We plan on creating more technical and performance fabrics
With the setting up of the group's first manufacturing unit in 1971, Indonesia-headquartered PT Shinta Indah Jaya has continued to set the standard for both the group and the industry as a leading producer of quality knitted fabrics using warp knitting machines with fully equipped dyeing and finishing facilities. This company has made continuous reinvestments to its production facilities. CEO Stacey Hermijanto talks about the aim to increase market share in Indonesia.
Tell us the story of your company and how it came into being.
Founded by the late Toto Hermijanto, Shinta Indah Jaya started out as a humble trading company and became the very first manufacturing unit of the Shinta Group. Set up in 1971, Shinta Indah Jaya has continued to set the standard for both the group and the industry as a leading producer of quality knitted fabrics - including circular knits, warp knits and a choice selection of flat knits - with fully equipped dyeing and finishing facilities.
How do you define your company's vision and mission?
Vision: To be internationally recognised as an exemplary premier textile manufacturer, known for our world-class quality products and for our strong corporate values of honesty, reliability and integrity as well as our genuine care for all our stakeholders.
Mission: (i) With passion and dedication, we strive to meet the ever-changing needs of our customers and to exceed their expectations through reliable delivery of world-class quality products at competitive prices with personalised care; (ii) To constantly grow and evolve as a team in a continued effort to improve not just our systems and operations but to empower and improve the lives of all our employees and be a blessing not just to them but to their families and the communities around them.
At what rate is the Indonesian textiles industry growing?
Despite a massive slowdown in the textiles industry since 2013 following the dip in oil prices and hike in gas and electricity tariffs, recovery began in 2017, with the ministry of industry predicting a growth in the industry of up to 7 per cent.
What are the textile manufacturing services / product categories available at Shinta Indah Jaya?
Shinta Indah Jaya's full product line encompasses a wide range of circular, warp and flat knitted polyester and nylon fabrics for the garment, footwear, lamination, toy and audio equipment industries. Tapping into different varieties of polyester and nylon yarns made available by a sister company, Sulindafin, Shinta Indah Jaya has been well-positioned to develop innovative fabrics using different types of specialty and performance yarns. For example, SulCool, developed in-house by Sulindafin, is a permanent moisture-management technology built into yarn. Shinta Indah Jaya has been supplying SulCool fabrics to the garment industry for the production of activewear. This fabric uses tetra-channel capillary action for superb moisture-management which keeps the skin cool and dry for long-lasting freshness and enhanced athletic performance. Shinta Indah Jaya also offers SulCool fabrics with dual functions of moisture-management and anti-UV or anti-microbial properties using advanced silver technology. All our products have been tested and certified in accordance with Oeko-Tex Standard 100 and meet the human ecological and azo-dye requirements.
Single Knits: Single Jersey; Jacquard; Visa Terry; Lining
Double Knits: Flat Back Mesh; Interlock; Pique; Scuba; Waffle; Drop Needle; Rib 1x1; Rib 2x2
Flat Knits: Collars; Cuffs (in solid as well as in stripes)
Anti-Soil / Soil Release
What are the core competencies and strengths of the company that uniquely distinguishes it from those in the same industry?
Strong management team: Shinta Indah Jaya's management team is made up of well-established professionals from multiple disciplines and industries. Through the adoption of collaborative leadership, the team is able to draw on each other's strengths and insights while positively influencing employees to reach their fullest potential, ensuring that their interests are aligned with that of the organisation for mutual growth and development.
Dedicated workforce: We take pride on being rich in human capital, with an experienced, skilled and dedicated workforce that embodies our passion for excellence. Continuous investment in training ensures that they are kept abreast with changing technology emphasizing on continuous quality improvements.
Quality: Shinta Indah Jaya's fundamental belief in delivering products of exceptional quality has been the key to our success. This has been made possible by retaining the best talent, utilising the finest equipment, and maintaining a high level of personalised customer service.
Customer service: Shinta Indah Jaya's high level of professionalism and integrity has helped nurture long-term business relationships with our customers built on trust and confidence.
Competitive pricing: Shinta Indah Jaya's ability to offer competitive pricing stems from the team's rich technical knowledge and experience within the industry, which helps to boost productivity. Being a part of an integrated textile group has also provided Shinta Indah Jaya with the added efficiency and competitive edge in the market.
Flexibility: Shinta Indah Jaya is able to stay nimble and more flexible given its size. We are able to explore market niches that bigger competitors are not pursuing or team up with other businesses to gain market share. With this strategic flexibility, we are able to adapt to the rapidly changing needs and preferences of our valued customers.
How do you keep track of the latest trends in the textiles industry?
We stay in close contact with our machinery suppliers as well as our customers, constantly sharing information on the latest technology available as well as the latest trends in the downstream industries. We actively attend textile exhibitions around the world to get first-hand information from different markets. We subscribe to various online publications to keep abreast with the relevant industry news.
How would you describe the current business climate of the global and Indonesian textile industry, and how can Shinta Indah Jaya capitalise on it?
