Groz-Beckert KG

Newsletter 1 | 2010

Green Production in Asia

Pacific Textiles is a leading manufacturer for customized knitted fabric with a focus on complex and high value-added fabrics. Despite a challenging environment with lackluster consumer confidence and low spending power, the group could uphold its competitive edge and achieve an encouraging performance during the first half of 2009 / 2010 business year.

About Pacific Textiles

zoom

Pacific Textiles is a leading manufacturer for customized knitted fabric with a focus on complex and high value-added fabrics. Their headquarters is located in Hongkong. The main production bases are are in Panyu (Pearl River Delta region in South China) as well as knitting and dyeing facilities in Avissawella (Sri Lanka). A new joint venture in Bangladesh is being built up right now. In total the group comprises around 6.700 employees and is exporting to more than 40 countries around the world. Since May 2007 the group is listed on the Hongkong stock market.

Despite a challenging environment with lackluster consumer confidence and low spending power, the group could uphold its competitive edge and achieve an encouraging performance during the first half of 2009 / 2010 business year. The group’s top 5 brand owners amongst their customers contributed 53.8% to overall sales during this period with stable sales to international apparel retailers like Uniqlo in Japan, Nike, Calvin Klein, Marks&Spencer, Victoria’s Secret and others.

The main production plant in Panyu (China) is a modern, integrated state of the art manufacturing plant providing integrated services of knitting, dyeing, printing and finishing with an annual production capacity of approximately 87 Mio kg. Offices, water treatment as well as power generation facilities are also located in Panyu. More than 1.000 knitting machines are running around the clock.

 

Pacific Textiles is spending great efforts in maintaining high standards in environmental production. In the past three years, almost 300 Mio HK$ have been spent on treating sewage and exhaust before discharging, reuse of waste water as well as desulphurization of power generation facilities. As a recognition and encouragement for their efforts in “green production”, Pacific Textiles has received several prestigious awards. For example in 2008 the “Cleaner Production Corporation Recognition” has been awarded to PT by the Economic and Trade Commission of Guangdong Province and Guangdong Bureau of Science and Technology. In 2009 the “Heng Seng Pearl River Delta Environmental Award” and “Hang Seng Pearl River Delta Environmental Category Awards – Air Emissions and Noise Abatement” has been awarded by the Federation of Hongkong Industries and Hang Seng Bank.
 

Interview with Mr. Wan Wai Loi

We have been granted an interview with the Chairman of Pacific Textiles, Mr. Wan Wai Loi to explore more in depth the situation at Pacific Textiles:

a) Dear Mr. Wan, first of all congratulations to the good result of Pacific Textiles during the last year. What are the reasons for this excellent performance despite a difficult business environment worldwide?

Last year indeed we have been faced with unprecedented challenges brought about by the global economic downturn. Fortunately we could profit from the consolidation in knitting industry and from the fact that orders have been switched to established players. Due to our high value-added products and excellent relationship with our customers we even could achieve a slight increase in our average selling prices, partly offsetting the impact of higher manufacturing cost.

b) How do you ensure the future success of your group?

We will continue with our strong focus on R&D in complex and high value added fabrics. Especially in synthetics we see strong opportunities. In addition, the current industry consolidation will provide major opportunities for established and competitive companies like ours. We are also making good progress in our geographical diversification. We successfully expanded our reach in Asia as well as the Chinese domestic market.

c) Are there differences in quality requirements between products destined for the China market compared to other export customers?

Actually in our experience there is no difference. Chinese customers are getting more and more brand and quality conscious and expect to buy first class products.

d) What about your investment in Bangladesh? What are the motives for this move?

In November 2008, together with Fast Retailing Co. Ltd, the holding company of Uniqlo Japan and another 2 partners we have formed a joint venture in Singapore in order to set up fabric and garment facilities in Bangladesh. This strategic move will enable us to expand our presence in Japan and EU markets as there are no tariffs and quota restrictions on Bangladesh exports whereas production costs are still low.


e) What is the motivation for the strong focus of Pacific Textiles on “green production” and environmental best practice?

Very early on our group has adopted cost efficient and environmentally advanced production technologies in order to enhance our long term competitiveness. We are committed to achieving best practices as a responsible corporate citizen. In line with the drive of the China and Guangdong government to achieve scientific and sustainable growth we want to be the leader in “green production” in order to be able to successfully expand our knitting and dyeing capacity in our main production location in Panyu.


d) What role does Groz-Beckert and Groz-Beckert’s products play in ensuring the current and future success of Pacific Textiles?

With Groz-Beckert we are having a very successful cooperation since many years. Stable quality and high performance of Groz-Beckert products play an essential part in fulfilling the ever increasing quality demands of our clients. I am convinced that Groz-Beckert’s products and service will continue to play a major role in our future manufacturing and research activities as well.

e) What are your expectations on Groz-Beckert’s most recent product innovation in knitting needles: the “litespeed” needles?

As always with new things we have been somewhat skeptical in the beginning. However, after our internal testing and in close cooperation with Groz-Beckert’s technical support, the new needles are now being used in our production department on a stable basis. We are especially interested in the new product features from the environmental point of view. We are confident that with further energy savings and higher efficiency we can make another step towards our goal of being the leader in green production.