Socio-Economic Review Advance Access originally published online on October 18, 2005
Socio-Economic Review 2006 4(1):35-67; doi:10.1093/SER/mwj030
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Domestic capabilities and global production networks in the clothing industry: a comparison of German and UK firms' strategies
1 Faculty of Social and Political Sciences, University of Cambridge, Cambridge CB2 3RQ, UK and 2 Centre for Business Research, University of Cambridge, Cambridge CB2 1AG, UK
Correspondence: Christel Lane, Faculty of Social and Political Sciences, University of Cambridge, New Museums Site, Cambridge CB2 3RQ, UK. E-mail: col21{at}cam.ac.uk
In this paper we examine the sourcing strategies of clothing firms in the developed economies of the UK and Germany in the context of their national institutional framework. We argue that, as a result of their embeddedness in divergent national structures, these firms pursue different sourcing strategies and make different locational choices. We place particular emphasis on the different mix of arms' length and relational contracting that firms develop, and on the divergent degree of control over the manufacturing process and the product that they retain. We suggest that the construction of global production networks and control over supplier firms is mediated by co-ordinating firms' product strategy and the degree of dependence on national retailers this engenders. UK and German firms and their networks differ not only from each other but also from the US case which is often taken as representative of the industry.
Key Words: clothing industry • global production networks • capabilities • JEL classification: L14, L23, L67