South Korea-based textile and clothing manufacturer Hansae Co., Ltd. is creating a localized sourcing stream for synthetic textiles for its Haiti manufacturing operations through a strategic partnership with fabric manufacturer Willbes Dominica Synthetic Mill.
The memorandum of understanding was signed on May 2 at Hansae’s headquarters in Seoul. Hansae vice chairman and CEO Daymond Ik Whan Kim, Hansae president and CEO Kyung Kim and Willbes president Chan-hyeok Lim attended, strengthening their commitment to strategic cooperation.
Hansae’s production subsidiary in Haiti operates 60 lines in three factories and has the capacity to produce about 2 million pieces of clothing per month. Willbes produces chemical fiber fabrics in the Dominican Republic and has production facilities capable of producing 30 tons of fabrics per day. The major goal of this partnership is to supply Hansae with high-quality Willbes synthetic fiber, which has been made in Dominica for 36 years, as well as to generate synergy by running the production line flexibly and reacting to customer needs with agility.
Through this agreement, the two companies expect to reduce lead times by around nine to 10 weeks as compared to Asian sourcing and result in a 30 percent reduction in duty costs. As an example of duty benefits, Hansae previously could not use the trade preference programs Haitian Hemispheric Opportunity through Partnership Encouragement Act (HOPE) and Haiti Economic Lift Program (HELP) Act for its men’s crewneck shirts because they were made with fabrics from Asia. Now, with this localized fabric sourcing, this category is eligible for export tax benefits, which represents an average savings of 25-32 percent.
Hansae and Willbes are committed to establishing the strongest and most reliable strategic cooperation possible on Hispaniola Island, which is home to Haiti and the Dominican Republic, and to increase their market share in the U.S. The ready-made-garment (RMG) producer counts U.S. brands and retailers such as American Eagle Outfitters, DKNY, JCPenney, Ralph Lauren and Under Armour among its customer base.
“It has become more important than ever to respond promptly to the rapid changes in the market and the corresponding needs of the buyers,” said Daymond Ik Whan Kim, vice chairman of Hansae Fashion Worldwide, during the signing of the strategic partnership agreement. “This strategic partnership between the two manufacturers will greatly sustain improving the product quality through rapid market response as well as the establishment of a stable supply chain.”
Hansae entered Haiti in 2016, and it has been steadily increasing production every year. Among the Korean apparel companies in Haiti, Hansae has the largest facility. It employs more than 3,000 local employees and contributes to the local economy. The company has been investing in Central America to support the growing demand for nearshoring. This past fall, Hansae announced a new sustainable, vertical facility in Guatemala.
Across its manufacturing facilities in Asia and the Americas, Hansae is focused on making its production more sustainable, including reducing energy and water use. By 2030, Hansae aims to cut its total water consumption by 20 percent. “As a main fabric supplier factory for such brands as Gap, Old Navy, Target, Kohl’s, Pink and Walmart, the factory’s water use is directly connected to the water consumption efforts of the brands,” said Ik Whan Kim.
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