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Thailand's Mc Jeans gearing to tap AEC benefits
15
Feb '12
In its bid to enhance its competitiveness and to gain from the Asean Economic Community (AEC) set for 2015, Mc Jeans' producer PK Garment (Import-Export) Co has earmarked a sum of one billion baht, to grow its production capacity to two-fold, and also to develop support facilities.

Half the budget outlay would be used for setting up a new office and design centre and for installation of new machineries at the firm's three facilities in Bangkok's On Nut area.

The three factories individually function as cutting, sewing or finishing centres, which helps in reducing overlapping of duties and investment.

Further, the firm believes that logistics is vital for enhancing the supply chain efficiency, as this can help it to counterbalance rise in wages and cost of raw inputs, particularly cotton.

It has earmarked a sum of 300 million baht for developing logistics efficiency, which includes setting up a 30,000 square metre warehouse on an area of 10.28 acres (26 rai) near Suvarnabhumi airport.

The expansion plan also envisages that the firm's business would increase to five to six billion baht per year, over the next five years.

Mc Jeans achieved a 2.3 billion baht turnover during last year, which the company proposes to grow to three billion baht this year, to bag a 30 percent market share.

For the purpose, the producer intends to spend 200 million baht for setting up 30 new stand-alone outlets by close of 2012, which would take the total number of its outlets to 108. The company will add more stores and take the tally of its total outlets to 200 by the end of next year.

The firm plans to add 200 new people to its existing staff strength of 2,000 workers. This would cause the firm to incur an extra cost of 60 million baht per year, as a rise in wage payment.

Looking at the brand's strong foothold and significant growth opportunities in domestic market, Mc Jeans is only considering domestic business expansion in the short term. However, for long term, it is undertaking a feasibility survey for expanding in Myanmar, by setting up a production facility there.

Fibre2fashion News Desk - India


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