U.S. feels the quality of Peruvian fabric
PERU IS STREAMLINING ITS ALREADY COMPETITIVE TEXTILE SECTOR BY INVESTING HEAVILY IN HUMAN RESOURCES AND UP-TO-DATE TECHNOLOGY

Peru’s dynamic textile industry is currently gearing up for what may be the sector’s most important opportunity ever for massive growth. The upcoming congressional vote in the United States on whether to renew and expand the Andean Trade Preferences Act to include textile will not make or break the already thriving industry in Peru, but it would surely represent an important boost.
There are a handful of textile companies in Peru that stand to gain considerably with the expanded legislation. Topping the list, of course, are those that export extensively to the U.S. where Peruvian quality and dependability is well known among U.S. industry leaders.

The largest player in Peru’s most important industry is Creditex, a fully integrated company that produces top quality finished products and fabric for export worldwide. Some 87% of its sales, however, are earmarked for the U.S. market despite restrictive import tariffs as high as 21%.

FREDERICK HORNY CEO of Creditex

The secret to its success, says Creditex CEO Frederick Horny, is the quality of its cotton. “The difference is basically in the fiber with which we work, pima cotton. There is a very high demand for it worldwide and especially in the U.S., where a huge marketing advantage for wholesalers and retailers is being able to say that their products are ‘made with Peruvian pima soft light cotton’. There are not many companies in Peru that work with pima besides us.”
Peru’s Universal Textil has some 50 years’ experience in the industry and is a leader in the use of synthetic materials that it mixes and matches into fabrics under its own registered brand names. It is one of the few formal and well-organized companies in the sector that successfully targets the domestic market.

Juan Bautista Isola de la Peña Managing Director of Textimax

George R. Schofield CEO of Universal Textil

But according to Universal Textil CEO George R. Schofield, “for the last 18 years we have been exporting to the United States on a regular basis. The possibility to grow in the domestic market is very low.”
Juan Bautista Isola de la Peña, managing director of Textimax S.A. would be one of the first to agree. A whopping 99% of his 10-year-old company’s products are exported to the United States. “It all goes to the U.S., and I’m convinced the U.S. is the natural market for Peru. The possibilities the American market can offer us are far superior to developing the Latin American or European market.”
Textimax has a sewing capacity of around 650,000 pieces per month, and as a vertically integrated factory with complete control of the entire process, from yarn spinning to finished garment. It is able to give its clients–which include several top-of-the-line brands in the U.S.–just what they want in terms of quality, cost and delivery.

AQUILINO FLORES General Manager of Topy Top

The Peruvian textile company with the catchy name of Topy Top began selling its own brand throughout Latin America in 1995, and in 1997 began exporting prestigious brands under the contract manufacturer system, including The Gap, Old Navy, Zara, Puma, Reebok, Billabong and others, mainly to the U.S. and Europe.
“Nearly 70% of our production is for export,” Topy Top General Manager Aquilino Flores explains. “Most is earmarked for the U.S. market, but for some of our clients, like Guess, DK and Zara, we also send to Europe and some goes out to Chile and Venezuela.” Topy Top owns a modern industrial complex in the capital Lima that houses has more than 2,000 employees.
Textil San Cristobal is counting on honing its competitive edge through investment ($20 million over the past four years into its Chicha and Lima plants) and innovation, organizing its 3,000-strong work force into autonomous task groups, using systems analysis techniques to rationalize production flows, and offering its employees incentives based on teamwork rather than individual performances. “The country has two great advantages, unique
natural fibers and a skilled work force,” says Mr. Ruffo, whose firm last year posted annual sales of $55 million, $40 million of which was generated in the U.S.