Immigration Reform Is a Good Look for This Apparel GiantBy
The U.S. Senate overwhelmingly approved a $46 billion plan Wednesday to tighten security on the Mexican border. The legislative step is big news for defense companies that make Blackhawk helicopters and handheld surveillance devices. But it may also be a boon for VF Corp., best known for its Timberland boots and North Face parkas. The Greensboro (N.C.) company makes most of the uniforms for Uncle Sam’s customs agents.
The latest version of the Senate bill—widely expected to pass in the chamber but facing strong opposition in the House—would double U.S. border patrol officers to almost 40,000 in 10 years. That kind of surge could mean tens of millions in annual revenue dollars for VF. In the past five years, the company has collected $254 million in sales from U.S. Customs and Border Patrol, according to contract data compiled by Bloomberg Industries. In that time, VF has harvested an additional $128 million stitching uniforms for other government workers, including airport security screeners and National Park rangers.
The uniform business isn’t trendy. It’s not fast fashion and certainly not high fashion. But it is safe fashion: a dependable revenue stream, even if it doesn’t offer the profit margins of high-tech outdoor gear or VF’s Vans sneakers. The challenge will be holding on to the federal-uniform business. VF’s longstanding contract with the Department of Homeland Security expired last year, and the company is currently operating under an extension that runs out in December. VF faces potential competition from other companies that make federal uniforms, including American Apparel, a Los Angeles maker of casual wear; Federal Prison Industries, a privately owned company that uses inmates to make clothes; and Source for Native American Products, a private company based in Maine.