Sunman mulls winding down Cambodia operations, sets $150m export target
Friday, 10 October 2008
Mushir Ahmed
The country's leading garment exporter Sunman group would wind down its Cambodia operation, but still sets an ambitious target to raise export to 150 million dollars by 2009, an official said Tuesday.
The company was the country's leading exporter even six years back, but a gradual slowdown of its investment in its core garment and textile business saw other groups clawing up the ladders.
A senior official of the group told the FE Tuesday that the company is building a 5000-worker capacity factory and would expand operations in textile, spinning and weaving units to raise its export volume.
"Our garment export was US$81 million in 2007. Already this year, we have exported more than 90 million dollars," said the official.
"Our target is to export $120 million in 2008 and $150 million dollars by next year. We think it's the best time to raise capacity and already we have embarked on ambitious plans," he said.
Led by Major (retd) Abdul Mannan, an ex-minister and the general secretary of Bikalpa Dhara party, Sunman has 21 factories including weaving, spinning and garment units based mostly in the port city of Chittagong.
The group employs more than 20,000 workers.
The company, a top supplier of US clothing giant Gap and Sweden's H&M, was first to make foray in Cambodia in 2004 setting up a 12-line factory in the South-east Asian nation, now emerging as a textile and garment hub.
But the official said rising cost of production and wages meant the profits are drying up in Cambodia and the company was now seriously thinking of winding up its Phnom Penh operation.
"The venture was profitable in the beginning. But nowadays it has become tough to make money there," he said.
"We think Bangladesh is still the best place for garment and textile manufacturing. The sector still has a lot of room for growth," he said.
The company was also among the first to venture into other businesses such as beverage, but insiders said its Suncrest brands have been faring poorly in the country's competitive soft-drink market.
Last week, the company made its entry into lucrative yet risky telecom sector, buying one of the three WiMax licenses for Tk2.15 billion as it sees increasing opportunities in the country's growing internet market.
But bankers said the auction price was too high and it would be difficult for the company to make money out of the deal in the near future.
Officials, however, are confident that the WiMax license would usher in a near era for the company.
The country's leading garment exporter Sunman group would wind down its Cambodia operation, but still sets an ambitious target to raise export to 150 million dollars by 2009, an official said Tuesday.
The company was the country's leading exporter even six years back, but a gradual slowdown of its investment in its core garment and textile business saw other groups clawing up the ladders.
A senior official of the group told the FE Tuesday that the company is building a 5000-worker capacity factory and would expand operations in textile, spinning and weaving units to raise its export volume.
"Our garment export was US$81 million in 2007. Already this year, we have exported more than 90 million dollars," said the official.
"Our target is to export $120 million in 2008 and $150 million dollars by next year. We think it's the best time to raise capacity and already we have embarked on ambitious plans," he said.
Led by Major (retd) Abdul Mannan, an ex-minister and the general secretary of Bikalpa Dhara party, Sunman has 21 factories including weaving, spinning and garment units based mostly in the port city of Chittagong.
The group employs more than 20,000 workers.
The company, a top supplier of US clothing giant Gap and Sweden's H&M, was first to make foray in Cambodia in 2004 setting up a 12-line factory in the South-east Asian nation, now emerging as a textile and garment hub.
But the official said rising cost of production and wages meant the profits are drying up in Cambodia and the company was now seriously thinking of winding up its Phnom Penh operation.
"The venture was profitable in the beginning. But nowadays it has become tough to make money there," he said.
"We think Bangladesh is still the best place for garment and textile manufacturing. The sector still has a lot of room for growth," he said.
The company was also among the first to venture into other businesses such as beverage, but insiders said its Suncrest brands have been faring poorly in the country's competitive soft-drink market.
Last week, the company made its entry into lucrative yet risky telecom sector, buying one of the three WiMax licenses for Tk2.15 billion as it sees increasing opportunities in the country's growing internet market.
But bankers said the auction price was too high and it would be difficult for the company to make money out of the deal in the near future.
Officials, however, are confident that the WiMax license would usher in a near era for the company.