A gold medal winning performance

As US politicians gripe about unpatriotic buying, a Chinese clothes maker keeps on reaping the rewards

'I think they should take all the outfits, put them in a big pile and burn them and start all over." When Harry Reid, the US Senate majority leader, made that declaration three weeks ago, referring to uniforms for his country's Olympic team being made in China, he was obviously not out to win gold medals from the people of Dalian.

Reid's comments, and those sympathetic to his view made by other US lawmakers, created a media storm, but when the US team marched into the Olympic stadium in London for the Games opening ceremony on July 27 the fuss seemed to be all but forgotten amid the pageantry and fanfare.

In the weeks before, the uniform maker, Dalian Dayang Group Co Ltd in Northeast China's Liaoning province, had itself been dragged into the Games limelight as it defended its products. Li Guilian, the company chairwoman, says Dayang had simply won the contract on merit, on the basis of quality and competitiveness.

That, Li says, is the way it should be, and that it is unwise for politicians such as Reid to oppose the made-in-China uniforms just because people in the US textile industry are out of work.

It took about 150 workers more than six months to tailor more than 2,000 uniforms for the US team, she says.

"Given the irreversible trend of globalization, the Chinese manufacturers and their American clients are playing different roles: they design, and we manufacture. We are partners not competitors. It is the cheaper labor in China that makes it possible for the US consumers to buy high-quality products at lower prices."

Li, 66, who started the company with 85 fellow farmers in 1979 when China started its reform and opening-up, says Dayang had produced the formal outfits for the US athletes for the 2008 Beijing Olympics, and Ralph Lauren spoke highly of the quality.

"We had never thought it would be controversial. It was just an ordinary order and we just continue to provide high-quality products."

The Shanghai Stock Exchange- listed company has more than 10,000 employees, and its products are sold to more than 20 countries and regions, including Britain, Germany, Italy, Japan and the United States.

Dayang has been making suits for Japanese companies since the early 1980s. The country has become its largest and most stable market, accounting for half of its business.

The US and European markets gradually expanded with China's accession to the World Trade Organization in 2001.

Hu Dongmei, deputy general manager of Dayang Group, says the company has phased out low-end orders and put more emphasis on high value-added products since 2009. The original low-end orders were moved to Southeast Asian countries with lower labor costs.

Dayang has set up dedicated production lines for customers from countries, including Britain, Japan and the US. The high-quality, low-cost products are attracting many more orders than they can handle, Hu says.

"However, we will not blindly increase our production. We need to spare resources so we can do higher value-added business, such as developing our own brands."

Dayang says it makes about 5 million suits a year, 80 percent of them for foreign markets.

For those markets, Dayang hopes to improve its relationships with existing customers by improving quality and providing more value-added services. It will also look for new customers, improve the ordering system, and accept more orders for made-to-measure suits.

The company makes clothing not only for world-famous brands but also tailors made-to-measure suits.

Domestically the company is heavily promoting its own brands, with a particular eye on getting Chinese to buy high-quality made-in-China clothes.

"The domestic economy is facing downward pressure," Hu says. "But given China's large population and the reputation we have gained worldwide, we are confident."

Especially since the financial crisis in 2008, Dayang has put a bigger effort into building its own brands, of which there are three: Trands, Keymen and Yousoku.

Trands, a menswear brand, was set up in 1995 and soon became popular among senior government officials and business executives as an outstanding Chinese label.

Its reputation really took off after Warren Buffett became a customer in 2007 and promoted the brand. In 2009 he sent a three-minute video clip to celebrate Dayang's 30th anniversary, lauding Li's accomplishments and her Trands suits.

He said in the video that he had nine Trands suits and that many of his friends, including Bill Gates, wore them.

Dayang's US market began to grow, and more than 100 specialty stores there now sell made-to-measure Dayang suits. The company has engaged world famous designers and fashion experts to help it stay abreast of trends, improve its clothes making and promote the brand.

In 2006, Ivano Cattarin, former chief designer for Giorgio Armani men's suits, joined Dayang as design director for Trands. Luigi Proietti, former vice-president for the Italian apparel manufacturer GFT Group, and a US marketing expert, David Margalit, are also working with Trands.

Dayang Group now has more than 30 factories that make suits, blazers, pants, jackets, shirts, overcoats, ski wear and uniforms.

Among them, Dalian Dayang Trands Co Ltd is the only one listed on the Shanghai Stock Exchange. Its market capitalization was 1.81 billion yuan ($284 million, 231 million euros) on July 27.

Keymen is a brand for business clothing. It targets large enterprises and public institutions, offering customized services. It sells well in the domestic market.

Yousoku's target customers are young people. Sales rely mainly on e-commerce, focusing on those born in the 1980s and 1990s who like shopping online. Thanks to its online sales strategy, Yousoku is very competitive, as the prices are about one third of other domestic made clothes of the same quality.

Hu attributes Dayang's success in pleasing and keeping customers to advantages such as strict quality control, original techniques and skilled workers.

At Dayang's branch in Dalian Development Area there is a State-level textile testing center at which materials can be tested according to various overseas standards, such as those of the European Union, the US and Japan.

Hu attributes its competitiveness in part to the quality of its workforce. The company says its salaries are more than 30 percent above par for the area, and that employees also enjoy housing, medical and educational benefits.

Dayang started from the Yangshufang township in Dalian, about 80 kilometers northeast to downtown Dalian. The small town, which accommodates most of Dayang's subsidiaries, has a population of 30,000. Nearly one third of them work for Dayang.

Contact the writers at zhuchengpei@chinadaily.com.cn and zhangxiaomin@chinadaily.com.cn

Ren Jinxia contributed to this story.