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Posted Date: 6/1/2003

Apparel Checks in with Koramsa's Carlos Arias

By JORDAN K. SPEER

Established in Guatemala in 1988, primarily as an assembly operation for woven bottoms, Koramsa has evolved into a full-service manufacturer. Currently, the company employs more than 12,000 and exports about 2.5 million units per month, primarily to the United States, where its customers include some of the premiere brands and retailers in the marketplace. Carlos Arias, executive vice president, told Apparel that with 2005 fast approaching, one of the company's immediate goals is to "define a clear value proposition" for its customers that is based on servicing them faster and more accurately.

Apparel: What are some major challenges you face in supply chain management, and some solutions you've incorporated to address them?

Arias: One of the biggest challenges that we have in this hemisphere is how fragmented our supply chain is. We lack a culture of sharing information and working together for a common cause. For this hemisphere to be relevant for our customers in the future, we need a big base of successful companies that "get it." If we lose their attention, we all lose. Of course, integration is easier said than done. There are many paradigms that need to be broken, and learning to trust each other is a process that takes time. Many of our customers view the Western Hemisphere supply chain as inexperienced and unreliable. Changing these perceptions will require us to demonstrate maturity and professionalism in how we service their business.

Apparel: Could you tell us about the strategic relationship Koramsa has with its suppliers? We understand, for example, that you conduct regular strategic meetings with your suppliers, as well as bring some suppliers in-house, in terms of opening your plant to their inventory.

Arias: We have devised a strategy that we call VVK, Virtually Vertical Kluster (the "K" is for Koramsa, of course). The idea is to work so closely with our key suppliers that we are able to "seem" vertically integrated to our customers. This program includes initiatives like having our suppliers' offices and warehouses within our compound and working jointly in planning and inventory management. As you mention, we meet with them on a regular basis, and once a year, we have a Koramsa vendors' meeting, in which we discuss how to keep integrating better as we move forward.

Apparel: Are there software solutions that have improved your supply chain efficiency and removed time and labor from your production cycle? If so, have these solutions enabled you to partner more effectively with your retail customers?

Arias: Yes, we are investing a great deal of time and resources in software solutions that help us integrate our supply chain. Our core initiative is a Web-based software solution called Apparel Trak. This software is an alert-based system designed to give visibility throughout the whole supply chain. It will enable us to create a shared information platform in which we eliminate surprises. The idea is to eventually give our customers full access to our processes. We understand that in today's world, customers don't want to micromanage their orders, but having the tool that gives them the confidence that everything is on time can be a great value-added [capability]. ... We have high hopes about being able to service our retail customers better by means of sharing information online. This tool can impact development lead times as well as approval processes tremendously. We hope to be able to deploy this initiative in the next few months.

JORDAN K. SPEER is senior editor of Apparel and may be reached at jspeer@apparelmag.com.

formoreinformation

Koramsa . Carlos Arias . carias@koramsa.com . www.koramsa.com

Apparel Trak (Ecom Partners Inc.) . 678-947-6580 . info@ecompartners.com . www.appareltrak.com 

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