PurposeThe purpose of this paper is to identify and map trends in the Canadian apparel industry (in a global context) and, through the application of Porter's models, establish strategies that could be employed by Canadian small and medium enterprizes (SMEs) in response to the move toward trade liberalisation since the phasing out of the multi‐fibre arrangement.Design/methodology/approachThe literature review established trends in the apparel industry both in Canada and globally. Qualitative research in the form of case studies highlighted apparel suppliers' perceptions of Canada's strengths and weaknesses as a business setting and provided preliminary information on possible supplier activities which provide value and competitive advantage. The analysis of the primary data also allowed the development of preliminary questions, answers to which will further enhance the understanding of clusters and their applicability to Canada's apparel SMEs.FindingsCanada's apparel manufacturing industry is winding down while imports are continuing to grow. At the same time, the Canadian market is not large enough to sustain all the suppliers, thus forcing those who are competitive to export, primarily to the USA, which is Canada's major apparel export destination. The morphology of related and supporting industries to apparel suppliers is changing. The findings suggest that Canada's apparel supply is becoming more of a service and less of a manufacturing industry.Originality/valueThis paper provides an understanding of Canada's position in the global apparel map and ascertains whether competitive cluster strategies exist for the Canadian apparel industry. Furthermore, it sets the stage for further research by identifying knowledge gaps pertaining to the applicability of clusters to the apparel industry and providing data and findings to bridge these gaps.

Purpose – The Canadian apparel industry has long been challenged by imports from low-wage countries while its exports have declined since their height in 2002. This situation was exacerbated with trade liberalisation, which started in January 2005. Data from Industry Canada and a number of studies, amongst which those of the Apparel Human Resources Council (AHRC), showing the adverse effects of trade liberalisation since the phasing out of the multi-fibre agreement in 2005, the lack of competitive advantage for Canada as an apparel manufacturing nation and the subsequent rapid decline of its apparel industry, pointed to the need for a strategic response from the Canadian apparel industry, particularly from small to medium-sized enterprises. A study conducted for the AHRC of the Federal Government of Canada outlined a number of strategies that Canadian apparel companies could pursue, focusing on elements other than manufacturing in the traditional apparel value chain. These strategies seemed to suggest the implementation of a cluster approach where greater cooperation between suppliers would be required throughout the supply chain with a focus on functional expertise and relationships. The purpose of this paper is to determine whether a cluster strategy is being applied or if indeed it is applicable to Canada’s apparel companies. Design/methodology/approach – A literature search, was undertaken to find the options available for the organisation of SMEs so that: an analytical framework could be created from the various theories and concepts that; would enable the evidence-based selection of an option or options suitable for adoption by Canadian apparel SMEs, to assist them to be more effective than stand-alone enterprises. Data were collected from case studies of Canadian apparel companies, an Experience Survey (conducted through face-to-face interviews with the directors of the AHRC, the Canadian Apparel Federation, Industry Canada, and Canadian retail and apparel supply executives) and from the responses to an online questionnaire sent to Canadian apparel suppliers. The data were subjected to examination using the analytical framework to determine whether the evidence existed on which to base a cluster-based strategic response to competition from overseas apparel suppliers, or whether one of the alternative options might be a more suitable match with the Canadian apparel business environment. Findings – Neither the case studies nor the Experience Survey revealed sufficient evidence of open communication or of cooperation among suppliers in areas that would fortify horizontal clustering amongst apparel SMEs, such as the sharing of labour, market research or supply chain management; similar findings emerged from the online questionnaire sent to Canadian apparel suppliers, which showed little evidence favouring cluster development as a strategic response for the Canadian apparel supply industry. The research also showed that industrialists, experts and government advisors all recognised that, beginning with trade liberalisation in 2005, there had been a transformation of the Canadian apparel industry from a manufacturing to a service industry with the retailers taking much stronger control of the supply chain than before, which, taken together with the lack of open communication or cooperation among apparel suppliers gives rise to conditions which favour collaboration over clustering. Originality/value – The paper provides a firm evidence base upon which to develop a different strategy for Canadian SMEs than the cluster approach that has been proposed to date. The findings reported in this paper show that Canadian apparel industry leaders, government and industry-led support organisations, retailers and suppliers all recognise that the type of open communication or of cooperation among suppliers in areas that would fortify horizontal clustering amongst apparel SMEs, such as the sharing of labour, market research or supply chain management does not occur to a sufficient extent to support the adoption of a cluster strategy by the Canadian apparel sector (although it may be applicable in Quebec). Canadian retailers have now taken the leading role in the supplier/retailer relationship. Any future strategy will need to take account of this repositioning of retailers and be centred upon vertical relationships between individual apparel suppliers and retailers.

Purpose – Earlier attempts to develop a strategy for the apparel industry in Canada to counter the adverse effects of trade liberalisation on Canadian apparel suppliers have been based on the concept of clustering. However, despite the support from government-supported industry bodies, clustering has not been forthcoming and this situation has created a pressing need for the development of an alternative to the clustering strategy. A study by the Canadian Apparel Human Resources Council offered up several different strategies including clustering, that the Canadian apparel industry might pursue, but these have not been taken up. Evidence gained from government reports on the industry and its performance, industry case studies, an experience survey and questionnaire reported earlier, leads to a radically different alternative with a more direct relationship between Canadian apparel suppliers and retailer. The purpose of this paper is to report and construct an evidence-based collaborative strategy together with its accompanying apparel industry business model. Design/methodology/approach – The evidence gained from case studies of Canadian apparel businesses, a secondary data search, an experience survey and an online questionnaire has been followed and combined with retailer requirements from apparel suppliers. Findings – The information gained from apparel industry representatives, government sources and industry reports has enabled step-by-step construction of an evidence-based business model centred on the formation of collaborative partnerships between apparel suppliers and retailers. Originality/value – The model reflects the fact that Canadian apparel retailers have taken the leading role in the supplier/retailer relationship and shows how Canadian apparel suppliers might better position themselves to combat competition from offshore suppliers through the formation of closer links with retail partners. It points not only to a requirement for Canadian apparel suppliers to become integrated into their retail partner’s retail management systems and technology, but also demonstrates the need for the formation of strong alliances through collaborative partnerships between supplier and retailer to address the needs of the apparel market.

This review is divided into three sections describing the state of the Canadian clothing market; the trade situation and the penetration of the market by American retailers, giving an interesting insight into the ongoing internationalisation of the sector. It is based upon articles published in Apparel Insights (The Canadian Apparel Market Newsletter) and the material is reproduced with permission from the aforementioned ‘Apparel Insights — A Canadian Quarterly Apparel Market’, a newsletter published by Apparel Management Insights, PO Box 694, Postal Station B, Ottawa, ON KIP 598, Canada (publisher: Constantine Campaniaris; editor: Jim Heppell). Data from the Canadian Apparel Market Monitor were provided by Randy Harris of Kormos, Harris and Associates.

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