1 00:00:15,316 --> 00:00:25,756 Speaker 1: Pushkin. Today's show is about some very big, very timely ideas, globalization, 2 00:00:25,996 --> 00:00:31,436 Speaker 1: supply chains, the future of American manufacturing. Today's show is 3 00:00:31,476 --> 00:00:36,316 Speaker 1: also about something very simple. A sweatshirt. A plain cotton 4 00:00:36,316 --> 00:00:38,916 Speaker 1: sweatshirt with a zipper and a hood and a pocket 5 00:00:38,956 --> 00:00:41,476 Speaker 1: to put your hands in when they get cold. The 6 00:00:41,516 --> 00:00:45,196 Speaker 1: sweatshirt is made in America, it costs one hundred and 7 00:00:45,356 --> 00:00:53,796 Speaker 1: thirty eight dollars, and it is wildly popular. I'm Jacob Goldstein, 8 00:00:53,876 --> 00:00:56,276 Speaker 1: and this is what's your problem. My guest today is 9 00:00:56,356 --> 00:01:01,236 Speaker 1: buyered Win, founder and CEO of American giant. Byron's problem 10 00:01:01,356 --> 00:01:04,396 Speaker 1: is this, how do you make clothes in America and 11 00:01:04,556 --> 00:01:07,116 Speaker 1: compete in a global economy. I grew up in the 12 00:01:07,116 --> 00:01:11,556 Speaker 1: East Coast, and I grew up in a wealthy town 13 00:01:11,556 --> 00:01:14,436 Speaker 1: in southern Connecticut where all the successful parents that I 14 00:01:14,516 --> 00:01:17,356 Speaker 1: was around worked on, at least in my imagining of it, 15 00:01:17,396 --> 00:01:20,276 Speaker 1: worked on Wall Street. And I got pretty fixated on 16 00:01:20,316 --> 00:01:22,436 Speaker 1: that as a young kid and wanted to wanted to 17 00:01:22,916 --> 00:01:24,916 Speaker 1: figure out a way to make money, I think, and 18 00:01:25,516 --> 00:01:27,356 Speaker 1: kind of put my head down and did that for 19 00:01:27,956 --> 00:01:29,796 Speaker 1: als of my college years and eventually got a job 20 00:01:29,836 --> 00:01:31,676 Speaker 1: on Wall Street and realized pretty quickly that it was 21 00:01:31,716 --> 00:01:34,356 Speaker 1: the wrong thing for me, and I had always grown 22 00:01:34,436 --> 00:01:38,316 Speaker 1: up I always loved consumer products. I love clothing, and 23 00:01:38,476 --> 00:01:40,236 Speaker 1: I have these very strong memories as a kid of 24 00:01:40,796 --> 00:01:43,716 Speaker 1: my first pair of blue jeans and my first flannel shirt, 25 00:01:43,796 --> 00:01:46,036 Speaker 1: my first Champion sweatshirt, all these things that these very 26 00:01:46,076 --> 00:01:49,676 Speaker 1: sort of strong associated memories I was young, and I 27 00:01:49,756 --> 00:01:52,756 Speaker 1: think that sort of informed for me an idea that 28 00:01:52,796 --> 00:01:55,836 Speaker 1: I wanted to make something. So Bayard started working at 29 00:01:55,836 --> 00:01:59,396 Speaker 1: companies that made stuff that sold physical products, and that 30 00:01:59,476 --> 00:02:02,316 Speaker 1: was great for him, but those companies, like a lot 31 00:02:02,356 --> 00:02:06,356 Speaker 1: of other American companies at the time, were moving production overseas, 32 00:02:06,916 --> 00:02:09,516 Speaker 1: and that created a new problem for byired. The more 33 00:02:09,556 --> 00:02:12,356 Speaker 1: I did that, the more I became really clear about 34 00:02:13,876 --> 00:02:17,636 Speaker 1: both a disconnect from the product itself and there was 35 00:02:17,636 --> 00:02:19,196 Speaker 1: a real loss attached to that, and a feeling that 36 00:02:19,276 --> 00:02:21,876 Speaker 1: I couldn't control quality as well, and I didn't feel 37 00:02:21,876 --> 00:02:24,116 Speaker 1: that sense of responsibility and stewardship over the stuff that 38 00:02:24,156 --> 00:02:26,636 Speaker 1: I was making. And then there was also a human 39 00:02:26,676 --> 00:02:28,596 Speaker 1: part of that that I felt that these people that 40 00:02:28,596 --> 00:02:31,316 Speaker 1: had built relationships with that we were providing jobs for, 41 00:02:31,476 --> 00:02:33,796 Speaker 1: that we were picking up and leaving. And as I 42 00:02:33,836 --> 00:02:35,836 Speaker 1: got older, that really started to wear on me, and 43 00:02:36,156 --> 00:02:38,636 Speaker 1: I began to contemplate the idea of American giant with 44 00:02:38,716 --> 00:02:41,036 Speaker 1: a really simple idea, which was, I'd grown up around 45 00:02:41,076 --> 00:02:43,956 Speaker 1: these great American brands Levies and Wrangler and wool Rich 46 00:02:44,036 --> 00:02:46,436 Speaker 1: and all these amazing brands that had built very high 47 00:02:46,516 --> 00:02:48,716 Speaker 1: quality products stood for something in my imagining of it, 48 00:02:49,436 --> 00:02:51,676 Speaker 1: and I felt that the particularly an apparel, there were 49 00:02:51,676 --> 00:02:53,916 Speaker 1: no brands like that left, and I wanted to do 50 00:02:53,956 --> 00:02:56,756 Speaker 1: something different. I felt that not only could we make 51 00:02:56,876 --> 00:03:00,716 Speaker 1: beautiful product here nearby, but also do it in a 52 00:03:00,756 --> 00:03:03,916 Speaker 1: way that was consistent with our values, that respected environmental 53 00:03:03,956 --> 00:03:06,676 Speaker 1: laws and human rights laws. And I thought the moment 54 00:03:06,756 --> 00:03:09,236 Speaker 1: was right. E commerce was emerging, there was a bunch 55 00:03:09,276 --> 00:03:12,396 Speaker 1: of advancement that happened in manufacturing and technology and data 56 00:03:12,476 --> 00:03:16,836 Speaker 1: that I felt could build sort of a new American brand. 57 00:03:16,876 --> 00:03:20,556 Speaker 1: And so in two thousand and twelve, we launched with 58 00:03:20,596 --> 00:03:22,876 Speaker 1: a single product, a sweatshirt, a full zip sweatshirt. I'm 59 00:03:22,876 --> 00:03:26,076 Speaker 1: wearing it now actually, and that sweatshirt we kind of 60 00:03:26,196 --> 00:03:28,036 Speaker 1: poured my life into. I sort of everybody I spoke 61 00:03:28,036 --> 00:03:29,196 Speaker 1: to told me it could be done in the United 62 00:03:29,236 --> 00:03:32,596 Speaker 1: States anymore, and we battled our way through that. In 63 00:03:32,716 --> 00:03:35,276 Speaker 1: real partnership with a bunch of people that remain suppliers 64 00:03:35,276 --> 00:03:39,316 Speaker 1: of ours today. And late that first year, Slate magazine 65 00:03:39,316 --> 00:03:41,996 Speaker 1: wrote an article about that sweatshirt. They called it the 66 00:03:41,996 --> 00:03:45,396 Speaker 1: greatest hoodie ever made, and that kind of changed everything 67 00:03:45,436 --> 00:03:47,876 Speaker 1: for us. I looked up that Slate article. It was 68 00:03:47,916 --> 00:03:52,756 Speaker 1: published on December fourth, twenty twelve, so pretty much exactly 69 00:03:52,836 --> 00:03:55,796 Speaker 1: ten years ago. So I don't know. Congratulations your ten 70 00:03:55,836 --> 00:03:58,276 Speaker 1: year anniversary of making it as a company. Thank you. 71 00:03:58,676 --> 00:04:01,396 Speaker 1: We're gonna do We're gonna do something special for that anniversary, 72 00:04:01,436 --> 00:04:03,396 Speaker 1: by the way, So I appreciate you noticing that. Okay, 73 00:04:04,356 --> 00:04:07,916 Speaker 1: So like tell me about seeing that article, Like someday, 74 00:04:07,956 --> 00:04:09,916 Speaker 1: what happened? You get up to somebody email it to you. 75 00:04:09,956 --> 00:04:12,916 Speaker 1: What happened? Yeah, So the article hit and I got 76 00:04:12,956 --> 00:04:15,796 Speaker 1: a phone call on the fourth at about five pm 77 00:04:16,476 --> 00:04:20,356 Speaker 1: from the people that were managing our website and in 78 00:04:20,396 --> 00:04:23,596 Speaker 1: a panic, and they said, you see what's happening here. 