Outsourcing is a business transaction. But sometimes outsourcing gets personal. When natural disaster strikes, sometimes the best aid comes from a long-term outsourcing partner.
Many times it's the outsourcing service provider who steps in to help out. (See these Outsourcing Excellence Awards winner stories: ACS and State of Lousianna, Vincent Catholic Medical Centers and Computer Sciences Corporation, and Eclipsys Corporation and Springhill Medical Center) In this case, it was the buyer who went the extra mile.
Palm Apparel in Carrefour, Haiti, opened its doors in 1998. The T-shirt manufacturer, which employs 1,500 people, works strictly for Gildan, a Montreal, Canada company. They signed their first outsourcing contract in 2002.
Gildan supplies activewear for the global screenprint market from the United States to Asia Pacific. It sells T-shirts, sport shirts, and fleece in large quantities to wholesale distributors as undecorated blanks, which screen printers then decorate with designs and logos. Consumers ultimately purchase Gildan's products in venues such as sports, entertainment, corporate events, and travel and tourism destinations.
This is an international outsourcing arrangement. The Canadian company has a textile mill in the Dominican Republic (DR). It sends the majority of the fabric it produces in the DR to outsourcing suppliers in Haiti like Palm for sewing. Palm sews T-shirts all year long and sends the completed products to Gildan's warehouses.
The supplier sends help
On January 12, 2010 a devastating earthquake hit Haiti. Sixty percent of Palm's main manufacturing building collapsed. Two hundred workers are still unaccounted for. "We feel they may have died during the earthquake at Palm," according to Alain Villard, President and General Director, Palm Apparel.
Gildan jumped into action. Forty-eight hours later, executives rented a helicopter to survey the damage. They sent containers with 25,000 boxes of food for Gildan and Palm employees in Haiti; one box will feed a family for up to five days. They sent tents for temporary housing, medicine, baby clothes, and flashlights with batteries.
They helped financially, too. They made a $50,000 donation to the Canadian Red Cross, reports Peter Iliopoulous, Vice President responsible for government affairs at Gildan. Then the leadership team formed the Gildan Haiti Relief and Reconstruction Fund to help employees of both companies who died or were hurt in the earthquake. To date, the fund has collected $417,000, donations from Gildan employees and the company itself. Gildan has a management office of approximately 40 employees in Haiti.
Gildan "is committed to maintaining a strategic presence in Haiti" because of its mills in the Dominican Republic, the Haitian trade preference programs for duty-free goods sent to the United States, and the close proximity of Haiti to its customer base. "We produce 15 million shirts a year there," Iliopoulous reports.
Palm held a mass on February 12 to honor the dead And Gildan executives attended. Palm started work again on February 15 and continues to operate with just 450 workers in the 40 percent of the plant that still remains. The manufacturer was able to send the remainder of its work to a sister factory an hour away.
Gildan also advanced working capital to Palm so it could rebuild its factories and replace or repair damaged equipment.
Villard says Gildan's generosity is helping more than just the service provider. He says there are currently 28 textile factories employing 30,000 workers in Haiti. The executive adds one factory job translates into four jobs in the area, like the cook who provides the midday meal. "Their generosity is good for the country and the people of Haiti. It is our responsibility to build bigger and better in this area where people need jobs badly," he says.
Lessons from the Outsourcing Journal:
- In good outsourcing relationships, one partner will go the extra mile to help the other in a time of crisis.
- When an outsourcing partner helps another and creates good will, the effort often helps the entire offshore location get back on its feet.