00:00 Speaker A
I’ve never designed a product. I have never worked in a supply chain. How hard is it to adapt to a tariff when you are in the apparel industry?
00:13 Speaker B
It’s impossible. So, we’re not dealing with it this time around. We dealt with it the last time Paris up tariffs were instituted. I think that year we thought we were going to make three million and we lost three million, you know. It was impossible with the timeline set forth to change your supply chain. I went to testify, you know, and rally for it, didn’t help. Um, and so it’s really hurting a lot of businesses. The silver lining is we got out of China at that time. We’re still out of China. And so that saved us a lot of money in the long run, but it’s pain we didn’t need, you know. I wish there was a little bit more time to adjust to these tariffs because our life cycle is nine months from concept to hitting the floor. So if you don’t have that and you know, then then you’re out of luck.
01:31 Speaker A
I the the retail executives I talked to, they continue tell me, well, we’re moving out of China, we’re going to Vietnam, or we’re going to Indonesia. And on paper, great. But is it the same quality or does China have some kind of secret sauce, they’re still able to make better things than a Vietnam and other countries?
02:17 Speaker B
You know, we’ve been making in Vietnam and Indonesia for the last three years, and I don’t see a difference in our quality at all. And I think that the smart factories were already establishing strongholds in those places. So some of the factories that made our goods in China are the same factories. They’re just happen to be in Indonesia and in Vietnam.
02:50 Speaker A
Can you make an amazing handbag profitably in the US?
03:00 Speaker B
You can, if you charge a lot more money. So I did this exercise a couple years ago when I had a lot of my, you know, 20 year old fans demanding Made in New York City, Made in the USA. And I said, cool. This is the price. I’m happy to do it. I can go back to my factory on 38th Street. Let me know if you want to pay. And guess what? Crickets. You know, I am excited by the prospect. I know LVMH is investing in Texas and I would love manufacturing to come back, but has to come back on a scale that is not just the make, you know, it’s the hardware. It’s all the filler that’s inside of a bag. Everything needs to be made here because if you’re buying it all from overseas anyways, and assembling it here, you’re still not saving very much money.
03:32 Speaker A
Well played.
03:38 Speaker A
Well played.
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