Strategic Sourcing plans should consider the opportunities offered by Turkey. As Sourcing and Procurement teams explore opportunities to shorten supply chains, look for alternative suppliers or find new fast growing potential markets to work with Turkey should be part of their thinking.

Many companies are already seeing the positive benefits Turkey can offer them as Turkey’s exports gain pace.  Turkish Export growth has seen three consecutive months of year on year growth. As demand and supply sides build to support deliver to challenges fuelled by

• Several years of turmoil and global trade impacts
• Reactions to the ongoing war in Ukraine
• A wider desire to reduce China exposure in Supply chains
• Rick and ESG benefits derived from moving some supply chain elements to Turkey

What can Turkey offer Sourcing and Procurement teams ? Why should it be considered as a core part of any Global Sourcing Strategy.

Turkey as a strategic sourcing destination can deliver a range of structural and economic benefits making doing business smooth and seamless.

1. Geographical location: Turkey’s strategic location makes it a gateway between Europe and Asia, providing easy access to markets in both regions. It also offers access to major shipping routes, making it an ideal hub for international trade. The ability to rapidly visit suppliers without Visa restrictions is extremely valuable to many companies saving time and complex travel arrangements. Making building strong supplier relationships easier.
2. Competitive pricing: Turkey’s lower labour and manufacturing costs, combined with its highly skilled workforce, make it an attractive option for sourcing products at competitive prices.
3. High-quality products: Turkey has a long tradition of producing both a diverse range of products of very high-quality. Building on their traditional strengths in Textiles, Timber, Fruit and Spices to include more HI Tech industries

5. Trade agreements: Turkey has trade agreements with many countries, including the European Union, making it easier for buyers to source products and conduct business with Turkish manufacturers.

6. Ease of doing business: Turkey has made significant improvements in its business environment in recent years, including streamlining bureaucracy, reducing regulations, and improving the ease of doing business.

Turkey has a diverse range of exports but some of its biggest exports include:

1. Automotive parts: Turkey is a major producer of automotive parts, with exports worth over $20 billion in 2020. The country is home to several large automotive manufacturers and suppliers, and its high-quality parts are in demand worldwide.

2. Textiles: Turkey is one of the world’s leading textile producers and exporters, with exports worth over $10 billion in 2020. The country is known for its high-quality cotton and textile products, including clothing, fabrics, and home textiles.

3. Machinery: Turkey is a significant exporter of machinery and equipment, with exports worth over $9 billion in 2020. The country produces a range of machinery, including industrial equipment, agricultural machinery, and construction machinery.

4. Chemicals: Turkey is a major producer of chemicals, including petrochemicals, plastics, and pharmaceuticals, with exports worth over $8 billion in 2020. The country’s chemical industry is well-established and highly competitive.

5. Food products: Turkey is a major producer and exporter of food products, including fruits, vegetables, nuts, and processed foods. Exports of food products were worth over $7 billion in 2020.

Turkey’s biggest exports reflect the country’s diverse economy and its strengths in manufacturing, textiles, and agriculture. Alongside their traditional market strengths Turkey is fast building strong positions in several other markets.

1. Defense industry products: Turkey has seen significant growth in its defense industry exports, particularly in the Middle East and North Africa regions. The country’s defense exports have grown by over 20% annually in recent years, with total exports reaching $3.2 billion in 2020.

2. Electrical machinery and equipment: Turkey has seen strong growth in its exports of electrical machinery and equipment, which have grown by over 10% annually in recent years. Total exports in this category were worth $18 billion in 2020.

3. Medical devices: Turkey’s exports of medical devices have grown rapidly in recent years, driven by the country’s strong healthcare industry and growing demand for healthcare products. Exports of medical devices were worth $2.8 billion in 2020.

4. Iron and steel: Turkey is a major producer of iron and steel, and its exports in this category have grown by over 10% annually in recent years. Total exports of iron and steel were worth $14 billion in 2020.

5. Plastics: Turkey’s exports of plastics have also seen strong growth in recent years, driven by demand from Europe and the Middle East. Exports of plastics were worth $5.6 billion in 2020.

ET2C Is a global sourcing company with over twenty years’ experience working with our clients to deliver their Sourcing Strategies. Our offices in seven countries, including Izmir Turkey, ensure you always have a team on the ground to be your bridge to your Offshore suppliers.

Giving you independent feet on the ground and confidence with fast responses, removing time zone and language challenges.

If you would like to explore sourcing opportunities within Turkey or to discuss your future supply chain challenges.

Please contact us at contact@et2cint.com

Strategic Sourcing from India, the high growth economy that should be in your Global Strategic Sourcing plan

With a population of over 1.2 billion, India is the World’s largest democracy, the second most populated country on the planet. It now boosts the World’s 5th Largest Economy WEF

Over the past decade, India’s integration into the Global Economy has been accompanied by similar levels of economic growth. Leading India to emerge as a Global Economic player and a country capable of playing a significant role in any product Sourcing Strategy.

