A

t first glance, Camuy, Puerto Rico, might seem an unlikely locale for a company owned by the Alaskan Inupiaq tribe to establish a major manufacturing operation. After all, it's a long way from the Arctic Circle to the northwest coast of the Caribbean island. But when you dig beneath the surface of this new apparel manufacturing operation, Cazador Apparel, it all makes perfect sense.
   NANA, formerly known as the Northwest Arctic Native Association, is one of a dozen Alaskan native-owned regional corporations created by the 1971 Alaska Native Claims Settlement Act, a measure intended to resolve long-standing aboriginal land claims in Alaska. NANA has operated a variety of businesses through the years, but Cazador is its first investment in manufacturing.
   Puerto Rico had a long history as an apparel manufacturing center until manufacturers began moving to low-wage countries in the early 1990s. The exodus left the island with plenty of empty plants and a significant, qualified work force for apparel manufacturing.
   NANA hired Mike Barnes of Portland, Ore., as president of Cazador and assigned him the task of developing the operation in Puerto Rico. The company is taking advantage of the Berry Amendment, which requires the U.S. Department of Defense (DOD) to buy certain products deemed essential to military readiness, including textiles and apparel, from manufacturers using 100 percent U.S. content and labor. Products made in Puerto Rico, a U.S. commonwealth, qualify. Cazador moved into a 76,000-sq.-ft. (7,060-sq.-m.) facility formerly part of a huge complex operated by Hanes.
   "Our customer focus is the U.S. military or government contracts through the Department of Defense, the Defense Logistics Agency and the Defense Supply Center Philadelphia," Barnes says. "We can make anything that's a sewn product, and that includes uniforms, duffel bags, backpacks, body armor, tarps, tents, you name it."
   Barnes says there are plenty of qualified workers in the region — with about 11,000 within an hour's drive of Camuy — who used to work in the apparel industry. Cazador, currently manufacturing white dress shirts for the Coast Guard and a military coverall, employs about 100, but has ambitious plans to boost that total to 500 within the next 18 months. The company has invested about US$4 million, mostly in manufacturing equipment. Cazador has bid on a number of other military contracts and Barnes expects business to develop rapidly.
   Eagle Industries opened its Puerto Rico operation in Lares last May. The company, which supplies bags, pouches and vest systems to the U.S. military, has ramped up more quickly than initial estimates and employs about 170, with plans to employ 400 within the next year. The 65,000-sq.-ft. (6,000-sq.-m.) plant in Lares was formerly used by Coach to produce leather products.
   "Puerto Rico had the best available skilled work force and their government wanted to work with us," says Scott Carver, Eagle's vice president, operations. "We looked at expanding in St. Louis [where the company maintains its primary plant], but we would have had to train people from the ground up. We were able to get a building at a very reasonable cost in a town where Coach had employed 600 people, and they all had skills similar to what we needed."

   The U.S. DOD purchased more than 8,000 different types of textile and apparel items during its 2005 fiscal year at a cost of more than $2.5 billion, according to the National Textile Association. Puerto Rico's share of that pie figures to grow: Seven U.S. companies set up shop in 2005 and more will likely do so this year.
   "We've been able to pair up four companies with municipalities that encountered apparel industry layoffs," says Boris Jaskille, chief promotion officer for the Puerto Rico Industrial Development Co. (PRIDCO). One unique case is Winston-Salem Industries for the Blind, the largest employer of the blind in North Carolina, which is locating in a former Timberland Co. facility in Isabella. The site was attractive because it's near one of Puerto Rico's schools for the blind.
   Jaskille says as of January 2005, Puerto Rico has 17 firms, employing a total of 4,500, supplying the U.S. military with apparel and other sewn products. That's nearly half of the island's approximately 10,000 apparel workers. That figure is about one-third of the industry's peak in 1990, he says.