Thu, Oct 17, 2013 - Page 13 News List

Textile firms strategize to survive in difficult market

OPPORTUNITIES:From expanding their client base to focusing on technological skills and branding, local firms are deploying new strategies to stay competitive

By Camaron Kao  /  Staff reporter

Everest Textile Co (宏遠興業), which manufactures polyester fabrics and yarns, expects sales to rise slightly this year, with the addition of fashionwear makers to its client list.

“Companies with famous sports brands have slashed their orders significantly this year, but we have started providing fabrics and yarns to new clients making fashionable clothes,” Everest vice president Alice Kao (高錦雀) told reporters yesterday on the sidelines of the Taipei Innovative Textile Application Show at the Taipei World Trade Center’s Nangang Exhibition Hall.

Affected by an oversupply of garments from China, textile companies have to find new growth strategies to survive, Kao said.

From January through last month, Everest Textile posted revenue of NT$5.43 billion (US$184.94 million), down 0.99 percent from NT$5.49 billion a year ago. First-half profit, the latest figures available, fell to NT$121.04 million from NT$577.95 million a year ago, company data showed.

Kao said the company expects sales to rise significantly from September through November as major garment brands increase purchases of fabrics and yarns to make winter clothes.

Kao said 80 percent of the company’s sales come from woven fabrics, with Nike its largest buyer.

Everest established its own brand “EverSmile” at the end of last year and it has contributed 2 percent to the firm’s total revenue, Kao said, adding that it will take three to five years for the brand to break even.

Meanwhile, Shei Chung Hsin Industrial Co Ltd (薛長興工業), the world’s largest wetsuit manufacturer, said on Tuesday that it expects sales to grow by about 10 percent year-on-year this year, supported by the economic recovery in the US and Europe.

Sales to the US and Europe account for about 40 percent and 35 percent respectively of its total annual revenue of about US$2 billion, the company said.

“We saw revenue grow only 1 to 2 percent annually from 2008 to last year, but we expect a strong recovery this year,” managing director Min Shiue (薛敏誠) said.

As an original equipment manufacturer for global wetsuit brands, such as Maui and Sons, Shei Chung Hsin produces 4 million to 5 million wetsuits a year, accounting for 60 percent of wetsuits sold around the world, Shiue said.

To maintain its technological advantage, the company does its own spinning, dyeing and finishing, Shiue said.

“We make the elastic fabrics ourselves and apply a special coating on the wetsuits called glideskin to enhance their water resistance,” he said.

Another garment maker, Libolon Enterprise Co (力寶龍), relies on its own brands to push sales.

Libolon on Monday said that sales of its FN ICE garments increased 50 percent during the first 13 to 14 days this month to NT$4 million, from NT$2.6 million a year ago, after the company opened a shop in Eslite Spectrum Corp’s (誠品生活) outlet at the Songshan Cultural and Creative Park (松山文創園區) in Taipei last month and another one at Eslite’s Ximending (西門町) outlet this month.

However, company chairman Jonathan Lin (林文仲) said he does not expect the brand to turn in a profit before 2018 because it takes time to build up brand recognition.

“We think it will take seven years for a new brand to profit,” he said, adding that the company will stop selling clothes under another brand, Vernor, next year because of poor sales.

The company also sells clothes online under the brandname Go Hiking via PCHome, Pay Easy, Yahoo and Momo.

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