'Sewing, embroidery, printing; we do everything ourselves'

Countless experts have already said it embarrassingly: labour-intensive companies, such as sewing workshops, have Thailand no future. They are better off moving to one of the neighboring countries, where wages are lower.

But Kittipong Ruayfuphan (31) has no plans to move at all; in fact, he is looking for a piece of land in the province of Samut Sakhon to build a second factory.

Kittipong is director of marketing of TTH Knitting (Thailand) Co in Bangkok. After studying business administration at California State University, he took over the management of the company founded by his father 20 years ago. The company has 220 employees, which is exceptional because similar companies have 400 employees.

Secret 1 and 2: automation and no outsourcing

How does he do that? Simple: automation. For example, the T-shirt printing department used to have 150 employees; now 15 employees operate 3 machines. If an employee in the packaging department is gone, another person can easily replace that person because they don't have to do more than press a few buttons.

Second secret: control of the entire production chain and fast delivery times. In the old business model subcontractors were hired, now TTH produces everything itself. It stores the products in warehouse, which means the delivery time is up to 25 days, which is fast for a company of this size. The company now has a stock worth 20 million baht.

Secret 3 and 4: all textile processing and own brand

Third secret: the company is a so-called one stop service company, so does everything: weaving, sewing, digital printing, 3D embroidery, design and shipping. The only thing it doesn't do is dye textiles, because Bangkok has strict requirements for wastewater disposal.

Fourth secret: developing its own brand, because about 10 years ago the company, which made shirts with Doraemon, Sailor Moon and Pokemon on commission, suffered from copycats. Under its own brand Mix print TTH now produces polo shirts, T-shirts, uniforms, underpants, jackets, hats, towels and other textile products. In addition, more expensive T-shirts are also made, such as the ventilating one Mix Tech T-shirt.

High turnover among Thai staff

Although Kittipong prefers not to work with foreign personnel, he is obliged to do so because the turnover among Thai personnel is high. Thirty percent of the current workforce is foreign. Both foreigners and Thais receive the same minimum daily wage of 300 baht; professionals earn 330 to 350 baht per day.

Kittipong doesn't like moving abroad. 'Some colleagues who have invested in Laos and Cambodia have already returned because of wage costs and a poor infrastructure. Although wages in Cambodia are lower than in Thailand, the buyers actually determine the profit margin, as long as low wages enable factories to sell products at low prices.'

New factory triples production

No, Kittipong is at peace with the current situation: 20 percent of the products are exported to Japan, Singapore and Italy, while domestic demand is difficult to meet. Hence the plans for a new factory. When it comes on stream, TTH will triple its current production of 900.000 units per month.

(Source: Bangkok Post)