“We believe India is set to surpass Japan and Germany to become the world’s third-largest economy by 2027 and will have the third-largest stock market by the end of this decade,” says Ridham Desai, Morgan Stanley’s Chief Equity

Building on their unique set of competitive advantages provided by:

1. Skilled workforce
2. Lower cost of labour
3. Cultural alignment and compatibility
4. Favourable regulatory environment
5. Improving infrastructure
6. Near-shoring and Re-shoring initiatives to move away from China benefitting India

The Regulatory environment has fuelled the delivery of six mega trends

1.Supply chain diversification

Fuelled by the global turmoil and moves by many companies to find alternative or additional sourcing partners to supplement China. India has benefitted from many companies in USA and Japan relocating supply chain partners to build future shock resilience.

2. Key Export Market for India

Industrial components

Textiles

Electronics and EV technology

Manufacturing competitiveness in India has benefitted hugely from skilled work force and lower labour costs allowing highly competitive pricing position v other markets. India steel manufacturing also fuels the competitiveness of the manufacturing sector. The textiles & Apparel markets in addition to the cost and quality of labour India has easy access to high quality raw materials.

EV manufacturing and innovation and India’s ambition to be a Global Hub for EV industry and Technology. India will launch 40 models of EV car models from a range of Car brands. Support for the industry has been further supported by the recently announced the opening of the worlds largest EV hub supporting the manufacture of both vehicles and advanced cells.

3.Government initiatives

The Indian Government continues to strive to create the rights conditions for Export business to flourish. Foreign and domestic investment in manufacturing has increased supporting further output growth.

4.Capex

As many factories reach high levels of utilisation, benefitting from the strong growth in the Indian economy. Investment levels are rising rapidly both from Government and Private enterprise.

5.M&A

Manufacturing companies are using M&A as a way of building scale and adding capabilities to their portfolios and export capability. Deals were $108b in India in 2021 of which 16% were in the Manufacturing sector.

6.PE/VC funding

In the last few year significant investment has flown in India industrial and export sectors. Fuelling growth in the start up Eco System and building transformative growth. The Manufacturing sector benefitted from over 16% of this investment.

Summary Indian Export growth

Indian continues to build its position as a global export powerhouse. Strong infrastructure in pace, continued investment and Government commitment to creating to export growth helps to make India an easy country to do business in.

It has the second largest railway network in the world and a vast coastline with established seaports.

Strategically located nearly 10,000 KM closer to Europe and the USA.

For companies wrestling with the need to evolve their Sourcing Strategies. Starting to look at Off Shoring options or as part of a wider China +1 strategy India should be top of your list of countries to investigate.

Key export areas of

Industrial Components.

Textiles

Electronics particularly EV Technology

Can provide exceptionally high value and innovative products whilst retaining a lower-cost base.

ET2C Is a global sourcing company with over twenty years’ experience working with our clients to deliver their Sourcing Strategies. Our offices in seven countries ensure you always have a team on the ground to be your bridge to your Offshore suppliers. Giving you independent feet on the ground and confidence with fast responses, removing time zone and language challenges.

If you would like to explore sourcing opportunities within India or to discuss your future supply chain challenges.

Please contact us at contact@et2cint.com

Global Sourcing and Procurement functions are taking on a new enhanced mission within business.

The immediate impact of which is to dramatically broaden their focus and accountabilities.This fast rate of adaption and development of new responsibilities and challenges creates a need for New Skillsets, Data and Inputs.

For many teams who sit outside Global organisations this requires the rapid building of a New Eco System of partners to support the rapid delivery of new responsibilities. Building both the structure and systems to manage data but also the insight and decision-making skills required for analysis and action planning.

What some of the pressing agenda points for Chief Procurement Officers and Global Sourcing teams? How can they keep on top of these big challenges as they rapidly evolve?

1. Supplier Risk Management: Organizations are becoming increasingly concerned about supplier risk, especially in the wake of supply chain disruptions caused by the COVID-19 pandemic. As a result, many companies are investing in supplier risk management tools and strategies to mitigate risk and ensure business continuity.

2. Near-Shoring: The disruption caused by the COVID-19 pandemic has prompted many organizations to rethink their global supply chain strategies and consider localizing their supply chains. This trend to Near-Shoring is likely to continue as companies look to reduce supply chain risk and improve their shock resilience.

3. Sustainability and Ethical Sourcing: Sustainability and ethical sourcing are becoming increasingly important to consumers, and as a result, organisations are placing a greater emphasis on sustainable and ethical sourcing practices. This includes

• Sourcing from suppliers that are environmentally and socially responsible.
• Measuring and managing the Carbon emissions in their wider Supply chains.
• Mapping wider Corporate Risks from within the entire Supply Chain.

4. Digital Transformation: Digital transformation is driving significant changes in the global sourcing landscape, with organizations adopting new technologies such as artificial intelligence, machine learning, and robotic process automation to streamline processes, reduce costs, and improve efficiency.