79 00:04:23,636 --> 00:04:24,836 Speaker 1: I had no idea. I said, know what's going on? 80 00:04:24,876 --> 00:04:28,836 Speaker 1: They said, we are getting orders now, we are getting 81 00:04:29,676 --> 00:04:32,196 Speaker 1: hundreds of orders a minute. We would you get in 82 00:04:32,276 --> 00:04:35,676 Speaker 1: a typical day, one hundred orders in a day? Probably 83 00:04:35,676 --> 00:04:39,196 Speaker 1: not even actually back then, this is like a good 84 00:04:39,236 --> 00:04:42,316 Speaker 1: news bad news situation. You're like, great, but oh my god, 85 00:04:42,356 --> 00:04:45,316 Speaker 1: we don't have the sweatshirts. Well, so in the in 86 00:04:45,356 --> 00:04:48,076 Speaker 1: the short time it was it was sort of unfettered 87 00:04:48,076 --> 00:04:51,676 Speaker 1: great news. I mean, it was really what you hope 88 00:04:51,676 --> 00:04:54,236 Speaker 1: for dream about as as an entrepreneur starting something. It 89 00:04:54,276 --> 00:04:56,996 Speaker 1: really was wonderful. There was a there were tins of 90 00:04:57,196 --> 00:04:59,116 Speaker 1: challenges like could we get the servers, could we get 91 00:04:59,156 --> 00:05:03,596 Speaker 1: the site loaded the web? Yeah, yeah, so there's some 92 00:05:03,756 --> 00:05:06,596 Speaker 1: short term crises, but but big picture it was really great. 93 00:05:06,836 --> 00:05:08,996 Speaker 1: But pretty soon what happened is, you know, by the 94 00:05:09,156 --> 00:05:11,676 Speaker 1: next morning, we'd sold out of everything we had. We 95 00:05:11,836 --> 00:05:14,316 Speaker 1: had a bunch of stuff that was in the supply 96 00:05:14,396 --> 00:05:17,716 Speaker 1: chain coming, yarn and fabric coming that would carry us 97 00:05:17,716 --> 00:05:19,796 Speaker 1: all the way through till about June. So six months 98 00:05:19,836 --> 00:05:22,676 Speaker 1: ahead we said, boy, why don't we put up a 99 00:05:22,716 --> 00:05:25,996 Speaker 1: blog post and say we're sold out. But you know, Jacob, 100 00:05:26,036 --> 00:05:27,756 Speaker 1: if you want a sweatshirt, you can give us your name, 101 00:05:27,756 --> 00:05:29,596 Speaker 1: in your size, and your preferred color and we'll ship 102 00:05:29,596 --> 00:05:30,876 Speaker 1: one to you and it may not get there till 103 00:05:31,036 --> 00:05:34,516 Speaker 1: May or June. And that blog we sold out of 104 00:05:34,716 --> 00:05:38,596 Speaker 1: everything in the pipeline within a day. Or two. And 105 00:05:38,636 --> 00:05:40,876 Speaker 1: so that's when things got really challenging. I mean, I 106 00:05:40,916 --> 00:05:42,996 Speaker 1: think we then had to sit down. Here we were 107 00:05:43,036 --> 00:05:46,756 Speaker 1: in December sixth or seventh. We thought, the article has 108 00:05:46,796 --> 00:05:49,276 Speaker 1: just hit. It's Christmas. Everybody's in a kind of a 109 00:05:49,316 --> 00:05:52,276 Speaker 1: holiday buying mood. We're not going to get back in 110 00:05:52,316 --> 00:05:56,476 Speaker 1: stock at the earliest until July. Is anybody going to care? Then? 111 00:05:56,676 --> 00:05:59,756 Speaker 1: Should we order a hundred sweatshirts or a thousand or 112 00:05:59,796 --> 00:06:02,596 Speaker 1: ten thousand? I mean that was a fool's errand to 113 00:06:02,636 --> 00:06:04,716 Speaker 1: try to predict that well, and we were no better 114 00:06:04,756 --> 00:06:06,516 Speaker 1: about it than you know, you and I might be 115 00:06:06,556 --> 00:06:09,596 Speaker 1: trying to predict the future. And so we made decisions, 116 00:06:09,596 --> 00:06:11,836 Speaker 1: we said, and by the way, those were scary decisions, 117 00:06:11,836 --> 00:06:14,236 Speaker 1: because if we decided to bring in ten thousand sweatshirts 118 00:06:14,476 --> 00:06:15,916 Speaker 1: and we only sold a hundred, and we would have 119 00:06:15,956 --> 00:06:18,156 Speaker 1: bankrupted the company. Right, You've got to you've got to 120 00:06:18,196 --> 00:06:20,316 Speaker 1: pay for the materials. You've got to pay for the 121 00:06:20,356 --> 00:06:22,476 Speaker 1: materials now, and you don't know if you're going to 122 00:06:22,556 --> 00:06:25,036 Speaker 1: sell a thousand or ten thousand. Yeah, And going through 123 00:06:25,036 --> 00:06:27,596 Speaker 1: our head was in July, it's going to be ninety 124 00:06:27,596 --> 00:06:29,436 Speaker 1: five in New York City, and no one's going to 125 00:06:29,476 --> 00:06:31,476 Speaker 1: be buying a sweatshirt and this article is going to 126 00:06:31,516 --> 00:06:34,956 Speaker 1: be old news. And so just to wrap the story up, 127 00:06:34,996 --> 00:06:37,276 Speaker 1: what happened was that demand kept going. And one of 128 00:06:37,316 --> 00:06:39,036 Speaker 1: the things I think we did in retrospect that was 129 00:06:39,076 --> 00:06:41,636 Speaker 1: smart is we reached out to our customers and and 130 00:06:41,676 --> 00:06:43,116 Speaker 1: we sort of have been this since the beginning. We 131 00:06:43,116 --> 00:06:45,116 Speaker 1: were just very honest with them and we said, look, 132 00:06:45,156 --> 00:06:47,236 Speaker 1: this is what's going on, and this is one of 133 00:06:47,236 --> 00:06:49,796 Speaker 1: the challenges about domestic supply, and this is the situation 134 00:06:49,796 --> 00:06:51,596 Speaker 1: that ran and all of our I mean maybe not 135 00:06:51,636 --> 00:06:53,876 Speaker 1: all of them, they seemed like all of them were 136 00:06:54,156 --> 00:06:57,756 Speaker 1: like cheering us on, saying that is the best. I 137 00:06:57,796 --> 00:06:59,756 Speaker 1: don't worry. As soon as you can. If it's a 138 00:06:59,836 --> 00:07:02,316 Speaker 1: year from now, I don't care. And people sat in 139 00:07:02,476 --> 00:07:05,876 Speaker 1: lists wait lists that lasted for months. And then here's 140 00:07:05,916 --> 00:07:08,476 Speaker 1: the kicker. In June or July of that year, I 141 00:07:08,516 --> 00:07:11,236 Speaker 1: don't remember when, and far How checked back in with 142 00:07:11,316 --> 00:07:13,516 Speaker 1: the business. I don't even know if you talk to 143 00:07:13,556 --> 00:07:15,956 Speaker 1: me about it. But he wrote a follow up article 144 00:07:16,116 --> 00:07:18,676 Speaker 1: that was titled the only problem with the greatest hoodie 145 00:07:18,676 --> 00:07:20,636 Speaker 1: in the World is you have to wait six months 146 00:07:20,636 --> 00:07:23,636 Speaker 1: to get it, And that did it again. It like 147 00:07:23,716 --> 00:07:26,636 Speaker 1: tipped us back into this chaos. And so anyway, we 148 00:07:26,796 --> 00:07:28,996 Speaker 1: were in this rhythm of trying to predict the future, 149 00:07:29,716 --> 00:07:31,836 Speaker 1: probably being conservatives, so we didn't get too far of 150 00:07:31,916 --> 00:07:35,116 Speaker 1: our skis financially, and we were constantly trying to catch 151 00:07:35,156 --> 00:07:37,316 Speaker 1: up with demand without over committing to inventory. And that 152 00:07:37,316 --> 00:07:41,036 Speaker 1: went on for long time and actually outship our capacity 153 00:07:41,036 --> 00:07:42,756 Speaker 1: of our facility that we were making the sweatshirts in 154 00:07:42,796 --> 00:07:45,036 Speaker 1: at that time, which was out here in California. We 155 00:07:45,196 --> 00:07:48,916 Speaker 1: purchased a facility in North Carolina and had to scramble 156 00:07:48,916 --> 00:07:50,196 Speaker 1: to get that up and running. So it was a 157 00:07:50,276 --> 00:07:54,556 Speaker 1: chaotic time, but incredibly grateful for it because I don't 158 00:07:54,556 --> 00:07:56,556 Speaker 1: think we'd be here today without without that, you know, 159 00:07:56,596 --> 00:08:00,396 Speaker 1: that year of insanity and then all the demand that followed. 