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Sri Lanka finds cash in old jeans

Sri Lanka finds cash in old jeans

Write: Sabah [2011-05-20]
The denims look tattered and frayed, but shoppers in Europe and the United States are prepared to pay good money for "distressed" jeans - and Sri Lanka is cashing in.

In the industrial town of Avissawella east of the capital Colombo, it takes workers around 13 minutes to cut and sew basic five-pocket denims.

They then spend another four days torturing the pants by dying, bleaching, and sandpapering them to get a "distressed" look.

"Each garment is dyed or dipped around 16 and sometimes as many as 30 times to achieve the proper torn, tattered look," explains Indrajith Kumarasiri, chief executive of Sri Lanka's Brandix Denim.

"We earn more money by making denims look dirty and torn. The classic clean look doesn't bring us much," Kumarasiri said. His US$10 million (HK$78 million) plant can make more than three million pairs of jeans a year.

Basic denim jeans cost around US$6 to make, but the shabbier "premium" ones cost twice as much.

Overseas buyers such as Levis, Gap and Pierre Cardin are now regular buyers of premium jeans from Sri Lanka where they can be made for as little as US$12 a pair, and often sell for more than US$100.

Buyers have been gradually shifting production out of Europe to low-cost countries such as Sri Lanka, explains Ajith Dias, chairman of the Sri Lanka Joint Apparel Association Forum.

"Retaining the business and growing the order book is tough with India and China competing with us on price and quicker lead times," Dias said.

Sri Lanka's US$3 billion garment industry accounts for more than half its annual US$7 billion of export earnings, and it provides jobs for nearly one million people. Nearly all the garments are shipped to the United States and the European Union.

But Dias said casual wear, including jeans, are the key to Sri Lanka's success in the price-sensitive global apparel market, and now account for 16 percent of total garment export earnings.

"We have invested millions to install high-tech plants, develop a sound raw material base and design garments, to ensure we remain competitive, by doing everything from fabric to retail hangers," Dias said. Brandix, Sri Lanka's biggest exporter with annual sales in excess of US$320 million, and MAS Holdings, are also expanding overseas.

In an attempt to get an advantage over the competition, Sri Lanka is trying to position itself as an ethical manufacturer in the hope of getting greater access to the US and European markets at lower duty rates.

"We have high labor standards. We don't employ child labour, we provide rural employment and we empower women. There are no anti-dumping cases against us on trading practices," said Suresh Mirchandani, chief executive of Favourite Garments.

Big-name brands are now adding organic-cotton clothes to their collection. "The joke is that one day we'll have a shirt we can eat," said Prasanna Hettiarachchi, general manager of MAS Holdings.

He said Levis recently launched eco-jeans using organic cotton, natural dyes, a coconut shell button on the waist band and a price tag made of recycled paper printed with environmentally friendly soy ink. The price - US$250.