Bye bye to underwear factories

With 50-60% market share, leading underwear producer Wacoal plans to move factories to Burma, Laos or Cambodia.

In the photo above Wacoal executive promotes the ‘Wacoal Must-Haves’ lingerie campaign among Thai women. The company expects the campaign will help to boost sales by 20%. 

Click button to listen to Wacoal Lingerie to download

Wacoal mulls Thailand exit

Keeping abreast of Myanmar market
21/06/2012
Pitsinee Jitpleecheep

ICC International Plc, the distributor of Wacoal lingerie, is looking into establishing a production base in neighbouring countries in the near future to resolve labour and wage problems in Thailand.

Thammarat Chokwatana, a director and executive vice-president, said the parent firm Saha Group is conducting a feasibility study into moving Wacoal production to Myanmar, Laos or Cambodia.

Such a move move would also see production capacity expanded to cash in on the huge regional purchasing power after implementation of the Asean Economic Community in 2015.

Mr Thammarat said two options are available. One is setting up a lingerie factory within the compound of a possible future Saha Group industrial park to be build in a neighbouring country.

The other is a stand-alone plant for Wacoal.

Most Saha Group products are labour-intensive, so it is necessary to look for new locations that can lower production costs and make the products more competitive, he said.

The group will decide on the best option by next year.

The company has already opened a new factory in Tak's Mae Sot district bordering Myanmar in a bid to resolve problems with labour shortages and rising wages.

Regardless of the location, the goal will be to support the group's expansion in Myanmar, where sales have shown continous growth each year.

That country will contribute revenue of 100 million baht this year, with the figure expected to double next year

Wacoal lingerie is now manufactured at four Thai factories, in Bangkok, Chon Buri's Si Racha district, Prachin Buri's Kabin Buri district and Lamphun province.
The brand generated sales of 2.8 billion baht last year, projected to rise to 3 billion this year.

To this end, the company is spending 30-50 million baht on a new marketing campaign called "Wacoal Must-Haves" that runs until Aug 31.

Customers purchasing four items of Wacoal lingerie will have a chance to win an international or domestic holiday and other prizes.

The company expects the campaign will help to boost sales by 20%.

The total value of Thailand's lingerie products sold in department stores is 5-6 billion baht with a 10% annual growth rate.

Mr Thammarat said the healthy growth rate is due to new products from new producers and aggressive marketing activities by existing brands.

Wacoal commands a 50-60% market share, followed by Sabina and Triumph at 12-13% each.

Mr Thammarat said shopping sentiment was not good in the first five months of this year, as customers had other priorities.

However, sales by ICC International Cosmetic Co is expected to grow by 30-40% to 15 billion baht this year.

(Source: Bangkok Post, Wacoal mulls Thailand exit, Keeping abreast of Myanmar market, 21/06/2012, Pitsinee Jitpleecheep, link)

Offshore Manufacturing Vocabulary

offshore - located outside of the country
offshore manufacturing - when a company produces its product in factories outside of the country 

lingerie - underwear worn by women such as panties, bras, short nightgowns or negligees worn to bed or to spark interest by husband, often bought by wife for husband; lingerie are typically fashionable, appealing to men and/or erotic; the most famous producer worldwide is Victoria's Secret in the US (See Wikipedia and list of different types)

underwear -  extra clothes that a person wears under their clothes: "they keep outer garments from being soiled by bodily secretions and discharges, shape the body, and provide support for parts of it. In cold weather, long underwear is sometimes worn to provide additional warmth. Some undergarments are intended for erotic effect. Special types of undergarments have religious significance. Some items of clothing are designed as underwear, while others, such as T-shirts and certain types of shorts, are appropriate both as undergarments and as outer clothing. If made of suitable material, some undergarments can serve as nightwear or swimsuits," also called "undergarment"  ชุดชั้นใน (See Wikipedia)

underpants -  กางเกงชั้นใน
undershirt - เสื้อชั้นใน 

Wacoal - a worldwide lingerie manufacturer and marketer headquartered in Kyoto, Japan founded in 1946, "the brand's promotion often features female celebrities, such as 'Empress of pop' Ayumi Hamasaki in 2008 and 2009, produces brassieres, panties, shapewear, camisoles and accessories. Wacoal spends nearly six months designing every bra and panty" (See Wikipedia)

executive - the highest level managers in a company

campaign - a planned group of especially political, business or military activities which are intended to achieve a particular aim การรณรงค์
marketing campaign

boost - to increase; to strengthen เพิ่ม; ทำให้มีกำลังมากขึ้น
boost sales

mull - think about something, think over something (before doing it)
exit - leaving a place ทางออก

Wacoal mulls Thailand exit

keeping abreast of - following and knowing about the latest news and developments in an area

keeping abreast of Myanmar market

distributor - a person or business that supplies goods produced by other companies to shops, stores or directly to the public

neighbouring countries - countries next to this country (Burma, Laos, Cambodia, Malaysia, etc)

production base - a place or country where a lot of factories are located

establish - create something for the first time
establishing a production base in neighbouring countries

resolve - to solve a problem, or to find a satisfactory way of dealing with it แก้ไขปัญหา
resolve problems - solve problems

wage - an amount of money that you earn for working, usually according to how many hours or days you work each week or month ค่าจ้าง

resolve labour and wage problems in Thailand

ICC International Plc, the distributor of Wacoal lingerie, is looking into establishing a production base in neighbouring countries in the near future to resolve labour and wage problems in Thailand.