160 00:08:00,716 --> 00:08:03,956 Speaker 1: And so when you're in that position of being essentially 161 00:08:04,836 --> 00:08:10,436 Speaker 1: having demand massively outstrip your supply, you have some set 162 00:08:10,476 --> 00:08:15,436 Speaker 1: of choices. Don't sell a sweatshirt to everybody who wants one, 163 00:08:15,756 --> 00:08:17,476 Speaker 1: Tell people they're gonna have to wait a long time, 164 00:08:17,996 --> 00:08:21,396 Speaker 1: raise the price would be a classic response to that. 165 00:08:21,556 --> 00:08:24,076 Speaker 1: I mean, which of those do you wind up doing 166 00:08:24,076 --> 00:08:26,156 Speaker 1: over the course of that year or so well, we 167 00:08:26,276 --> 00:08:28,276 Speaker 1: talked about all of them. I'm talking about all of them. 168 00:08:28,276 --> 00:08:29,836 Speaker 1: I mean, yeah, there were people that were saying, like, 169 00:08:30,276 --> 00:08:33,076 Speaker 1: go to China, Like what are you doing? Like go 170 00:08:33,076 --> 00:08:35,316 Speaker 1: go get on the phone and have the switcher made overseas. 171 00:08:35,556 --> 00:08:37,236 Speaker 1: There was every option you could think. I was on 172 00:08:37,276 --> 00:08:39,436 Speaker 1: the table and and but to your question, I think 173 00:08:39,476 --> 00:08:41,356 Speaker 1: we put a couple of stakes in the ground. We haven't. 174 00:08:41,356 --> 00:08:43,436 Speaker 1: We did this with the pandemic too. It's always clarifying 175 00:08:43,476 --> 00:08:45,716 Speaker 1: to me to figure out, what do you what are 176 00:08:45,716 --> 00:08:48,116 Speaker 1: your core principles, what do you believe in One was 177 00:08:48,196 --> 00:08:51,236 Speaker 1: that we were not gonna we won't go sacrifice quality, 178 00:08:51,876 --> 00:08:53,916 Speaker 1: We weren't going to change our philosophy about how we 179 00:08:53,956 --> 00:08:56,476 Speaker 1: made things, and we were gonna be honest with our customers. 180 00:08:56,596 --> 00:08:59,796 Speaker 1: And and that looked like big, big delays. And you know, 181 00:08:59,796 --> 00:09:01,076 Speaker 1: people ask me a lot like co did you do 182 00:09:01,156 --> 00:09:02,796 Speaker 1: that on purpose? And boy, it's great to be backward 183 00:09:02,836 --> 00:09:07,236 Speaker 1: And I'll tell you that um with the business was great. 184 00:09:07,356 --> 00:09:09,596 Speaker 1: But but but having customers have to wait for that long, 185 00:09:09,636 --> 00:09:12,196 Speaker 1: he is asking an awful lot of customers And that 186 00:09:12,316 --> 00:09:15,796 Speaker 1: was not Uh. I wouldn't want to repeat that again, 187 00:09:16,116 --> 00:09:19,756 Speaker 1: but that's the route. And it was just to sell sweatshirt, said, 188 00:09:19,756 --> 00:09:22,076 Speaker 1: you can't swell all the sweatshirts people want. It's got 189 00:09:22,156 --> 00:09:25,316 Speaker 1: to be a very mixed kind of blessing. Well, there's that, 190 00:09:25,356 --> 00:09:27,476 Speaker 1: and there's the there's just the reality of the deep 191 00:09:27,676 --> 00:09:29,316 Speaker 1: sense of trust that a customer puts in you and 192 00:09:29,356 --> 00:09:31,476 Speaker 1: they decided to spend their money on something you make. 193 00:09:31,556 --> 00:09:33,596 Speaker 1: And when you do that and you can't fulfill it 194 00:09:33,596 --> 00:09:34,996 Speaker 1: and you're asking them to wait and it's gonna be 195 00:09:34,996 --> 00:09:36,836 Speaker 1: another month, and this just changed it. Just you don't 196 00:09:36,836 --> 00:09:38,876 Speaker 1: want to be in that situation. So it was a 197 00:09:38,956 --> 00:09:40,436 Speaker 1: it was a it restored a lot of my faith 198 00:09:40,476 --> 00:09:43,036 Speaker 1: in humanity and um and as I said earlier, I 199 00:09:43,036 --> 00:09:44,756 Speaker 1: think we were totally honest about the whole process and 200 00:09:44,796 --> 00:09:46,516 Speaker 1: that helped. But it was a it was a rocky 201 00:09:46,596 --> 00:09:49,076 Speaker 1: couple of years there, for sure. So okay, so that's 202 00:09:49,116 --> 00:09:53,636 Speaker 1: the that's the dramatic beginning. UM I wanted to talk 203 00:09:53,676 --> 00:09:57,036 Speaker 1: about the present now. I would imagine in the long run, 204 00:09:57,916 --> 00:10:03,076 Speaker 1: to make clothes for any significant market in the US, 205 00:10:04,236 --> 00:10:07,196 Speaker 1: you have to do a lot of innovating, right Like 206 00:10:07,236 --> 00:10:09,196 Speaker 1: you have to figure out how to be efficient, how 207 00:10:09,276 --> 00:10:12,196 Speaker 1: to use technology. And so I'm curious what you have 208 00:10:12,356 --> 00:10:14,276 Speaker 1: learned yeah, I mean, I think it just if I 209 00:10:14,356 --> 00:10:16,036 Speaker 1: may just to kind of frame it up a little bit, 210 00:10:16,036 --> 00:10:18,236 Speaker 1: because I think it's important to kind of contextualize it somewhat. 211 00:10:18,236 --> 00:10:21,716 Speaker 1: I think if you, as a framing principle, say we 212 00:10:21,796 --> 00:10:24,476 Speaker 1: are going to make things in the United States, Let's say, 213 00:10:24,516 --> 00:10:26,676 Speaker 1: as a country, you make that decision, we're gonna we're 214 00:10:26,676 --> 00:10:28,596 Speaker 1: gonna make We're gonna be a bit more protectionist in 215 00:10:28,596 --> 00:10:31,876 Speaker 1: our leanings. And I would suggest that company countries like Japan, 216 00:10:32,196 --> 00:10:37,996 Speaker 1: South Korea, Germany, Switzerland have adopted slightly more protectionist policies 217 00:10:38,236 --> 00:10:40,476 Speaker 1: than the United States have, and as a result, they 218 00:10:40,516 --> 00:10:42,276 Speaker 1: have to turn inwards to say, how do we remain 219 00:10:42,316 --> 00:10:44,956 Speaker 1: competitive in a highly competitive world. The United States, on 220 00:10:44,996 --> 00:10:47,916 Speaker 1: the other hand, largest marketplace in the world. The cost 221 00:10:47,956 --> 00:10:50,956 Speaker 1: of entire United States is very very low. We've we've 222 00:10:50,956 --> 00:10:53,636 Speaker 1: made a decision to have trade barriers be very low. 223 00:10:53,796 --> 00:10:56,836 Speaker 1: And the result is is that there's overstating this. To 224 00:10:56,836 --> 00:11:00,636 Speaker 1: make the point, there's less incentive to invest in capabilities 225 00:11:00,636 --> 00:11:03,036 Speaker 1: domestically if there's an alternative right around the corner for 226 00:11:03,036 --> 00:11:06,716 Speaker 1: apparel companies, let's say to say, why don't I go overseas? Sure? Well, 227 00:11:06,756 --> 00:11:09,516 Speaker 1: I mean it's also the case though, if you look 228 00:11:09,556 --> 00:11:13,116 Speaker 1: at Germany or South Korea, basically other rich countries that 229 00:11:13,156 --> 00:11:15,756 Speaker 1: are more protectionists and have manufacturing, they're not making a 230 00:11:15,796 --> 00:11:20,156 Speaker 1: lot of clothes, right like those companies. They're making high 231 00:11:20,196 --> 00:11:24,036 Speaker 1: tech things where you have highly skilled workers using fancy equipment. 