Hanesbrands shifts supply chain focus to Asia

Asia - Underwear makers Hanesbrands will increase production in Asia and shut plants in the West as part of its global supply chain re-engineering strategy.

The company, which manufactures for brands Hanes, Bali and Playtex said it will close nine plants in five countries in the Western Hemisphere by the end of summer 2009, a move that will affect approximately 8,100 employees.

"We are making significant progress in expanding our supply chain production capability in Asia and consolidating into fewer, larger facilities located in lower-cost countries in the world," CEO Richard A Noll said. "Globalising our supply chain, and eventually balancing production between Asia and the Western Hemisphere, is a critical plank in our strategic efforts to reduce costs, improve product flow and increase our competitiveness."

The company said most of the sewing production from the central American plants that will close will be moved to the company's new Asian facilities. These include the four sewing plants in Thailand and Vietnam the company has opened or acquired in the past two years.

It expects to increase its workforce in Asia from 4,000 today to 6,000 by the end of 2008.

"Our startup of supply chain operations in Asia is progressing very well," Gerald Evans, Hanesbrands president, chief global supply chain officer said. "Since acquiring our first sewing operation in Chonburi, Thailand, in 2006, we have doubled production at that plant with the same number of operators, as we bring to bear our production and plant operations expertise.

"Operations in Vietnam are starting very fast with excellent quality from a very capable workforce."

The company also revealed plans to construct a textile fabric plant in Nanjing, China, which is expected to begin the ramp up of production in 2009 to supply fabric to the company's expanding Asian sewing network.