TSI Holdings has lowered production at its units based in China. The company is looking to farm out more work to units in inland China and South-east Asia, where labour is much more inexpensive.
The Japan-based clothing company had sold its jacket and dress plant in Suzhou, Jiangsu Province, to an anonymous buyer. The reason behind selling the unit is touted to be the rising cost of production at the unit which was opened in 1994. Moreover, plant in Qidong will also witness drop in production.
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However, the company earlier maintained quality of its products through in-house production, but of late observed that the quality variance with outsourcing has been negligible; besides the cost of running the facilities have also come down as the production work gets shifted to units in more financially viable regions.
TSI Holdings emerged in the year 2011 due to the unification of Tokyo Style and Sanei-International. The company has upheld production at Tokyo Style’s facilities in Japan and overseas.
Considering the fact that around 70 per cent of the company’s production is being done overseas, TSI is now feeling the need to face-lift production as foreign exchange rates and other factors involved in the production process are taking the cost further.