232 00:11:24,076 --> 00:11:27,356 Speaker 1: They're using their sort of natural international advantage, right, and 233 00:11:27,396 --> 00:11:31,036 Speaker 1: so clothes seem particularly hard. Tell me how you do it, like, so, 234 00:11:31,036 --> 00:11:33,436 Speaker 1: I'll give you a couple of examples and maybe want 235 00:11:33,436 --> 00:11:35,876 Speaker 1: to go a little bit deeper on. In a typical 236 00:11:36,196 --> 00:11:40,276 Speaker 1: apparel manufacturing facility, what you'll see is what it's called 237 00:11:40,276 --> 00:11:42,876 Speaker 1: batch sewing. So you'll see a line of operators made 238 00:11:42,876 --> 00:11:45,596 Speaker 1: five operators in a line, and they'll be sewing a 239 00:11:45,636 --> 00:11:49,076 Speaker 1: sweatsher and each operator will have a single task. It 240 00:11:49,156 --> 00:11:53,156 Speaker 1: might be Jacob's task to sew a sleeve onto a body, 241 00:11:53,476 --> 00:11:55,516 Speaker 1: it might be mine to attach a hood to a body. 242 00:11:55,556 --> 00:11:57,316 Speaker 1: And the next person's going to attach the zippers, and 243 00:11:57,356 --> 00:11:59,556 Speaker 1: the final person's going to attach the labels. There's a 244 00:11:59,556 --> 00:12:02,156 Speaker 1: bunch of ancillary problems with that. One is is that 245 00:12:02,436 --> 00:12:04,596 Speaker 1: you've got a massive amount of inventory tied up and 246 00:12:05,036 --> 00:12:07,956 Speaker 1: in working process, and so you are you're the amount 247 00:12:07,996 --> 00:12:10,236 Speaker 1: of inventory that's sitting on the floor is huge. You've 248 00:12:10,236 --> 00:12:12,556 Speaker 1: got quality control problems. So let's say Jacob had a 249 00:12:12,556 --> 00:12:14,996 Speaker 1: long land out in the town last night and he's 250 00:12:15,036 --> 00:12:19,116 Speaker 1: attaching sleeves to bodies. He's doing incorrectly. Catching that qualities 251 00:12:19,116 --> 00:12:22,756 Speaker 1: problem oftentimes takes hours, might take the next operator after 252 00:12:22,836 --> 00:12:24,596 Speaker 1: a thousand units have moved down the line to him 253 00:12:24,676 --> 00:12:26,836 Speaker 1: or her where they get caught. So there's a whole 254 00:12:26,836 --> 00:12:29,036 Speaker 1: bunch of things there that are maybe a bit harder 255 00:12:29,076 --> 00:12:31,676 Speaker 1: to see. I call them soft costs or hidden costs. 256 00:12:32,316 --> 00:12:34,596 Speaker 1: And so one response that we've done there is we've 257 00:12:34,636 --> 00:12:37,876 Speaker 1: moved that batch approach to sewing into what we call 258 00:12:37,956 --> 00:12:40,996 Speaker 1: module or sew or bump. So and that is getting 259 00:12:41,036 --> 00:12:44,756 Speaker 1: those same operators. First, they've got to stand up. That's 260 00:12:44,756 --> 00:12:46,676 Speaker 1: a big, big change. To get operators to get out 261 00:12:46,716 --> 00:12:48,916 Speaker 1: of their seats and stand all day, that's a big ask. 262 00:12:49,276 --> 00:12:53,116 Speaker 1: And then have operators to cross trains, so that Jacob 263 00:12:53,156 --> 00:12:55,796 Speaker 1: doesn't only know how to attach sleeves to bodies, but 264 00:12:55,876 --> 00:12:58,516 Speaker 1: he now knows how to attach sippers and hoods and labels. 265 00:12:58,516 --> 00:13:00,596 Speaker 1: He can do every function. One thing that that does 266 00:13:01,396 --> 00:13:05,036 Speaker 1: is it eliminates a vast amount of your working process 267 00:13:05,236 --> 00:13:09,036 Speaker 1: that's a big deal. It implements quality control that every step. 268 00:13:09,396 --> 00:13:11,516 Speaker 1: That's a big deal, so you catch quality cotrol issues 269 00:13:11,516 --> 00:13:13,796 Speaker 1: the minute they happen. The other thing is if you 270 00:13:13,836 --> 00:13:16,916 Speaker 1: are productive as a team, which most of our teams are, 271 00:13:17,356 --> 00:13:20,836 Speaker 1: and you beat your expected output, you get bonused for 272 00:13:20,956 --> 00:13:23,916 Speaker 1: every additional unit you make in a given day. They're 273 00:13:23,956 --> 00:13:26,836 Speaker 1: they're making more money, they're learning more, they're not just 274 00:13:26,876 --> 00:13:29,076 Speaker 1: doing a single operation that's kind of a deadening on 275 00:13:29,076 --> 00:13:31,956 Speaker 1: one thing all day, every day. So that that's an 276 00:13:31,996 --> 00:13:34,916 Speaker 1: example of one of the changes that we've made. The 277 00:13:34,956 --> 00:13:37,276 Speaker 1: reason why you don't see that more in the US 278 00:13:37,436 --> 00:13:40,316 Speaker 1: is that the capital investments big. You've got to you've 279 00:13:40,316 --> 00:13:41,956 Speaker 1: got to invest in the equipment. Number one, the stand 280 00:13:41,996 --> 00:13:44,196 Speaker 1: up couldn't cost a lot of money. Number two, you've 281 00:13:44,196 --> 00:13:46,396 Speaker 1: got to train your operators, cross train all your operators. 282 00:13:46,476 --> 00:13:49,116 Speaker 1: That takes time. So let me ask you this, I mean, 283 00:13:49,716 --> 00:13:53,476 Speaker 1: why couldn't someone at a factory in Asia do that? 284 00:13:53,796 --> 00:13:56,636 Speaker 1: Or could theyre they you could? You could, yeah, and 285 00:13:56,676 --> 00:13:58,796 Speaker 1: you and you do see that sometimes in Asia. The 286 00:13:58,836 --> 00:14:02,436 Speaker 1: paradox is that there isn't a ton of an incentive 287 00:14:02,476 --> 00:14:03,876 Speaker 1: to do it. But you do see it. You see 288 00:14:03,876 --> 00:14:05,996 Speaker 1: it domestically too. You see it in Asia. You see 289 00:14:06,396 --> 00:14:10,356 Speaker 1: some of the some of the facilities in Asia modernizing 290 00:14:10,356 --> 00:14:13,556 Speaker 1: and using TOTA systems. I'm not sure I'm right about this. 291 00:14:13,596 --> 00:14:15,076 Speaker 1: I think there's less of the sentive to do it 292 00:14:15,196 --> 00:14:18,396 Speaker 1: in textiles because you can throw cheap labor at the problem. 293 00:14:18,676 --> 00:14:21,116 Speaker 1: In place like that, there's less of the capital equipment. 294 00:14:21,156 --> 00:14:23,276 Speaker 1: I guess part of what I'm looking for is, like, 295 00:14:23,996 --> 00:14:27,116 Speaker 1: you know, besides sort of branding and price, which are 296 00:14:27,116 --> 00:14:30,756 Speaker 1: clearly important, like what advantages do you get out of 297 00:14:30,796 --> 00:14:33,036 Speaker 1: being in the US, And maybe one of them is, 298 00:14:33,556 --> 00:14:36,596 Speaker 1: you know, more access to capital so that you can 299 00:14:37,596 --> 00:14:41,116 Speaker 1: buy the fancier machines and a more highly skilled perhaps 300 00:14:41,196 --> 00:14:44,116 Speaker 1: workforce that can you know, respond to this innovation. I 301 00:14:44,116 --> 00:14:46,116 Speaker 1: don't know. I think that's I think it's one. I 302 00:14:46,156 --> 00:14:50,396 Speaker 1: think I think the more profound ones are proximity to market, right, So, 303 00:14:50,436 --> 00:14:52,676 Speaker 1: I think I think that you when you're close by 304 00:14:53,236 --> 00:14:56,236 Speaker 1: from a manufacturing standpoint, your ability and my judgment to 305 00:14:56,836 --> 00:14:59,876 Speaker 1: have higher quality control standards, closer relationships with your suppliers 306 00:14:59,956 --> 00:15:02,196 Speaker 1: and is enhanced. So having spent a lot of time 307 00:15:02,196 --> 00:15:04,156 Speaker 1: manufacturing things overseas, I can just tell you when you're 308 00:15:04,796 --> 00:15:07,476 Speaker 1: five time zones away and a language barrier in between. 