06/16/03 Sourcing in Guyana South America The following write up serves to recap a follow up assignment in Guyana, South America (June 7-14) to assess progress that the factories we have been working with over the last year are achieving. We are pleased to report that the productivity levels have risen to approximately 65% of international levels. This is quite an achievement considering that for the most part the machinery that they are using is on average what most North American factories may have retired 10-15 years ago. However, considering that: The Guyana wage rate is less than 1/10 of your Montreal costs The acceptable quality level (AQL) based on international standards is 2.5, as recognized by the companies that they supply e.g. Victoria’s Secret; Russel Athletics; Sears ; JC Penny A container can be shipped by boat from Guyana to Miami in 2.5 days or via Air in hours Communication is easy as Guyanese companies communicate in English and are internet connected Problems requiring factory visits require ˝ the travel time compared to the Orient The CBI, CBPTA International trade treaty places them favourably for shipping back to the United States Full Package sourcing is possible as there are textile mills in the region Required infrastructure is building including development of schools for designers and technicians The progressive elimination of quotas and duties come WTO 2005 will make this country that much more desirabe to assure your profit margins Guyana is relatively unknown and thus much more flexible in order to establish itself The Guyanese people are very humble and easy to work with. They do not exhibit the hardened and somewhat independent attitide of other nations we have visited. If we had to describe one of their weakness, it may be stated as their failure to promote their capabilities. However, this may also be viewed as an opportunity for new companies to build relationships. We believe that it would be wise for interested companies to explore options for working with them. We believe that sourcing with a CBI nation has significant benefit over Asia. ( Quicker turnaround; small runs; same language; ease of communication) As a result of our attendance to trade shows and seminars in conjunction with travels to the United States and the Caribbean Basin including South America during the last two years, we are well aware that numerous leading Canadian and American companies are already well advanced in establishing strategic sourcing relationships in these regions. For this reason we are of the opinion that failure to recognize and assess the possibility may prove to be a serious omission for vital 3-5 year strategic planning. As Steve Woloz Associates Inc. has already made inroads in this region, we are confident that we could provide valuable assistance to establishing new contacts for you. It may well be worth your while to meet with us to discuss the feasibility of how you may benefit from considering sourcing in this region. There are numerous routes to explore all of which are open for discussion. The bottom line is that this may well lead to new opportunities for profitability. Should you wish to obtain additional information, please do not hesitate to contact Steve Woloz at: email: s.woloz@swaassoc.com telephone: 514-944-8241

 

Steve Woloz Associates Inc. 5763 McAlear C.S.L. (Montreal) Quebec H4W 2H2 Tel: (514) 944-8241 E-Mail: s.woloz@swaassoc.com