5. Supplier Diversity: Many organizations are recognizing the importance of supplier diversity, both from a social responsibility standpoint and to mitigate supplier risk. As a result, there is a growing emphasis on sourcing from diverse suppliers and supporting small and minority-owned businesses.

6. Trade Policy: Trade policy continues to be a hot topic in global sourcing, with organizations closely monitoring changes in tariffs, trade agreements, and other trade policies that could impact their supply chain operations

7. Reshoring: The COVID-19 pandemic has prompted some organizations to consider reshoring their manufacturing operations to reduce supply chain risk and improve agility. Whilst this trend has immediate and obvious appeal as companies look to build more resilient supply chains. It is proving extremely complex and challenging for many organisations.

These 7 topic areas are increasingly important for companies and brands of all sizes to understand and review as part of their Global Sourcing Strategy. For many already stretched teams the need for skilled Partners to support their delivery of answer to these questions is crucial. 

https://et2c.com/corporate-profile/

As many companies move rapidly towards a future defined by Global Sourcing &  Procurement Drop us a line to see how we could support you in your challenges Email us at Contact@et2cint.com. 

5 reasons your business will benefit from a well-developed and executed Global Sourcing Strategy.

As the Canton fair opens for the 133^rd time, bringing together business from across the globe. There is no better time to review and reflect on the need for a strong Global Sourcing strategy.As Sourcing and Procurement teams manage enhanced missions and a more elevated seat at the corporate table. Refining and delivering the Sourcing Strategy is even more important for corporate success.

1. Cost savings: A well-executed strategic sourcing plan can help your company reduce sourcing and procurement costs by identifying opportunities to consolidate suppliers, optimize processes and build in new offshore supply partners.
2. Improved supplier relationships: By working closely with suppliers to develop long-term partnerships, your company can benefit from improved quality, reduced lead times, and increased supplier responsiveness.
3. Increased efficiency: Strategic sourcing can help your company streamline procurement processes, improve supply chain visibility, and reduce the time and effort required to manage supplier relationships. Speeding up Innovation, Npd and Packaging changes.
4. Risk management: More strategic supplier partnerships can help mitigate the risks associated with supply chain disruptions, natural disasters, and other unforeseen events. Working together to jointly build a partnership for growth.
5. Better alignment with business goals: A strategic sourcing plan can help your company align procurement decisions with broader business objectives, such as sustainability, innovation, and growth. Supporting the delivery of wider corporate ESG commitments.

Overall, a well-designed and executed strategic sourcing plan can help your company reduce costs, improve supplier relationships, increase efficiency, mitigate risk, and align procurement decisions with broader business goals.

Global Sourcing 2.0 will define the response of Procurement and Sourcing Teams to another year of volatility. Inflationary pressure continues to build and the business need for Environmental and Supply Chain Risk management gains momentum, creating huge challenges for Sourcing and Procurement Teams.

Procurement and Sourcing Team leaders who had hoped that economic conditions in 2023 would make their jobs easier than last year are already disappointed. As the new year began, the volatility and inflation of the previous year showed no signs of abating

Many of the dimensions of change impacting business in 2023 are likely to still be with us in some form at the outturn of the year. Procurement and Sourcing functions are responding to these wide-ranging challenges in an equally wide range of structural changes and ways of working adaptations. Sourcing teams are facing the New Challenge of Global Sourcing 2.0

Macroeconomic conditions straining procurement

Understandably, the aggregate effect of these challenges has overwhelmed many procurement functions. Procurement can play a critical role in solving today’s most pressing business problems, but it cannot do so on its own. Winning now requires an entirely new level of resilience improvement and value creation built through a coordinated enterprise-wide effort. Global Sourcing in 2023 requires Procurement teams to sit at the heart of business in an expanded mission.

• Protecting against Corporate margin erosion
• Deliver on Environmental and Social Risk in Supply Chain
• Build Resilience against the next Black Swan event

Accordingly, success in protecting margins, containing cost escalation, and dynamically capturing opportunities requires an expanded mission for the procurement function. CEOs should consider positioning their procurement leaders at the center of the company’s response to the current context, tasked with a clear mandate to protect margins. CPOs can then mobilize executives for cross-functional impact and escalate investments in the talent and systems required to achieve and sustain outperformance.

Visibility-Measurement-Action-Reduction

Procurement leaders can combat volatility, inflation, and shortages and build resilience by taking ten core actions. The first critical element required is to gain transparency over the pressures and change drivers in their supply chain. Only be creating true visibility can they start to identify the key decisions required to deliver high level objectives. This will require

support from all functions across the business and external partners to support Procurement in developing a more agile approach.

Wide ranging Risk Assessment of Supplier Network

• Suppliers. What vulnerabilities—including financial, fulfilment, reputational, and environmental—do suppliers face?
• Supply. How are events affecting the end-to-end value chain? Which categories may be hard to secure in the foreseeable future?