309 00:15:07,636 --> 00:15:10,076 Speaker 1: It's much harder to on top of quality. I don't 310 00:15:10,076 --> 00:15:12,036 Speaker 1: care what anybody says, it's just hard. You spend a 311 00:15:12,036 --> 00:15:14,076 Speaker 1: lot of time on planes and trying to figure out 312 00:15:14,396 --> 00:15:16,676 Speaker 1: what's going on, and oftentimes you find stuff when you know, 313 00:15:16,756 --> 00:15:18,476 Speaker 1: too late, when it's on a truck or on a boat, 314 00:15:18,516 --> 00:15:21,036 Speaker 1: and you're you know, you've got quality failures on their 315 00:15:21,036 --> 00:15:23,236 Speaker 1: way to you. But look, Jake, the bottom line is 316 00:15:23,356 --> 00:15:25,676 Speaker 1: it costs more money to make stuff. Here's what's sort 317 00:15:25,676 --> 00:15:28,676 Speaker 1: of the frontier now, like on the manufacturing side, Like, 318 00:15:28,716 --> 00:15:31,516 Speaker 1: what's the kind of frontier problem you're trying to solve now? 319 00:15:32,036 --> 00:15:35,156 Speaker 1: So we are working really hard now to take some 320 00:15:35,196 --> 00:15:37,676 Speaker 1: of our learnings and pushing them up stream into our 321 00:15:37,676 --> 00:15:40,156 Speaker 1: fabric providers and our dyers and our finishers and stuff, 322 00:15:40,156 --> 00:15:42,796 Speaker 1: and getting them to work with us in inventory and responsiveness. 323 00:15:43,236 --> 00:15:45,956 Speaker 1: So for example, you know, using working with let's say 324 00:15:45,956 --> 00:15:48,316 Speaker 1: Carolina Cotton Works, one of our key suppliers in Gaffey, 325 00:15:48,316 --> 00:15:51,116 Speaker 1: South Carolina, so that we can when we need another 326 00:15:51,476 --> 00:15:54,396 Speaker 1: six thousand yards, we can let them know, pick them 327 00:15:54,476 --> 00:15:56,076 Speaker 1: up a day or two later, and move them up 328 00:15:56,116 --> 00:15:57,716 Speaker 1: the road by you know, in a few hours and 329 00:15:57,756 --> 00:16:00,956 Speaker 1: be going again and constantly trying to lower work in 330 00:16:01,036 --> 00:16:03,476 Speaker 1: process and increase response times that we can be into 331 00:16:03,516 --> 00:16:05,916 Speaker 1: market much faster. So that is a game of increments. 332 00:16:06,036 --> 00:16:07,756 Speaker 1: That really is a game of increments. And it seems 333 00:16:07,796 --> 00:16:12,756 Speaker 1: like that's sort of abstractly how you get manufacturing clusters, right, 334 00:16:12,836 --> 00:16:14,836 Speaker 1: you have these related businesses. I mean, if you go 335 00:16:14,916 --> 00:16:17,436 Speaker 1: to lots of places in Asia where they make everything, 336 00:16:17,516 --> 00:16:20,116 Speaker 1: there's like a million different companies that do each other 337 00:16:20,156 --> 00:16:21,756 Speaker 1: stage and they all work with each other. I mean 338 00:16:21,756 --> 00:16:24,036 Speaker 1: it seems like that's what you're trying to build at 339 00:16:24,036 --> 00:16:27,676 Speaker 1: a regional level, basically in the southeast US. Yeah. Yeah, 340 00:16:27,796 --> 00:16:29,756 Speaker 1: if you begin to build a let's say a fabric 341 00:16:29,756 --> 00:16:33,356 Speaker 1: supply capability that is supplying American giant quickly high quality, 342 00:16:33,676 --> 00:16:36,596 Speaker 1: they can pivot that and look at a poulstry for furniture. 343 00:16:36,676 --> 00:16:38,996 Speaker 1: They can pivot that and look at a poultry for automobiles. 344 00:16:39,356 --> 00:16:41,636 Speaker 1: And so there is this spidering out that happens, is 345 00:16:41,676 --> 00:16:45,036 Speaker 1: that capability develops. It really does build, to your point 346 00:16:45,116 --> 00:16:47,836 Speaker 1: a network of suppliers and capability regionally. So if you 347 00:16:47,876 --> 00:16:50,756 Speaker 1: look like places like Gaffe, South Carolina or Spartanburg, South Carolina, 348 00:16:50,796 --> 00:16:54,276 Speaker 1: they are becoming manufacturing centers. Gaffney place where we get 349 00:16:54,316 --> 00:16:55,636 Speaker 1: a lot of our yarn out of Gaffey, we get 350 00:16:55,636 --> 00:16:57,476 Speaker 1: a lot of our fabric out of Gaffney. Gaffey has 351 00:16:57,476 --> 00:17:00,356 Speaker 1: got a really vital and vibrant little manufacturing textile industry 352 00:17:00,396 --> 00:17:02,996 Speaker 1: that's growing. And the more people that work there, the 353 00:17:03,276 --> 00:17:05,796 Speaker 1: better they get, the more customers they attract, them where 354 00:17:05,836 --> 00:17:10,196 Speaker 1: they can expand outside of specific industries. So that's absolutely right. 355 00:17:12,396 --> 00:17:14,356 Speaker 1: In a minute, Bayern and I will talk about the 356 00:17:14,396 --> 00:17:17,596 Speaker 1: costs and benefits of free trade. We'll also talk about 357 00:17:17,596 --> 00:17:20,756 Speaker 1: why the cost of his American Giant Classic hoodie went 358 00:17:20,836 --> 00:17:23,836 Speaker 1: from seventy nine dollars to one hundred and thirty eight dollars. 359 00:17:31,636 --> 00:17:34,236 Speaker 1: Now back to the show, I think it's worth talking 360 00:17:34,276 --> 00:17:38,756 Speaker 1: about cost and price for a minute. In that article 361 00:17:38,836 --> 00:17:43,716 Speaker 1: ten years ago, it said your classic hoodie was seventy 362 00:17:43,796 --> 00:17:46,716 Speaker 1: nine dollars, which adjusted for inflation, is right around one 363 00:17:46,756 --> 00:17:50,596 Speaker 1: hundred dollars today. The Classic hoodie costs one hundred and 364 00:17:50,676 --> 00:17:54,836 Speaker 1: thirty eight dollars today, so it's a lot more expensive 365 00:17:54,876 --> 00:17:59,596 Speaker 1: even adjusting for inflation. Tell me about tell me about 366 00:17:59,596 --> 00:18:02,156 Speaker 1: the price, Like, how do you how do you arrive 367 00:18:02,196 --> 00:18:04,636 Speaker 1: at that price? So I think a few things. I 368 00:18:04,676 --> 00:18:08,076 Speaker 1: think for starters, you know, one of the things is, 369 00:18:08,236 --> 00:18:10,316 Speaker 1: as when you start off a company and you have 370 00:18:10,356 --> 00:18:12,556 Speaker 1: an idea you probably can relate to this is that 371 00:18:13,316 --> 00:18:15,996 Speaker 1: you make a product, you pour your soul into it, 372 00:18:16,196 --> 00:18:20,956 Speaker 1: and there's an inherent insecurity about gosh, is it really 373 00:18:20,956 --> 00:18:24,236 Speaker 1: worth what we're investing in this thing? And will customers 374 00:18:24,236 --> 00:18:26,836 Speaker 1: pay for it? And so we had underpriced the garment 375 00:18:26,876 --> 00:18:28,236 Speaker 1: in the beginning, and I think a lot of that 376 00:18:28,276 --> 00:18:30,516 Speaker 1: was frankly just insecurity. In my part, I just feeling like, 377 00:18:31,116 --> 00:18:32,436 Speaker 1: you know, maybe we don't need to make much of 378 00:18:32,436 --> 00:18:34,716 Speaker 1: a margin here, because if we charge, you know, one 379 00:18:34,796 --> 00:18:37,236 Speaker 1: hundred and nine dollars for this thing, will people ever 380 00:18:37,236 --> 00:18:39,316 Speaker 1: pay for that? And I think that was my reference 381 00:18:39,356 --> 00:18:41,636 Speaker 1: about the Slate article in the beginning, about really kind 382 00:18:41,676 --> 00:18:46,236 Speaker 1: of taking me to give me a boost a confidence 383 00:18:46,236 --> 00:18:48,076 Speaker 1: that I feel like you needed. Now. At the same time, 384 00:18:48,916 --> 00:18:51,476 Speaker 1: one of my board members said to me, congratulations, you've 385 00:18:51,516 --> 00:18:53,556 Speaker 1: just sold a bunch of under margin products a bunch 386 00:18:53,556 --> 00:18:56,116 Speaker 1: of people and so and so he was, in a 387 00:18:56,716 --> 00:19:00,076 Speaker 1: not very subtle way saying, you think that you're what 388 00:19:00,116 --> 00:19:03,156 Speaker 1: you're standing for that supporting US jobs and US communities 389 00:19:03,156 --> 00:19:05,836 Speaker 1: and that level of quality is worth something. Prove it 390 00:19:05,916 --> 00:19:08,036 Speaker 1: whether your customers will pay for it. It's a good question, 391 00:19:08,116 --> 00:19:11,516 Speaker 1: good point, good challenge. So that's part of the answer. 