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Saturday, October 27, 2007

Victoria Beckham collection halts Canadian production

Victoria Beckham's jean collection will see its Canadian production come to an end early next year as the high Canadian dollar and a shortage of qualified workers convinced the manufacturer to venture overseas. Production of dVb jeans, designed by Victoria Beckham as part of the David Victoria Beckham empire, is being relocated to lower-cost offshore facilities, a decision that will cost about 100 Canadian jobs.

"It was a combination of the (Canadian) dollar and staffing issues, but the dollar was the straw that broke the back," said Bob Silver, president of Western Glove Works, a closely held company based in Winnipeg, Manitoba.

Since reaching parity with the greenback last month, for the first time since 1976, the Canadian dollar has extended its gains and was worth about US$1.02 on Monday.

"The economics were difficult when the (Canadian) dollar was at 80 (U.S.) cents, when the dollar is at par it's almost impossible."

Relocating the Beckham line of jeans to lower-cost offshore factories represents the last 5 percent of Western Glove's production in Canada, and it points to difficulties faced by other domestic manufacturers dealing with the soaring currency.

The bulk of sales at Western Glove, whose brands also include Silver and 1921, are made outside of Canada, so a lofty Canadian dollar makes the products more expensive to foreign buyers.

The Victoria Beckham line of jeans retail for anywhere between C$250 ($255) and C$300.
"We have been steadily moving our production offshore over the last 10 years," said Silver. "I had thought that we could maintain a small facility in Canada for an extended period of time but that's just not possible."

Victoria Beckham collection halts Canadian production


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