• Cost. How are suppliers’ costs of goods sold (COGS) trending? Can we quantify the inflation or deflation they face? What do the results mean for our company’s P&L?
• Environmental. How are Key Suppliers measuring their Environmental impact and taking active measurable and visible steps to reduce as part of wider range of commitments
• Social, How is the Supply network mapped Globally against potential Social risks and are key suppliers.

Building New Skill Sets to Deliver an Expanded Mission for Procurement

As Procurement leaders wrestle with the new challenges of Global Sourcing 2.0 the need for a new range of additional skills becomes a critical need for delivery.

As Sourcing and Procurement teams play a more central role in business delivering their expanded contribution. The need to rapidly build skills will become a critical enabler to deliver their New Mission.

• Delivering a visible assessment of high level risk, across the entire supply chain
• Identifying Environmental impacts, particularly Emissions generated within Supply base
• Minimising impact on Key suppliers at potential risk of audit fatigue
• Building working Partnerships

Global Sourcing 2.0 represents a shift in priority and ways of working. From the old Procurement model of expecting Suppliers to make and supply to a forecast and at the cheapest possible price.

To one where there is a more collaborative approach to Sourcing Strategy based on visible shared data, shared Environmental and Social

commitments and strong partnership for growth. A shared vision of the future that can inform the future requirements.

We have long argued that an approach based on strong partnerships is a more successful Sourcing model than the focus on Cost and make to Forecast.

Summary

As more companies move to re structure the breadth of the Sourcing team mission within companies core competencies and skill sets need to be created, adopted and utilised.

Sourcing teams will need to rapidly build or bring in the skills required to bring full risk and impact visibility to their supply chain.

ET2C are a leading global sourcing company, with over twenty years’ experience supporting our clients to develop and deliver their sourcing strategies. We have seen a big rise in our clients demands for

• Emissions measurement and management
• Risk identification
• Quality and Compliance. Social & ethical Auditing

As many companies move rapidly towards a future defined by Global Sourcing 2.0. Drop us a line to see how we could support you in your challenges email us at contact@et2cint.com.

Overview

Malaysia Sourcing is a unique opportunity. Located between two and seven degrees north of the Equator between the Andaman and South China Sea, Malaysia is formed by 13 states. A population of over 33m people live on the islands that are 60% covered by Rain Forest. Its landmass is similar in size to Germany, Norway or Finland.

Economic development:

Malaysia has the third largest economy in South East Asia .Since gaining independence in 1957, Malaysia has successfully diversified its economy from one that was initially agriculture and commodity-based, to one that now plays host to robust manufacturing and service sectors, which have propelled the country to become a leading exporter of electrical appliances, parts, and components.

Openness to trade and investment has been instrumental in employment creation and Malaysian Income Growth, with about 40% of jobs in Malaysia linked to export activities. Malaysia’s economy has been on an upward trajectory, averaging growth of 5.4% since 2010, and is expected to achieve its transition from an upper middle-income economy to a high-income economy by 2024

Key Export Categories for Malaysia

1. Electrical equipment
2. Plastics and Plastic products
3. Medical apparatus
4. Forestry products
5. Pepper

Malaysian advantages as a Market for Strategic Sourcing

Malaysia has several factors that make it a country that should not be overlooked in any sourcing strategy. It offers a dynamic and vibrant business environment with a well-developed infrastructure, a productive workforce and supportive pro-business Government policies.

“The focus will have to be on making it easier — ease of doing business,” he said. “That is one of the key opportunities for Malaysia.” Malaysian Trade Minister Tengku Zafrul Aziz

Malaysia has a well-developed infrastructure after investing in Roads, Rail, Ports and Airports to ensure good connectivity. The population has a high level of fluency in English (a legacy of British colonial rule).

The strategically strong position of Malaysia on the Straits of Malacca is on the major trade routes between Europe and China.

Summary

Malaysia has many assets that make it a sourcing country that should be a part of any companies Sourcing Strategy. Whether you are looking to build you first offshore sourcing plans or diversify into a Multi country strategy.

The ease of doing business, high levels of transport connectivity, Pro business government policies and skilled workforce make Malaysia a strong sourcing option.

Malaysia’s economy has been on an upward trajectory, averaging growth of 5.4% since 2010, and is expected to achieve its transition from an upper middle-income economy to a high-income economy by 2024. 

ET2C Is a global sourcing company with over twenty years’ experience working with our clients to deliver their sourcing strategies. Our offices in seven countries ensure you always have a team on the ground to be your bridge to your Off Shore suppliers.

If you would like to explore sourcing opportunities within Malaysia for your sourcing strategy or to discuss your future challenges.

Please contact us at contact@et2cint.com

“China Suppliers” is a popular keyword for buyers and importers when scouring the Internet but it is not always as straightforward as a click of a button. Do you really know how to qualify the most suitable supplier for your business?

