Ruentex Industries Ltd (潤泰全球) board of directors has approved the shutdown of the firm’s sole textile factory in Taiwan in a bid to improve its profitability, the company said in a Taiwan Stock Exchange filing.
The textile and garment supplier said that 303 employees would be affected by the closure on April 26 and 93 would be eligible for retirement.
“The plant in Taoyuan’s Yangmei District (楊梅) is unable to satisfy customers’ demand in terms of costs,” Ruentex said.
Losses at the factory have soared over the past decade, it said.
Many of its peers have either moved production overseas or quit because of the worsening environment at home, Ruentex said.
The company estimated that the closure would only erode 7.17 percent of its revenue this year, according to the statement.
Ruentex plans to farm out production to other suppliers in Taiwan or overseas to supplement the production loss, it said.
Ruentex, which counts Burberry Group PLC and Tommy Hilfiger Corp among its major clients, reported that its revenue nosedived about 93 percent to NT$366 million (US$11.87 million) last month, compared with NT$5.52 billion in January last year.
Last year, the company’s revenue plunged 66 percent to NT$10.5 billion from NT$31.04 billion in 2017 after divesting its retail business in China through Sun Art Retail Group (高鑫零售) to Alibaba Group (阿里巴巴) and France-based Auchan SA.
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