392 00:19:11,836 --> 00:19:13,836 Speaker 1: Part of the answer to is that is that over 393 00:19:13,876 --> 00:19:16,916 Speaker 1: the last couple of years, cotton, our inputs have increased 394 00:19:16,916 --> 00:19:19,236 Speaker 1: a lot. Really, two things have increased. The cost of 395 00:19:19,316 --> 00:19:22,316 Speaker 1: cotton got very, very expensive over the last couple of years, 396 00:19:23,116 --> 00:19:25,196 Speaker 1: number one, and the cost of domestic labor got a 397 00:19:25,196 --> 00:19:26,916 Speaker 1: lot of expensive. We couldn't get people to work in 398 00:19:26,916 --> 00:19:30,756 Speaker 1: the supply chain, and so those two inputs drove our 399 00:19:30,876 --> 00:19:34,476 Speaker 1: costs up a ton, and cottons come down a bit, 400 00:19:34,556 --> 00:19:37,596 Speaker 1: labor is not. So it's accombination of all those things. 401 00:19:37,636 --> 00:19:39,716 Speaker 1: And you know, I think my hope is is that 402 00:19:39,916 --> 00:19:42,996 Speaker 1: there's an opportunity to bring that one thirty eight down 403 00:19:43,076 --> 00:19:45,476 Speaker 1: if input costs come back down. But the reality is 404 00:19:45,516 --> 00:19:49,676 Speaker 1: we are you know, we are subject to to things 405 00:19:49,676 --> 00:19:54,276 Speaker 1: like domestic cotton prices. So you mentioned labor costs going up. 406 00:19:54,316 --> 00:19:58,436 Speaker 1: It's obviously been a tight labor market nationally. You know, 407 00:19:58,476 --> 00:20:00,956 Speaker 1: one of the things I was curious about is what 408 00:20:00,956 --> 00:20:04,316 Speaker 1: would it mean for your business if Congress raised the 409 00:20:04,436 --> 00:20:07,596 Speaker 1: national minimum wage to fifteen dollars. My answer to this 410 00:20:07,756 --> 00:20:11,316 Speaker 1: is always it's an incomplete question, because if if what 411 00:20:11,356 --> 00:20:14,316 Speaker 1: you're saying is, should Congress raise them in wage to 412 00:20:14,356 --> 00:20:17,236 Speaker 1: fifteen or twenty dollars an hour, but at the same 413 00:20:17,276 --> 00:20:20,396 Speaker 1: time allow every textile business to avoid those minimum wage 414 00:20:20,476 --> 00:20:23,596 Speaker 1: laws and make stuff in China, All you're doing is 415 00:20:23,596 --> 00:20:25,716 Speaker 1: you're putting out a bunch of people and businesses out 416 00:20:25,716 --> 00:20:28,836 Speaker 1: of business. You're just making it incredibly difficult digging textiles 417 00:20:28,836 --> 00:20:31,476 Speaker 1: to compete. So so would it if the Congress raised 418 00:20:31,516 --> 00:20:33,956 Speaker 1: the minimum wage of fifteen dollars an hour and didn't 419 00:20:34,036 --> 00:20:36,516 Speaker 1: change it, would it would basically put you out of business? 420 00:20:36,636 --> 00:20:37,876 Speaker 1: Is that? What? Is that? What? Now? I don't if 421 00:20:37,916 --> 00:20:39,356 Speaker 1: it puss out business, but it would. It would It 422 00:20:39,356 --> 00:20:41,756 Speaker 1: would increase our input costs, and so we would then 423 00:20:41,796 --> 00:20:43,796 Speaker 1: have to you know, we we can just absorb that right. 424 00:20:43,836 --> 00:20:46,516 Speaker 1: But to answer your questions, simply, if midium waves laws 425 00:20:46,516 --> 00:20:48,276 Speaker 1: go up, our input costs go up, it means that 426 00:20:48,316 --> 00:20:50,036 Speaker 1: we have to pass those costs onto our customers. And 427 00:20:50,076 --> 00:20:52,756 Speaker 1: so do I my favor of mindum ways laws. Absolutely 428 00:20:52,836 --> 00:20:55,156 Speaker 1: do I think that they should get higher. Absolutely. I 429 00:20:55,196 --> 00:20:57,756 Speaker 1: think we should just have trade agreements that reflect that. 430 00:20:57,756 --> 00:20:59,796 Speaker 1: That provides some measure of protection to the men and 431 00:20:59,796 --> 00:21:01,956 Speaker 1: women that are trying to build you know, good working 432 00:21:01,956 --> 00:21:03,916 Speaker 1: class jobs and communities all across the country and not 433 00:21:03,956 --> 00:21:06,676 Speaker 1: get just hammered by competition for places that are not 434 00:21:06,676 --> 00:21:09,916 Speaker 1: compliant with those rules. And so in that universe, we 435 00:21:09,996 --> 00:21:12,316 Speaker 1: have a higher minimum wage in the US and new 436 00:21:12,396 --> 00:21:15,876 Speaker 1: rules that either impose tougher labor standards, say on China, 437 00:21:16,036 --> 00:21:19,156 Speaker 1: or or impose a higher tariff on imports from China. 438 00:21:19,196 --> 00:21:20,996 Speaker 1: And so what we have in the end then is 439 00:21:21,396 --> 00:21:23,916 Speaker 1: more expensive sweatshirts made in the US. Your sweatshirt is 440 00:21:23,916 --> 00:21:27,596 Speaker 1: more expensive, and so are sweatshirts imported from, say China. Yeah. 441 00:21:27,636 --> 00:21:29,676 Speaker 1: So I think forty years ago we said, hey, listen, 442 00:21:29,676 --> 00:21:32,396 Speaker 1: we're gonna trade to everybody. And by doing that, what's 443 00:21:32,396 --> 00:21:34,636 Speaker 1: going to happen is China is going to be dragged 444 00:21:34,636 --> 00:21:36,356 Speaker 1: into the modern world and they're going to be a 445 00:21:36,356 --> 00:21:39,396 Speaker 1: really good partner to us. And in fact what's happened 446 00:21:39,516 --> 00:21:41,516 Speaker 1: is over the last forty years we've had a massive 447 00:21:41,556 --> 00:21:44,876 Speaker 1: transfer of capability and capital to China, and China's become 448 00:21:44,916 --> 00:21:48,516 Speaker 1: a more intractable foe, not the Chinese people, the Chinese government, 449 00:21:48,676 --> 00:21:50,796 Speaker 1: a more intractable float for the faux of ours today 450 00:21:50,836 --> 00:21:52,996 Speaker 1: when they were forty years ago. On the other hand, 451 00:21:53,116 --> 00:21:56,516 Speaker 1: had our trade agreement been based on what I think 452 00:21:56,596 --> 00:21:59,996 Speaker 1: Janet Yellen is referring to as friend shoring, meaning we're 453 00:22:00,316 --> 00:22:03,276 Speaker 1: we're gonna do business with people that share basic values 454 00:22:03,276 --> 00:22:05,796 Speaker 1: with us, things like freedom of the press, freedom of speech, 455 00:22:06,396 --> 00:22:09,756 Speaker 1: rule of law, minimum wage standards. Then you have access 456 00:22:09,796 --> 00:22:11,916 Speaker 1: to the United States marketplace. That would include everyone from 457 00:22:11,956 --> 00:22:14,996 Speaker 1: Israel to France, to Germany, to South Korea to Japan, 458 00:22:15,436 --> 00:22:18,516 Speaker 1: all countries that basically adhere to a set of standards 459 00:22:18,556 --> 00:22:21,956 Speaker 1: that we view as being basically human values. I think 460 00:22:21,996 --> 00:22:24,156 Speaker 1: that is the type of trade agreement where if you 461 00:22:24,196 --> 00:22:26,516 Speaker 1: want to have access to the American marketplace, you've got 462 00:22:26,516 --> 00:22:28,916 Speaker 1: to adhere to a set of standards that would translate 463 00:22:28,996 --> 00:22:33,156 Speaker 1: over time, hopefully into consumers operating a bit more maybe 464 00:22:33,156 --> 00:22:35,876 Speaker 1: European or Japanese or South Korean, where there is a 465 00:22:35,916 --> 00:22:39,036 Speaker 1: bit less consumption, a bit higher emphasis on quality. Things 466 00:22:39,076 --> 00:22:40,876 Speaker 1: cost a bit more, but they last to think a 467 00:22:40,876 --> 00:22:43,276 Speaker 1: bit longer. And if you look at the underlying data 468 00:22:43,316 --> 00:22:46,356 Speaker 1: in the textile worlds, it's discompanying. I mean, you know, 469 00:22:46,356 --> 00:22:48,596 Speaker 1: the average I'll just bore you as statistics for a second. 