Our revenue growth in India is likely to outpace that in other markets
Renfro Corporation, one of the world's largest producers of socks, recently landed a deal with Walmart that anticipates creating about 440 jobs at Renfro's manufacturing facility in Fort Payne, Alabama, as part of Walmart's January 2013 US Manufacturing Commitment to buy an additional $250 billion of US products supporting American jobs over 10 years. Renfro Corporation is a long time manufacturer of socks for Walmart under brands such as Fruit of the Loom, Russell, Dr Scholl's, Faded Glory, among others. With changes in energy costs and labour costs overseas, it is increasingly cost-effective and efficient to manufacture closest to the point of consumption, helping Walmart respond to trends and customer demand. Subir Ghosh spoke to senior officials from Renfro about the significance of the deal, especially keeping global trends and processes in mind.
Please tell us more about this new deal with Walmart. After all, if I am not wrong, Renfro has been selling socks to Walmart since the 1970s.
Yes, we have sold Walmart since the 1970s and have grown with them. We provide Walmart a variety of products, both branded and private label, across all departments, all genders. We have participated in Walmart's US Manufacturing Initiative since its inception several years ago. Renfro was one of the first companies to join this effort with Walmart. This latest expansion is the result of our bringing to Walmart better product, better presentation made in the US. Walmart recognised the value in this latest proposal. We believe it met Walmart's strategic goals.
Renfro has had partnerships with retailers and suppliers like Walmart, Macy's, etc. Are you still going to rely heavily on partnerships?
Part of our strategy and part of our culture is to maintain key partnerships. Relationships matter. Long-term partnerships matter, and they are a necessary component for success. We have customer relationships that have existed since the 1920s. We have supplier and brand partnerships that have existed for many decades. Trust can take a long time to earn. It is meaningful and valuable, and we recognise how important it is to our success.
Athletic socks have been dominating the socks market for a while. Do you expect this trend to continue? Or do you also see other legwear categories expanding at a relatively faster rate in the near future?
Athletic socks will continue to comprise a significant portion of the market. But consumers have many broadening preferences related to usage occasion, lifestyle and fashion. Consumer preferences continue to represent greater variety in construction, fibre, design and colour.
Renfro Corporation has had a manufacturing facility in Fort Payne since the 1980s. Could you tell us more about the ups and downs with the manufacturing facility there?
The Fort Payne factory has existed since the 1980s. Over time, its capabilities have been enhanced, and it has been further automated to improve quality and to lower costs. Its capacity has increased.
Fort Payne itself was once known as the Sock Capital of the World, but over time the title seemed to have lost its significance. How do you react to that?
The closing of most of the other sock manufacturers in Fort Payne is unfortunate for that community. We chose a different path for our factory there, and have been able to identify and to manufacture products there that fits the factory's evolving capabilities and that can be done competitively with similar product manufactured outside the US.
In terms of material used (be it nylon, cotton, polyester, wool, or even waterproof breathables), what is the trend likely to be in the days to come?
The trend on fibre type, whether natural or synthetic, has changed some recently. The preference on fibre often varies by geographic region, but it also varies by usage intent. Some fibres are preferred for certain technical applications while others are preferred for various lifestyle applications. One thing is certain: Consumers are demanding a greater variety of fibres and constructions depending on usage intent.
US President Donald Trump wants jobs back in the US. But given your global presence, how do you plan to tread that thin line between manufacturing relatively expensive products in the US, and relatively cheaper products outside?
We do have a global presence and our resources outside the US are also critical to our total supply chain and critical to our total product offering. Both US and imported products are necessary for our company to supply all the types of products that our customers want at prices they are willing to pay.
Ceteris paribus, how sustainable are you at the present? How are you ensuring environmental compliance?
We monitor, measure and track our sustainability efforts. Part of our culture requires the company to operate in a sustainable manner, to respect the environment. So we have numerous projects under way to improve the impact of the footprint we leave, and we do have goals set to improve continuously. Some of our partners require us to report our progress. Walmart has a significant sustainability initiative, and we believe that Walmart's leadership in this initiative with its suppliers continues to have a very positive impact on our environment.
Four years from now, Renfro would be completing 100 years. How do you look at the past?
Yes, our 100th anniversary is approaching. We are proud of that continuous history-our ability to survive and to prosper through many economic and competitive challenges. We believe that we should honour the past, recognise and appreciate it.
Please tell us more about your current India operations.
Our company operates two factories in India. We also market, sell and distribute a variety of products and brands in the Indian domestic market. We have earned a significant market share there. We are very pleased with our workforce in India. Our staff there is very capable, sophisticated in business practice and competitive with any management group in the world. We are very proud of our group there; it has responsibility for and manages our efforts in Europe and Asia.
How do you see the Indian market? Especially, with respect to other markets?
Our Indian operations have grown and our domestic sales have grown. We expect that to continue. We expect our capacities in India to increase with that, growth. Our revenue growth in India is expected to outpace growth in most other markets where we operate.
And what about the future? Are you planning for the next 100 years, or are you looking only at the immediate future?
But, the future brings change. Always. So honour the past, but find the opportunity in change. That is how we will prosper for another 100 years. Of course, we are planning for more than the next year.
You have manufacturing and distribution facilities across the world. Do you have expansion plans charted out?
We do have expansion plans in the US, the rest of North America and in key markets outside North America. We also have plans for continuing product evolution.
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