Under Armour?s Vision for Future Manufacturing: Make Local for Local

Under AmourBefore calling it Project Glory, Under Armour executives batted around another name for a project launching next year to make products in local markets.

?Black Swan,? a reference to an old belief that no black swans exist because none had been sighted, seemed a fitting name for the brand?s vision for manufacturing?s future, said Kevin Haley, the company?s head of innovation. Because so much production moved offshore in pursuit of low-cost labor, especially in the labor-intensive apparel and footwear sector, many believe it will never come back to the United States.

?We chose to look at things a little differently,? Haley said. ?If you could manufacture a shirt or a pair of running shoes in Baltimore and sell them at a profit in the U.S., then what can?t you manufacture in the U.S. and sell in the U.S? We can be a beacon to show the way ? that with the right amount of innovation and technology and know-how ? and the will to do it ? you can manufacture anything here.?

Those ideas formed the basis of Project Glory, an initiative the Baltimore-based athletic apparel brand has explored for several years but only recently began discussing publicly. The long-term goal is for Under Armour products to be made closer to the markets where they?re sold, for instance in the U.S. for U.S. consumers, in Brazil for South American buyers, in Europe for European shoppers and in China for the Chinese market.

?We?re starting in Baltimore,? Haley said. ?That?s our home.?

The initiative comes at a time when manufacturers are re-evaluating how goods are produced, prompted by rising labor and energy costs in China and elsewhere, complications associated with international shipping and the growing availability of technology that reduces labor requirements.

Some apparel companies, in particular, are starting to look at ?not mass production, but mass customization,? said Jeff Fuchs, executive director of the Maryland World Class Consortia, a nonprofit that helps manufacturers improve productivity.

?Everything we?re surrounded with is almost completely mass-produced,? Fuchs said. ?But modern technology is making it possible to change that and change the economics of production and make it possible to provide customers with uniquely tailored products ? and do that in an efficient way.?

Under Armour plans to start developing and perfecting technologies next year to enable a ?local for local? model, building on systems it already uses to make its Speedform running shoes in a lingerie factory.

The work will be done in a design and manufacturing test center called Under Armour Lighthouse that will open sometime next year in a renovated 133,000-square foot former city garage in Port Covington, the Baltimore area where the company plans to build a sprawling new waterfront headquarters campus.

Engineers, developers and designers ? new and current Under Armour employees and others rotating in from manufacturing partners around the world ? will collaborate on the project in the new facility. Their mission will be to develop and find ways to use advanced manufacturing processes to make products on a smaller scale in local markets while improving the products? performance.

Eventually, Haley said, the Port Covington facility will also make shoes and apparel that could be sold across the harbor at the city?s Under Armour Brand House and at other U.S. Under Armour stores.

Advanced technologies will ?reduce lead times, time in transit,? Haley said, ?so the consumer gets what they want more quickly, more efficiently, and gets better products.?

For products that are designed in the United States but made in China, Vietnam or elsewhere in Asia, shipping times that typically stretch over weeks are sometimes extended further by labor disputes and other issues, said Ravi Srinivasan, an assistant professor of information systems and operations management at Loyola University Maryland?s Sellinger School of Business and Management.

?One of the things that happens is now suddenly what was supposed to take two to three weeks may be stuck at a port several more weeks,? Srinivasan said. ?When you consider companies like Under Armour or Nike, or any fashion industry, the timing is really important. You need to have the right product at the right time available. That?s challenging ? specifically industries like fashion and electronics, because of how fast tastes change.?

Making goods locally makes companies not only more nimble in supplying inventory and reacting more quickly to changing tastes, but better able to respond market by market and to customize merchandise, he said.

Srinivasan said he would expect Under Armour to continue offshore production for some products, while establishing local production for others.

(Source: TNS)