The global textile and apparel business in 2017 was estimated to be worth about $4,395 billion, with global trade in textile and apparel standing at around $360 billion.
According to WTO forecast, global trade is set to expand by a further 4 per cent this 2018, after an expansion of about 3.3 per cent in 2017.
It is expected that the growth rate of trade in knit fabrics and apparel will exceed that of the woven counterparts.
The statistics reflect a positive overall global outlook for the industry and a positive forecast for Shinta Indah Jaya given our specialisation in knit fabrics.
The current global apparel market is estimated to be $1.15 trillion, which forms nearly 1.8 per cent of the world GDP. Almost 75 per cent of this market is concentrated in EU-27, US, China and Japan. The next largest markets are Brazil, India, Russia, Canada and Australia, in descending order with a combined share of approximately 18 per cent.
While the growth of the apparel market is stagnating in the traditional consuming hubs of EU, US, and Japan, countries like China, India, Russia and Brazil are emerging as apparel retail markets and will form significant alternate markets to US, EU-27, Japan.
Interestingly, among the largest markets, Australian per capita spending on apparel is the highest one with $1131.
With this trend, we may target Russia and Brazil as potential growing new markets for Indonesian exports. Also, in view of the fact that the IA-CEPA is soon to be finalised, Shinta Indah Jaya may benefit with improved market access into the Australian market.
Indonesia has a population of over 250 million people, providing for a huge domestic market, with a fast-growing middle class, which is expected to double to 140 million by 2030
The large and growing domestic market will always serve as a safety net for Indonesian manufacturers like Shinta Indah Jaya amidst any potential global economic turbulences.
Textiles has been designated as a national priority according to the National Industry Development Master Plan for 2015-2035, given its employment of over 15 per cent of Indonesia's total manufacturing workforce. The government is also promoting Central Java as a new textile hub for the nation, since the minimum wage there is just as competitive as Pakistan and comparatively lower than major competitor, Vietnam.
This is in line with Shinta Indah Jaya's plan for expansion with West / Central Java within the next five years.
Through increased governmental support for the industry, targeting total export value of textile and apparel products to reach $75 billion by 2030, Indonesia is poised to become one of the top five global textile manufacturers alongside Vietnam, India and Bangladesh.
Positive outlook for the industry and for local manufacturers like Shinta Indah Jaya.
Indonesia's pursuit of bilateral trade deals (CEPA with Chile signed in Dec 2017; finalisation of CEPA with Australia expected this 2018; interest expressed to join TPP-11 in near future) would help open up new markets for businesses, further fueling export growth.
This serves as a positive platform for Shinta Indah Jaya as we aim towards building a market presence globally.
Which is your targeted market segment?
I'd describe my targeted market segments as predominantly sportswear and athleisure (both garments & footwear). My reasons are as follows -
Growing middle class in Indonesia together with the rise of a young and more health-conscious population will continue to boost demand for sportswear.
Besides, more than 43 per cent of the population is below the age of 25 with an average age of 28 years old, leading to a huge potential growth for future sportswear sales.
Amidst the global economic slowdown, Indonesia's sportswear industry posted positive growth of up to 9 per cent in 2015 and 2016.
While low-priced sportswear used to dominate the domestic market, in recent years, premium multinational brands have quickly gained market share due to greater disposable income with a preference for fashion.
Globally, two out of the world's top four most valuable apparel brands are sporting brands-Nike has retained its position as the world's most valuable apparel brand, with a brand value of $28 billion. H&M ($19 billion), Zara ($17.5 billion) and Adidas ($14.3 billion) took second, third and fourth position respectively. Out of these four apparel brands, Shinta's fabrics are already being used in the production of two-H&M, Adidas. We will therefore continue to focus on the segment of sportswear and athleisure, which we believe will continue to see a growth spurt in the future.
Which are the prominent customers that have utilised your company's services/products?
What are your strategies going forward and where do you see Shinta Indah Jaya in five years?
Unlike the other member companies within the group, Shinta Indah Jaya did not embark on an aggressive growth strategy in the early years, choosing to focus instead on quality and stability. So, while being relatively small in size, Shinta Indah Jaya was more than able to withstand the various economic shocks in the last two decades.
Going forward, Shinta Indah Jaya's focus will be on increasing its market share within Indonesia through a three-pronged approach:
improved productivity through further modernisation of machinery and equipment;
strengthened R&D for greater value-add to enhance the overall customer experience; and
Shinta Indah Jaya is expected to be on a new growth trajectory over the next five years, marked by steady capacity expansion. We aim to increase our market share within Indonesia through the growing and deepening of existing business relationships and formation of new partnerships. We will concentrate on the sportswear and athleisure segments of the apparel market. Through intensified and strengthened R&D, Shinta Indah Jaya will also have a renewed focus on the development of technical and performance fabrics. Shinta Indah Jaya looks forward to growing its market presence globally.
Published on: 19/05/2018
DISCLAIMER: All views and opinions expressed in this column are solely of the interviewee, and they do not reflect in any way the opinion of Fibre2Fashion.com.