470 00:22:49,116 --> 00:22:53,116 Speaker 1: The average American family today spends about sixteen hundred dollars 471 00:22:53,156 --> 00:22:56,916 Speaker 1: on apparel and footwear per family. In nineteen eighty, in 472 00:22:56,956 --> 00:23:00,596 Speaker 1: today's dollars, the average American family spent about sixteen hundred 473 00:23:00,596 --> 00:23:04,476 Speaker 1: dollars per family, So that in dollars to dollars has 474 00:23:04,516 --> 00:23:07,916 Speaker 1: not changed much. But in nineteen eighty it represented about 475 00:23:08,156 --> 00:23:11,396 Speaker 1: eighty items. Today it represents about one hundred and eighty 476 00:23:11,396 --> 00:23:16,076 Speaker 1: five items. And the average American family throws away about 477 00:23:16,156 --> 00:23:19,436 Speaker 1: eighty pounds of clothing a year, and so there's been 478 00:23:19,436 --> 00:23:22,716 Speaker 1: a structural shift among the American marketplace towards cheaper stuff 479 00:23:23,156 --> 00:23:26,396 Speaker 1: that we throw away, and I think that's got terrible 480 00:23:26,676 --> 00:23:30,036 Speaker 1: implications for the environment for us as consumers, for our 481 00:23:30,036 --> 00:23:32,796 Speaker 1: ability to provide good jobs to places that need them, 482 00:23:33,196 --> 00:23:35,076 Speaker 1: and so I would advocate for that. I think you 483 00:23:35,076 --> 00:23:36,396 Speaker 1: have to do it over time, and you get through 484 00:23:36,436 --> 00:23:39,396 Speaker 1: it slowly. My preference as a consumer would be to 485 00:23:39,436 --> 00:23:41,276 Speaker 1: be able to buy clothes that are made in the 486 00:23:41,316 --> 00:23:45,836 Speaker 1: developing world ethically, basically right, because I do feel like 487 00:23:47,036 --> 00:23:49,556 Speaker 1: lots of people in the developing world, like more than 488 00:23:49,596 --> 00:23:53,476 Speaker 1: a billion have gotten out of poverty in that forty 489 00:23:53,556 --> 00:23:57,316 Speaker 1: year period because of trade, and that that is basically good, 490 00:23:57,716 --> 00:23:59,916 Speaker 1: and I agree with you that lots of bad things 491 00:23:59,996 --> 00:24:04,436 Speaker 1: have come along with that. And I'm curious, like, are 492 00:24:04,476 --> 00:24:08,316 Speaker 1: there any apparel companies that you think manufacture in the 493 00:24:08,356 --> 00:24:12,556 Speaker 1: developing world and do so in an ethical fashion? It's 494 00:24:12,716 --> 00:24:17,796 Speaker 1: very very hard. Yeah, So I appreciate your your not 495 00:24:17,836 --> 00:24:22,956 Speaker 1: being Yeah, yeah, I appreciate the dream. Yeah. What about Patagonia, 496 00:24:23,076 --> 00:24:25,876 Speaker 1: Like I kind of believe Patagonia, Like, am I right 497 00:24:25,916 --> 00:24:28,916 Speaker 1: to believe Patagonia? I think I think you are right 498 00:24:28,956 --> 00:24:31,996 Speaker 1: to believe Patagonia. But if if you if you read 499 00:24:32,196 --> 00:24:36,796 Speaker 1: what Patagonia says, they recognize that they operate in an 500 00:24:36,836 --> 00:24:38,836 Speaker 1: imperfect manner. I mean they say we try to do 501 00:24:38,956 --> 00:24:41,356 Speaker 1: more more good than harm. And I think inherent in 502 00:24:41,396 --> 00:24:44,716 Speaker 1: that statement is we make things in China, and inherently 503 00:24:44,756 --> 00:24:46,756 Speaker 1: making things in places that are far away means they 504 00:24:46,756 --> 00:24:49,876 Speaker 1: have to sit on container ships for long distances. To me, 505 00:24:50,036 --> 00:24:51,836 Speaker 1: either way, I agree with you. By the way, I 506 00:24:51,876 --> 00:24:54,876 Speaker 1: think trade and capitalism lift people out of poverty. No 507 00:24:54,876 --> 00:24:56,476 Speaker 1: no better way to do it than I'm aware of. 508 00:24:56,876 --> 00:24:59,636 Speaker 1: But I think that we also have to reconcile to 509 00:24:59,676 --> 00:25:02,276 Speaker 1: what extent are we are we comfortable with trading with 510 00:25:02,356 --> 00:25:05,316 Speaker 1: countries that maybe practice things that are you know, our 511 00:25:05,356 --> 00:25:07,876 Speaker 1: human rights violations or that environmental violations. Do we care? 512 00:25:08,276 --> 00:25:09,916 Speaker 1: And if we care, what do we do about it? 513 00:25:09,956 --> 00:25:11,836 Speaker 1: And I would suggest that what you do about it 514 00:25:11,876 --> 00:25:15,116 Speaker 1: is that you make trade deals with countries that that 515 00:25:15,276 --> 00:25:19,036 Speaker 1: respect basic standards of behavior. Those would include, for me, 516 00:25:19,996 --> 00:25:24,676 Speaker 1: democratic elections, free and fair, freedom of speech, free, free 517 00:25:24,756 --> 00:25:28,716 Speaker 1: a good and functioning judicial process, and they're Unfortunately we 518 00:25:28,916 --> 00:25:31,196 Speaker 1: trade with a bunch of countries that don't. Don't Are 519 00:25:31,316 --> 00:25:34,356 Speaker 1: there countries in the developing world that meet those standards? 520 00:25:34,796 --> 00:25:36,836 Speaker 1: For you? Yeah, I think a lot of countries in 521 00:25:36,836 --> 00:25:40,916 Speaker 1: our hemisphere. By the way, Mexico are much better, Yes, 522 00:25:41,156 --> 00:25:44,316 Speaker 1: much better, hunt us El Salvador, Mexico. There's a lot 523 00:25:44,316 --> 00:25:48,436 Speaker 1: of good and that that that reshowing to this hemisphere 524 00:25:48,516 --> 00:25:51,036 Speaker 1: is happening quite quickly, and that is a very good thing. 525 00:25:51,036 --> 00:25:53,716 Speaker 1: It's environmentally good, doesn't have to travel so far, doesn't 526 00:25:53,756 --> 00:25:56,596 Speaker 1: to go on containerships forever. And those countries by and 527 00:25:56,676 --> 00:26:01,636 Speaker 1: large are genuinely trying to have good institutional functional norms 528 00:26:01,636 --> 00:26:04,596 Speaker 1: that we can so yes, absolutely there are yep and 529 00:26:04,436 --> 00:26:06,556 Speaker 1: I and just to be clear, I think the one 530 00:26:06,636 --> 00:26:08,876 Speaker 1: end of the spectrum is a you know, total protectionist 531 00:26:08,916 --> 00:26:10,876 Speaker 1: that that doesn't work for anybody. I just think we 532 00:26:10,916 --> 00:26:12,916 Speaker 1: have to ask some questions about what should be in 533 00:26:12,956 --> 00:26:15,916 Speaker 1: our trade agreements, and how do we think about domestic capability. 