“China Suppliers” – those who never searched for them cast the first stone! Certainly, for companies that sell products finding the right supplier lays the foundations for building a successful business. Suppliers should be considered partners given their performance has a material impact on your business, particularly those that are in the early stages of growth.
A bad supplier can negatively influence your sales revenues and margins, reduce the quality of your products and services (which could cause damage to customer relations), disrupt operations and increase costs.
On the other hand, a good supplier – one that you truly partner with – which meets your business needs will provide you with quality products and services. In short, the right factory will set you up for success whereas the a bad supplier can easily jeopardize your business before it has even got off the ground.

‘China Suppliers’ – How to Identify the Best Partners

Making mistakes in the supplier selection process can impact business results at multiple levels. To avoid this, we want to share with you some useful tips and lessons learnt over the past 20 years of sourcing in China. Key to this is implementing a rigorous process that is followed and repeated as you expand your business.

1. Conduct a detailed factory evaluation

Success in offshore manufacturing starts with the supplier selection process. There is a range of factory audits that can give you the transparency you need to identify the right partners, including manufacturing audits, ethical audits (SMETA, BSCI), technical audits and also, where appropriate, internal audit requirements (particularly for specialist products or sectors). There needs to be a ‘base level’ which must be met for your clients, your business and your market for the factory to qualify as a potential partner. Anything less is immediately rejected.

2. Take an ‘Under the Hood’ approach

As a Partner and a key stakeholder potentially in your business, it is important to try and get a breadth of understanding about the supplier. This includes financials, clients, markets served, qualifications and certifications and any information on the management team. For example, there is public information available on companies in China on shareholding, management team and the number of employees. This information is invaluable as part of a holistic assessment of a factory before you start collaborating.

3. Get the right contracts in place

You want to be working with a professional supplier that sets the parameters of the relationship in a clear and accurate agreement. Such contracts enable you to quickly build trust with your partner and ensure that any intellectual property or other confidential information is suitably protected.

4. Understand the Commercials

Work through a request for quotation process that will enable you to fully evaluate the factory’s ability to deliver against your needs. This starts with the quotation process and needs to make sure that the factory has all the relevant product information to be able to provide an accurate quotation. One should also understand whether there are any minimum order quantities (MOQs), product lead times, payment terms and any sample charges. Although for the latter, it is often the case that you can get this returned on placing your first order. Make sure you factor in freight costs, import duty and any insurance to get your landed costs.

It is worth also making sure that they have the capacity to deliver your products within the timeline you have agreed. Ask for high-level information (quantity) on the factory’s other orders and do a quick sense check to see what this means in terms of available capacity. Late delivery can be detrimental to your client relationships/sales on the shop floor and can end up undoing all your hard work.

5. Do not evaluate a product or Supplier solely on price

The lowest cost may not always get you to where you need to be. In fact, it might be a risk if your sourcing strategy is only driven by saving on costs. Although product cost impacts gross margin, you should be aware that the cheapest supplier is not always the right one. Conversely, an expensive supplier does not guarantee the best products.

When selecting a supplier consider the broad range of elements that are right for your business. Ultimately, if you value a supplier as a partner, the relationship should be much more than solely focused on cost and this will lead to greater flexibility, MOQs, prioritization, assistance when timelines change, and the list goes on. It is difficult to quantify the added benefits!

Bonus Tip: Consider more than one supplier

It is important to have a choice of suppliers and ideally (although not always practical) it should be possible to have a range of suppliers for one product category, perhaps in different markets, so that you can quickly move between suppliers as required. Most companies use a supplier matrix that helps build resilience to shocks in your supply chain.

Need help with “China Suppliers”?

Selecting the best suppliers is critical to the success of your business. We are uniquely placed to help with a presence on the ground in the local market, product knowledge and we can add value when it comes to managing the supplier from development through to shipment.

In the main, having some kind of local presence will only help enhance these relationships whether it be your own office, a sourcing company or some other third-party presence. At ET2C, we provide our clients with the transparency needed to best manage their suppliers across Asia. For more information on how we can help you, please contact us at contact@et2cint.com.

Turkey manufacturers are well-positioned to complement your supply chain with their proximity to the EU market.

The country has a broad and established manufacturing base which sits on the edge of Europe. This is important from a ‘near sourcing’ perspective and provides an alternative sourcing option for UK/EU companies. This is particularly true at present given the current spike in freight rates on the main trade routes out of Asia. Having an alternative near shore option will mitigate the high freight rates as well as shorten lead times considerably.

Sourcing Textiles

One of Turkey’s key export industries is the textile and apparel sector, which has been a very important driving force for the economy in terms of GDP and employment. These sectors accounted for 17% of the country’s exports in 2019. As a part of global trade, Turkey is one of the main actors in the apparel industry as the 7th largest supplier in the world, and the 3rd largest supplier of the EU, which has high standards and sophisticated customer needs with the top five foreign markets for Turkey’s exports being Germany, Spain, UK, Netherlands, France.