subsidiary - a smaller company owned by a larger company
firm - a business or company บริษัท
parent firm - the larger company that owns a smaller company
 
feasible (adjective) - possible to do; not impossible; goals possible to achieve
feasibility (noun) - the possibility of doing something (whether it can be successfully done and completed or not) 

feasibility study - an examination of every detail of a new project, such as the costs, benefits and risks, in order to decide if it is possible and likely to be achieved; the document that is produced (See Wikipedia)

Thammarat Chokwatana, a director and executive vice-president, said the parent firm Saha Group is conducting a feasibility study into moving Wacoal production to Myanmar, Laos or Cambodia.

production capacity - the amount of something that can be produced ความสามารถในการ (ผลิต)
cash in on - take some opportunity that you have and gain some benefit from it; make money from something; profit from 

huge - very big
regional - within Asean (including all the countries in an region or area)

purchasing power - the amount of goods and services a group can buy (determined by income, wealth, value of country's exchange rate, etc)
huge regional purchasing power

implementation - actually do or carry out a plan; making a plan into reality; the process of making something such as a plan, system, idea or law start to work and be used การบังคับใช้ (กฎหมาย) (See glossary) นำ (แผนการ) มาบังคับใช้

Such a move move would also see production capacity expanded to cash in on the huge regional purchasing power after implementation of the Asean Economic Community in 2015.

options - choices ทางเลือก
the best option
decide on the best option

industrial park - an area that has special things and infrastructure that factories need such as transportation, electricity, waste disposal, etc (See Wikipedia)

compound - an area in which a group of buildings stands บริเวณบ้าน
compound of an industrial park

stand-alone - not built with others; alone; by itself
stand-alone plant  

Mr Thammarat said two options are available. One is setting up a lingerie factory within the compound of a possible future Saha Group industrial park to be build in a neighbouring country. The other is a stand-alone plant for Wacoal.

intensive - using a lot of ; involving a lot of effort, energy, or attention
labour-intensive - using a lot of labour (worker time) compared to capital (machines and equipment)

competitive - involving competition มีการแข่งขัน

Most Saha Group products are labour-intensive, so it is necessary to look for new locations that can lower production costs and make the products more competitive, he said. The group will decide on the best option by next year.

shortages - when there are not enough goods for people to buy การขาดแคลน
labour shortages

wages - the amount of money earned per hour by a worker
rising wages

bid - an attempt to do something ความพยายาม
bid to resolve problems

bid to resolve problems with labour shortages and rising wages

The company has already opened a new factory in Tak's Mae Sot district bordering Myanmar in a bid to resolve problems with labour shortages and rising wages.

expansion - when something increases in size, number or importance การขยายออก
expansion in Myanmar
the company's expansion in Myanmar

support - help สนับสนุน
support the group's expansion in Myanmar

continous - happening all the time; not stopping
continous growth

shown continous growth each year.

Regardless of the location, the goal will be to support the group's expansion in Myanmar, where sales have shown continous growth each year.

revenue - income from taxes or business activities รายได้
contribute revenue

figure - an amount; an amount of money จำนวนเงิน
expected - believe will happen คาดว่า (จะเกิดขึ้น)
double - to become twice as big, twice as much or twice as many เพิ่มเป็นสองเท่า

figure expected to double

That country will contribute revenue of 100 million baht this year, with the figure expected to double next year. Wacoal lingerie is now manufactured at four Thai factories, in Bangkok, Chon Buri's Si Racha district, Prachin Buri's Kabin Buri district and Lamphun province.

brand - a type of product made by a particular company ตรา, ยี่ห้อ

generated - created
generated sales

brand generated sales of 2.8 billion last year
 
projected - what people believe it will be in the future
projected to rise

The brand generated sales of 2.8 billion baht last year, projected to rise to 3 billion this year.

a must-have - something that you "must have" that you need to have 

To this end, the company is spending 30-50 million baht on a new marketing campaign called "Wacoal Must-Haves" that runs until Aug 31.

purchasing - buying
a chance to win a prize - an opportunity to win a prize (to be part of a contest where you may win a prize)

holiday - a vacation (time taken when you are not working; taking a rest)

domestic - within the country ภายในประเทศ
domestic holiday

international - between countries ระหว่างประเทศ
international holiday

an international or domestic holiday

Customers purchasing four items of Wacoal lingerie will have a chance to win an international or domestic holiday and other prizes

boost - increase
boost sales - increase sales

The company expects the campaign will help to boost sales by 20.

annual - happening once a year ประจำปี
annual growth rate

The total value of Thailand's lingerie products sold in department stores is 5-6 billion baht with a 10% annual growth rate

aggressive - forceful, determined, and eager to succeed (See glossary)   ก้าวร้าว, ซึ่งมีความมั่นใจสูง
aggressive marketing activities
brands - products with well-established names that people remember, that create a certain image and expectations about the product

Mr Thammarat said the healthy growth rate is due to new products from new producers and aggressive marketing activities by existing brands.

market share - the percentage of customers in a market that a company has (See Wikipedia)

Wacoal commands a 50-60% market share, followed by Sabina and Triumph at 12-13% each

sentiment - feelings; an attitude or belief that people have based on their thoughts and feelings กระแส, แนวความคิด, ความคิดเห็น; อารมณ์ทางความคิด
priorities - important things that must be done; the most important things that you must do first (before other less important things)

Mr Thammarat said shopping sentiment was not good in the first five months of this year, as customers had other priorities. However, sales by ICC International Cosmetic Co is expected to grow by 30-40% to 15 billion baht this year.