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Liz Claiborne Will Use Outside Firm For Global Sourcing

Liz Claiborne, whose brands include Mexx, Juicy Couture and Kate Spade, is turning over its global sourcing to Hong Kong-based Li & Fung, which already handles supply chain management for brands including American Eagle, Tommy Hilfiger, and Kohl's, Jonathan Birchall reports.

"I do think this will be seen as a bellwether, because we were the first ones out, and we stood by a model of owning and managing the sourcing on our own," says Bill McComb, CEO of Liz Claiborne. He characterizes the change to underlying shifts in the global supply chain since the end of the old GATT trade system, under which large companies developed direct sourcing to leverage the scale of their orders to secure the best manufacturing capacity in countries with available quota.

McComb says the shift also reflected shifts in Liz Claiborne's own structure, and gives the company's recently decentralized brand management greater flexibility within a variable, rather than a fixed, cost structure.

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