There are many reasons why Turkey manufacturers are ranked so highly:

• Low labor costs are a significant advantage when compared with European producers, and the labor cost is obviously a significant part of the Bill of Materials for “cut and sew”.

• Cotton production – As the seventh-largest cotton-producing country in the world, Turkey has access to an uninterrupted supply of cotton, which is the main raw material dominating the textile market owing to its features like high absorbency and strength.

• Proximity to European markets – short lead-times – With many retailers demanding products with short lead times, Turkey has a big advantage with its proximity and can react more quickly; a key aspect of the fashion industry.

• Sustainability – Turkish production complies with international ecological standards, such as the prohibition of the use of harmful dyes.

• Its skilled workforce, modern production equipment, and national infrastructure also guarantee a sustainable competitive advantage.

Turkey manufacturers also have an advantage of an agreement with the EU which removes tariffs and duties on most goods. This also reduces the landed cost price further.

Main Categories

Within the textile and garment sector, there are a range of categories.

Garments

As the main center for clothes, Istanbul prides itself on its designers, fashion, and shopping malls; where you can find the harmonious mixture of the West-East, and Old-New. Due to recent domestic and foreign investments, Istanbul is fast becoming a fashion hub.

As a global sourcing center that is in both Asia and Europe, Istanbul has attracted the attention of many international fashion sourcing offices, trading companies, and major retailers and department stores. Since Istanbul became a commercial and fashion center, most manufacturers have moved production facilities to inner regions. Izmir, Bursa, Ankara, Denizli, Gaziantep, Kayseri, Tekirdag, Adiyaman, Kahramanmaras and Adana are now the main cities for the production of knitted and crocheted garments.

Carpets & Kilims (Rugs)

The history of carpets dates back to the 3rd and 2nd Centuries BC. They were introduced to world civilization by Turks as a decoration item for walls and floors, the earliest samples of which have been found in Central Asia. This is an art form that the Turks discovered, developed, and introduced to the world as they traveled across vast regions. Since the mid-15th century, Turkish rugs have been highly praised in Europe and played an indispensable role in European social life, even depicted in the paintings of the time and regarded as a status symbol. Today, Turkish carpets and kilims from the Ottoman Empire are displayed in the most prestigious museums. Turkey continues the tradition of hand-made carpets and rugs with ornamental motifs and different weaving types, exporting them to a wide range of countries.

In the meantime, machine-made rugs and carpets are also not neglected. Their durability, colorfastness, anti-soiling finish, ease of cleaning, and antibacterial properties made Turkey one of the biggest suppliers in this sector. Manufacturers continue to introduce new trends, a variety of different types of carpets, innovative designs, and colors to the world market.

Footwear

The Turkish footwear industry has developed very quickly due to modern manufacturing techniques, quality raw materials, qualified workers, and high design capabilities. It has a powerful position among exporters of high-quality fashion goods. About 70% of the production volume of the sector is carried out in a semi-machine manufacturing process, and approximately 15% of the manufacturing is manual. In 2019, the production of Turkish shoes has reached more than 392 million pairs, including sneakers, boots, plastic shoes, and slippers. The production of military boots and work safety shoes has also considerably increased in recent years.

Today, the Turkish shoe industry has the ability to create its own brands and styles. The performance of the industry is highly dependent on exports, with the main markets being the Middle East & Europe.

Home Textiles

The Turkish home textile industry now plays an important role in world trade with its ability to meet the high-quality standards of all sophisticated consumers.
Nearly all types of home textiles are manufactured in Turkey: towels, bedsheets, bedspreads, curtains, blankets, pillows, quilts, cushions, eiderdowns, table linens, lace, and sleeping bags.

The largest quilt factory in Europe is located in Turkey. In addition, the industry has managed to reduce production costs below the world average while improving product quality and carrying the tradition from the past to the present.

To meet the demand for environmental protection within the international market, Turkey also provides traditional fabrics made from pure cotton or linen without the use of chemical dyes. At present, the Turkish home textiles industry has realized the growing demand for healthier and more environmentally friendly products in the international market and has rapidly adapted to the development of legal and technical regulations.

Leatherware

The history of the Turkish leather industry can be traced back to 500 years ago. The production of this sector is based on modern technology and historical background. Today, the industry has a worldwide reputation for its well-designed and stylish products.

Although initial efforts to modernize the leather industry began in the 1970s, significant progress on the real industrial scale began in the mid-1980s. In recent years, this field has shown rapid progress. Today, production meets international standards and environmentally friendly production policies are highly valued: around 90% of production is based on health and environmental standards.

The technological advancement of this industry is vital to a highly competitive industry and is growing rapidly. Today, the Turkish leather industry exports its own leather. Now, the industry is beginning to pursue value-added and advantageous innovation, branding, and design.

