Indian exporters are not only setting factories abroad but even expending too as their experience of running factories in overseas has proved to be good. Producing mainly outerwear, Modelama Exports, well-known apparel exporter of Gurgaon recently expanded by adding 400 machines in Tanjung Emas, Semarang, a port city on the north coast of Java, Indonesia.
The company had entered Indonesia almost 5 years ago and had 450 machines there. Production in Indonesian is for mainly Ann Taylor (Ascena Retail Group) and Calvin Klein (PVH). The company had a turnover of more than Rs. 125 crore in last fiscal from Indonesian operations. In India, it has 7 factories and offers employment to nearly 7,000 workers. The company does overall annual business of more than 600 crore.
The official approvals are quite fast in Indonesia and land price is also comparatively less to India. Even productivity is high there as compared to Indian sewing operators. Lalit Gulati, MD, Modelama Exports, Gurgaon informed, “By having a unit in Indonesia, we can compete with Bangladesh and with any other such competitors’ because productivity is quite higher in Indonesia. We want to grow there as we can’t do volume-based business in India as it is too expensive. So, we have to have a base in such a place like Indonesia as we don’t want to lose any of our customers. Our strategy is to do volume production in Indonesia and value addition garments in India.”
He further added that Indonesia is a professional country and things are managed in a very proper way. “If we get an opportunity, we will increase our capacity there but it depends on our clients,” concluded Lalit who is overall expecting a growth of 5 to 10 per cent in business.