534 00:26:15,956 --> 00:26:18,356 Speaker 1: And you know, I think the counter to your argument 535 00:26:18,396 --> 00:26:21,156 Speaker 1: about I would love to have textiles in a developing world, 536 00:26:21,196 --> 00:26:23,156 Speaker 1: me too, But I also want to have good vibrant 537 00:26:23,236 --> 00:26:25,476 Speaker 1: jobs for people. You come from my supply chain. Some time, 538 00:26:25,516 --> 00:26:27,396 Speaker 1: go to some of these rural communities in the Southeast, 539 00:26:27,396 --> 00:26:29,756 Speaker 1: and you know, you see lots and lots of towns 540 00:26:29,796 --> 00:26:33,076 Speaker 1: that have no jobs. And that's a that is a 541 00:26:33,116 --> 00:26:35,836 Speaker 1: tough thing to reconcile too. That you know, we've we've 542 00:26:35,876 --> 00:26:37,956 Speaker 1: got a responsibility there as well, that we've got to 543 00:26:37,956 --> 00:26:40,156 Speaker 1: figure out ways for young men and women, maybe they 544 00:26:40,236 --> 00:26:42,236 Speaker 1: only have high school degrees, that are looking for jobs 545 00:26:42,236 --> 00:26:44,356 Speaker 1: to help, you know, help chip in, help pay their way. 546 00:26:44,716 --> 00:26:47,596 Speaker 1: We've got to prove I think we've got to provide good, viable, 547 00:26:47,636 --> 00:26:50,676 Speaker 1: dignify jobs to those people's safe jobs, jobs where they 548 00:26:50,676 --> 00:26:54,796 Speaker 1: can move up. And I think it is a shame 549 00:26:55,196 --> 00:26:57,876 Speaker 1: that we let our biggest companies ignore that. And I 550 00:26:57,876 --> 00:26:59,836 Speaker 1: think they are ignoring that. I think they're they're they're 551 00:26:59,916 --> 00:27:02,036 Speaker 1: choosing a cheaper way that is, we're turning a huge 552 00:27:02,036 --> 00:27:04,556 Speaker 1: amount of value to their shareholders, and they're not wrestling 553 00:27:04,596 --> 00:27:06,756 Speaker 1: with a lot of the things that I think societally 554 00:27:06,796 --> 00:27:11,036 Speaker 1: we need them to be wrestling with. Right now, we'll 555 00:27:11,076 --> 00:27:22,396 Speaker 1: be back in a minute with the lightning round. Now 556 00:27:22,396 --> 00:27:25,716 Speaker 1: it's time for the lightning round. Let's close with the 557 00:27:25,796 --> 00:27:29,076 Speaker 1: lightning round. Just a bunch of questions somewhat lighter in 558 00:27:29,196 --> 00:27:31,876 Speaker 1: tone than this conversation we've been having. Are you ready 559 00:27:31,956 --> 00:27:35,716 Speaker 1: to pivot to the lightning round? Ready? So? I know 560 00:27:35,796 --> 00:27:38,516 Speaker 1: you used to work at a snowshoe company, and I'm 561 00:27:38,516 --> 00:27:41,436 Speaker 1: a big fan of skiing and cross country skiing and sledding, 562 00:27:41,756 --> 00:27:45,116 Speaker 1: but I never really got into snowshoeing. Can you like 563 00:27:45,276 --> 00:27:49,356 Speaker 1: briefly sell me on snowshoeing. Oh that's an easy one, Jacob. Yeah, 564 00:27:49,476 --> 00:27:52,556 Speaker 1: snowshoeing is it requires? If you can walk, you can snowshoe, 565 00:27:52,676 --> 00:27:56,076 Speaker 1: no lift ticket required. There's nothing quite as magical as 566 00:27:56,516 --> 00:27:57,996 Speaker 1: parking on the side of a road and putting on 567 00:27:58,036 --> 00:28:00,876 Speaker 1: a pair of snowshoes and walking really twenty yards into 568 00:28:00,876 --> 00:28:04,036 Speaker 1: a snowy forest and suddenly it is silent and you 569 00:28:04,076 --> 00:28:09,556 Speaker 1: are immersed in wilderness and quietude. Unlike anything you look experience, 570 00:28:09,556 --> 00:28:11,716 Speaker 1: and so I think you can do it with families, 571 00:28:11,756 --> 00:28:14,116 Speaker 1: young people, old people. You don't need to pay to 572 00:28:14,156 --> 00:28:16,156 Speaker 1: do it. I just think it's magical. I think it's 573 00:28:16,196 --> 00:28:18,956 Speaker 1: magical and it's a it's a great fun activity for 574 00:28:18,996 --> 00:28:21,076 Speaker 1: the whole family. If you were going to start another 575 00:28:21,116 --> 00:28:25,036 Speaker 1: company that didn't make clothes, what would you do? Uh? 576 00:28:25,076 --> 00:28:27,196 Speaker 1: I love to make pizza, So I want to start 577 00:28:27,196 --> 00:28:29,716 Speaker 1: a pizzaia in some beautiful spot. What. I don't care 578 00:28:29,756 --> 00:28:32,556 Speaker 1: about making money anymore. That's your dream and that's your escape. 579 00:28:32,716 --> 00:28:36,796 Speaker 1: Your escape fantasy has moved to Napa. I don't think 580 00:28:36,836 --> 00:28:38,556 Speaker 1: it's Napa. I don't think it's the North. I think 581 00:28:38,596 --> 00:28:43,196 Speaker 1: it's getting back home. Yeah. Well, last question, Uh, what's 582 00:28:43,356 --> 00:28:45,676 Speaker 1: one piece of advice you'd give to someone trying to 583 00:28:45,676 --> 00:28:49,516 Speaker 1: solve a hard problem? I don't give up. I really 584 00:28:49,556 --> 00:28:52,716 Speaker 1: think that the mistake that that that entrepreneurs make a 585 00:28:52,716 --> 00:28:56,196 Speaker 1: lot is that they don't keep their legs pumping against 586 00:28:56,196 --> 00:28:58,876 Speaker 1: the blocking sled. I think that you know, eventually things 587 00:28:58,876 --> 00:29:00,876 Speaker 1: start to break your way. It's not always the case, 588 00:29:00,956 --> 00:29:02,956 Speaker 1: but I think I have found that when I'm at 589 00:29:03,036 --> 00:29:05,036 Speaker 1: my most tenacious and I hang in there, the longest 590 00:29:05,476 --> 00:29:07,836 Speaker 1: things break you away eventually good. I got one more. 591 00:29:08,596 --> 00:29:10,636 Speaker 1: What's it? What's a tip to what's a tip to 592 00:29:10,796 --> 00:29:14,356 Speaker 1: make clothes last longer once you've bought something like, I 593 00:29:14,476 --> 00:29:17,356 Speaker 1: like my clothes to last a long time. I don't 594 00:29:17,436 --> 00:29:20,476 Speaker 1: like getting buy good stuff by good stuff, I know. 595 00:29:20,596 --> 00:29:22,676 Speaker 1: But once I've bought good stuff, what do I do? 596 00:29:22,916 --> 00:29:26,196 Speaker 1: Buy good stuff? Were wash them less? Huh? I mean, 597 00:29:26,196 --> 00:29:27,396 Speaker 1: I don't know if you got kids or not. I 598 00:29:27,436 --> 00:29:29,876 Speaker 1: got kids. You know, they will wear a sweatshirt and 599 00:29:29,876 --> 00:29:31,876 Speaker 1: it's in the it's in the laundry pile. It's like, no, no, no, 600 00:29:32,356 --> 00:29:35,596 Speaker 1: that that sweatshirt does not need unless you pitch your 601 00:29:35,636 --> 00:29:38,956 Speaker 1: spaghetti on it. If the pitch that's my advice. Ask 602 00:29:38,996 --> 00:29:40,636 Speaker 1: me a question again, And the next time I masted, 603 00:29:40,676 --> 00:29:43,596 Speaker 1: I'll say, sniff the pits. Don't wash you need to? Yeah, 604 00:29:43,756 --> 00:29:46,036 Speaker 1: buy good stuff and and wash them. Don't wash them 605 00:29:46,036 --> 00:29:47,876 Speaker 1: that often. That that I don't make your clothes last 606 00:29:47,916 --> 00:29:50,316 Speaker 1: a lot longer. I try and hang dry my stuff. 607 00:29:50,316 --> 00:29:53,516 Speaker 1: Am I fooling myself that that helps? No? No, no, no, no, 608 00:29:53,556 --> 00:29:55,916 Speaker 1: that's right. I mean that's right. I mean you put 609 00:29:56,036 --> 00:29:58,996 Speaker 1: you put fabric, you have cotton, You have cotton to 610 00:29:58,996 --> 00:30:01,956 Speaker 1: be caught in garments and and synthetics. You know, they 611 00:30:02,036 --> 00:30:04,396 Speaker 1: are under high heat. Not it's not great for them 612 00:30:04,396 --> 00:30:05,956 Speaker 1: and they get banged around a lot. So yeah, hang, 613 00:30:06,036 --> 00:30:08,476 Speaker 1: drawing is great, Okay, yeah, but just wash them less 614 00:30:08,476 --> 00:30:09,956 Speaker 1: and you'll be doing a good for the environment while 615 00:30:09,956 --> 00:30:17,876 Speaker 1: you're at it. Byard Winthrop is the founder and CEO 616 00:30:17,996 --> 00:30:22,476 Speaker 1: of American Giant. Today's show was produced by Edith Ruslow, 617 00:30:22,676 --> 00:30:26,236 Speaker 1: edited by Robert Smith, and engineered by Amanda k. Long. 618 00:30:27,116 --> 00:30:29,356 Speaker 1: I'd love to get your suggestions for who else I 619 00:30:29,396 --> 00:30:32,076 Speaker 1: should talk to for the show. You can email us 620 00:30:32,156 --> 00:30:35,516 Speaker 1: at Problem at Pushkin dot fm, or you can find 621 00:30:35,516 --> 00:30:39,196 Speaker 1: me at Twitter at Jacob Goldstein. I am Jacob Goldstein 622 00:30:39,276 --> 00:30:41,876 Speaker 1: and we will be back next week with another episode 623 00:30:41,876 --> 00:30:48,596 Speaker 1: of What's Your Problem.