Turkey’s leather garment industry produces the best quality leather garments for men and women. Most of the major companies in the industry are producing original collections under their own brands. The industry creates its own fashion using unmatched quality colors, patterns, manufacturing processes, and materials. Due to these characteristics of the industry, Turkish leather clothing products enjoy a high reputation and are appreciated all over the world.

Turkey Manufacturers – Our Network

Turkey manufacturers are well positioned to add to your supply chain across a broad range of categories – particularly when freight rates are so high. The Textile & Soft goods sectors are well established and provide a near sourcing option for UK and EU companies looking to source closer to their own markets.

At ET2C, we are well placed to help manage your sourcing needs across multiple markets with teams on the ground. For more information on how we can help you with your Turkey sourcing or for other markets, please contact us at contact@et2cint.com.

Shoe suppliers produce 24 billion pairs annually in a surprisingly complex, labour-intensive industry

Shoe suppliers The Insight Series

We work with our suppliers to develop products across an array of different sectors that rely on varying materials and a range of manufacturing techniques. It is always fascinating to see how each of these products are made, whether it is the number of hands that touch the products as it is manufactured or the machines that are employed as part of the production process.

Consumerism has firmly put our focus on what we want, rather than understanding how the product is actually made. We launched the ‘Insight-Series’ to explain how some of the products we manufacture (across China, Vietnam, India, Turkey) are made. Also, we want to provide you with a little bit more knowledge the next time you buy a product.

Shoe Suppliers

Our first insight is on the shoe industry. This is a traditionally labour-intensive sector, requiring a combination of skilled human labour.

It is no surprise that the majority of shoes are still produced in China. In fact, China alone accounts for around 75% of global manufacturing capacity.

The “shoe dogs” amongst us will recognise that the traditional manufacturing process has not evolved much in decades.

However, the industry is preparing for a shift in materials and methods, with sustainability driving much of this change.

For example, additive manufacturing (3D printing) is now being used by major brands to create customised shoes and soles tailored to individual feet, using data-led processes.

The Manufacturing Process

Shoe suppliers make lots of different styles that require different elements of the traditional manufacturing processes. These elements are largely dependent on the materials, aesthetic and the function of the shoe. To keep it simple, we will focus on one style of shoe that covers the most common elements of shoe production – the ‘Sneaker’.

Moulding the Sole

The first part is to get the sole moulded. This involves designing the sole, the shape, the branding and the type of sole you want. Large metal moulds need to be created in accordance with the design and approved. This then allows the rubber (or blend) to be put in the mould and pressed to get the individual soles. The hardness of the rubber will impact the feel and function of the shoe, which can be tested using a durometer.

Shoe suppliers Fabric Uppers

The material needs to be selected. These can be cottons, leathers and a range of other products – we are seeing more and more Ocean Plastic woven fabrics being used from a sustainability perspective. Whichever material that is selected, is put on the die cutting machine for cutting. The ‘Die-Cutting’, involves a metal shape – much like a Cookie cutter for baking – that is sharp and is pressed through multiple layers of fabric at one time to get many fabric uppers. For leather hides being cut, there is more expertise required to make sure that marks on the hides are not part of the uppers so mass cutting is not possible.

Shoe suppliers Upper Stitching

Probably the most labour-intensive process and if you have ever been into a shoe factory, it is where most of the workers will be, sitting at sewing machines making the uppers from the cut fabrics. There can be many elements to this depending on the design, which can involve multiple seams being added to the upper.

Shoe suppliers Cemented (Cup) vs Vulcanised

Sneakers have two main methods of attaching the soles to the uppers. Vulcanised soles are for much larger scale production. In fact, they require a machine to fix the ‘twice-cooked’ rubber sole to the upper. In comparison, the cup sole is traditionally stitched and glued (with heat) to the upper part of the shoe. This allows EVA or TPR to be added into cup sole to provide additional cushioning.

Shoe suppliers Lasting

The lasts (inserts that are the shape of the shoe) are used to make the sneaker and make sure that there is consistency with the shape of the shoe – the fabric/leather does have some flex.

Although a simplified version of the process, imagine that at each stage there are 2-3 workers touching the shoe as it goes along the production line and you begin to get an appreciation as to what kind of labour resource is needed to make just one pair of sneakers. And this does not include any additional embellishments on the uppers and packaging the goods. Think about this next time you buy a pair of shoes!

The shoe industry is a global industry, although the two largest exporters of shoes are China and Vietnam. The latter has developed an expertise over the past decade particularly in trainers for the likes of Nike and Adidas.

Shoe suppliers Summary

Shoe suppliers are in the most part still using traditional labour-intensive manufacturing techniques. This is likely to change with the evolution of the latest technologies, such as additive printing.

At ET2C, we look to provide our clients with insights across our manufacturing base. For more information please contact us at contact@et2cint.com.

