from interaction - btw CMT’s & Designers • Mini Case

12. Insights for Strategic Interventions CMT’s: • Compliance • Scarcity of skilled labour • Cost of Rentals • Cost of Utilities • Absenteeism of Employees • CMT prices • Financial assistance • Multi-Purpose Centre • Working with Designers • CCMA and Bargaining Council

13. Designers: • Geographic Spread • Rentals • Machines • Product range • Access to Fabric • Production and Marketing • Common Vision

14. STRATEGIC FRAMEWORK

15. 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

16. Diagram 11.1: Multipurpose Service Centre and Incubator

17. Various centres can specialise as follows:- Marburg – Main Multi-purpose Production and Support Port Shepstone – Retail Margate – Incubation Gamalakhe – Training Scottsburg and Harding – Incubation [phase 2]

18. DIAGRAM 7.2: Community Based Manufacturing

19. Incubation of micro enterprises involves Access to:- • 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

20. 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

21. 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

22. Weaknesses within perceived strength of China are:- • 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.

23. Potential Partners include :- • 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]

24. Indicative Business template

26. Next Steps towards the UGU DESIGN AND CLOTHING CLUSTER: Bankable Business Plan document Project Steering Committee formation Site identifications Investor liaison Funding arrangements Entity registration

27. QUESTIONS…