Textiles magnate predicts UK resurgence Few people have devoted as much time and effort to building up the UK textile industry, and then lamenting over its decline, as Lord Alliance of Manchester. The Iran-born businessman presided over the growth of Coats Viyella, at one time one of the world's biggest textile companies, only to see it gradually founder and be taken private in 2003 at a fraction of its previous value. But now the 80-year-old peer, who came to Britain at the age of 17 with only £14 in savings and built up a company that once had 65,000 employees, is trying to put in train what some might see as an improbable rebirth. Due to UK retailers" growing need for more responsive suppliers to help them react quicker to fashion trends, Lord Alliance believes the massive trend over the past 20 years towards "offshoring" of UK textiles production can be put into reverse. "I question whether the likes of Marks and Spencer can keep going as successful companies without switching over to a considerable amount of UK-based sourcing," says Lord Alliance in an interview with the Financial Times at an ornate townhouse in the St James's district of London that serves as his business headquarters. However, the one-time textiles magnate, who grew up in the central Iranian city of Kashan, famed for carpet manufacturing and trading, will have to work hard to engender a significant revival in the UK. Due to emergence of low-cost manufacturing in what are now the world's big textile centres of China, the Indian subcontinent and other parts of Asia, the numbers employed in UK textiles production has slumped to about 100,000, compared with eight times this number in 1980. The industry's annual output in the UK has fallen to about £8bn last year, of which only a small amount is for clothing, with the lion's share consisting of high-tech industrial textiles for specialised uses in sectors such as building. Studies by the Trigon Diligence consultancy, however, underline how recent economic changes have brought the costs to retailers of buying some types of clothes in the UK - especially those with a strong fashion element - more in line with those produced in Asia. This shift is being driven by substantial wage increases in China and other similar countries, higher transportation costs and more sophisticated machinery that has dramatically reduced the labour content of some parts of clothing production. US backing for "made in Britain" One of the strongest backers of a "made in Britain" approach to textiles is Joe Dixon, vice-president of production at Brooks Brothers, the upmarket US clothing chain. Mr Dixon, an Englishman whose previous jobs have included working for Marks and Spencer, says a lot of UK-based clothing and fabric manufacturers "offer great value" to a business such as Brooks Brothers. "They [many UK clothing producers] have a good story to tell," says Mr Dixon. They offer great designs and quality. If they can get their act together they will have plenty of expansion possibilities. Among the clothing producers that Brooks Brothers buys from in the UK are Johnstons of Elgin, a leading maker of cashmere garments, and Lovat Mill, a tweed weaving specialist. It also buys specialist silk fabric - which it turns into ties in a plant on Long Island, New York - from Stephen Walters and Vanners, two Suffolk-based weaving businesses. Out of expected sales for Brooks Brothers this year of about $1bn - through stores scattered globally though mainly in the US - about a quarter will be derived from garments or materials produced in the US and a further 7 per cent from the UK. The British figure could easily expand over the next few years, Mr Dixon says, especially if new textiles businesses start up or existing companies increase production - especially of goods with a strong fashion element. "There's a sense of authenticity about much of UK textiles that a lot of the people who come to our stories appear to like," he says. Added to this is a growing realisation by retailers that by building into their business plans long and complex supply chains that are difficult to control, they are missing out on the opportunity to bring into shops new and fresh designs that are difficult to order unless from a domestically-based factory. "There are a lot of hidden costs [to offshoring] that retailers are only now noticing," says Lord Alliance. The peer's most substantial direct connection with textiles is through N Brown, the mail-order clothing specialist, where the peer remains the biggest shareholder, having stepped down as chairman in September after 44 years. At the behest of Lord Alliance, N Brown has begun an effort to identify new clothing suppliers based in the UK to supplement the company's main Asian sources. Paul Short, business development director at JD Williams, N Brown's trading arm, says he has found "about 10" promising UK suppliers capable of meeting the company's requirements. From a standing start early last year when the company's UK sourcing amounted to zero, about 1 per cent of N Brown's expected sales of some £750m year is likely to come from British factories, Mr Short says. "In five years" time we might be able to push this to 5 per cent." The experiences of clothing chain River Island - likely this year to have a similar level of (UK) sales as N Brown - are a little more positive for those backing Lord Alliance's thinking. This year about 10 per cent of River Island's revenues are expected to come from UK sourcing, with the amount of purchasing from domestic factories having increased by half in the past year. We've found that we can respond to fashion trends much more quickly by having a strong element of British sourcing. Also a lot of our customers like the "feel-good" element to having UK-made products in the stores," says Josie Roscop, River Island's head of marketing. Dilip Patel, managing director of Jack Masters, a Leicester-based clothing manufacturer that is one of River Island's suppliers, says he can envisage "expansion opportunities" on the back of a "change of attitude" by UK retailers. Sir Paul Smith, the clothes designer and main owner of the eponymous fashion chain employing 970 people and with sales last year of £378m, says it has "only a small amount" of its production based in the UK. "I'd love to increase the figure," says Sir Paul. But it will be a hard job to replace the lost production [capacity] and I can't see this being a quick fix.