China manufacturing is obviously the first option that comes to one’s mind when considering outsourcing any production. It’s scale, breadth of products and supplier network are unrivalled the world over.
Clearly, decreasing product cost is the main driver for any decision in favour of outsourcing.
However, outsourcing can bring many other benefits to your business, like for example increasing the flexibility of your supply chain.

In our previous article, we already listed the main advantages of outsourcing manufacturing:

• Costs reductions
• Raw material
• Flexibility
• Quality
• Expertise.

Certainly, it is more affordable to outsource production processes to companies that have a comparative advantage in that area than to produce them internally and China is not the only option available.
In this article, we will be providing you with an overview on the main manufacturing jurisdictions in Asia.

China Manufacturing

Although China’s manufacturing base has had challenges over the past five years (notwithstanding the current impact of the Coronavirus outbreak), it continues to be the manufacturer to the world. There is no doubt that there is work to do though to retain a competitive advantage and with the Chinese Government’s implementation of “Made in China 2025”, and investment in smart manufacturing and technology, there is a promise of further efficiencies being driven through their factory gates.
How can we help?
As your China sourcing agent, we will help maximize your company’s sourcing potential in China’s complex manufacturing base. Contact us at shanghai@et2cint.com to know more.

Vietnam

Vietnam is one of the most dynamic and fastest-growing emerging markets and represents a valid alternative to China sourcing. First, the country is currently propelled by buoyant export demand and supported by strong foreign direct investment. In addition, the manufacturing sector benefits from a strong work ethic of the Vietnamese and their commitment to quality.

Vietnam actually wants to remain competitive, with low labor rates, while bringing a greater quality for economic transformation. The young and skilled workforce is highly literate, willing to learn and trainable.

China Manufacturing Advantages of sourcing from Vietnam

The country continues to attract business from US buyers due to the current tariffs imposed on Chinese products. Clearly, companies are also looking to de-risk and look to spread their supplier base across multiple jurisdictions.
Also, Vietnam has the largest investment in infrastructure in South East Asia, including in both private and public sectors. With nearly a billion US dollars being spent on new infrastructure projects, Vietnam is serious about increasing the speed and efficiency of its economy.

China Manufacturing The biggest industries in Vietnam

Electronics, machinery, and steel are some of the biggest industries in Vietnam.
In terms of quality and high value in production, we must mention:

• Furniture. With an export value of USD 8.66 billion and 1,500+ medium to large furniture manufacturers, Vietnam is one of the most important outdoor and indoor furniture manufacturing countries in the world.
• Garden product. This is a growth manufacturing sector in Vietnam, due to the available raw material and skill set within the workforce.
• Garment. This sector has been developing strongly and plays an increasingly important role in economic growth of the country. Vietnam is the third-largest garment exporter, with major exporting destinations including the United States, EU, Japan, and South Korea.

Is sourcing from Vietnam the best option?

Vietnam is a growing economy but suffers from an inadequate infrastructure in banking, communications and transport.
However, while China has slightly lost its competitive edge over the past couple of years, mainly due to the increased labour cost and lack of investment, manufacturing in Vietnam still offers the flexibility of low volume, high mix production and competitive overall cost level.
If you think that Vietnam might be the right Sourcing solution for you, contact our team now: vietnam@et2cint.com.

China Manufacturing India

India has a large and growing workforce, China Manufacturing as well as access to raw materials. With a newly elected pro-business and pro-manufacturing government, the country is entering a new era of skilled manufacturing and production. Investment in smart manufacturing is coming to the fore and should create greater production efficiencies in the future.
For these reasons, an increasing number of companies are exploring alternative markets such as India to diversify their business and minimize risks.

China Manufacturing Benefits of Sourcing from India

First of all, a wide range of raw materials are readily available within India including cotton, silk, jute, marble, metal, wood, bamboo and others. The country traditionally focused on producing unique and handcrafted products not found in other countries.
In general, Indian suppliers have more respect for their buyers’ IP than suppliers from other countries and there are more robust laws in place to implement such protection.

China Manufacturing India’s top industries

India’s top exported categories overall are raw materials and industrial products. Other goods that you can import from India include handcrafted items made of various materials such as metal, ceramic, wood and textiles; apparel and fabrics; fashion accessories; leather products; and eco-friendly products.
Are you looking for Indian suppliers? As your India sourcing agent, we will guide you through the complexities of the Indian market and identify product opportunities. Contact us at india@et2cint.com and let us help!

China Manufacturing Summary

China is still an important part of the global sourcing arena, and will continue to be so. Scale and population size (albeit an aging demographic) still count and provide a significant advantage when compared with smaller markets. For example, Vietnam by comparison is only 90 Million people in total against China’s 1.6 Billion population.

China Manufacturing The annual GDP output of Guangzhou City, in Guangdong province, is more than the whole of Vietnam in 2019.

Certain industries have become more global and the garment sector is a good example of this. New territories often bring with them new challenges. At ET2C, we are constantly looking for the best suppliers for our clients both within China and beyond. For all enquiries, please contact us at contact@et2cint.com