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| Issue date:01/04/2006 |
| ATA Journal for Asia on Textile & Apparel - Apr 2006 Issue |
| Source:Journal for Asia on Textile & Apparel |
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PT. Cedrateks Indah Busana Group is a joint venture company founded 10 years ago by A.M International MFG. Co Ltd, Hong Kong, Busana Intisari Garmen and Eka Sandang Prima. With a 3,300-strong workforce, it produces 250,000 dozens of 3, 5, 7, 9 and 12 gauges knitted sweaters. All the production processes, including knitting, linking, stitching, finishing, inspecting and packing, are carried out in its factory in Semarang. A production system in such a scale is so far uncommon in Indonesia.
The company sources different textile materials, such as fancy yarn, cashmere, angora and wool, from both overseas and local suppliers. Apart from fashionable sweaters, it also produces seamless and three-dimensional structured knitwear. About 90% of the products go to the US and the rest to the EU.
Baari La Inggi of ATA Journal has talked to Cedrateks Indah Busana's General Manager, Benny Benyamin, who is also former chairman of the Indonesian Textile Association of Greater Jakarta (API DKI Jakarta):
Benny Benyamin |
A-ATA Journal B-Benny Benyamin
A: Having visited a number of textile and textile product (TPT) industries in some important production bases like Bandung, Semarang, Surabaya and Bali, I found that many companies reported a decline in export. However, your company is operating at full capacity. How do you retain your buyers?
B: We focus on producing good quality products that meet buyers' requirements at reasonable price. Due to the high level of technical difficulty involved in the production process, there is only a handful of heavy knit companies like mine in the country, but thousands of light knit companies producing polo shirts, T-shirts and the like.
Some of our buyers who switched to China in 2002 before the quota ended had come back to us after some time. The buyers have their own criteria about quality. I believe that we will continue to enjoy good sales because of our good quality and our highly skilled workers. The China factor is not a problem to us.
Another factor is that we strictly comply with buyers' standards on human rights, safety and health. Apart from paying workers according to local government's regulations, we make sure the factory has adequate facilities, and we provide the workers with medical care. Different buyers have different requirements, our group can meet the requirements so we have long-time buyers who trust our performance.
A: Do you think that some politicians speaking about the TPT industry in the local papers have exaggerated the number of factories that were forced to shut down?
B: I don't think that "hundreds" of TPT companies had closed down as reported by local papers. As far as I know, some companies in Bandung could not operate because of the floods some time ago, which had damaged their machinery. It is not true that, as reported by the local papers, "unfavorable policies of the government" like cutting subsidy on fuel and raising the electricity base rate (TDL) have resulted in the bankruptcy of hundreds of TPT companies. They even failed to mention the names of the companies reported to have closed down.
Cedrateks Indah Busana focuses on knit goods |
Our competitor countries have even higher fuel price and TDL. Of course, I agree that the government should learn about the difficulties faced by the TPT industry, but I don't agree that the policies can significantly affect the gross profit margin. Before setting up a new company, one should have considered all these matters.
I think those companies which closed down were small companies cultivating the local market. In fact, orders keep coming to this country from overseas. A friend of mine told me that three Korean companies are going to invest in Cikampek, West Java, with a capacity of 100 lines. It is likely that they are going to take advantage of the safeguards against the textile and apparel products originated from China before 2008.
Due to the safeguards, buyers cast doubt on placing all their orders in China, as they may experience great losses if their goods cannot enter the US or EU markets. I have rejected an order for 10 million pairs of trousers for delivery between April and November this year because it is beyond my company's installed capacity.
A: What is actually the key to success of your company?
B: I would say that good management of workers is the key to success of PT. Cedrateks Busana Indah, and therefore, I am optimistic that there will be no problem with orders. The principle of my company is "love your workers", make them feel happy so that they have a sense of belonging to the company. Having good relationship with your employees makes everything easier, such as in giving them technical training, because they are willing to learn. When the workers think that they can develop a career in the company, they will do their best.
On the contrary, if you don't care about them or are rude to them, they will feel unhappy and may not take their work seriously. That will adversely affect the quality of the output, and make it hard for us to train them. Any errors in my products such as a missing stitch will result in rejection. Other companies may say they have good relationship with their workers, but believe me, in practice, if they don't love their workers, there must always be slavery. I would say that "management by love" is our key to success.
A: How do you see all the compliance standards Ð some say that they are trade barriers while others disagree?
B: It really depends on the company. I think most of the compliance standards are good but sometimes it seems strange that some buyers still need additional certificates. If you can meet all the compliance standards, then there will be no problems at all. Buyers would feel sure that you can do the work on time. But in practice, local NGOs appointed by certain buyers often overacted, and they sometimes chose to interview the workers in the factory during their work time.
As the workers have a sense of belonging to the company, there were no problems at all. Some small companies, which failed to comply with the standards, may think that these standards are trade barriers.
In conclusion, I think that if an export-oriented company is well-managed, complies with buyers' standards, maintains quality control and so on, there is no reason why it cannot survive. I am committed to "management by love" as it has proven to be effective in our company.
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| Copyright © Adsale Publishing Limited. Any party needs to reprint any part of the content should get the written approval from Adsale Publishing Ltd and quote the source "ATA Journal for Asia on Textile & Apparel", Adsale Textile English Website - www.AdsaleATA.com. We reserve the right to take legal action against any party who reprints any part of this article without acknowledgement. For enquiry, please contact Editorial Department. |
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| Copyright © Adsale Publishing Limited. Any party needs to reprint any part of the content should get the written approval from Adsale Publishing Ltd and quote the source "ATA Journal for Asia on Textile & Apparel", Adsale Textile English Website - www.AdsaleATA.com. We reserve the right to take legal action against any party who reprints any part of this article without acknowledgement. For enquiry, please contact Editorial Department. |
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